Indigenous and Northern Affairs Committee on Oct. 17th, 2018

[The Chair, Liberal, MaryAnn Mihychuk]

Welcome, everybody. We're here at the Standing Committee on Indigenous and Northern Affairs. Pursuant to Standing Order 108(2) we are conducting a study on northern infrastructure projects and strategies. We have presenters here with us in Ottawa as well as on video conference. I welcome you all. The procedure is 10 minutes to present with the question period after that.

Before we get started, it's very important for us to recognize that we're on the unceded territory of the Algonquin people here in Ottawa. As Canada moves through truth and reconciliation, it's not only a formality, but it brings to mind our process of moving toward equality and justice.

Let's get started with the Honourable Wally Schumann, Minister, Department of Industry, Tourism and Investment, from the Government of Northwest Territories, on video conference.

Please go ahead whenever you are ready.

[Wally Schumann, Minister, Department of Industry, Tourism and Investment, Department of Infrastructure, Government of the Northwest Territories]

Thank you, Madam Chair.

If I'm going to run over 10 minutes and you to need to cut me off, you're going to have to go ahead because I don't know how long it's going to take.

[The Chair, Liberal, MaryAnn Mihychuk]

I will try to give you signals.

[Wally Schumann]

On behalf of the Government of the Northwest Territories, thank you for this opportunity to speak about our concerns and priorities and about how we can work together to improve the lives of northerners.

The Government of the Northwest Territories has been actively working with the Government of Canada to advance transformational infrastructure needs throughout the territory. Through our work on key policy documents such as the Arctic policy framework and the Arctic transportation policy framework, as well as in other forums, our government has been communicating our overarching goal of creating a prosperous, sustainable future for the people of the Northwest Territories.

A strong, diversified economy is the foundation that provides residents with the jobs and economic opportunities needed to support themselves and their families. Responsible resource development has been, and will continue to be, the backbone of our economy and is central to ensuring that the territory develops a strong middle class. With a strong resource development base, we will be able to support diversification of our local economies into emerging and established sectors such as tourism, traditional economies, agriculture, arts and crafts, manufacturing and commercial fishing. This diversification increases the sustainability of our economy and broadens opportunities for northerners.

Before I speak about specific economic and infrastructure priorities, I'll talk about how our government works to create opportunity through the Northwest Territories through our partnership with indigenous governments and businesses.

The Prime Minister has spoken extensively about indigenous reconciliation, and it's an important and welcome priority for many in Canada. The Northwest Territories is an example of how real partnerships with regional and community indigenous governments, based on mutual respect and recognition, can lead to increased political self-determination and economic participation for indigenous people.

Reconciliation is an ongoing process, but we think our territory is well ahead of the rest of Canada, and there are some lessons that can be shared. The Northwest Territories is the one and only jurisdiction in which decision-making and resource revenue-sharing agreements exist with indigenous governments. It's an area in which we are proud to be leaders, both for the benefit of our territory and for those who choose to invest in its future.

Our dynamic, modern economy is defined in large part by our innovative indigenous businesses. From mining and mining services, to indigenous culture, tourism and everything in between, our indigenous business community has evolved over decades of world-leading indigenous participation in business and economic development. The indigenous businesses have proven their capacity to play an active, fully engaged role in the economy and are encouraging NWT governments and organizations to act and invest accordingly.

Increasing and expanding participation and engagement of indigenous businesses in particular is evidence of a changing and fast-developing NWT economy. Earlier this month, leaders from the Dene, Métis, and Inuvialuit governments and the Government of the Northwest Territories met for a two-day, in-depth discussion about the future of the NWT economy and to identify concrete ways to work together to create a prosperous and strong territory, while still respecting aboriginal, indigenous and individual rights, legal authorities and priorities of each government. At the end of the two-day symposium, leaders agreed to consider establishing a working group with representatives from indigenous governments and the Government of the Northwest Territories to identify economic opportunities and concrete next steps it can take together to ensure a sustainable and prosperous future for all Northwest Territory residents.

Identifying the shared economic priorities of our government and indigenous governments helps us create the consensus we need to move forward as a territory. It will also help our government as we continue to work with the federal government on completing an Arctic policy framework that will set out federal priorities and spending commitments for social and economic development in the north. The Government of the Northwest Territories actively supports economic diversification through strategic investments to support tourism, film, agriculture, the information and knowledge economy, the traditional economy, manufacturing and other renewable resource-based activities locally, within Canada, and internationally.

