CONTENTS
Standing Committee on the Economy
Saskatchewan Research
Council Vote 35
TWENTY-NINTH
LEGISLATURE
of
the
Legislative Assembly of Saskatchewan
STANDING
COMMITTEE ON
Hansard Verbatim Report
No.
29 — Tuesday, April 9, 2024
The Chair: — All right, folks. Welcome to the
Standing Committee on the Economy. I’m Colleen Young, and I’m chairing the
meetings this afternoon and this evening. Members joining us are Ms. Betty
Nippi-Albright in for Jennifer Bowes and Mr. Doyle Vermette in for Aleana
Young. And we also have members Ken Francis, Delbert Kirsch, Greg Ottenbreit,
and Doug Steele joining us.
Pursuant
to rule 148(1), the following estimates and supplementary estimates no. 2
were committed to the Standing Committee on the Economy on March 28th, 2024 and
on March 20th, 2024 respectively. 2024-25 estimates: vote 1, Agriculture; vote
23, Energy and Resources; vote 26, Environment; vote 16, Highways; vote 89,
Immigration and Career Training; vote 84, Innovation Saskatchewan; vote 35,
Saskatchewan Research Council; vote 90, Trade and Export Development; vote 87,
Water Security Agency. The 2023-24 supplementary estimates no. 2: vote 1,
Agriculture; vote 23, Energy and Resources; vote 26, Environment; vote 16,
Highways; and vote 35, Saskatchewan Research Council.
I
would also like to table the following document: ECO 21-29, Ministry of
Environment: Responses to questions raised at the March 18th, 2024 meeting.
Today
the committee will be considering the estimates for the Saskatchewan Research
Council and the Ministry of Highways. We will take an hour recess at about 6:30
p.m.
General
Revenue Fund
Saskatchewan
Research Council
Vote 35
Subvote
(SR01)
The Chair: — We will first consider the estimates
and supplementary estimates no. 2 for the Saskatchewan Research Council.
And we will begin with consideration of vote 35, Saskatchewan Research Council,
subvote (SR01).
Minister
Harrison is here with his officials this afternoon, and I would ask that the
officials please state their names before speaking at the microphone the first
time. And Hansard folks will turn the mikes on for you. Minister, you can begin
by introducing your officials that have joined you here today and with your
opening remarks.
Hon. Mr. J. Harrison: — Sure. Well thanks very much, Madam
Chair. And thank you to committee members for being here this afternoon and to
the evening as well. Much appreciated. It is a pleasure to appear before the
committee again with regard to the Saskatchewan Research Council estimates.
And
with me here for officials . . . As you probably remember last year,
actually we didn’t have officials because there was a snowstorm. And Ryan and
Mike were stuck in Saskatoon, unable to get down here. So we tried over the
phone, but I think basically it was the minister trying to muddle through on
his own with support on the phone. But it worked okay. Much better this year though.
So on my left, Mike
Crabtree, SRC’s [Saskatchewan Research Council] president and CEO [chief
executive officer]; Ryan Hill, on my right, our chief operations officer; and
behind, Jocelyn Allard, SRC’s vice-president for financial services.
SRC, as we all know, is the
second-largest research and technology organization in Canada — an impressive
feat for our province and something that we, I think, all are really quite
proud of. Last year SRC celebrated 76 years of providing valuable research,
innovation, and demonstration to Saskatchewan industry and beyond. Since its
inception SRC has been part of many important firsts for the province that have
brought many benefits. In the 1970s SRC was a leader in energy-efficient
housing research, and its work formed the basis for the development of the
R-2000 standard for energy-efficient homes.
In the 1980s SRC played a large
role assisting the Saskatchewan oil and gas industry by enabling the
implementation of horizontal wells and the use of carbon dioxide for enhanced
oil recovery. SRC geoanalytical laboratories secure diamond facility,
established in the early 2000s, is now the largest such facility in the entire
world. Not only does it offer diamond services but it also offers geochemical
and mineralogical analysis for base metals, gold, lithium, uranium, potash, and
rare earth elements.
These examples provide a small
glance of the important work SRC has done over its 76-year history and the
positive impacts that have followed. And speaking of impacts, SRC has been
measuring its economic impact within the province for over two decades now.
SRC’s 2022-23 economic impact assessment showed impacts of approximately
$930 million in direct economic benefit to the province with about 1,473
jobs created or maintained in Saskatchewan that are valued at an additional
$89 million. This means, for every dollar invested in SRC by the
provincial government, a 46-times return was achieved in 2022-23. These
impressive figures underscore SRC’s pivotal role in fostering innovation across
Saskatchewan industry and driving economic growth within the province.
As recently announced for the
2024-25 budget, SRC is receiving $41.6 million, in provincial investment
compared to last year’s allocation of about $40 million. This includes a
status quo portion of SRC’s provincial investment to continue its work in
spurring economic growth across the manufacturing, agriculture, oil and gas,
and critical minerals sectors, plus an additional $21.5 million of
previously approved funding for SRC to pursue its commercial demonstration of a
microreactor, which I’ll speak more about later.
SRC continually works to help
address Saskatchewan’s biggest challenges now and into the future. Through
their strategic planning process, SRC has identified five large-scale
industrial and resource-based projects as areas of focus. These projects, which
are aligned with the province’s growth plan, aim to address significant
technology challenges and industry needs. They include the following key areas:
strategic metals, as in rare earth elements and lithium; microreactors;
advanced mining; carbon capture, utilization, and storage; and agriculture and
industrial water.
Advancements
in each of these five identified areas of focus requires substantial capital
and engagement from multiple stakeholders, including governments, academia,
industry, and regulators. SRC is well equipped to undertake these projects as
it has the networks, technical and scientific expertise, and hands-on
experience needed to bring these complex ideas to life.
These
projects will support economic growth in our province while preserving
environmental sustainability. While these projects will take some time to fully
develop and mature, we’re already seeing evidence of success, which I’m excited
to share today.
The
strategic metals project focused primarily on rare earth elements, or REEs,
which are naturally occurring minerals that are essential to the modern economy
for the manufacture of vehicles, electronics, phones, tablets, and basically everything
that our modern society uses. REEs also hold significant strategic function as
they’re used in the production of most high-end military systems and defence
systems.
For
over 15 years SRC has been investigating REE technologies as the industry developed.
Its minerals group is now internationally recognized as a centre of expertise
in rare earth extraction and processing technology. A significant part of the
province’s critical mineral strategy relies on the expertise and experience of
SRC in this area to grow a rare earth element hub right here in Saskatchewan
through our government’s $71 million investment into a first-of-its-kind
rare earth processing facility.
The
rare earth facility will be North America’s first fully integrated commercial
demonstration and rare earth processing facility with hydro, metallurgy,
separation, and metal smelting stages. Nine hundred tonnes of feedstock for its
monazite processing unit procured from Brazil will be sufficient to feed the
facility through the first year of operation.
Earlier
this year, SRC achieved a major milestone in the metal smelting unit of its
rare earth processing facility. SRC has successfully automated the highly
complex mixing process through internal design, fabrication, and testing. During
a week-long test of the automated metal smelting process, SRC achieved results
that were above expectations; 400 kilograms of NdPr [neodymium praseodymium]
metal was produced — and that’s an acronym for something Mike can pronounce
later — that was produced with a 99.5 per cent purity and a recovery rate of
over 96 per cent.
SRC
achieved this during a 24-7 operation managed by only one person, compared to a
process in other jurisdictions that would require several operators and a lot
of manual work. All of this means that the rare earth processing facility is on
track to be concluded on time and on budget, and will be operational by the end
of this year.
Our
government has also identified lithium development as an important area of
focus. Lithium is one of the key ingredients in the development of key energy
technologies. In 2023 SRC built and successfully operated a lithium hydroxide
monohydrate or LHM large-scale pilot plant and from it produced battery-grade
LHM. Currently Canada does not have large-scale battery-grade production;
however SRC’s success in demonstrating this process is a major step towards
developing a secure and reliable lithium supply chain in Canada and North
America.
Given
its 38 years of hands-on experience with the Slowpoke II reactor and its
connections with key stakeholders across the nuclear industry, SRC is uniquely
positioned to play a leading role in supporting the development of
microreactors in Saskatchewan going forward.
SRC’s
designation as the primary provincial body responsible for microreactor
development in Saskatchewan marks a pivotal moment in our journey towards a
sustainable energy future. With support from our government, including the
$80 million investment announced in November of 2023, SRC is poised to
accelerate the adoption of microreactor technology, creating economic
opportunities and securing Saskatchewan’s position as a global leader in the
nuclear microreactor supply chain. SRC will apply the research and knowledge
gained from the licensing and deployment of an initial microreactor to support
the Saskatchewan nuclear industry to better understand this type of technology
and the potential for future microreactor projects and deployment in the
province.
The
eVinci microreactor will of course be built by Westinghouse Electric Company.
Subject to licensing and regulatory requirements, we’re expecting that to be
operational by 2029. The location of the reactor will be determined as the
project progresses through the regulatory process. The eVinci is classified as
a microreactor capable of producing 5 megawatts of electricity, over 13
megawatts of high-temperature heat, or operating in a combined heat-and-power
mode.
Advanced
mining technologies have the potential to unlock billions of dollars in
Saskatchewan commodities such as potash, uranium, diamonds, and other mineral
reserves such as rare earths. SRC’s experience in the research, design, and
development of advanced mining technologies will help us access these valuable
commodities.
Sensor-based
sorting is one example of an advanced mining technology that SRC has experience
with, has now become a leader in, with its sensor-based sorting service
offerings for new uses and to new industries. SRC continues advancing its
mineral liberation sorting centre, which helps mining operations reduce energy,
capital, and operating costs along with greenhouse gas emissions.
Our
government has also identified the use of enhanced oil recovery to assist with
carbon capture, utilization, and storage, or CCUS. SRC has considerable
expertise and experience in each of the three components of CCUS: capture,
transport, and carbon dioxide enhanced oil recovery. This knowledge and
technical capability will help us work towards the targets we’ve set out in the
Prairie Resilience climate change strategy.
Through
the Centre for the Demonstration of Emissions Reductions, SRC helps the oil and
gas sector to identify, test, verify, and quickly deploy methane reduction
technologies that are best suited for their unique needs. The centre is playing
a leading role in creating environmental benefits and helping sustain primary
natural resource industries in Saskatchewan by encouraging and enabling the
adoption of greenhouse gas emission reduction technologies.
SRC
is also focused on effective water management for agriculture and industrial
use that will be needed, particularly due to the increased consumption as our
province’s economy and population grows. These key projects demonstrate SRC’s
ambitious strategic plan which will help ensure ongoing future economic,
environmental, and social impacts in Saskatchewan and around the world.
With
a focus on projects that expand Saskatchewan’s industrial and resource base,
SRC is also supporting the development of new industries, new resources,
value-added manufacturing, and the application of emerging technologies.
I’d
like to note some additional examples that help provide an understanding of the
breadth of work SRC does currently to assist industry. Last year SRC’s
collaboration with the Ministry of Energy and Resources in helium liquefaction
has positioned Saskatchewan as a potential leader in this emerging market. The
study on developing a commercial-scale helium liquefier underscores the
economic potential and job creation opportunities in the province. The helium
study will help provide companies with the information they need to make major
investment decisions around establishing Saskatchewan as a regional helium
liquefaction hub in Western Canada and the surrounding US [United States] states.
[15:45]
Over
8,000 inactive oil and gas wells and facilities were capped or closed, thanks
to the dedicated work of 900 Saskatchewan-based oil and gas service companies,
supporting an estimated 2,500 jobs, with significant support for Indigenous
participation totalling over $90 million.
SRC
is leading another major remediation project that’s been ongoing for well over
10 years now and is expected to soon wrap up. In 2023 work continued at project
CLEANS [cleanup of abandoned northern sites], the remediation being done at 37
abandoned uranium mine and mill sites in northwest Saskatchewan.
The
Lorado mill site and 22 smaller satellite sites have been fully remediated now,
and SRC has permanently closed the three mine openings present at the Gunnar
mine and mill site, including completing the construction of a hazardous
material landfill.
This
project will ultimately remediate the sites, all of the sites with positive
economic, environmental, and social impacts, ensuring a safe environment for
those that live and work in the area.
SRC
recognizes the value of integrating a variety of stakeholders and local knowledge
into the work, in creating various training opportunities for local people, and
in building substantial, quantifiable capacity for the North going forward. SRC
works directly with the communities of the Athabasca region, with the majority
of the labour and heavy equipment being utilized from local communities.
In
closing, it’s clear through the achievements of SRC that the organization
continues to add value to the Saskatchewan economy. And we look forward to
continuing this journey of growth driving economic prosperity and enhancing the
quality of life for all who call Saskatchewan home.
And
I look forward to questions from the committee. Thank you, Madam Chair.
The Chair: — Thank you, Minister. I’ll now open
the floor to questions from members. And I’ll recognize Ms. Nippi-Albright.
Ms. Nippi-Albright: — Thank you, Madam Chair. Thank you
for your opening remarks and your presentation on the SRC, what you have been
doing in the fiscal year and going forward.
I’m
just going to kind of start with some general questions. It was hard for me to
try and keep notes of all that’s going on, so I’m going to ask you questions so
you can fill me in on what you’ve all shared thus far.
