Sudbury, Ontario
August 25, 2014
Check against delivery
Thank you, David [David Simpson, Vice-president, Union Gas], for those kind remarks. Let me welcome you all to Northern Ontario, our extraordinarily beautiful and vast region. I can’t think of a better place and a better time for us to be gathered here in Sudbury, the mining capital of the world and — more than that — the centrepiece for Canada on the global stage for perhaps the world’s best example of a fully integrated city.
We’re building a region here that has a lot to offer the world. So it’s fitting that we’ve got people from around the world and particularly from across the country and, in particular, my colleagues — ministers from across the provinces and territories — to join me at this conference. Over the next 24 hours, ladies and gentlemen, we’ll be discussing a wide range of issues and hearing from and engaging with industry. But this afternoon, I want to speak about the priorities that I believe are critical to an upward trajectory of expanding opportunity over the coming years and beyond.
We all know the importance of natural resource industries to Canadians. They account directly and indirectly for almost one-fifth of our GDP — as many as 1.8 million jobs in every part of the country. That resource development is the difference between communities surviving and communities thriving, and it helps pay for our social programs and education program and public infrastructure and the quality of our life — the things, as I said last evening, that define us as Canadians and tie together our social fabric.
Resource development goes beyond extracting minerals and energy: it cascades throughout our economy. In fact, resource development acts as a vital driver of economic growth — the fuel that literally propels our economy — whether it be legacy construction, transportation, machinery or financial services. We estimate that the natural resource sectors create $180-billion worth of sales in other sectors, such as these. For example, Automatic Coating Ltd., a company based right here in Ontario, has been able to shift its business focus in support of the important oil and gas industry to adapt to shifts currently affecting their traditional manufacturing markets.
Yet, there’s a stream of thought in some quarters that says, “Well, resource development may sound fine in theory, but it should be opposed in practice.” Of course, there are legitimate concerns that come with resource development. We all agree in this room that development cannot happen at any price, and that we must address real concerns about workplace safety, the safety of our communities, the health of our communities, environmental performance and local community engagement.
So the discussion we should be having in this country is not whether to develop our resources, but actually how to develop them responsibly, how to provide the energy and the resources we need in a way that respects the environment we all share and in a way that engages and benefits all local communities. That’s why our government’s approach — its plan — is framed as Responsible Resource Development. We believe this is a platform to getting everything right.
We are focused on four key objectives. One, making the regulatory review process for major projects more predictable and timely. Now that’s been framed differently by other groups, but that’s the fact, and that’s what’s happening. We’re reducing, secondly, duplication. Third, we’re strengthening protection in areas like marine, offshore and pipeline safety. And fourth, we’re engaging First Nations groups in every aspect of resource development. There’s no question that there’s more work to be done. My sense from working with stakeholders and talking to my colleagues before this conference is that we’re all up to the task. It’s a discussion that we’re having that’s backed by our actions. And it’s in this context that I want to expand on the theme for this year’s meeting, Our Resources, New Frontiers.
Frontier is indeed an apt metaphor, because frontiers are filled with promise as much as they’re filled with uncertainty. Frontiers require us to be adaptable, innovative and inventive, and they go beyond geographical borders to areas we need to pursue further. So today, I would like to speak of three frontiers we need to pursue together, three areas where we need to do better if we’re going to be successful and responsibly develop our resources.
The first is the frontier of new markets. The unfolding story is well known to everyone in this room. The rise of China and India and other emerging nations is propelling demand for both energy and mineral resources. We’re told that, by 2035, the world will need a third more energy than is being consumed today. Almost all of the increase in demand will come from non-OECD countries — and it’s not just energy. There’s also a soaring demand for minerals and the manufacturing they make possible: steel to build new building; copper to wire new office towers; nickel-based alloys to create new electronics.
Just look at China, which I’ll be visiting next week — a country that is urbanizing 100 times faster today than the United Kingdom did in the 19th century, as we heard earlier this morning. By 2025, China will need five million new buildings, including 3,000 new skyscrapers, requiring an almost unimaginable amount of raw materials, which should include — and we hope will include — wood, as a nod to Minister Arcand here and the important work we’re doing with wood buildings and to India, where fully 80 percent of the infrastructure it will need by 2030 hasn’t even been built yet. For Canada, this shift in the world’s economic centre of gravity offers an exciting frontier of new possibilities to provide the energy and materials that will drive growth and lift millions out of poverty, as well as contribute to international stability. In these regards, Canada and its provinces and territories should be, and are, open for business.