While our economy is shifting, resource development remains the main contributor to the Northwest Territories economy and will be a significant source of middle-class jobs and business opportunities well into the future. Our territory has mineral and petroleum resources that could position it as a primary economic driver for our country. The recent announcement by Minister LeBlanc and Minister Sohi, including the beginning of negotiations around offshore resources, was a notable first step in the right direction for our government.

The Northwest Territories is home to many of the minerals that will fuel the global green economy, including cobalt, gold, lithium, bismuth and rare earth elements. Alongside our mineral resources, our territory has significant energy power potential. As we continue our shift to low-carbon alternatives, our hydro development has the potential to meet market needs and reduce greenhouse gas emissions.

A healthy environment is essential for northerners. We have decades of experience in safe and responsible resource development and are already positioned to drive innovation in cold-climate research.

Despite our enormous economic potential and strong indigenous partners, the Northwest Territories is still hindered, in that we still require much of the basic infrastructure that already exists in southern jurisdictions. This includes roads to which many of our communities do not have access. In partnership with Canada, we need to continue to build territorial and community infrastructure to support healthy and prosperous communities and to lower the cost of living.

Large-scale investment in northern energy, transportation and communications infrastructure corridors is key to creating investment and economic opportunities in all sectors. The Government of Northwest Territories has identified four priority strategic infrastructure projects, including the Taltson hydro expansion project, the Tlicho all-season road, the Mackenzie Valley Highway and the Slave geological province access corridor. Each of these has the potential to make a transformative impact on the territories by helping unlock our full economic potential, transitioning to a lower-carbon economy and stabilizing the cost of living.

We're a small population, and we can't get there alone. While we will be working with indigenous governments and businesses as well as industry, the federal government needs to be a key partner. The Government of Canada has been a key proponent in the vision and the realization of transformative infrastructure investment, and we look forward to continuing work with Canada to bring the north to the forefront of transformative nation-building projects and investments that will benefit all of Canada.

Working with the Government of Northwest Territories to make transformative investments in the NWT economy and infrastructure, people and environment provides the federal government with an opportunity to achieve goals in growing the middle class, fostering meaningful reconciliation, protecting the environment, promoting sovereignty and strongly positioning Canada as an Arctic nation.

The Taltson expansion is a key element of our vision to transform our economy by lowering industrial emissions, improving energy security, harnessing innovation, and reducing the cost of living, while providing access to clean power that will fuel the technology sector and advance indigenous reconciliation. Connecting the Taltson and the Snare hydro systems and expanding the Taltson capacity will provide cleaner, more reliable energy for over 70% of our residents and businesses and will lay the foundation for greening current and future mining development.

Partnering with indigenous governments to advance the Taltson expansion is essential for meaningful economic reconciliation and will be a key area of focus at the start of the project. Incorporating indigenous rights, knowledge and cultural values into project design and implementation will help create prosperity and sustainable livelihoods. Indigenous ownership and equity participation are an integral component of the project.

The project will apply innovative techniques and environmental stewardship through the deployment of Canada's first high-voltage direct current submarine cable in fresh water, which will span over 100 kilometres across Great Slave Lake, the tenth-largest lake in the world. Phase one will include a 60-megawatt expansion and a transmission line to connect the existing Taltson facility in the southeast part of the Northwest Territories to the Snare hydro system on the north side of Great Slave Lake.

This expansion would allow for the transmission line to be incorporated into the proposed Slave geological province access corridor, with a combined benefit of increased road access for more efficient resupply and development in mines in this resource-rich region, while reduced energy costs through the Taltson project would completely transform the investment environment for industry and the economic future of the territory.

The Taltson River currently has 18 megawatts of installed hydro power, but has 200 megawatts of potential that could be harnessed under the phased-in approach. All phases will rely on run-of-the-river technology without the need for new flooding.

The Government of Northwest Territories has been in discussions with Environment Canada regarding funding support for preliminary work, including—

[The Chair, Liberal, MaryAnn Mihychuk]

Minister, could I ask you to try to summarize, please?