So
I guess my first question was, does the minister have any new priorities or
strategic directions for SRC for this year as compared to last year?
Hon. Mr. J. Harrison: — Right. No, and it’s a very good
question. And thank you for your comments. You know, we have really, over the
course of the last number of years I laid out kind of the five areas that we’re
advancing in. I’ll tell you what — I’m really excited about where we’re getting
to with the rare earth facility right now. Very, very close to commercial
production. I think we’ve now completed construction of about 200 of the
separation units, which are really the heart of the facility in a lot of
substantive ways.
And
those are what actually do the processing for the monazite feedstock,
especially on the light rare earth side, which will mean that we are into commercial
production of the neodymium and praseodymium, NdPr, very, very shortly. And
that means we’re going to be selling that product obviously on the market, and
the Saskatchewan taxpayers are going to be seeing a return on the investment
that was made early on. And you know, hopefully this will be just the start of
what’s going to be a very exciting industry here in Saskatchewan.
Another
thing that I am really very, very excited about is the partnership that we have
entered into with Westinghouse. You know, really a company I think that most
people are highly aware of that has played a central role in the development of
the nuclear supply chain, including power production around the world now for
nearly 80 years.
We
are going to be moving forward with the very first-of-a-kind eVinci
microreactor which really, you know, I’m very excited about the capability and
the capacity for this design to really have a huge impact around the world, and
not just here but really around the world. This could have a very significant
impact here as well for remote communities, baseload power for remote mine
sites, for islands which are . . . You know, one of the things that
we had a huge amount of interest on this project has been, maybe not
surprisingly, but Filipino power companies who have the responsibility of
providing secure baseload power generation on to literally thousands of
islands.
You
know, having this technology available and Saskatchewan really leading the way
in the development of this technology in partnership with Westinghouse is
something that we are I think all very excited about at SRC.
You
know, and there are a number of other . . . I think lithium is
another area where we really are very excited about what the future could look
like as well, as far as a future-facing critical mineral that is going to have
significant application going forward. So I’d just kind of add those. Short
number, there’d be . . . I could go on and on, but that would be kind
of a short answer anyway to your question.
Ms. Nippi-Albright: — Thank you. I just was very
interested in your response on . . . You already have 200 separation
units that you’ve created already, and all that’s happening with job creation,
etc. I’m just curious, do you have a number of how many First Nation and Métis
employees you have at all levels in this initiative?
Hon. Mr. J. Harrison: — Yeah, we do. And officials can kind
of get to that, but we do. And I would say as well, one of the things we at the
company have really worked hard to make sure that we are doing is making sure
that we have very positive relationships with Indigenous leaders and
communities and businesses. You know, the accelerated site-closure program was,
I think, a pretty good example of that. We worked with the First Nations Centre
of Excellence very closely on delivering that program, which really has been a
tremendous success story.
We
have been very closely engaged on the microreactor project now for a number of
years. Meadow Lake Tribal Council have been very engaged with SRC. In fact I
think we had a very good meeting with our tribal chief just last week. And I
think it’s fair to say that Meadow Lake Tribal Council have been a central part
of the microreactor project, and we envision that continuing going forward.
We’re
working hard on the lithium, what we view as being a huge opportunity in
lithium with the First Nation who have expressed a long-standing interest in
this space as well. So that discussion is continuing. I think next week we’re
going to have our next meeting there.
But
we have really endeavoured to make sure . . . Project CLEANS is
another example where, you know, First Nations and Indigenous, local companies
in the North have been really central to project CLEANS.
So
maybe I’ll turn it over to whoever wishes to go.
Mr. Crabtree: — Mike Crabtree. Another area where
we’ve actively engaged with Indigenous First Nations is, you mentioned these
cells, the 200 cells that we’re manufacturing. We’ve worked with North West
College to include a module in their welding program to train predominately
Indigenous people, bringing them down to Saskatoon to train them how to do this
specialized welding for these tanks because there’s going to be a really
significant opportunity for Indigenous employment, education, and for
high-quality jobs in that rare earth space.
Hon. Mr. J. Harrison: — Yeah and I actually should have
mentioned that as well. This is an area on the separation, the actual
manufacturing on the separation unit. So you know, we have our kind of initial
batch of 200, but really we are going to be building a supply chain on this
because I think there is going to be a very significant market outside of
Saskatchewan for what is proprietary, our design units, which we really did
here at home.
So
you know, it’s a very good synergy with North West College which obviously has,
you know, deep reach into Indigenous communities in northwest Saskatchewan. So
that’s one example. Ryan, did you want to jump in?
Mr.
Hill:
— Ryan Hill. In answer to your question with regards to the number of
Indigenous individuals involved, it’s 14 within the work group within the
organization. We have representation within the organization that’s consistent
with the marketplace, so the job labour force that’s available.
Ms. Nippi-Albright: — Thank you. Yeah, 14 people and a
large initiative that you have. Just want to get back to, I was asking about
numbers in terms of First Nation and Métis people that are involved, employed
at all levels of the process. And you’ve talked about North West College that
you have. I’m hoping that those that have been trained up are actually getting
jobs, and not just trained and given to non-Indigenous people.
So
my question is again, how many numbers in terms — and if you’re not able to
provide that right now, that’s okay; you can table it and just present those
numbers — because I want to know, in terms of economic reconciliation and
engaging First Nation and Métis people in employment in all sectors of the
economy is, how many are actually engaged? What are the numbers? What plans
does SRC have? Do you have target measures? And what, if any, exist in terms of
incentives or de-incentives for not hiring Indigenous people at all levels all
across the board?
Hon. Mr. J. Harrison: — Yeah, I appreciate the question. You
know, one of the things I had talked about a bit in my opening remarks was
around how we measure our economic impact in the province. So you know, I think
we cited a little over 1,400 direct jobs that were very much reliant on the
work that SRC does. A number of those would be in the communities in northern
Saskatchewan that are involved in project CLEANS.
So
it’s a bit challenging because our partners that we are responsible for, you
know, in these kind of direct job creation and direct impacts, they would be
the ones who would have the data as far as the number of Indigenous or First
Nation people who are employed by their companies. We don’t really keep that. I
mean, they do. It would be the same story through the accelerated site-closure
program, where we worked with Indigenous companies and communities in being
directly engaged in that program.
So
of the 1,400 direct job impacts, it would be an overrepresentation, I know, of
what the population is in general. But we don’t have specific data on that
simply because, you know, we’re not the direct employer in some of those
scenarios.
Ms. Nippi-Albright: — Okay. Thank you. Just on that, when
you said that we don’t keep track of that, I’m wondering as, I guess as a
Government of Saskatchewan Research Council, that wouldn’t it be
. . . And I know this: that if you’re a partner and you use the stats
in whatever you’re going to use it for, that you also want that information.
So
why would you not have it as an expectation to say, okay, this partner, I’m
partnering with you, and I want to know what your plans are in terms of
Indigenous engagement at the employment level, at different levels, so that it
helps inform us in whether we’re meeting the overall target of employing
Indigenous people within this province?
Hon. Mr. J. Harrison: — Yeah. Well I may turn it over to
Ryan and Mike. They can feel free to jump in. But you know, like I said, with
the companies who we’re partnering with — whether it be in CLEANS or
accelerated site-closure, you know — like I said, I suspect that there would be
a very, very high proportion. Maybe we do track that. I’m not entirely sure.
Mr.
Crabtree:
— We track internally on this. But I think, if I could maybe put a little bit
of context around this, I think SRC looks to engage in two ways, both of which
the minister’s mentioned. The first way is with regards to Indigenous and Métis
personnel who are employed within the company. We obviously maintain the stats
on that.
The
other area, which is related to that, is in training and education. And we had
a program that unfortunately it was suspended due to COVID, which we’re just
re-engaging now, which was called — inappropriate title now but it was called
traditionally — the Aboriginal mentorship program, AMP. And that identified
post-secondary, in some cases post-graduate First Nations, Métis people in
order to bring them into the organization for a period of time, typically over
the summer for very intense mentoring in their chosen area of expertise, which
often was highly specialized. We chose particularly STEM candidates — science,
technology, engineering, and maths — and over the period of that AMP program,
the AMP program, we took 25 people through that program. So education is a key part
of this.
The
second area and actually in some ways the most impactful is what SRC does in
terms of being a catalyst for the development of industrial sectors in
particular in Indigenous and Métis areas, particularly in the North in mining
operations and increasingly in provision of energy. So you may be aware that we
partnered with Cowessess some years ago to build — only about I think 20 miles
from here — a combined wind, solar, and battery storage. That is still in
operation and is actually providing power not only for the local community, but
into the grid.
These
are the sorts of things where SRC can make a real difference. And if I can have
one more minute to talk about nuclear — and we’ll probably talk about this a
little bit more later — these nuclear batteries that we’re talking about, these
eVincis, have two commercial purposes. The first is for mining operations in
the North that are looking to generate net zero power for their mining
operations, and the second is for Indigenous communities looking to provide
power. These reactors replace 1.3 million barrels of diesel at $7 a litre.
So these are going to be transformative to northern communities and provide
very significant opportunities for social and economic development.
So
when we talk about what SRC is designed to do, that’s where we look to deliver
impact, if that makes sense.
Ms. Nippi-Albright: — Thank you. It’s Mike?
Mr.
Crabtree:
— Mike.
Ms. Nippi-Albright: — Yeah. May I call you Mike?
Mr.
Crabtree:
— Absolutely.
Ms. Nippi-Albright: — Thank you. Mike, just thank you for
all that you’ve shared there. So just in keeping with my line of questions, if
you could just focus on the question that I’m asking because we’ll get to those
other questions as well.
So
you talked about 25 people that you put through the STEM program. How many of
those 25 were Indigenous? And how many of them are still with the organization?
Mr.
Crabtree:
— All of them were Indigenous, and a number of them were given positions within
the organization and moved on — onwards and upwards. If I can make a comment on
here, I meet AMP personnel all the time in the province. And one within FNPA
[First Nations Power Authority], and the individual there says that the only
reason that they are there is because of the AMP program. So these are a
relatively small number of people, but are having disproportionate impact on
their companies and communities.
Ms. Nippi-Albright: — Thank you. That’s wonderful that was
25 people that were . . . They’re all Indigenous. So was there a
process that you used to verify they were in fact Indigenous and not
pretendians?
Mr.
Crabtree:
— Oh gosh. In that they made the application, and they made their application
with support from their communities, so we took that as being validation.
Ms. Nippi-Albright: — Thank you. That’s good. I’ll move
on. So as a treasury board Crown, SRC does not currently have a commercial
mandate. Last year in estimates, Minister, you indicated that “SRC really does
operate in the commercial environment and really does operate in competition
with companies . . .” So does the government have any plans to
convert SRC into a CIC [Crown Investments Corporation of Saskatchewan] Crown?
Hon. Mr. J. Harrison: — You know, as far as kind of a
machinery-of-government question, I would say I think we have a degree of
contentment with the current legal status of SRC. That’s not to say
. . . I wouldn’t preclude there being a change in that regard, but I
think our mandate, our vision, our statute are appropriate for where we are
operating right now. You know, that may or may not change. I wouldn’t rule it
out.
But
you know, I don’t think we’ve actually had a statutory amendment for probably
20 years or thereabouts. So we don’t have kind of a defined plan for here, this
is the year we’re doing it in, but, you know, there likely will be a review of
the statutory status. You know, like I said, we wouldn’t rule out — kind of
from a machinery-of-government perspective — change, but I think where we
operate now we’re pretty comfortable with.
Ms. Nippi-Albright: — So does the government have any
plans to privatize SRC?
Hon. Mr. J. Harrison: — No.
Ms. Nippi-Albright: — Thank you. Okay. I should have did
all my questions and separated them all in a nice pile. So I’m just going to
talk a little bit about, ask questions regarding the governance issues. Why was
SRC’s board membership changed on January 18th and then changed back on January
21st, 2022?
Hon. Mr. J. Harrison: — Off the top of my head, I’m not
entirely sure, not sure if that’s pertaining to this year’s estimates.
The Chair: — Ms. Albright, it doesn’t pertain to
the estimates that are before us this evening. So I mean, you’re asking
something that happened two years ago in estimates. And I mean, they didn’t
come prepared for that kind of an answer because that isn’t what these
estimates . . .
Ms. Nippi-Albright: — So I guess the question — let me
rephrase that — is, there has been changes made to the SRC’s board membership
at some point, and then a short time later they were changed again. So can you
explain some of that change in such a short period of time?
Hon. Mr. J. Harrison: — I think in this year we
. . . Did we have a new board member come on this year?
Mr.
Crabtree:
— We had one new board member.
Hon. Mr. J. Harrison: — One new board member this year, and
I think that was because we had a retirement on the board. So I mean there are,
you know, changes that happen in this regard. Basically, annually we’re going
to have changes, but you know, people either retiring or people who come to
their end of their terms or for whatever reason. You know, there’s a process we
go through on . . . You know, SRC will provide suggested names of
replacements, and we’ll have a discussion about who might be the right fit and
whether they have an interest in doing it. And there’s a lot of factors that go
into that. So I know we did one this year though.
Mr.
Crabtree:
— If I could . . .
Hon. Mr. J. Harrison: — Yeah, go ahead. Yeah.
