Environment Committee on June 6th, 2024

[Laila Goodridge, Conservative, Fort McMurray—Cold Lake, AB]

My very last question is for Ms. Harradence.

The equity partnership with 23 indigenous communities is groundbreaking in my community and my region. You talked briefly about the AIOC being a success story. My good friend Justin Bourque was the leader on the Athabasca corporation that led this.

Why did you do this?

[The Chair, Liberal, Francis Scarpaleggia]

We unfortunately don't have enough time to hear the answer.

I now give the floor to Mr. Longfield.

[Lloyd Longfield, Liberal, Guelph, ON]

Thank you, Mr. Chair.

A sincere thank you to the executives for coming into what's a difficult meeting and discussion that we're having.

I come to Ottawa from Guelph, where my youth have really charged me with not pointing fingers at other politicians and not pointing fingers to be confrontational, but trying to work on the problem of reducing emissions.

I really appreciate your framing in your discussion, Mr. Kruger, that “Profits and the planet are not mutually exclusive; they're mutually dependent,” but it seems from today's discussion that we're using two different measuring sticks. We're talking about emissions per barrel versus net emissions, but we need to reduce emissions as a country. If we're not getting those net reductions from oil and gas because we're increasing production, we have to find those savings somewhere else. We don't have any savings with the scale of oil and gas.

I think the technical challenge is how we decouple emissions from production. How do we reduce emissions faster than we're increasing production? Is that a fair read on the situation, Mr. Kruger?

[Rich Kruger]

Yes, I think you framed it very well. It's that, in my view, the world's going to consume a given amount of oil independent of what Canada chooses to do.

[Lloyd Longfield, Liberal, Guelph, ON]

The world aside, Canada has reduction targets.

We have reduction targets, and one way of hitting those targets is to put a cap on emissions. As a government we—and as a party, the Liberal Party—made a commitment to cap emissions. We've been having trouble getting that across the line because production keeps going up, so we're having trouble getting that cap put in place.

Can you talk about the challenge from your side that we're trying to work on together?

[Rich Kruger]

My view is that the emissions cap is unnecessary regulation. I do support a price on carbon across the economy because I believe that will drive the innovation and the economic incentives, on all of our parts, to continue to improve our business. I fundamentally worry that a cap on emissions, the way it's constructed, will be a cap on production.

I do think and I believe in my heart that, with the technology and innovation of Canadians, we should be a big part of that energy equation for the long term, and I think we can do it in a way Canadians can be proud of.

[Lloyd Longfield, Liberal, Guelph, ON]

Going forward, we have to look at a way of getting that cap in place so you could still have production but at a lower net output of carbon emissions. That's a challenge we can't solve in the two minutes I have left, but I just put that on the table in terms of our discussion.

It is helpful for you to say that having an economic driver, such as a price on carbon, over the long term gives us capital incentives for countries to know what the investment will look like in Canada in the years ahead. Pathways Alliance also supported that, and maybe you can just briefly comment on that as well.

[Rich Kruger]

You know, maybe my colleagues Jon or Brad, on the Pathways Alliance side of it.... I can comment, but you guys have been very close to it for years.

[Lloyd Longfield, Liberal, Guelph, ON]

Yes, that's fine—in 20 seconds or less, if you could.

Maybe Jon...we haven't heard too much from you.

[Jon McKenzie]

Sure. I'll take a crack at it. I think we as a company and Pathways have been clear that a carbon tax can work to reduce emissions, but it has to be universally and ubiquitously applied. It can't target one particular industry or segment of the economy. I think the other piece that's important is that there has to be an alternative—

[Lloyd Longfield, Liberal, Guelph, ON]

Thank you. Yes...as we did for a very short period—for two years. To get at a different way of getting home heating oil off the market and trying to help with rural communities, it was a short period to get an incentive or an alternative in place.

To go to Ms. Pierce, the committee right now is talking about the effectiveness of the net-zero accelerator fund. We've been having some debates on that, and we will be having a further discussion on whether that's an effective way of helping businesses reduce emissions. Can you maybe comment on that briefly? I also have a follow-up question to that, Ms. Pierce.