[Wally Schumann]

We have the Taltson project we've talked about. We have the road projects that have been identified, the Tlicho all-season, the Mackenzie Valley and the Slave geological province. Tlicho has been secured with P3 conditional funding. For the Mackenzie Valley Highway, our application was for $700 million, and we have one hundred and some million dollars to help move that along. That will be for the Great Bear River Bridge and some environmental studies, and moving that process along, and the small section from Wrigley to Mount Gaudet.

We will be submitting the Slave geological province in the coming round for the trade and transportation corridors funds, and we need your support in securing that funding, because we believe that it is the future of the biggest part of our economy in the Northwest Territories, which will benefit all of Canada.

The benefits that come from investing in infrastructure in the Northwest Territories have clearly been shown just in what we've done with the Inuvik Tuktoyaktuk highway. We had the chance to open that last year. We had Minister Sohi, Minister Bennett, and the Governor General up there. They were there for the grand opening, and I can clearly state to all of you on the committee today that the opening of that road this year has transformed that community. They've been overwhelmed with tourists. We have a whole new situation we have to deal with in Tuk, because we have so many people coming that they have to learn how to deal with the capacity issues and other investments needed there.

In the coming weeks, we're going to open the Canyon Creek access road, which is a small section outside Norman Wells and the Mackenzie Valley Highway. That's going to be taking place in November, but—

[The Chair, Liberal, MaryAnn Mihychuk]

Minister, you have a lot of needs.

You have a terrific presentation, and I'm sure we're going to get a lot of questions for you, which will give you an opportunity to continue your presentation.

[Wally Schumann]

Sure.

[The Chair, Liberal, MaryAnn Mihychuk]

For the other two presentations, try to be under 10 minutes so that we can get things on schedule.

We are moving to Hilda Broomfield Letemplier from the National Indigenous Economic Development Board.

Welcome.

[Hilda Broomfield Letemplier, Board Member, National Indigenous Economic Development Board]

Good evening to all committee members, and thank you for the invitation to speak with you today. I would like to start by acknowledging that we are gathered on the traditional unceded territory of the Algonquin and Anishinabe peoples.

My name is Hilda Broomfield Letemplier. I am from Happy Valley-Goose Bay in Labrador, and I am here on behalf of the National Indigenous Economic Development Board. Our board is made up of first nations, Inuit and Métis business and community leaders from across Canada, whose mandate is to advise the whole of the federal government on indigenous economic development issues. I am aware that you have begun a study of northern infrastructure projects and strategies. The board would like to offer its perspectives on this topic by presenting the work we have undertaken with regard to northern infrastructure.

In working on the critically important issue of indigenous economic development in the north, we identified infrastructure as a key ingredient for economic and social development. Therefore, the board has released reports and studies on northern infrastructure leading to the addition of an infrastructure index in our most recent 2018 indigenous progress report, due to be released in February 2019.

The first study we commissioned was entitled, “Study on Addressing the Infrastructure Needs of Northern Aboriginal Communities”, and focused on Yukon, the Northwest Territories and Nunavut, as well as Nunavik and Eeyou Istchee in northern Quebec, taken as a whole, and the coastal region of Nunatsiavut in Newfoundland and Labrador. The study showed that although each northern region is unique, many northern indigenous communities face similar infrastructure challenges. In small northern communities, especially in remote areas with small populations, the critical infrastructure that supports economic development is often deficient or absent.

The study found that transportation, energy and telecommunications are key types of infrastructure most strongly linked to economic development. Allow me to elaborate on these key areas.

On transportation, due to the lack of efficient transportation systems, costly workarounds must be developed. Port infrastructure is highly limited. In most communities, ships must use barges to unload the cargo, a process known as lightering, which is extremely time-consuming and costly.

Energy is fundamental to the daily operations of every business. For organizations that weigh the costs and benefits of investing in remote communities, the availability and cost of energy is critically important. This means that the shortage of low-cost and environmentally sound energy options proves a significant obstacle for business investment.

Telecommunications infrastructure is critically important for northern economies and communities. About 50% of communities across the north are dependent on satellite backbone to support basic telecommunications. Consequently, they have limited access to the digital economy and electronic service sectors due to the low speed, low quality and high cost of their systems.