Mr.
Crabtree:
— If you look at our current board makeup, there are a significant number of
board members. In fact most of the board members will be coming up to the end
of their term in 2025 with a few in 2026. So this phasing is not ideal, but
quite often you get to a point where a number of board members are changed at
the same time. We try and avoid that and we try and stagger that, but sometimes
that’s not possible.’
Ms. Nippi-Albright: — So you’re saying that in that short
time period that those changes that were made is normal.
Hon. Mr. J. Harrison: — Like I said, I don’t have kind of
the 2022 stuff, but I mean we . . . It’s not un-normal to have
changes on the board. So there might have been an issue with how the order in
council is issued or something. We’ve had to redo some order in councils if names
are spelled wrong or things of that sort. But I don’t know the specific case in
this. But you know, there sometimes are administrative issues around these
things.
Ms. Nippi-Albright: — Okay. Well thanks for talking about
the order in council appointments. So upon reviewing the order in council
appointments for the past several years, I note that most board changes are
made due to term expires, which you just talked about. However, these three
appointments at this time period of Fitzpatrick, Kozinski, and Herman were
noted as cancelled. Why was that?
The Chair: — Ms. Albright, as I mentioned, what
you’re asking is not part of the vote that we are discussing tonight and the
estimates that are before you. They’re relevant to the current board and the operations
of SRC out of the budget.
Ms. Nippi-Albright: — Thank you for that. And I just
wanted to . . . Let me rephrase that then. So I’m curious. For me,
I’m very curious why three appointments were made and cancelled within any
fiscal year . . .
The Chair: — Ms. Albright, they’re not
. . . there was, as they mentioned, there was one on the board this
year that was changed. But what you’re referring to is not part of the
estimates that are sitting here before you. So I ask you to redirect your questions
to deal with the vote that’s in front of you in the estimates.
Ms. Nippi-Albright: — Okay. And then I’ll ask this
question: how often do you do governance and leadership reviews?
Mr. Crabtree:
— Governance and leadership reviews. So at the board level, we do one major
governance review annually, and we have quarterly board meetings where
governance is discussed routinely in terms of our compliance with both our
existing governance protocols but anything that is new that may have come in in
terms of either from a legislative requirement or best practice. And of course,
we have subcommittees. We have a governance subcommittee and a finance
subcommittee to the boards. They report into the board on both finance issues
and governance issues.
Ms.
Nippi-Albright: — Okay. And who usually leads these
reviews?
Mr.
Crabtree: — So for governance it is the
governance committee and typically myself and one other of the executive team
would sit to lead any major governance review.
Ms.
Nippi-Albright: — Okay. So when there is a perceived
or actual conflict of interest, is that taken into account in your review that
comes up?
Mr.
Crabtree: — So conflict of interest. There’s a
requirement for all board members to sign a conflict-of-interest statement once
a year, and that is typically signed . . . Actually we just signed it
at our last board meeting for the year going forward. So that is effectively
the self-declaration of conflict of interest.
Ms.
Nippi-Albright: — So if you do have those, would you
release the results of the review as well? Like when are those . . .
Like I know the conflict-of-interest disclosures and also the reviews, do you
release those reports?
Mr.
Crabtree: — Those reports form part of the
governance package within a board package at the appropriate board meeting.
Yeah.
Ms.
Nippi-Albright: — I just wanted to just say that there
is . . . And why I ask this, you know, is that there’s been a
significant turnover in senior executives. So was this considered in the
management review? And why has there been so much turnover?
Mr.
Crabtree: — If you actually look at the turnover
of the executive team over this period of the last five years it’s actually
been remarkably low, if you look at the development compared to similar
organizations of a similar size. And also the company has grown significantly
over the last five years both in terms of revenue and areas and sectors that we
operate in. So it’s always necessary to refresh the executive team based on
what the objectives and goals and strategy of the company is.
Ms.
Nippi-Albright: — So then is it common though to have
such a high turnover with the executive in that period of time? Because you
look at consistency, you look at . . . yeah, consistency, and you
want people that have that corporate knowledge there to mentor new people that
come in. So like for your organization, is that . . .
[16:15]
Mr.
Crabtree: — The majority of our executive team
have been in place for longer than 10 years and some of them for 20 years. So
I’m not quite sure I recognize the question.
Ms.
Nippi-Albright: — Okay. So you’re talking about,
there’s a large number of your executive have stayed there for 10 years, then
why has there been a turnover? Like, that I’m not getting. I’m not
understanding that. Perhaps you could explain why there has been that turnover.
The
Chair: — I believe Mr. Crabtree already
answered the fact that they haven’t had a significant turnover in the last five
years, and yet you’re asking a question that isn’t relevant, as I said once
before, to the estimates that are before us because it’s been consistent in the
last year or two.
Ms.
Nippi-Albright: — Thank you for that. And I keep
asking those questions just to try to get a better understanding and also to
. . . These are an opportunity to ask officials the questions about
accountability. Like it’s not to offend anyone; it’s simply to get a clearer
understanding about the accountability measures and how we’re best serving the
people in this province in the organizations that we represent.
Mr.
Crabtree: — If I can just add one point here.
One of the very significant strengths of Saskatchewan Research Council is what
you alluded to there which is the corporate knowledge. And so we tend to
promote to our executive team from within. And a really good example of that —
and I don’t want to embarrass Jocelyn — Jocelyn has just been promoted into the
executive team as VP [vice-president] of finance. So you know, some of the
changes that you see on there is because we have been bringing people up through
the organization. And that’s a really, really important thing to achieve.
Ms.
Nippi-Albright: — No, that’s good. And
congratulations, Jocelyn. It’s always good to see individuals being mentored
into these key positions. And it’s also wonderful to see women in these
positions. So thank you for that.
So I’m just thinking about the time; we
have lots of time still. So has the SRC CEO and secretary to the board
disclosed his interest in Westbridge Capital, Quickthree Solutions, and
101184840 Saskatchewan Ltd., formerly Quickthree Solutions Inc.? And if so,
what was the date of his disclosure?
The
Chair: — Once again, Ms. Albright, the
question is not relevant to the $41.623 million of estimates that are here
before you this evening. So if you could redirect and get back on track as to
asking questions that are relevant to the operations of SRC and what they
provide to our province.
Ms.
Nippi-Albright: — Thank you for that, Madam Chair. And
again this is relevant because we’re looking at running a huge corporation. We
have to ensure that the folks that are employed in these organizations are
actually serving the people of the province and doing that without conflict of
interest that’s going to impede the interest of the whole province. So it is
relevant.
The
Chair: — It isn’t relevant in the sense that
Mr. Crabtree already answered your question in the fact that a conflict of
interest is signed and was just recently signed by every member.
Ms.
Nippi-Albright: — So then the CEO has signed it then.
A
Member: — Correct.
Ms.
Nippi-Albright: — Correct? Okay. Okay, perfect. So I
know this is something that’s ruffling feathers, but I will keep going
. . .
A
Member: — Not really.
Ms.
Nippi-Albright: — Good, that’s good. So I will move on
to other questions.
So I’ll just talk a little bit now,
switch gears over to the rare earth minerals. Okay. So what is SRC’s role with
respect to rare earth minerals? And what are the government’s plans for the
future? And I know you shared this earlier and you’ve given a lot of
information, but if you could just kind of break this down in terms of the rare
earth minerals, that would be good.
Hon.
Mr. J. Harrison: — Yeah, no. Well I’m happy to talk
about the rare earth project that we have had under way now for a number of years.
You know, I think I had said earlier that we are getting very close to
commercial production of NdPr. And I would say as well, I mean this isn’t just
the . . . We are managing obviously this project through SRC, but
we’ve actually had very productive collaboration with the Government of Canada
on this as well, and I spoke about it publicly a couple of months ago.
Minister Champagne and I did a public
forum along with Minister Duncan as well and really spent a lot of time talking
about the collaboration between ISED [Innovation, Science and Economic
Development Canada] — Minister Champagne’s department — and the SRC with
obviously, you know, me being minister responsible for that.
Minister Champagne and I talk about this
all the time, given that this project is, you know, obviously a significant one
for Saskatchewan. This project actually is a very significant one for Canada as
well in that the implications, benefits, outcomes are going to have a
significance that go beyond just the production of NdPr or terbium, dysprosium,
scandium, you know, whatever kind of element of these 17 rare earths that are
being produced.
So the Government of Canada actually
just recently did an announcement a few weeks ago with Minister Vandal. And
Minister Wilkinson and I did an announcement as well where the Government of
Canada are providing additional resources such that we will be in a position to
do the separation of heavier rare earths, those being dysprosium and terbium at
this point anyway, which have — again, along with scandium and NdPr and some of
the lighter rare earths — applications that have very real strategic
significance for not just North America, but really for the NATO [North
Atlantic Treaty Organization] alliance.
These are materials right now that are
90‑plus per cent produced from single suppliers in the People’s Republic
of China. You know, obviously that’s problematic when your defence industry is,
both in Canada and the United States and Western Europe, are dependent on the
supply of rare earth materials, and particularly strategic rare earths from
China.
We are going to be in a position right
now, or very soon, where we will be able to produce the very first plant in
North America that’s able to do this, at scale, production of strategic rare
earths that are going to have application into the defence sector. You know,
two years ago, I think it was about two years ago now, Lockheed Martin
literally shut down the F35 production line. And why did they have to shut that
down? It was because they had no access to scandium from anywhere but the
People’s Republic of China.
These are real issues. And you know, the
degree of interest and investment, you know, from both our government and the
Government of Canada I think reflects the fact that this is important for
Saskatchewan. We want the industry to be based in Saskatchewan, which is why we
made the investment. But there are implications that go beyond just the
economic context here in this province, which I think we should be aware of.
And I think, frankly, I think Saskatchewan people are going to be proud of the
fact that we’re able to contribute in this way to the Western security
interests.
So you know, we are very close to
commercial production. We are going to be actually producing beyond the
separation units, which we talked about, at the light side. We’re going to be
able to produce separation units for heavier rare earths because they are
different processes for how you do these things.
We are very fortunate here at SRC in
that we have a team that really is the leader in basically . . . well
not just North America, but I really think in . . . a global leader
outside of China in this. And it’s not by accident, I’ll tell you. Our team at
SRC, under Mike’s leadership, has seen this opportunity. We have been working
on this for 15 years.
And you know, I got the question from
the media at one of the announcements we did around this: well why, you know,
why is Saskatchewan leading on this? It’s because it’s not easy to do. It’s
really hard to do this, and the expertise to do this does not exist. It hasn’t
existed outside of China. But we have been working on this with a team at SRC
now for 15 years.
So when we made the decision to move
forward at that midstream stage, we were able to execute on it. And it’s not
easy to do because a lot of this stuff is very challenging from a scientific
perspective. The actual physical elements that go into a lot of these things
are only available from Chinese manufacturers, which is why . . . And
the Chinese are highly aware of this and deeply protective of their market
position because of the strategic implications of that market position, are
deeply protective of it.
So what they have done in the past
really has been a combination of export controls on the physical implements of
rare earth separation or market manipulation to change the economics for
projects that may have been pursued outside of China. And I don’t just mean
here. I mean around the world. And they have been very successful frankly in
doing that.
You know, one of the things we had
looked at initially when we moved forward was around the physical
infrastructure separation unit component. The Chinese had put in place export
controls on that technology, you know, kind of in a clever way how they did it.
But really it added risk, and that was the whole point, was to add risk to
projects, whether it be in Italy, whether it be in North America, whether it be
in the United States, whatever. I mean that was the point.
So
you know, we have those elements of the rare earth projects, kind of the policy
rationale. I’ve talked about it publicly extensively. But what we needed to do
was to have a secure midstream supply chain. That would be the catalyst for
both downstream and upstream applications in this.
And
where there have been challenges, and where projects have collapsed and the
economics have been wrecked in the past on both downstream and upstream has
been where — because of the dominant position played by Chinese state-owned
enterprises, really SOEs [state-owned enterprise] in the People’s Republic —
they have changed or been in a position to alter economic facts for a lot of
companies that would be moving into this space, which really created a risk
framework where they were unprepared to make what they would view as high-risk
investments in the downstream and upstream because there was no guarantee that
you were going to be able to actually do either the processing or value-add, or
even kind of have a market for your mined material, whether it be monazite or
basanite or whatever the source feed would be.
So
what we have done by making this investment into the vertically integrated
midstream space is really created the catalyst for the private sector to have
confidence in both the downstream and upstream space in rare earths. So in kind
of non-corporate language, what that really means is that companies will have
the confidence to mine monazite or basanite or, you know, whatever other source
product would be sufficient for midstream manufacturing or midstream refining.
And
also on the other end, for companies to know that they were going to have a
source of processed rare earths that they could then turn into magnets, for
example, or you know, purchase from a non-Chinese supplier if you’re an auto
manufacturer for another example. So really kind of that would be part of the
consideration. It was a deep consideration that we went through within
government about that framework for investment into the midstream, why SRC made
sense in developing it. It really is kind of this unique expertise we had which
is really why the Government of Canada have also made significant investments
into this because of our unique positioning in this space.
[16:30]
So
that’s the short answer. I could go on for longer, but I’ll leave it at that
for right now.