As recent events in Europe have made evident, energy security has become more important — a sometimes misused piece on the global chess board — its supply or its withdrawal a tool for exercising foreign policy, making energy security a matter of national security. And as countries in Europe and elsewhere seek to diversify both the types of energy they use and the suppliers of that energy, Canada is well positioned — reliable, secure and responsible. A point that I made clear at the G7 energy ministers’ meeting just this past May in Rome.
The changing global economy also presents Canada with a once-in-a-generation opportunity to diversify our markets. In the case of energy, this is now a strategic imperative as the United States, virtually our only customer for oil and gas, produces more and more of its own fuels.
And as America unlocks its shale and tight oil formations, it’s transforming its energy relationship with Canada and the world. According to the International Energy Agency, oil production in the United States will increase 26 percent before 2020. At the same time, the United States has dramatically increased production of shale gas. Two years ago, the United States overtook Russia as the largest gas producer and is expected to remain so through 2035.
So folks, in the simplest of terms, we have to look for new customers and new markets, and we have to get our diversified energy products to our tide waters. The implication for Canada could not be clearer. We need to broaden our customer base and push forward the frontiers of commerce. That’s the opportunity. The challenge is that we’re not alone. Canada faces enormous competition, and the danger is we could get crowded out or overlooked if we can’t overcome the challenges to getting our resources to the marketplace.
So that’s the first frontier we need to pursue together: developing new markets and the supply system to serve them.
The second frontier before us is environmental stewardship. On environmental safety, there can be no compromise.
Recent events in British Columbia underscore the importance of continuous improvement. Industry needs to step up its game as we’ve done through our broad-ranging action — for example our commitment to build world-class pipelines and marine safety systems and respective liability regimes for those rare occasions when things go wrong.
When it comes to safety, the job is never done. In today’s competitive global marketplace, ongoing improvements and the pursuit of excellence are the price of admission, the prerequisites for success. That’s true for businesses, and it’s true for government. It means employing new techniques, new practices and technologies and investing in them. And for both government and business, innovation is critical to ensuring that our energy infrastructure is as safe as it can be. Whether we’re transporting energy by rail, tanker or by pipeline, our safety systems must be world-class — in fact, world-leading.
For governments, encouraging innovation starts with getting the fundamentals right: a sound economy, lower taxes, less red tape, a modern regulatory system and a liability regime and opening new markets through free trade agreements — all the things that our government is doing, all the things that have Bloomberg ranking Canada as one of the best countries in the world in which to do business.
Recent measures proposed by our government will strengthen the prevention of incidents, enhance preparedness and response and boost liability and compensation based on the principle of the polluter pays. Taken together, they will create the safest energy transportation system anywhere in the world, bar none. The first thing we must do is ensure that we do every possible measure, take every possible step to prevent incidents. We’ve already done a lot in this regard, such as introducing new fines that can be imposed for smaller incidents to preventing large incidents from occurring and increasing audits and inspections. We’re expanding the power of the National Energy Board to enforce compliance, and we will ask the National Energy Board to provide guidance on the use of best-available technologies in the materials and construction of federally regulated pipelines. For both marine, shipping and pipelines, we’ve mandated major increases in surveillance inspections and safety audits and the powers of enforcement.
On marine safety, we’ve unveiled new measures to enhance Canada’s world-class tanker safety system. These include investing in state-of-the-art technology and modernizing navigation systems. Additionally, the Canada Coast Guard is adopting the incident command system, which allows for more effective response to a major spill and integrates its operations with key partners such as Canada’s private sector, response organizations and in some instances, our First Nations communities who live in tide waters.