We know that investment in infrastructure, particularly transportation, energy and telecommunications infrastructure, can leverage economic development. However, long-term economic growth also relies on community infrastructure that supports a diversified economy and good quality of life for community members.

Businesses across the north struggle to attract and retain employees when there is a shortage of suitable housing.

Our second study was the business case for a northern economic infrastructure system. To find out the actual dollar impact of greater infrastructure investment in the north, we commissioned a second study. This one was a business case analysis of eight proposed major resource projects across the north, for which the costs of needed infrastructure were weighed against forecasted benefits of the projects. The study found that public investment in northern economic infrastructure that supports major resource development will yield significant economic and fiscal returns.

Specifically, every $1 spent on transportation and energy infrastructure will yield about $11 in economic benefits and $11 in fiscal benefits. The study also found that employment created by major resource projects in the north can generate $3 for every $1 that governments spend on providing services to people. In short, public investment in northern economic infrastructure that leads to major resource employment then contributes a significant fiscal premium to governments.

Reducing poverty reduces fiscal costs to all governments. This is important because raising the northern indigenous standard of living to that of other Canadians would take a great deal more tax dollars than would simply providing more employment opportunities for northern indigenous Canadians.

We then conducted a round table and report. In addition to the board's studies, we hosted a round table discussion in Whitehorse to consult local knowledge holders to generate ideas to leverage investment in northern infrastructure.

Our studies and consultation with northern leaders provided the groundwork for the board's report, “Recommendations on Northern Infrastructure to Support Economic Development”, published in 2016.

Northern Canada is facing many challenges in meeting the infrastructure needs of northern Canadians. To name only a few, building and maintaining infrastructure is more costly in the north—in fact, it is roughly 150% higher than in the rest of Canada—and accessing capital to support infrastructure projects can be challenging because of their inherent risk.

A significant infrastructure deficit puts the north in the position of having to play catch-up. Most funding mechanisms available in the north are overwhelmed by the magnitude of their infrastructure deficits, leaving little room for consideration of strategic infrastructure investments.

With regard to the board's recent work on infrastructure, following our 2016 recommendations report in which we called for bold investment in large, nation-building infrastructure, as well as greater investment in community-level infrastructure, the board has developed an infrastructure index for its upcoming 2018 indigenous progress report. Preliminary results show that major infrastructure challenges still persist for communities in the north.

Key findings include that the infrastructure gap is greatest for Inuit, followed by first nations and Métis, and the largest infrastructure gap is for housing, particularly for Inuit. Furthermore, remote non-indigenous communities enjoy a higher level of infrastructure than do remote indigenous communities.

The board would be glad to come back before this committee to discuss our 2018 indigenous progress report, specifically on the infrastructure index, in further detail, after it is published in February 2019.

Additionally, in February 2018, our board heard from the First Nations Tax Commission on an exciting new initiative. They are proposing to create a national first nations-led institution that would support a better first nations infrastructure system. The proposed first nations infrastructure institution would offer an improved infrastructure service-delivery model that would address the current infrastructure deficit on reserve while building first nations capacity. The tax commission has established a development board to explore the concept further. They are also engaging with existing regional organizations to determine how they could work together to offer an improved service-delivery experience for first nations.

We are happy to support this indigenous-led initiative. An improved first nations infrastructure system will reduce the cost of infrastructure development, improve health and social outcomes, and support the growth of first nation economies to build sustainable communities and nations.

We encourage the Government of Canada to continue working with the development board to explore this concept and other options advanced by indigenous communities and organizations that could improve the first nations infrastructure system.

Based on our previous and recent work, the board has identified numerous opportunities. Three of them include that the debt market is looking for long-term stable investment opportunities; the potential for significant payoff from investment in infrastructure in the north; and major resource projects in the north having a potential to generate $3 in government revenue per worker for every $1 that government invests in them.

To support northern infrastructure and economic development, the board recommends that the Government of Canada address three issues: coordinate investments in economic development infrastructure; increase infrastructure funding and financing; and support northern community capacity by funding research and comprehensive community planning.

It is the board's opinion that upgrading existing infrastructure and improving economic development infrastructure are prerequisites to affordable and sustainable housing in the north. Indeed, community-level infrastructure and large-scale infrastructure go hand in hand in supporting an investment-ready north.