Ms. Nippi-Albright: — Well thank you for that. Thank you
for just sharing that and also the investments. So just getting back to that
investment. So just correct me — I know you’ve got 41.6 million, and a
portion of that is the status quo of course. And then 21.5, is that what this
is about?
Hon. Mr. J. Harrison: — For this year’s budget, no. The
additional allocation is for the eVinci project.
Ms. Nippi-Albright: — Okay. So you’ve mentioned that the
Government of Canada is significantly contributing to this. How much is
Saskatchewan, what dollar figure is Saskatchewan, this government investing?
Hon. Mr. J. Harrison: — On the rare earth facilities?
Ms. Nippi-Albright: — Yes.
Hon. Mr. J. Harrison: — 71.5.
Ms. Nippi-Albright: — 71.5. And that’s for the rare earth?
Hon. Mr. J. Harrison: — Yes.
Ms. Nippi-Albright: — The rare earth. Okay. And you’ve
spoken about the private sector, the role that they have and the confidence
that this would give the private sector to participate in. Can you just
elaborate a little bit more on that?
Hon. Mr. J. Harrison: — Sure. I think I elaborated a bit on
that already, but . . .
Ms. Nippi-Albright: — There was a lot there to take in.
Hon. Mr. J. Harrison: — Yeah.
Ms. Nippi-Albright: — Yeah.
Hon. Mr. J. Harrison: — Actually maybe Mike, if you want to
take a run at it. I’ve spoken a bit about that.
Mr. Crabtree: — Historically with rare earths
because the People’s Republic of China dominate the market in excess of 90 per
cent across the supply chain, right from the mining, owning the mines, right
through to the provision of the metals and the actual magnets that those metals
make, they have the opportunity to manipulate the pricing across the supply
chain.
So
when it became very clear — probably about 20, 25 years ago believe it not —
that rare earths were, whilst they were utilized in our phones and in all sorts
of control systems, that they were going to become very, very important for the
energy transition in terms of things like electric vehicles and wind turbines.
And
so by the early 2010s what was happening is that outside of China, investment
was starting to go into the rare earth space, not least here in Canada. The
Chinese recognized this and basically used their influence on the market to
drive the prices down, and basically made all of these projects unviable.
In
the meantime, between 2010 and where we are now, the consumption of rare earths
has gone up almost . . . It’s on an exponential curve. So where we
are now is we’re playing catch-up in terms of developing rare earth
manufacturing and processing capability outside of China.
However
private investment — and we’re talking about the billion-dollar private
investment companies — were burned or were impacted in the early 2010s, so they
tend to be cautious about investing in rare earths.
So
what you see globally is governments investing in catalyzing and de-risking the
rare earth process, and to the point where it becomes de-risked for private
investment to invest in. And what we’re doing here in Saskatchewan is
essentially a version of that.
We
are de-risking it in three ways. We’re de-risking the technology by developing
radically new leading-edge technology, which SRC has done. We’re de-risking the
financials so that we can show that this will be a profitable way of operating,
particularly in this vertical integration where the single plant does multiple
stages in the supply chain. That de-risks it from manipulation. And then the
third component of this is in understanding the market, so understanding the
inputs in terms of monazite and the ores, and the output in terms of the
neodymium praseodymium, the NdPr.
So
the role of SRC, as has been given by the Government of Saskatchewan, is to
de-risk those three areas to the point where private investment says yes, okay,
we can take it from here.
Ms. Nippi-Albright: — Thank you for that. And I just want
to ask more about the de-risking. Everybody knows that I’m First Nation and I
talk a lot about land, you know. And as First Nations people, we’re connected
to our land and often are considered the stewards of the land. So when we’re
looking at taking resources, extracting resources from the land, you know,
Indigenous people are always thinking about how are we protecting mother earth.
So
when you look at de-risking, how are you de-risking the potential, well, the
raping of mother earth, you know, and taking out but not . . . What
are you doing in terms of ensuring that we have a place for those that come
behind us and where there is actual resources that are still going to be there
and they’re going to live? Like how are you mitigating those environmental,
potential environmental negative impacts?
Hon. Mr. J. Harrison: — Maybe I’ll take the first shot at
answering some of this, and Mike can jump in as well. But I think it’s
important to remember the context around where rare earths are coming from
right now: primarily mined in China through processes that have, you know,
virtually none of the environmental or technical standards that we have in
Canada. And in addition to that, the way that the Chinese do this I think is
generally considered to be very unhealthy from an environmental perspective.
Every tonne of rare earth metal that we produce through our process here in
Saskatchewan is a tonne that likely will not be done in that same way in China,
and that is a net benefit for everyone.
And
I would say as well, I mean just as far as the actual harvesting of the source
material, whether that be monazite or other materials — and there are a number
that can go into both the light and heavy rare earth recovery process — you
know, obviously we have very different standards in Canadian jurisdictions than
others do for processing that.
But
SRC isn’t really, and we have no intention of being, in the business of doing
the actual mining. We’re a midstream processor. That’s where we felt that there
was a necessary requirement for us to be involved in to really catalyze both
the downstream and upstream. But we are not going to be doing the mining.
So
you know, there is a company in the Northwest Territories that has been doing
mining. I think there are a number of others that are looking at doing some of
the initial harvesting of the source or feed materials, you know, done in a
very, very different way than it would be done elsewhere in the world. So you
know, if there is a desire to look holistically or globally at what is the best
environmental process such that the most people benefit, I would rather Canada
and Saskatchewan be doing mining and processing than the People’s Republic of
China. And I think that that, you know, is an important part of it.
And
the folks who are doing this work as well take it very seriously. Like they
really, really take it very seriously, whether they be in the mining space,
whether . . . You know, it’d be our team who have put a huge premium
on making sure our process is the best in the world for doing this, and it is
the best in the world for doing this. And there are associated elements that go
along with the rare earth midstream supply space — you know, battery recycling,
for example — which really I don’t think we have much capacity in North America
to do a lot of these things. It surprises people, but we don’t really. So,
Mike, if you want to kind of add to that, feel free.
Mr.
Crabtree:
— I think, yeah, absolutely. With respect to this midstream plant that SRC is
constructing here, as the minister said, this is going to be the most
environmentally sustainable plant in the world, bar none. These plants tend to
use vast quantities of water and chemicals. In China it’s an environmental
catastrophe — air, water, land, including the use of things like child labour.
In our plant we will use water and we will use chemicals, but not one single
drop will be emitted. Everything will be recycled and reused within the plant.
And that is demonstrating, not only to Canadian industry but to the world, what
appropriate and proper extraction and processing of these energy transition
minerals is going to be.
We
are moving from a century of oil and gas into a century-plus which will be
energy minerals. Now oil and gas is going to play a huge role as we move
through this, but it’s energy minerals. And Saskatchewan has a very significant
role in that in being able to demonstrate how we can process these efficiently
and how we can deliver a high-value sector not only for Saskatchewan but for
Canada as a whole.
Ms. Nippi-Albright: — Thank you. Just to kind of delve
into that a little bit more, you’ve . . . And I agree that Canada is
— and hopefully Saskatchewan — we’re thinking more of the environment than
others. Like what kind of safeguards does SRC have with other . . .
Like what regulations do you have? Or are there regulations to ensure that we
are doing the minimal environmental damage that we can do? Is there something
that you have in place? Do you have a business plan regarding that or a plan or
an accountability framework that says that this is what our commitment is,
ensuring that we do the most minimal environmental damage in what we’re doing
as SRC?
Hon. Mr. J. Harrison: — Well I mean I would just kind of add
to what Mike said or maybe reiterate what Mike said with regard to the design
and operation of the plant which is, by far in the world, the most
environmentally sustainable and environmentally friendly. You know, the kind of
technical elements of that, I think Mike probably spoke to in the last question
as far as the recycling of water and the no emissions in that regard.
I
mean we’ve had some other discussions about how we can be even more sustainable
going forward as well. You know, those discussions will continue. Nothing to
announce right now. But you know, again something we really take very, very
seriously. And frankly I think it’s an advantage for us to do it that way, to
take it as seriously as we do because, you know, there are companies out there
that are going to have choices about where they want to source their rare
earths from.
You
know, if you’re a major manufacturer — you know, whatever it be; fill in the
blank — but if you’re a major manufacturer of a commercial product, well you
have the choice to buy your NdPr from China or you have the choice to buy it
from Saskatchewan. Well, you know, where are you going to buy it from? I think
I know where most probably would land on that. And you know, that’s really how
we have approached the entire question from the start.
Mr. Crabtree: — I think maybe another context for
this is that . . . second-largest research technology and
commercialization organization in Canada after the National Research Council.
And part of the reason that we’ve been able to build that is because we are a
very outward-facing organization. So we work with 1,600 clients in 22
countries.
And
the vast majority of the projects that we are working on — which are commercial
projects where we’re looking to develop technologies for partners but also
bring those technologies back into Saskatchewan, and I’ve got some good
examples of that — I struggle to find one single project that isn’t around
either the energy transition, around enhancing safety, or enhancing economic
and environmental performance. That’s where our strengths are.
[16:45]
And
I’ll stop there. But I’ve got one perhaps useful example of that.
Okay,
the minister mentioned in his initial speech there a technology called
sensor-based sorting, which sounds a little esoteric. In effect, when you give
it its full title — artificial intelligence-based sensor-based sorting — what
this allows is mines to be able to take the ore that they are mining and pre-screen
it through a system that disposes of the waste rock. What that does is it
substantially reduces the water use in terms of processing non-ore-bearing
rock, and it substantially reduces the energy burden because you’re not
crushing waste rock.
So
we’ve been a leader in introducing that technology here into Saskatchewan. And
for areas like rare earths and for other areas — precious metals and base
metals — that’s going to become a primary system, and that is going to really
transform some of the water use and the energy use in these mines. So that is
an area where we worked . . . It’s actually a German company that we
worked with to develop this technology and brought that technology back into
Saskatchewan.
Ms. Nippi-Albright: — Well thank you. I know I’m just
going on and on, on this question. So to date, how much has been spent on this
initiative?
Mr.
Crabtree:
— On the rare earths?
Ms. Nippi-Albright: — Yes.
Mr.
Crabtree:
— So we’re in process. We’re actually in the bolt-down of equipment process at
the moment. So a lot of the equipment has been procured. So actually out the
door in terms of expenditure is 60 million so far.
Ms. Nippi-Albright: — And what are your future
projections, budget projections?
Mr.
Crabtree:
— It’s about 100.5 million, of which 71.5 million from Government of
Saskatchewan, 14 million from federal, and then the remainder from
internal SRC resources.
Ms.
Nippi-Albright:
— Okay. Oh, thank you. You just answered my next question. That was good. So I
understand a private landlord is handling the building construction, which SRC
will lease. Who is the private landlord and what process was used to select it?
Mr.
Crabtree:
— The private landlord that we engaged is for several reasons. One is that
SRC’s large piloting facilities, pilot testing facilities, is located at 51st
Street. So as we built out these sorts of initiatives that we’re talking about
— rare earths and lithium and larger labs — it made sense to have that on the
same campus, if you like. So it was a natural progression to extend into areas
where the landlord already had that space. It would not have made logistical
sense to move those facilities to other potential areas, even within that
northern part of Saskatoon.
Ms. Nippi-Albright: — So you didn’t mention the name of
the private landlord. Is there a reason why?
Mr.
Crabtree:
— The only reason that we’re saying that is we might be bound by
confidentiality on that. So we don’t want to inadvertently breach a
confidentiality with regards to that.
Ms. Nippi-Albright: — And this is government funding?
Mr.
Crabtree:
— But these are still commercial contracts with a landlord, government or no,
so we would need to check whether there was any confidentiality clause within
that.
Ms. Nippi-Albright: — So once you check that, would you
present it and table that, I guess, to us once you find out whether it’s
acceptable to do that? And in the case that if it is acceptable that you would,
I guess, disclose or . . .
Mr.
Crabtree:
— Yes. Once we’ve checked the confidentiality status within the contracts with
the landlord, we will disclose.
Ms. Nippi-Albright: — So there was a projection of when
this construction was going to be completed. Is that on track to be completed
by that day, or is there going to be a potential delay? Like when do you
project it to be completed?
Mr.
Crabtree:
— We are projecting to actually accelerate some of the components of the plant,
particularly the metals processing because that is being completed. And we
anticipate that we will be into commercial sales of NdPr metal by midsummer,
which is six months ahead of schedule on that.
The
monazite processing unit and the SX [solvent extraction] unit there, what we’re
going to do is we’re going to design the actual completion and commissioning of
those as per what makes the most sense economically to do in terms of
deployment. But that is more or less scheduled for the end of this year.
Ms. Nippi-Albright: — So remind me which minerals will be
available. I know you’ve named a whole bunch, and it’s late. So which minerals
will be available for processing at the conclusion of the construction? Which
ones, yeah.
Hon. Mr. J. Harrison: — I can kind of add to it. But I’ve
spoken to this in some degree of detail. I mean, the feedstock is a monazite
feedstock. That’s what our plant is designed to work with. That wouldn’t be
kind of necessarily entirely exclusionary going forward as to the feedstock.
There are kind of interesting rare earths. Although they’re called rare earths,
they’re actually not particularly rare. The challenge is how you actually do
the separation from the broader substance in which they exist.