These measures respond to the tanker safety expert panel and continue our work towards preventing spills, building public confidence so that we can react and respond, clean up quickly in the rare instances where these occur and, of course, making polluters pay. We will also require pipeline companies to have the world’s highest minimum financial resources to be prepared for an incident set — $1 billion for major oil pipelines — and to hold cash on hand to respond quickly to incidents. Our collective actions, government and industry, are critical to meeting our obligations to the environment.
Finally, we know that some of the best environmental stewardship is the energy that you don’t use, that every dollar spent on energy efficiency programs contributes between four and eight dollars to the GDP. In 2011, the International Energy Agency ranked Canada second for its rate of energy efficiency improvement. We appreciate the work that we’ve done with provinces and territories in these regards. We also learned from a study released last month by the American Council for an Energy Efficient Economy that Canada has surpassed the United States, Australia and Brazil in their rankings of energy-efficient economies. So we have a leading edge on which to build.
Through our support for energy efficiency and clean technologies, we’re helping increase the resilience of Canadian communities and enhancing the competitiveness of our industries. Canada benefits from one of the cleanest electricity mixes in the world, with 63 generated from renewables resources — that’s the highest in the G7. Our government is taking action to lower emissions while growing Canada’s economy. In 2012, emissions were 5.1 percent lower than 2005 levels while the economy grew by 10.6 percent during the same period. Indeed, per-capita carbon emissions have fallen to their lowest level since this kind of tracking began.
The third and final frontier I want to highlight this afternoon is the frontier closest to homes, to our communities. Folks, we can’t go global — we can’t reach the foreign markets we must — if we don’t strengthen community engagement and public confidence in our own backyard.
Nowhere is that more important than with respect to our dealings with First Nations communities. This, as some of you may know, is a particular passion of mine. I’ve had the privilege to spend more eight years of my life in its aggregate in isolated and remote First Nations communities as a nurse and as a lawyer.
Indeed, with that experience and more than six of those years right here in Northern Ontario, I’ve been privileged to work with and understand all of the important contributions that our First Nations communities can make to responsible resource development. What these experiences have taught me is that First Nations are as proud a people as any. They want a better future for themselves and for their children. I’ve learned of their immense respect for things like the environment, land utilization, traditional land use, planned and cultural mapping, all activities that have occurred in the environmental assessment in the Ring of Fire. We saw firsthand, Minister Gravelle, that we ought to be compelled to engage these communities in a way that understands and accepts that this must be how we do it as we move forward.
This goes beyond any constitutional or legal requirement that we must do — it’s simply what we should do. As the lead minister for the Ring of Fire, I know how important it is to engage communities, all communities in this region, to work effectively with our provincial counterparts and industry. But make no mistake, these communities, our region, want to benefit from the economic prosperity and the opportunity that come with responsible resource development.
I believe that the Ring of Fire holds great promise for this region — a legacy resource development that will require substantial investment, new roads and essential infrastructure to ensure that our communities have road access and electrification at a competitive value point for industry and communities in Northern Ontario to thrive. To build local confidence, communities must trust what governments and industry say and what government and industries do. We must listen and address local concerns. Building trust in public confidence comes from transparency. One of the reasons that we’re pursuing initiatives like mandatory reporting for the extractive sector — a topic on our agenda at this very conference — is to get us to a point of some consensus.
Now I mentioned earlier how appropriate it is for us to be meeting here in Sudbury, a city that traces its origins back to the discovery of nickel ore in 1883. I think it’s important to point out that that single discovery not only propelled this city forward; it touched off a wave of immigration from Europe as settlers came to start new lives in a new land.
This would not be the last time that an event began as a local discovery which would have ripples across the globe, nor would it be the last time that Canada’s frontiers became international destinations, places where the world saw opportunity, places where other people wanted to be. Folks, today we have new frontiers to conquer and — just like the men and women who carved Canada out of forest and swamp, mountain and plain — we’ll only succeed by working together, reaching into our communities and reaching outward to the world.
I look forward to working with all of you, not just today, not just tomorrow, but moving forward so we can make progress and conquer these new frontiers. For my part, ladies and gentlemen, my name is Greg Rickford and I’m the Member of Parliament for the great Kenora riding. It’s a privilege and an honour to serve my constituents in my capacity as the minister responsible for Fednor and as the minister for Natural Resources Canada. Thank you for this opportunity.