The board would like to take this opportunity to reiterate that northern infrastructure is inadequate to meet the needs of all northen Canadians, indigenous and non-indigenous, and it is limiting our overall ability to realize the great potential of the north. Action is needed now.

With this, I would like to welcome your comments and questions.

Thank you.

[The Chair, Liberal, MaryAnn Mihychuk]

Thank you.

Our last presenter for this panel, from Nunavut Resources Corporation, is Patrick Duxbury.

[Patrick Duxbury, Advisor, Nunavut Resources Corporation]

Thank you, Madam Chair and committee members.

I'm here on behalf of the leadership of both the Kitikmeot Inuit Association and Nunavut Resources Corporation, who unfortunately are not able to be here today due to their annual general meeting being held in Cambridge Bay, Nunavut, this week.

As way of background, the Kitikmeot Inuit Association, or KIA, is a regional Inuit association whose authority is enshrined in the Nunavut agreement. KIA represents more that 6,000 Inuit living in the westernmost region of Nunavut. Nunavut Resources Corporation, or NRC, is a wholly owned subsidiary of KIA that is focused on infrastructure development.

On behalf of my colleagues, I appreciate the opportunity to present to you.

My presentation is on a transformational infrastructure project that the KIA is proposing, the Grays Bay road and port project, or GBRP. If constructed, this project will profoundly improve the economic and social prospects of the Kitikmeot region's residents. It will also yield significant benefits for Canada while assisting in reconciliation efforts with the Inuit of western Nunavut.

This project has national appeal. The Canadian Chamber of Commerce agrees with our assessment of the benefits of this project and recently passed a resolution at its annual general meeting calling on the federal government to fund the project.

In championing the Grays Bay project, KIA is working towards its goal of Inuit developing, upgrading and owning strategic infrastructure that generates greater economic opportunities, especially those from Inuit-owned lands that have associated mineral rights. For KIA, this kind of infrastructure creates the basis for an economy that is able to provide multiple benefits and opportunities for generations to come.

The GBRP project is a nation-building initiative. It's a modern-day version of Canada's 19th century railroad development. It consists of three major components. The first is a brand new fully equipped port at Grays Bay, located on the Northwest Passage between the communities of Kugluktuk and Cambridge Bay. The second component is an all-weather gravel road running 230 kilometres south from the port to the Jericho Mine site, where it would connect to the winter road to Yellowknife and then onto the national highway system. The third component is an 1,800-metre runway at the port site.

The total project cost, including contingency, is just over $550 million. A portion of the construction costs is expected to be financed by third parties through project debt financing that would be repaid via road tolls and port usage fees, but to fill the gap, significant federal government support is required to make this first terrestrial connection to Nunavut work.

In addition to boosting the region's resource economy, there are two major strategic benefits associated with this project.

The first is that currently the nearest deepwater port to Grays Bay that is available to the Government of Canada is at Nanisivik, more than 1,300 kilometres away by air and almost 2,000 kilometres away by water. The Grays Bay port would be available to help Canada better respond to the increasing traffic in the Northwest Passage by supporting Coast Guard search and rescue operations, marine spill response, naval exercises and Arctic sovereignty in general.

The port is also well placed to be a hub for community and exploration project resupply. Goods could be trucked from Yellowknife to the port along the winter road and then shipped by barge once waters are open in July. This would be a huge improvement from the current situation, in which goods typically come in between late August and early October. Not only would community resupply be more timely through the Gray Bay Port, it would cost less.

For Canada, the primary economic rationale to support this project is that it will lower the cost to access, explore and develop the mineral-rich Slave Geological Province, part of which falls within western Nunavut. With abundant and known gold, diamond, base metal and rare earth deposits, the Slave Geological Province is recognized as one of the most promising mining regions in Canada.

However, having great mineral potential does not on its own result in a prosperous economy. We know that, compared to their southern counterparts, northern resource developers face significantly higher costs at all stages of the development cycle from exploration all the way to reclamation.

Lack of infrastructure is at the heart of the situation. The infrastructure shortcoming is an indisputable contributor to the high cost of doing business in the north. This assertion has been confirmed by many parties, including the National Indigenous Economic Development Board and the Mining Association of Canada.