So
monazite is, you know, we view it as being the feedstock of choice, I think,
for the light rare earth space where we are in. So out of that light rare earth
space, NdPr is kind of the product that we are going to be initially moving
forward with. What the Government of Canada have made investment into
. . . Minister Wilkinson and I had announced — I think in February; I
forget when it was — he and I met in the UK [United Kingdom] actually and kind
of nailed this all down. I think we announced it in February.
The
Government of Canada has made investment into additional capacity for
separation into the dysprosium and terbium space, which are two additional
elements that make up the 17 rare earths. You know, applications are slightly
different than for NdPr. The federal government felt that this was an
appropriate investment for them to make. And we have the capacity and technical
expertise to actually be able to be in a position to do this separation of
those two additional elements as well.
Minister
Vandal and I had done another announcement like a few weeks ago. And that was a
further investment from the Government of Canada that really allowed us to
recover more of the rare earth oxide than may have been the case before. And
again, going back to the fact that we have, you know, a degree of expertise in
this space that other companies don’t.
So
feel free to add to that but NdPr terbium, dysprosium, scandium as well
. . . sorry, samarium. And feel free to add to the other 17 because I
don’t actually remember all 17 off the top of my head.
Mr. Crabtree: — The ones you mentioned are the ones
that will be separated as individual metals. The others will be sold in batches
which is a commercial proposition.
Ms. Nippi-Albright: — Okay. So how many . . .
Like have any contracts been signed with suppliers, and if so with whom and for
how much?
Hon. Mr. J. Harrison: — So you’ll see an announcement next
week. That will be one. I can’t speak to it yet.
And
as far as kind of the commercial arrangements, you know, we’ll announce when
appropriate. And that depends on where our partners are at on some of these
things as well. But suffice to say that we feel very comfortable with where we
are at right now. Feel free to add to that Mike, but there’s sensitivities
around that.
Ms. Nippi-Albright: — Good. No. Thank you for that. So
I’ll be looking forward to the announcement and any other announcements that
come forward. So how will SRC ensure there is sufficient supplies of minerals
to sustain operation of the processing facility on an ongoing basis?
Hon. Mr. J. Harrison: — Yeah, I would just kind of say, stay
tuned for news on that front. But I would also go back, you know, my initial or
a comment I made just not that long ago about rare earths not being
particularly rare. The challenge is around the midstream separation capacity.
It’s not so much around the supply of the feedstock. But, you know, feedstock
is important, and we’ve been working on that over the last number of years. I’m
not sure, Mike, if you wish to add more.
Mr. Crabtree: — I think the objective of catalyzing
this rare earth processing hub here in Saskatchewan is to be able to provide
mining operations across Canada with a route to value. And it’s a little bit of
like a chicken and an egg situation here. What we’ve decided to do is to put
this midstream capability in place, so as these mines come online in the next 5
to 7 to 10 years, they have a route to market and adding value within Canada
and within Saskatchewan in particular.
That
of course leaves the challenge of, how do you feed the plant in that interim
period? So that’s where we are building a whole series of networks of
relationships and contracts to be able to supply the feedstock in that interim
period while domestic Canadian production comes online.
Ms. Nippi-Albright: — Help me understand the relationship
between SRC’s rare earth initiative and the new Saskatchewan critical mineral
innovation and the mineral processing investment incentives which were
announced in this budget to be delivered by Energy and Resources. Help me
understand that.
Hon. Mr. J. Harrison: — Yeah, I mean the short answer to
that is as far as the incentives themselves, those are Energy and Resources, so
you know, the specific question around that, I would recommend the member put
to the Minister of Energy and Resources.
But
just as a broader directional statement, I would say I think the fact that
you’re seeing, you know, a critical mineral strategy which we announced earlier
in the year, the fact that you’re seeing tax incentives that have been
announced as part of budget really speaks to the critical importance that the
government is putting onto the development and the policy framework existing
for this sector to develop here within the province.
We
feel we have some very, very real competitive advantages in this space given
our long history of mining here in Saskatchewan, given the fact that we have a
highly skilled workforce, that we have an established service industry. All of
the things that really make a lot of sense for why there should be downstream,
midstream, and upstream investment into critical minerals.
And
that doesn’t just include rare earths, which is a bit of a special case. And
there are a couple of other, I would say, critical minerals that have a pretty
unique standing as well. But we are really working to make sure that we have
the incentives and framework in place because we are competing for investment
into this field with other jurisdictions both within Canada but also around the
world.
[17:00]
And
that’s why we have really endeavoured to make sure that we have as competitive
an environment as anywhere. And I think that’s actually been reflected in the
fact that we have outside organizations saying that Saskatchewan is the
. . . I think we were the second most attractive destination for
investment of any national or sub-national jurisdiction in the entire world for
mining investment. And that doesn’t just happen. That is because we work very
closely with industry. That is because of the fact that we work very closely
with the investment community to make sure that not just the policy framework,
but the certainty in the long term exists for very, very large-scale
investments to be made.
And
you know, it doesn’t just happen. And BHP would, you know, an example of this,
investing 14‑plus billion dollars so far, their largest capital
deployment in the history of their company, here. Here. And it doesn’t just
happen.
Ms. Nippi-Albright: — Good. Thank you for that. I know
last year I had asked a question about the abandoned oil wells and that there
was a significant investment from the federal government that the province used
in helping with the cleanup. So how much has Saskatchewan invested in, I guess,
those abandoned oil wells, the cleanup and etc.?
Mr.
Crabtree:
— SRC’s role in that was to work under Energy and Resources and in partnership
with other government bodies such as SaskBuilds to be able to deliver that
program. And the objective of that $400 million of federal funding was to
support the industry during a really critical time. If you cast your mind back,
you know, oil prices were sub $10 and sometimes sub $1, and so there was a real
risk for loss of very, very significant numbers of jobs in a major sector. So
the focus of those dollars had two purposes. One was to support the industry
during an extremely difficult time, and secondly to address some of the many thousands
of abandoned wells and facilities in the province.
What
we achieved as a group in two years was quite astounding, was the permanent,
permanent abandonment of 8,000 wells, utilizing the existing oil and gas
service companies to do that, 900 companies — very, very significant, as you
know, Indigenous component to that.
And
the other jurisdictions that were provided money, the primary one was Alberta.
It was provided over a billion dollars of funds, and it’s generally recognized
that the Saskatchewan process was by far the most efficient. And that was
because of that great collaboration between the industry and between the
institutions who were delivering this. So going forward from that, that has
given the province a really good baseline and expertise in terms of abandonment
of future wells. And that’s the ongoing legacy of that, is the expertise and
the capability to be able to move that forward.
Ms. Nippi-Albright: — Thank you. So the 400 million
that was provided — which was well used — by the federal government to help
clean up these abandoned wells, how much over and above that 400 million
from the federal government did the provincial government contribute to the
cleanup?
Mr.
Crabtree:
— What the province contributed was basically the resources and the
infrastructure to be able to deploy those funds. To be able to close 8,000
wells and deploy $400 million into a sector in two years was in itself a
really significant challenge. There was little opportunity to have been able to
exceed that within the timeline, and the federal government gave a very
specific timeline which those funds had to be deployed, or lost. So the
challenge was to actually effectively deploy that 400 million within that
period.
Ms. Nippi-Albright: — So just going back, so what kind of
dollar figure do you have? You’ve said that the province provided the resources
and the infrastructure. Is there like an in-kind dollar figure that you have
come up with to say, although we didn’t provide the dollars, here is what we
provided and this is what the dollar figure would be regarding resources and
infrastructure?
Mr. Crabtree: — Minister, I think that would be an
ER [Energy and Resources] question. They were the overall project managers and
financial control for the project.
Ms. Nippi-Albright: — Okay. So of the abandoned wells, we
know that these companies put dollars into a fund to help with the cleanup of
these abandoned wells. And how many of those companies accessed the
$400 million to help clean up?
The Chair: — Once again that’s a question for ER
because they’re the ones that kept track of the companies as they applied.
Ms. Nippi-Albright: — Okay. Thank you. So is Saskatchewan
going to be contributing dollars to any other further cleanup of abandoned oil
wells? And I’m sure we still have some here in Saskatchewan. Is there an
investment, a financial investment, a potential for the future that
Saskatchewan will invest in?
The Chair: — Once again, ER. That belongs to ER.
As was noted, SRC was just the support for processing and getting it through.
Everything came through ER from the feds.
Ms. Nippi-Albright: — Okay. Well thank you for that. So I
will move on then. So I’ll move on to asking more about the micro small nuclear
reactors, microreactors. So why is SRC leading this initiative as opposed to,
for example, SaskPower?
Hon. Mr. J. Harrison: — So SaskPower is, of course, leading
on the small modular reactor component. Actually we just put out, I think we
put out a news release on this a short while ago that talked about the
differentiation between the two projects.
So
you know, SRC has a long history of being a nuclear operator, the only nuclear
operator in fact in Saskatchewan. We did operate a small nuclear reactor at the
University of Saskatchewan, which people . . . I think there was not
as high a degree of public awareness about all of that; it wasn’t a secret or
anything. But there was a nuclear reactor operating in Saskatchewan for 38
years and it was operated by SRC. So the company has a very, very high degree of
expertise and a nuclear operating licence as well, based on the fact that we
have operated a nuclear reactor for 38 years up until its decommissioning just
a few years ago, I think . . .
Mr.
Crabtree:
— 2020.
Hon. Mr. J. Harrison: — Yeah, just a few years ago we
decommissioned it, so it makes all the sense in the world for SRC to be the
lead agency. The fact that we are a nuclear operator, we have the expertise, we
have the history, we have the institutional memory — on all of these fronts, it
makes sense for SRC to do the microreactor project.
Ms. Nippi-Albright: — Okay. So between, like, SaskPower
and of course SRC, I guess, help me understand what the respective roles and
responsibilities when it comes to nuclear power in this province. Help me understand
that.
Hon. Mr. J. Harrison: — Yeah, well I think I . . .
Like I kind of did.
Ms. Nippi-Albright: — Yeah, I know you’ve just
. . . Refresh my memory.
Hon. Mr. J. Harrison: — The SaskPower Corporation really are
going to be the lead agency on commercial-level power production from nuclear.
So you know, if you’re looking at a 300‑megawatt SMR [small modular
reactor], that really is for baseload commercial power generation. That makes
sense for SaskPower as the power utility province-wide to be the lead agency.
And
as for what we are doing at SRC, you know, this being a first-of-a-kind
microreactor project, that really fits within our mandate. So you know, the
differentiation between the two, I think, is fairly clear. But we wanted it to
be really quite crystal clear, and that’s why we, you know, made that
announcement that we did a couple of weeks ago.
Ms. Nippi-Albright: — Okay, thank you. So can you outline
what you believe to be the future for microreactor development in the province?
And you’ve just referred to the recent news release.
Hon. Mr. J. Harrison: — Yeah, no, I’m really very excited
about what this could mean for Saskatchewan. You know, we have a long history
in this province of having different parts of the uranium and nuclear supply chain.
You know, I think the public really have a very clear understanding and desire
that we should have a bigger part of the value-added uranium and nuclear supply
chain, including and up to nuclear power production.
So
working with Westinghouse, Westinghouse now obviously being a company that is
49 per cent owned by Cameco, really presents some very real opportunities for
Saskatchewan to be a part of the uranium and nuclear value-added supply chain,
up to and including nuclear power generation.
So
this is a part of that. We’re going to be working with Westinghouse on the
location. We are going through that licensing process right now, and it is a
process, but we are working with CNSC [Canadian Nuclear Safety Commission]. I
think it’s fair to say that CNSC are a good partner on this, and I think
enthusiastic is not too fine of a point on it. We are working with CNSC,
Canadian Nuclear Safety Commission, of whom we have a 50‑year — at least
— relationship, to go through the regulatory process on eVinci.
But
really, you know, this is going to be a potential catalyst for investment, and
again for private sector investment into different elements of the supply chain
on uranium and nuclear. And you know, I would leave it to maybe some private
companies to talk in-depth about what their plans might look like, but I would
say that by moving in the direction that we are moving in, we are creating an
environment which I expect you are going to see hundreds of millions of dollars
of investment, if not more, from the private sector into that value-added space
on uranium and nuclear.
Ms. Nippi-Albright: — You talked about the public has a
desire to have, to look at microreactor development in the province. So can you
share when that feasibility study or that consultation process . . .
And where you gathered that feedback from the public about their desire for the
province to be a leader in microreactors?
Hon. Mr. J. Harrison: — Yeah, I mean there’s a formal
process through the Canadian Nuclear Safety Commission as far as that path
forward, you know. I alluded to it earlier, but I mean one of our partners on
this project for a long time has been Meadow Lake Tribal Council. They’ve been
undertaking First Nation-by-First Nation consultation. I think it would be fair
to say that there’s been an overwhelming degree of support from constituent
communities.
[17:15]
I’ll
leave kind of the final announcement for Chief Ben and Vice-Chief Derocher and
Vice-Chief McIntyre, but I think it’s fair to say that there has been an
overwhelmingly positive response from communities that comprise the Meadow Lake
Tribal Council.
You
know, as far as our CNSC and regulatory process, we’re continuing to move down
that path. We’ve been in regular communication with other stakeholders in this
regard, and that will continue.