[Susannah Pierce]

Okay. Thank you.

We're not directly involved in the net-zero accelerator fund, but what I can say is that, when we're looking at making decarbonization investments, they need to be investable. That means, compared to other investments we might make, they need to be investable. If there are ways of actually using funds like that to make that happen, it can accelerate decarbonization.

[Lloyd Longfield, Liberal, Guelph, ON]

Okay. Thank you.

I see the chair making motions.

Thank you, all, for your answers and for your participation.

[The Chair, Liberal, Francis Scarpaleggia]

Thank you.

We will now begin the third round.

Mr. Kurek, the floor is yours for five minutes.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Thanks very much, Mr. Chair. I appreciate the fact that we can have this conversation today.

I do want to give Ms. Harradence an opportunity to answer, if she could, just very briefly in 30 seconds or so, about the multi-generational benefit that her company's investments will have on local first nations in Alberta's north.

[Michele Harradence]

Yes, absolutely. You're referring to our Project Rocket.

I have to tell you that the question that was asked was this: Why did we do that? We did that because it was the right thing to do. We did that because it was a fundamental part of our indigenous reconciliation plan.

I can tell you that I was there in Calgary on September 30, 2022, when we announced that project, and I have never seen a more excited and proud group of employees than we had. However, most importantly, we met recently.... Our indigenous advisory committee was in to meet with our board a few weeks ago. Justin Bourque was there—he's part of that—and he spoke to exactly what you just said: the multi-generational impact this has.

One of the chiefs referred to having, in the past, a few thousand dollars per member that he could spend and that number changing to investing in his community to the tune of $100,000 per member that he could invest in his community. It's just a dramatic impact.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

I appreciate that.

I'd like to ask Mr. Corson and Mr. Kruger.... The benefit of energy investment is, I think, misunderstood by, certainly, the left-leaning political parties around this table, but in the communities I represent, we have small and medium-sized employers who work diligently and provide services to many oil and gas companies.

I'm just wondering if you could briefly comment, Mr. Corson and Mr. Kruger, about how much your companies are investing in contractors who are, essentially, small and medium-sized enterprises that exist in communities like those I represent.

We'll start with Mr. Corson for 20 seconds or so, and then go to Mr. Kruger.

[Brad Corson]

I don't have any specific numbers on that, but it is critical for our company and our industry. To deliver reliable energy supply to the communities, we depend on local contractors. We have our own large workforce, but we also employ significant numbers of contractors that probably more than double our workforce. That is one of the key economic benefits of—

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

I hate to cut you off, but it's a short amount of time.

Mr. Kruger.

[Rich Kruger]

Yes, let me be quick.

We have 16,000 employees. On any given day, we have 28,000 contractors that work at our operations. The vast majority of them are local to where the operation is. It's approaching a 2:1 ratio. The contractor support and the money we spend in that is equal to or typically more than what we pay our own employees.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Wow. That's a lot of jobs that the Liberals, the NDP and the Bloc Québécois want to shut down in the communities I represent.

We heard earlier some of the conversation around the regulatory regimes that exist. I'd like to ask this again, Mr. Corson and Mr. Kruger. Is Canada leading the world in terms of the accountability for environmental activities related to the energy sector?

You have five seconds or so. Ideally, give just a yes or no. We'll go to Mr. Corson and then Mr. Kruger.

[Brad Corson]

I've worked all over the world, and Canada has some of the most stringent regulatory requirements of any place in the world, which is why, when it comes to something like an emissions cap, I think it's unnecessary. There are plenty of other vehicles and requirements in place that create the necessary drives.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Just to be clear, do those strict regulations predate the Liberals as well?

[Brad Corson]

I've only been a part of Imperial for around five years, so I can't comment specifically on that—

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Mr. Kruger, if you could answer the same thing very quickly—these strong regulatory environments—and if that's something that Canada is known for, including legacies that predate the current government....