Put simply, the north's infrastructure deficit is a bottleneck to development that must be addressed if the full potential of this region of Canada is ever to be realized.

In championing this transformational project, the Kitikmeot Inuit Association is attempting to reshape its future in accordance with a vision that was espoused by the Inuit negotiators of the Nunavut agreement.

KIA owns and manages more than 106,000 square kilometres of land in the Kitikmeot region, lands selected during the negotiation of the agreement. There are lands that include mineral rights, selected for their known economic potential and with the means through which Inuit could become more economically self-sufficient. The Grays Bay project would be especially effective in this regard. The proposed corridor would provide access to the highest concentration of Inuit-owned lands with mineral rights in western Nunavut.

There are already mining companies holding mineral rights along the Grays Bay corridor. However, without the type of publicly financed infrastructure in place that has supported resource development in other regions of Canada, most of these projects will remain infeasible; the minerals will remain in the ground; and Canada will forgo a substantial opportunity to benefit from this region's economic development.

Let me be clear. The opportunity cost is very real. Already one mining company, MMG, is poised to invest over $1.5 billion in mine development, with an additional $300 million in shared-use infrastructure that would be available to other users, including the federal government. Yet the business case for this project does not work unless someone other than a mining company builds the trunk road and the deep-sea port.

This single mine going into production is expected to generate an annual average of 3,500 jobs nationally over an 11-year period, projected tax revenues of more than $665 million to federal or territorial governments over 11 years, and a $7.5-billion surge in gross domestic product.

If these benefits seem conceptual, this summer has provided one very concrete reason why a port at Grays Bay is so important. You may be aware that the annual community resupply sealift is a lifeline for isolated Arctic communities. The Kitikmeot region is served by sealift companies based out of Montreal or Hay River in the Northwest Territories. This year, ice conditions in the Arctic were particularly severe, and because of this the Montreal-based sealift arrived several weeks later than usual. As for the Hay River sealift, ice conditions prevented it from reaching either Kugluktuk or Cambridge Bay. As a consequence, thousands of tonnes of supplies and vehicles bound for the Kitikmeot are now stranded in Inuvik For the people of these impacted regions whose lives and businesses are caught up in this situation, it is disastrous. Similarly, future situations would be completely avoided or greatly mitigated if there were a port in the Kitikmeot region with a terrestrial connection to the national highway system.

I will conclude with our recommendations to the Government of Canada. While our extensive efforts in Ottawa to promote this project have garnered near universal praise, there is no clear path for obtaining the necessary public financing that would release the social and economic potential of the area. The northern envelopes for existing infrastructure funding programs are simply not large enough to accommodate this nation-building and tax-revenue-generating project.

Beyond direct support for our project, we have three recommendations to the federal government.

The first is to add new funding to the national trade corridors fund. Such a step would align with the government's objective of diversifying trade.

Second, ensure that any northern envelope for infrastructure funding is large enough to support the scale of projects such as the GBRP , and also reflect the fact that there are significantly higher costs for infrastructure development in the north and that there is a lack of conventional public resources in the territories compared to in the rest of Canada.

My third recommendation is to ensure that sufficient funding for programs like the strategic partnerships initiative is there to allow indigenous proponents to seek to lead and develop their own projects in support of the natural resources sector.

I conclude my presentation and thank you.

[The Chair, Liberal, MaryAnn Mihychuk]

Thank you.

Questioning now moves to MP Yves Robillard.

[Yves Robillard, Marc-Aurèle-Fortin, Lib.]

Thank you, Madam Chair.

I thank the witnesses for their excellent testimony.

My questions are for Ms. Broomfield Letemplier.

In your 2016-2017 annual report, you talk about the aboriginal labour force being underrepresented in a number of areas. Is the situation improving? What factors could play a key role in this case?

[Hilda Broomfield Letemplier]

We feel the indigenous education is definitely improving, but there is more room for support, for training and for.... One of the real things we know, being Inuit, is that this is our home. This is where we live. When government invests in us, in our communities...

This is our home, we don't want to leave. This is where we want to be, this is where we want to stay. When investments in us are made, we're staying there. We're not going away. Major resource companies.... A lot of the operations are fly-in and fly-out, so they bring people from all around Canada.