Ms. Nippi-Albright: — Okay. Thank you for that, and thank
you for mentioning MLTC [Meadow Lake Tribal Council]. And we know that Meadow
Lake Tribal Council has a number of First Nations that are within their tribal
council. However that doesn’t include the other Nations and Métis communities
that are neighbouring that area.
So
I’m just wondering how . . . Like I know that your MLTC is doing
their consultation with their member bands. It doesn’t include Métis
settlements or communities, nor does it include anywhere past the northwest
area. So how was, I guess, the approval or the consultation and uptake on that
have occurred outside of MLTC?
Hon. Mr. J. Harrison: — Yeah, I would just be very cautious
in conflating the two processes. What MLTC have been working through has been
being involved in the project. So that’s the nature of that consultation. There
is a very separate regulatory process and consultation process that exists
outside of that. Mike, if you want to speak to that.
Mr.
Crabtree:
— Absolutely. The process for the, if we want to call it SRC eVinci, which
would be the first of a kind, is already under way. That will be a five-year
process of which the majority of that process, or what the limiting steps to
that are the regulatory and licensing process, which is driven by CNSC. A huge
component of that is the public and Indigenous engagement process.
So
we are driven by what is the requirement of CNSC. As the minister said, there
is very significant interest from both industry and Indigenous communities,
MLTC being the one that we can talk about — there are others, which we can’t
for confidentiality reasons — who are leaning into this because they see these
as being transformative.
And
I think that the interesting thing here is — and maybe this is another
differentiation with the microreactors — the microreactors can produce very
significant amounts of power. So an eVinci would produce about 5 megawatts. In
context, that’s enough for 5,500 homes. But a significant number of both
Indigenous communities that have expressed interest and mining companies are
interested in these for the heat. So not to produce power for a grid or even
power for local communities. It’s the heat that would be used in industrial and
community processes. So that’s another differentiation between the SaskPower
utility reactors, which are 60 times the size, and the eVinci units.
Ms. Nippi-Albright: — Thank you. That was another question
that I had asked earlier you just answered. But just getting back to this
piece, it’s wonderful and I applaud Nations that want to be involved with
economic reconciliation, be part in ensuring that they’re involved in the
economy. That’s absolutely wonderful. And this is great that industry and
Indigenous community are very interested in participating in the economy, and
especially where they have a vision of things moving along for them.
And
I just kind of want to circle back to that question that I asked earlier about
the minister, when you said that citizens in the province want this. So I want
to go back and ask where, like is there a . . . was there a survey
done? Was there a feasibility study done to say, yes this is the direction
because this is the direction by the people of the province? And if it’s
available, would you share that with us?
Hon. Mr. J. Harrison: — Yeah, I think there have been a
number of public opinion surveys done on this over the course of the last
number of years. I don’t have them right in front of me. They’re publicly
available. We’re happy to find them, but it shows overwhelming support for the
province to move in the direction of nuclear value-add and nuclear power
production.
And
it would be interesting . . . I’m a bit confused actually as to where
the official opposition is on this because we’ve heard in the House
representations that there is support for going in this direction, but the line
of questioning I’m not sure is reflective of that.
Ms. Nippi-Albright: — Well thank you for the question, but
it’s an opportunity for me to ask you questions. So I’ll keep asking my
questions here.
So
the Government of Saskatchewan, I understand that they’ve signed a deal with
Westinghouse Electric Company to construct the first microreactor in Saskatchewan.
What funding has been allocated by the province for this initiative?
Hon. Mr. J. Harrison: — Yeah. We announced $80 million
in funding over a number of years for the project, of which in the estimates
before the committee I think 21.5 this year, 21.5 million allocated in
this fiscal year for the project and the remainder will be allocated out over,
I believe, three years, four years that, you know, will be committed to this
project.
Ms. Nippi-Albright: — Okay, perfect. Okay. And I also just
noted here that there’s been a news release that you are putting
80 million for licensing and regulatory fields. Okay, good.
So
has the federal government allocated funds for this initiative? And again
remind me, is it . . . because there are so many figures we’re
talking about.
Hon. Mr. J. Harrison: — Yeah. I mean, the federal government
have been quite supportive, I would say. I’m going to speak to the commitments
they’ve made through the strategic . . .
Mr.
Crabtree:
— The Strategic Innovation Fund. Yeah.
Hon. Mr. J. Harrison: — Which was a significant one. I
forget what . . . It was over $20 million?
Mr.
Crabtree:
— It was a total of just under $50 million, of which the SIF [Strategic
Innovation Fund] fund contributed just under 25.
Hon. Mr. J. Harrison: — Right. Right. So Mike was at the
announcement where Minister Champagne had rolled it out. Westinghouse was there
as well.
Mr.
Crabtree:
— Yes. Yeah.
Hon. Mr. J. Harrison: — Yeah. We’ve been working closely
with . . . The federal government are highly aware of this project as
well. Not just aware; I mean, the federal government have been, to their
credit, very supportive of the direction and have put real funding behind it as
well. So you know, again, a project where publicly, I mean, Minister Champagne
and I were talking about this in front of 300 people a few weeks ago. So you
know, an area where I think that there is significant opportunity for
collaboration between the province and the national government.
Ms. Nippi-Albright: — Okay. Okay, thank you. So can you
provide an update on what’s happened in the past year with respect to SMR
reactor design approval by the Canadian Nuclear Safety Commission?
Hon. Mr. J. Harrison: — Well, I can’t speak for CNSC, but
SMRs are, as we talked about earlier, within the SaskPower purview. The SMRs,
the small modular reactors, are within the SaskPower
purview . . .
Ms. Nippi-Albright: — Yes.
Hon. Mr. J. Harrison: — And kind of the question about CNSC,
I mean that really, I can’t speak for them.
Ms. Nippi-Albright: — Okay. You may have to speak up.
These guys are chatting. So I’m sorry; I’m having trouble hearing.
The Chair: — Anything that is to do with the
design in the initial input belongs to SaskPower.
Ms. Nippi-Albright: — Yes. No, that’s good to know. That’s
good to know. Thanks for that clarification.
So
last year at estimates, I asked if SRC has produced a business case for SMRs. I
really didn’t get a clear response at the time. Has a business case been
prepared? And if so, will you be able to share it publicly?
Hon. Mr. J. Harrison: — Yeah, I mean, I would just add
again, I mean SMRs are SaskPower, so that would be better put to SaskPower.
Ms. Nippi-Albright: — Thank you. Okay . . .
[inaudible interjection] . . . Oh okay, I’m hearing too many things.
So who will operate the first SMR once Westinghouse has constructed it?
Hon. Mr. J. Harrison: — Just for clarification, so the micro
SMR or the SMR . . . I’m not sure. Westinghouse has an SMR design as
well, which is called the AP300, which, you know, we really can’t kind of speak
for them on that. So I’m not too sure what you’re referring to.
Ms. Nippi-Albright: — Okay. So then I’ll ask you this one
then. So does the government plan to lever commercial adoption of SMRs in the
province? Is that the plan?
Hon. Mr. J. Harrison: — That’s SaskPower.
Ms. Nippi-Albright: — Again SaskPower.
The Chair: — There’s a difference between
microreactors, Ms. Nippi-Albright, and SMRs. So if you’re talking SMRs, you’re
talking to SaskPower.
Ms. Nippi-Albright: — Okay. I’ve lost my questions now. So
I’m going to ask you questions more about . . . Tell me more about
the engagement process that you had with the broader Indigenous community
besides MLTC.
Hon. Mr. J. Harrison: — So specific to what? Like the CLEANS
project? We can speak to our engagement on that.
Ms. Nippi-Albright: — Well let’s talk about SRC, all the
work that you’ve done and the work that you, the initiatives
that . . .
Hon. Mr. J. Harrison: — Sure. I actually think we did talk
about . . . They’d be happy to talk about CLEANS.
Ms. Nippi-Albright: — Yes.
Hon. Mr. J. Harrison: — This is a really exciting project
which we’ve been working on for 10 years, on the cleanup of the abandoned
uranium sites in northern Saskatchewan. So really I think Mike can probably
speak to that. But we’ve made significant progress on this. I think Lorado’s
been done for a number of years now and remediated. Gunnar, we are getting
close. I think there is one site which has been a bit of a challenge because it
has been . . . Basically Lake Athabasca’s water level has made it a
challenge to remediate. Satellite locations, there were about 35 satellite
locations that were a part of the Uranium City mining complex. Over 20 of them
have been entirely remediated now, is that right?
Mr.
Hill:
— Yes.
Hon. Mr. J. Harrison: — I think it’s over 20, low 20s. And
we have, I think a number of the remainder, I think six or seven have been
partially remediated, and there’s five that are a bit of a challenge. But as
far as kind of the engagement with northern communities . . .
[inaudible interjection] . . . Ryan, yeah, feel free to speak.
Mr.
Hill:
— With regards to engagement in northern communities for the project cleans, we
work and talk with all communities and the surrounding area. We’ve actually
gone above and beyond the requirements within it, and so we’ve dealt with
communities not just upstream but downstream associated with the remediation
area. We constantly have meetings throughout the year with the communities that
are impacted, and additionally we also work with the contractors that we have
up there to ensure that there are specific targets utilizing Indigenous labour
within the actual cleanup processes happening.
So
we’ve gotten a lot of excellent feedback from the communities around the areas.
And actually as a result of that we’ve had Indigenous communities, not just
within Saskatchewan but also around Canada, contact us and want us to be
involved with regards to their projects just because the engagement and the
trust that’s there because of it.
Ms. Nippi-Albright: — Okay. That’s interesting. That’s
good to hear. So you’ve actually gone right into the communities and consulted
with them. So how often do you provide reports to the communities and to the
general public in terms of the remediation with the mines?
Mr.
Hill:
— We deal with the communities at least once a year, generally twice a year to
talk with them about how the remediation is going, listen to them. They ask us
questions surrounding it. Deal with them on that. As far as the reports that go
out, we provide quarterly reports to the Ministry of Energy and Resources.
Ms. Nippi-Albright: — Do you provide those quarterly
reports to communities that potentially are impacted by upstream, downstream,
etc.?
Mr.
Hill:
— Not those reports, because they tend to be rather technical. The engagement
happens when we’re actually on site talking to them.
Ms. Nippi-Albright: — So at what point do you provide
briefing documents to the community for them? I know when they meet, they often
have community meetings to say, here’s what’s happening and here’s what we’ve
received. How often does that occur?
[17:30]
Mr.
Crabtree:
— I think one of the things that we’ve learned from experience — and this
project has been ongoing for, you know, 10 or 12 years — is that engagement
with the local communities there . . . Providing them with reports,
written, you know, reports is one thing. Actually going into the community on
that biannual basis and standing there for, and verbally going through, and
then presenting pictorially and in PowerPoint and in discussion with chiefs and
elders and individuals who attend, is a much more effective way of
communicating what is being done and what has been done and what we intend to
do that next season.
The
other area that is on a regular basis, at least once a year, is taking elders
and chiefs actually into the remediated area for them to actually actively
inspect the work that’s being done. Because of course the objective here is to
be able to return these lands to traditional use. And so the guidance that’s
being provided over that by chiefs and elders over that period of time has
actually had an impact on the work that has been done. So there is a very close
ongoing discussion and relationship with respect to this work.
Hon. Mr. J. Harrison: — I would maybe add, if I could, to
that as well. We’ve undertaken this work from the perspective of the Government
of Saskatchewan and have allocated now over $250 million to this
remediation, with the Government of Canada literally not putting in a dollar
into any of it, despite there being a long-standing agreement that the
Government of Canada was going to pay for 50 per cent of the remediation costs.
And this has been a deeply frustrating issue.
I
can tell you the first time I raised this in public life was 20 years ago in
the House of Commons asking the then Liberal Minister of Natural Resources,
literally on behalf of a minister in the NDP [New Democratic Party] government
here in Saskatchewan, about why they were not moving forward with the 50 per
cent that they owed to the Government of Saskatchewan for the cleanup of the
uranium sites. And it has been very frustrating in 20 years in public life in
pushing the Government of Canada to live up to the commitment they made on
this.
But
what we decided to do, and this was about 10 or 12 years ago, we made a
decision as a government that we were going to fund it; we were going to get it
done. And we were going to, you know, deal with the federal government on
paying their share of this over time. I think they’ve somewhat acknowledged
that they’re prepared to pay, you know, twelve and a half or something like
that. They still haven’t given us a dollar of that, so it is extremely
frustrating how this has gone on.
And
for a government that claims to be as deeply concerned about the environment
such that they need to impose taxes and whatever, that literally here’s an
abandoned uranium mine, multiples of abandoned uranium mines with tailings
leaching into one of our largest freshwater lakes, and they would do nothing to
actually come to the table to provide funding for it. It’s just mind-boggling.
But
you know, we put this out there publicly and talk about it. You know, media
aren’t interested in pursuing it for whatever reason. And you know, we’re not
going to leave it alone. I can tell the committee that. We are not going to
leave this alone. And the federal government need to and will eventually pay
for half of this cleanup. But we stepped up as a province though and allocated
the $250 million to do it because it needed to be done.