When there is investment in the people who live there, it's a fantastic opportunity for the growth and development of our communities. Money gets invested in our communities. The people who live there are actually able to give back to the communities. They provide better for their families. They're able to give more back to the community. They have a better, more enriched life. They have higher self-esteem. It's so much healthier for the people in their own communities.

[Yves Robillard]

The same report indicates that per capita funding means that territories receive less infrastructure funding than provinces, as they are less populated.

How much does the per capita funding model contribute to the lack of infrastructure in the north? In what way does this system influence various economies in the Arctic?

[Hilda Broomfield Letemplier]

I realize that there are fewer people there, but I can't stress enough how important it is for the people who live in these communities to be able to give back to the communities, to see that they can do it as well as anyone else in the rest of Canada. It is important to see that we can grow our own communities. We have every opportunity to have as good a standard of living as anywhere else in Canada.

We have so many other things to offer. We have the tourism, nature, such beautiful animal life, hunting and fishing. That's a big attractor to bring people to our communities, but it's so much more important to feel that we are as good as anybody else.

Just because we're Inuit, or any other indigenous people, it's important that we can show that we're equal to other people in Canada, or in the world. We have so much more to offer. The compassion and feeling, the whole natural being of how we are—that's what we offer.

[Yves Robillard]

Most residents of Canada's Arctic communities are under the age of 30.

What impact does the relatively young population of the Arctic have on the current and future infrastructure needs?

[The Chair, Liberal, MaryAnn Mihychuk]

You have 30 seconds.

[Hilda Broomfield Letemplier]

It's quite important. The young have so much to bring. We're old school; because we're older, we do things the old way.

Because of telecommunications and the opportunity that telecommunications can bring, there are so many things that can be done now in terms of health, safety and learning, with the way the Internet has opened up everything in the world.

The young have such different perspectives. They have different ideas, different technology. They bring so much to the table. They're very innovative.

[The Chair, Liberal, MaryAnn Mihychuk]

Thank you.

The questioning now moves to MP Kevin Waugh.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

Thank you to the two groups in front of us and also on video conference.

Minister of the Government of the Northwest Territories, I'm going to go first to you.

How has the northern drilling moratorium affected your area?

[Wally Schumann]

I guess we can be very frank because we're in front of the committee.

When it first came out, we never got very much notice on the whole issue of the moratorium and the potential that was in the Beaufort Sea. There were millions and millions, if not billions, of dollars in bid deposits and land leases up there. That took away any hope we had of developing the Beaufort Sea.

In light of that, with the announcement last week with Minister Sohi and Minister LeBlanc about sitting down and starting to have discussions on developing and on how we're going to co-manage these resources ourselves and with the IRC—and I think the Government of the Yukon is mentioned in the press release as well—that at least gives us some hope of moving forward on this, even though the moratorium is still in place.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

On Monday, we talked about ports. It's ironic, because in the Arctic you have less marine infrastructure than does any other part of Canada, with no deepwater ports and few craft harbours. Well, there's Churchill, but we're talking about the Northwest Territories here.

What can we do to improve on that situation? As you know, ports open up your area more than anything else, especially in the winter.

[Wally Schumann]

Exactly.

One presenter alluded to the situation that we have this year in the Beaufort Sea.

A week or so ago, I went in front of a committee on sovereignty that was travelling around the north. They went to Iqaluit and Inuvik, and then they came down here and met with me and a couple of other people. I had a good opportunity to talk to them about exactly the same thing.

In fact, 40% of Canada's coastline is on the Arctic coast. We have no ports in western Canada. Sovereignty is a big issue for us. We have more sea traffic that we've seen coming in the last few years, even though we had a challenge this year.

We're working closely with the ocean protection application. We just announced a few days ago that they have supported our application on double-haul barges so we can deliver to these communities in a more timely, safe and effective manner. That's going to help a little, but that doesn't eliminate the port conversation that we need to have if we want to develop any type of offshore liquefied natural gas plant to support what's available.

As I said in my presentation, I believe most people don't realize the potential we have in the Mackenzie Valley Highway and the Beaufort around oil and gas. We have trillions of cubic feet of gas and billions of barrels of oil that are locked there due to lack of resources, and a port there would certainly make a big difference, not just to help us develop our economy but also around sovereignty.