Ms. Nippi-Albright: — Oh, that’s good. Thank you for
sharing that. And 250 million for the uranium remediation is good to hear
from the province, their investment. So it brings . . . I guess it
kind of brings me back to the 400 million that the federal government had
given for remediation of oil wells. And you weren’t able to give a dollar
figure of how much the province invested for that remediation of oil wells. Do
you have a figure for that?
The Chair: — Once again that belongs to ER. Any
of the ASCP stuff, the accelerated site-closure program, went
through . . .
Ms. Nippi-Albright: — [Inaudible] . . .
remediation.
The Chair: — Yes.
Ms. Nippi-Albright: — Okay. So back to this uranium
remediation. And it’s good that you go into the communities and speak to chief
and councils, leadership, elders, and you hear some positive responses in the
remediation work that you’ve done. And we know when we . . . the
environment is impacted, our food source, they’re taken away from their natural
habitat. So you’re saying that wildlife has come back and people in the North
that had been impacted by these uranium mines, that their . . . the
food source is not contaminated? Is that what you’re saying?
Mr. Crabtree: — What we’re saying here is that we’re
in the process of remediating the land, the tailings, and to a significant
extent the leaching of those tailings into the lakes. I’ll give you one example.
One of the smaller lakes that was in front of, I think it was the
Lorado . . .
Mr. Hill: — Yeah, you are right.
Mr. Crabtree: — When SRC was first doing the
evaluation there, the lake was a beautiful azure green-blue, and it was that
colour because it was highly contaminated with uranium and uranium-based salts.
And nothing lived in that lake at all. It was one of the first areas that we
looked to remediate. And again this was done in consultation with local
communities and used local community contractors to support this process.
Within
three years that lake had been brought back to where the water quality was
sufficient for us to be able to bring flora and fauna back into that lake. And
that is one of the things that we’re looking to achieve here. And I come back
to what I said before. I said, it’s to be able to return these to traditional
land use.
Another
example here is the 35 remote mine sites that we talked about. These are large,
highly dangerous shafts that were drilled down many hundreds of feet. SRC, in
collaboration with again local communities, have designed caps for these that
are designed to last multiple hundreds of years so that we will not lose
wildlife or, God forbid, lose people to these shafts. So this is the type of
work that is being done in terms of returning these to traditional land use.
Ms. Nippi-Albright: — So we talk about the traditional
land use. Let’s go talk . . . let’s get into that. Like, I’m not an
environmentalist. I don’t claim to know a whole lot about it other than my
people. We hunt and gather, pick medicine on our traditional territory. And
these uranium mines that you are remediating, how long does it take for
Indigenous people to be able to use those lands that you are attempting to put
back for traditional use? Like, what is the time figure to be able to see some
improvements where the wildlife are not contaminated and that we ingest that
and make ourselves ill?
Mr.
Hill:
— A prime example is the Lorado site that we’d taken and completed previously.
Originally the site was basically completely barren. It just looked like sand.
And there’s pictures of it; you can find pictures of it going back all the way
to actually when the mill site was operating there. We completed the
remediation work on that site, and in doing so we’d actually reintroduced local
vegetation. We have worked with local communities to be able to identify
species that had existed on that land previously, reintroduced those species
onto the land. And we have expertise in-house with regards to vegetation also,
and within the year that vegetation was actually regrowing on the land. So it’s
actually beautifully green now. You can’t even tell that it looks the same
site.
Hon. Mr. J. Harrison: — I was just going to add to that,
yes. Last I had seen, you literally can’t tell on that mine site that it had
been a mine site. And not that long ago, 10 years ago, it looked like a
moonscape including with all of the abandoned structures that were still there,
and it was a mess. And so that’s why we moved forward and made the decision
unilaterally as government to allocate the funding to clean it up.
And
you heard me talk about the frustration I have on this, but it continues to be
a frustration that a government that claims that they are very serious about
environmental matters, here’s an actual environmental catastrophe and they
won’t put a dollar into it.
Mr.
Crabtree:
— If I could add one thing here.
Ms. Nippi-Albright: — Sure.
Mr.
Crabtree:
— Once this has been implemented and funded by Saskatchewan, the regulatory
framework that we operate on is the federal regulatory framework and that is
governed again by the CNSC. So they determine the processes. They determine the
timelines that we operate to. And to answer your question in terms of when those
lands can be . . . whatever they look like, when they can actually
physically be returned to traditional use, again is governed by regulatory
processes which are fundamentally federal on that. So we follow those
timelines.
Ms. Nippi-Albright: — So you’re saying within a year the
grass grows back, the water is good, and is like . . . So then that’s
different from the regulatory . . .
Mr.
Crabtree:
— But let me be clear: within a year, we’ve repopulated the flora and the
fauna. Then there is a monitoring and regulatory process that determines when
it can be then returned for humans to use it for traditional land use. And
that’s something that is part of a monitoring and regulatory process.
Hon. Mr. J. Harrison: — Yeah, so again, this goes to some of
the frustrations the government has had on this because on the one hand,
literally if we had done nothing, well it would still be sitting there looking
exactly as it does. But we move forward with a decision to do the remediation,
then we have . . . You have the CNSC, a federal government regulatory
body that’s actually doing the regulation about the remediation, where Natural
Resources Canada have entered into a legal agreement to pay for half the
funding, and they refuse to give us a dollar to do it. But you have the other
federal agency saying, here’s exactly how you have to do it. It’s outrageous.
Ms. Nippi-Albright: — So just, you know, when I think
about like in Saskatchewan, we have . . . All of Saskatchewan is
treaty territory, right? And when you talk about going into the communities and
you’re getting positive response from the community saying oh, this is great;
you guys are doing fantastic work; you’re planting grass; you’re putting the
stuff together; it’s helping. At what point do they get the go-ahead to say, it
is safe for you to consume the wildlife? They’re not going to be contaminated.
It’s not going to make you ill . . . and/or drink the water that you
just cleaned up. At what point do you as a government inform the Nations?
Hon. Mr. J. Harrison: — I mean that’s what Mike said. I mean
that’s entirely up to the Canadian Nuclear Safety Commission. Not up to us.
Ms. Nippi-Albright: — Right, but you’ve taken the
initiative as a province to go and do this remediation, and you have said, this
is what we’re doing. And it’s getting positive feedback from the Nations when
we go to them on a yearly, sometimes yearly, basis to report back, this is how
the remediation process is happening and this is what we’re doing.
I
guess my question is . . . Because absolutely I would be like, yes,
that’s great you’re doing what you’re doing as a province. But at what point as
a First Nation that wants to exercise her inherent and treaty rights to hunt,
pick medicines, and that, when is it safe for me to do that?
Mr.
Hill:
— Once again, that’s governed by the CNSC. So using the Lorado site as an
example, once again we talked about how it’s been revegetated. It’s been
introduced into post-remediation monitoring activities.
[17:45]
And
so it’s additional activities that we have a responsibility to the CNSC for,
with regards to monitoring, testing to ensure stuff are within the compliance
ranges for CNSC. CNSC determines the specific timeline for the reintroduction
or return.
Ms. Nippi-Albright: — I’m hoping that this is communicated
to the impacted communities, that (a) we’ve done our part; now it’s the
regulatory body that decides when there’s safe consumption. So that it’s clear.
Mr.
Hill:
— Yeah, absolutely. Every single time we have the meetings with the local
communities, we take and communicate everything associated with regards to
timelines on all the applicable sites.
Ms. Nippi-Albright: — You know, I’ve had individuals from
the North that have come and have actually . . . Because I’m the
critic for First Nation and Métis Relations, I often get calls from First
Nation and Métis people from the North that talk about the uranium mines that
still impacted them. And often I struggle with how do I respond to them, and
who would I refer them to to say, here’s the organization — I’m hoping that
it’s SRC — to say, hey, if you have questions, you get your community to go and
reach out to SRC. Is that something . . . Like how would you
recommend, because you guys are the experts in this uranium remediation, how
would you do that?
Hon. Mr. J. Harrison: — I guess just for clarification, so
is it kind of the existing McArthur, Cigar? Is that what we’re talking about?
Ms. Nippi-Albright: — No, I don’t know. I just have
Indigenous people thinking I know everything when I don’t, right. And they’re
like, I should know about this stuff. And they think that I should know and
respond and help.
Hon. Mr. J. Harrison: — No, I appreciate the question, and
it’s a good faith question. I get that. It would be dependent, I think is the
short answer. So if you’re dealing with a currently operating mine, you know,
also regulated by the Canadian Nuclear Safety Commission, so I think the answer
would probably be to the federal regulator.
It
would depend on the specific nature of the question, exactly where the matter
pertained to in the area, whether it was on site, off site. There would be a
number of elements that would go into what the answer would be. But if it was
kind of on-site issues with the mine itself, that’s a federal regulated matter.
Ms. Nippi-Albright: — Okay. Well that’s good to know. So
what kind of influence does the provincial government have in terms of having a
voice at that regulatory table?
Hon. Mr. J. Harrison: — Well with regard to CNSC, I mean
they set their own direction. They have their own policies. They have their own
minister for whom responsibility is assigned over the agency. You know, we work
with them. And like I said earlier in a response to a question, we’ve been
partners and worked with the CNSC for over 50 years, having been a nuclear
operator for a long time. So you know, we have existing relationships with
CNSC. A lot of that’s probably on matters that are to do with slightly
different challenges that might be raised by constituents. I would say that we
have a productive relationship with CNSC. Feel free to jump in, either Ryan or
Mike.
Mr.
Crabtree:
— The CNSC, their predominate, overriding priority is safety, and that’s very
much aligned with SRC because our overriding priority is safety. We were one of
the first organizations in Canada to receive a licence from the CNSC, nearly 60
years ago. So it’s been a relationship, and I can’t claim the benefit for this,
but it’s been a trust relationship over 60 years.
So
answer your question, they are the regulator, so they set the regulations. We
follow the regulations. But what they do do is they listen to areas where we
think that there are opportunities to improve or concerns that we may have. So
we have that sort of good, a very good dialogue with the CNSC.
Ms. Nippi-Albright: — That’s good. And do you also have
that same dialogue with, perhaps, some recommendations from the Indigenous
community to feed into that? Is that something that happens?
Mr.
Crabtree:
— In the area that we’ve been talking about, the CLEANS project, the northern
mine site cleanup project, it’s not simply an engagement process. This is an
advisory process from the Indigenous communities up there. So we listen and the
project itself is not written in stone. And then we’re saying, we’re engaging
with you to accept this. It’s, what changes do we need to make to this? Even to
the extent of prioritizing areas for remediation. So in some cases there may be
traditional areas that have greater significance than others, and we’re asked
to be able to prioritize those areas. So very much an interactive dialogue.
Ms. Nippi-Albright: — Okay. Well that’s good to know that
you are engaging in dialogue with communities that are potentially impacted or
potentially could be impacted.
So
I just want to get back to a little bit more of the engagement piece, so
regarding the ministry. So what efforts have been made to engage Indigenous
people over the past year? I know that you’ve engaged extensively with MLTC,
but I’m just curious of other Indigenous communities regarding the rare earth
mineral and the other projects.
Hon. Mr. J. Harrison: — We’ve spoken to kind of the northern
engagement on project CLEANS, where northern communities have been integrally
involved in kind of all elements of that project. And we’ve talked about some
of the elements of the advanced accelerated site-closure program, of which we
had responsibility. And that was really working with partners, and we
prioritized Indigenous partners through that process as well.
You
know, we are always having, you know, discussions with different Nations about
opportunities, about you know, what future opportunities might look like. You
know, one of the directions that we really take seriously — and we really do —
is to make sure that where, you know, we have opportunities that are existing
or emerging, that First Nation communities, Indigenous communities are going to
have opportunities to meaningfully economically participate.
That’s
why we created the Indigenous Investment Finance Corporation, for example. You
know, all of these things are holistic. Not all of them are SRC-specific, but
you know, we have really worked hard to . . . You know, the bioenergy
project we’re working on — SaskPower has really led with MLTC — is another example
of that. It’s not just in the Northwest but obviously I’m most familiar with
what’s going on in the Northwest. So you know, it’s a whole-of-government
approach to these things.
Ms. Nippi-Albright: — So would you be able to provide the
list of — just within just the past year — of some of those communities that
you have had conversations with or consultations with, to say, hey, let’s work
together on this? Is that something . . .
Hon. Mr. J. Harrison: — Yeah, sure. We can talk about the
. . . Yeah.
Ms. Nippi-Albright: — Okay, that’s good to know. So what
do you see as the future for, I guess, the role for Indigenous people
respecting these projects going forward? How do you envision that?
Hon. Mr. J. Harrison: — Yeah, I mean one of the things likely
that would be, you know, speaking not just from the SRC perspective
. . . I realize the SRC estimates are before committee, so I will
stick to the SRC part of it. But you know, there is a broad, holistic
government approach. And you know, through some of the other files which I have
the honour of being minister responsible for, you know, we have taken
significant initiatives to create the conditions for Indigenous companies,
communities, governments to be directly involved in a meaningful economic way,
beyond just the legal consultation process. And I mean, those are important.
But
you know, forestry sector is a good example of it. I’ve spoken about that
publicly. And again an area where I probably . . . I know, while just
being from the Northwest, you know, and particularly from Meadow Lake where we
have . . . The largest saw mill in the province is owned by Meadow
Lake Tribal Council — 100 per cent owned by the Meadow Lake Tribal Council —
which also has a significant partnership in Mistik Management. And all of the
different elements that cascade through the forestry sector, really responsible
for thousands of jobs up in my country that are Indigenous led, Indigenous
directed. And it’s a model that works. I mean, I’ve seen it first-hand.
You
know, we go from 30 years ago probably being in a very different place than we
are today in the forestry space in northwest Saskatchewan. And it’s a much
better place. And the reason it’s a much better place is because of the fact
that we have Indigenous governments and companies that are at the very centre
of the industry, and very supportive of the industry, and do a wonderful job in
responsible management of the resource.
Whether
that be in the bush, like in harvesting, whether that be in, you know, moving
forward with a bioenergy centre that really has taken what had been a highly
polluting waste stream, which was the beehive burner at NorSask, and using that
waste product both at the mill site but also what would have been waste fibre
in the bush and using that to create green and renewable power.
And
that wouldn’t have happened but for a long-term partnership that SaskPower, the
Government of Saskatchewan, NorSask, Mistik, MLTC have embarked on, and it
doesn’t just happen. I mean these are challenging and highly complicated
projects with a lot of moving parts and that are not easy.
I
mean we’ve had the federal government involved in that project as well, you
know, and that’s been a challenge at different points also. But all that to
kind of say that having, you know, direct Indigenous equity in a project like
that has made a huge difference. Likely it wouldn’t have happened, just it
wouldn’t have happened but for the leadership that MLTC showed in that. You
know, we were . . .
And
there’s more to come. I can tell you that as well. I can’t get into details,
but there is more really good and exciting news to come, building off of the
successes that we have seen that started with an ownership position in a saw
mill. That has cascaded over the last 25 years into being really an economic
leadership role beyond even just the forestry sector into power production and
other components. You know, Flying Dust has a solar energy production facility.
This is all possible because of that initial equity position into a natural
resource generating sector.
So
your question about what the future looks like. The future is going to look
like that. That’s what the future is going to look like. And it’s not just
going to be forestry. It’s going to be energy. It’s going to be other elements
of the economy.
And
that’s precisely why we moved with the Indigenous Investment Finance
Corporation, because it doesn’t have to be starting at the very top of that
pyramid. It’s going to start at the bottom. It’s going to start with positions
in projects that are going to lead to further economic opportunities, and it
doesn’t all happen overnight. It happens with work and it happens with
commitment. And it’s built on long-term partnerships amongst folks who trust
each other and understand that everybody is working in the same direction for
the same outcome. That’s why we’ve seen success in the Northwest.
Ms. Nippi-Albright: — Okay. Thank you for sharing that,
what’s going forward. I know you referenced the forestry piece a number of
times and kind of the success that you’re having with that with the partners.
[18:00]
I
know that I have and probably my colleague here has received many emails,
telephone calls regarding consultation in there and that it’s not going in a
way that’s respectful. So I’m just wondering, like, when you’re thinking of
your vision for Indigenous people, respecting Indigenous people with these
projects, how is that looking in terms of what kind of targets do you have for
achieving your goals of this, including Indigenous people in this economy and
economic reconciliation?
Hon. Mr. J. Harrison: — Yeah, I mean kind of the specifics
around consultation, I mean that really is, kind of, not in our bailiwick. But
you know, the reason I talked about forestry was really to illustrate a broader
direction that we’re seeking. So I mean the specifics really would be probably
better put in Government Relations on that.
Ms. Nippi-Albright: — Yeah. No, I brought it up
. . .
The Chair: — We also seem to have jumped to Trade
and Export.
Ms. Nippi-Albright: — Yes.
The Chair: — So if we can bring it back to the
vote with regards to SRC and the funds that are being expensed there, that
would be great.
Ms. Nippi-Albright: — Yes, so I just took your lead there,
following you. So just it’s interesting how, you know, we talk about
. . . And it’s good that there’s some initiatives coming forward
where Indigenous people are not an afterthought, and that they’re engaged from
the onset, like MLTC. And I just want to talk about . . . And it’s
wonderful the work that they’re doing and the leadership that they have taken
in partnering with the government.
I’m
just wondering how other Nations, and do you have a target, do you have a
timeline of how many Indigenous communities will be part of these initiatives
of SRC?
Hon. Mr. J. Harrison: — Well you know, I would say that as
far as the initiatives that we’re undertaking, you know, I think we talked
about what some of those are and the eVinci project being one of them. You
know, we really view it as being a very important part of what we’re doing
going forward. And you know, our record shows that, I think, clearly on
accelerated site, on CLEANS.
On
eVinci, I think I’m hopeful we’re going to have some really good news on some
of this, which again I can’t really get into the details of. But it’s a really
important part of how we approach these questions and how we work on
partnerships and how we, really from the very inception of a lot of these
things, have sought to find partners who have often just come forward of their
own volition saying, you know, this is an area we’re interested in; we want to
be a part of what you are up to as government, whether it be through SRC or
whether we have some of these interests funnelled through other departments in
government.
You
know, a lot of it has been folks who want to be a part of how we develop the
economy going forward. So that’s going to continue to be the case. You know,
parallel to a lot of that, I mean there obviously is a formal process for
consultation and for discussion and there’s a formal way of doing it too.
You
know, I’m really a believer in having that ground-level collaboration with
everybody having a stake in a positive outcome, a successful economic outcome
in these things.
Ms. Nippi-Albright: — So do you have . . . Would
you be able to share kind of, I don’t know if it’s a report, but just kind of
where you started in terms of Indigenous engagement in SRC or other
initiatives, where you’ve started, where your target is, where you are to date,
how many . . . Do you have something? Like I’m a visual person. I
like to see graphs, you know, and I’m sure there’s other Indigenous people also
would like to see something like that rather than just hearing it.
Sometimes
they also would like to look at some of the data as well and also whether it’s
a picture, a graph of some sort saying, this is where we started; this is what
we’ve done. Like here’s our five-year term, you know. Here’s our short-term,
long-term, mid-term evaluation of how we achieved our target measures regarding
Indigenous engagement with respect to the Saskatchewan Research Council. Is
that something you’re able to provide?
Hon. Mr. J. Harrison: — Yeah, what I would say is we’ll have
some discussions maybe with our partners and what that might look like. I don’t
have anything to put in front of the committee here right now, but I appreciate
where you’re coming from on this. And that’ll be a discussion we’ll have
internally on what something like that might look like.
Mr.
Hill:
— As a note, we have an Indigenous relations policy, an Indigenous engagement
policy, as well as an Indigenous procurement policy. Within those we don’t have
specific metrics set out, but we do have policies in place with regards to
that.
Ms. Nippi-Albright: — So then with those policies that you
have in place and the measures that you have there and the desire to achieve
that, how do you evaluate the effectiveness of your well-laid-out plans and
policies? How do you evaluate that to say that yes, we’re doing exceptionally
well here, and here’s an area that we need to improve on. How do you evaluate
yourself?
Mr.
Crabtree:
— Couple of things here is that . . . When you evaluate yourself, you
tend to give yourself five stars. So the way we evaluate is go and talk to our
clients, which include the Indigenous communities that we’re working with. So a
lot of this is actually just discussing and saying, how are we doing? What are we
doing right? What are we doing wrong? What can we do better? And we’ve done
that through the entire CLEANS project, as we’ve discussed; through ASCP, the
site-closure program; the AMP program. Those 25 individuals, we talk to them
and say, what did we do right? So it was a process of continuous improvement.
There’s
something else I wanted to say here is that we’re at the start of a really
exciting development of new energy minerals and new energy systems, and we’ve
talked a little bit about lithium and we’ve talked about rare earths. These are
new sectors. And in the Indigenous communities that we’ve talked to and intend
to talk to just in coming months and throughout the rest of this year, they’re
starting to lean into this because these are new sectors where there are new
opportunities for investment and, you know, social and economic engagement with
these. So we’re at the early stages of that.
So
what we’ve done — and this has been a very significant financial commitment for
SRC — is at the 51st Street site we have built what we call tech bays, so a
10,000‑square-foot space looking at nuclear. And our intent will be to
bring a very significant number of Indigenous groups through that tech bay this
coming year. And we’ve also got about a 5,000‑square-foot space which is
focused on rare earths. And one just will come online in the next couple of
months on lithium.
These
are very visual. They are with models and they are designed very specifically
to be able to communicate not only baseline engagement but opportunities in
terms of investment for those communities. And those have been in place now for
well over six months. We’ve had a number of communities through that. And what
that does is it gives them the baseline knowledge and education to be able to
understand whether this is a need and a desire for them to engage with it or
not.
So
we’ve also engaged with, and have for many years, FSIN [Federation of Sovereign
Indigenous Nations], the . . . Sorry, my brain’s gone dead. FSIN
. . .
Ms. Nippi-Albright: — Federation of sovereign Indian
Nations.
Mr.
Crabtree:
— Yes, thank you. My brain went . . . Lack of glucose. And First
Nations Power Authority as well, have both been through these tech bays and are
looking at opportunities for their membership in these spaces.
Ms. Nippi-Albright: — You know, we talked a lot about and
you’ve also given a lot of information about the engagement you have done with
First Nation communities. And I guess when I talk about Indigenous communities,
I’m always talking about First Nations and Métis. And often when I talk to
mainstream folks and I talk about Indigenous people, they automatically
gravitate to First Nation only. And I apologize that I didn’t . . . I
should actually have said, talked about First Nation separately from Métis. So
what I would like to know is how many Métis locals and settlements in the
North, with the uranium remediation, have you worked closely with and have
engaged with?
Hon. Mr. J. Harrison:
— Yeah, I mean I fully understand the challenge sometimes with those who are
maybe not from the area get confused a little bit on occasion. But I mean, it
being primarily First Nation right holders in the North, that really on CLEANS
would be the communities we were working with. That being said, I mean it’s not
exclusively First Nation and we try and really make a point of ensuring that
all of the communities that are impacted are engaged, whether they be First
Nation, whether they be Métis, but you know, obviously primarily First Nation
in the CLEANS sector. You know, outside of that though, I mean we work hard.
And I would say just kind of, if you’re
talking uranium or nuclear, it wouldn’t be just even government. I would say
the companies that are operating in the North, you know, make a concerted effort.
You know, Cameco obviously, you know, would probably be well known for some of
the efforts that they have made as a company to work with northern communities,
northern leaders.
You know, whether that be Pinehouse or
whether that be, you know, Black Lake, they I think would have been
. . . I can’t speak for Cameco by any stretch, but I know that they
make a real effort to engage. And I think it’s not just Cameco, but some of the
other companies work hard at doing that as well. So again, because I think that
there is a view that engagement leads to better outcomes, and I think it’s been
proven.
Ms.
Nippi-Albright: — So do you have, I guess, any plans
to create some target measures in terms of where you would like to see yourself
in terms of engaging First Nations and Métis, in particular Métis communities,
in the initiatives you have? And also regarding procurement, do you have like
target measures that you say, okay, we want to have 50 per cent procurement to
Indigenous-owned organizations, or something like, just something like that?
Do you have any plans of creating
something like that for yourselves as an accountability measure with your
organizations to say, here’s our plan, this is what we envision that we want in
terms of engagement, as partners, as employees that we have, as procurement
that we’re offering? Do you have any plans of ever doing that?
Hon.
Mr. J. Harrison: — I mean I would say kind of just by a
general statement, we do have policies on a number of these matters that Ryan
can maybe speak to that to a degree. But you know, as a kind of overarching
general statement, I mean we’re seeking to maximize engagement. We want to make
sure that Indigenous folk, Métis and First Nation communities have, and
companies and governments have opportunity to participate.
[18:15]
That’s
why when we set up the Indigenous Investment Finance Corporation, it’s not just
First Nation; it’s including both on the board and as far as application,
opportunities for all Indigenous people.
I’d
say as well just on procurement, very deliberately, it’s got very little
attention, but we have actually taken an exemption in both the Canada Free
Trade Agreement and the New West Partnership Trade Agreement to allow for
preferential procurement for Indigenous companies from Indigenous companies.
You know, we get criticized on occasion, saying well you have 12 exemptions and
14 exceptions within the CFTA [Canadian Free Trade Agreement] and NWP [New West
Partnership]. Well that’s why. A number of them relate to, the exemptions that
we took actually relate to procurement from Indigenous companies, so a very
deliberate decision that we had taken. I was the minister when we took these
decisions and it was for this very reason.
Ms. Nippi-Albright:
— So I know you just talked about this and I’m going to go into this, the
Indigenous investment funds that you have. Do you have plans of putting more
money in there? Because he went into it. Sorry.
Hon. Mr. J. Harrison:
— So I would say . . . I’m sorry. I brought it up, Madam Chair, so
I’ll . . .
The Chair:
— I know you did, but it doesn’t belong to SRC and the vote that’s on the
table.
Hon. Mr. J. Harrison:
— Yeah, so okay. I’m ruled out of order. Sorry.
Ms. Nippi-Albright:
— So Métis investment, that is . . . Because I know that and I, you
know, have to remind myself always to be cognizant about my Métis brothers and
sisters and the challenges they face in terms of participating in the economy.
So how, like what Indigenous communities or locals or settlements have you
successfully engaged, whether it’s in partnership or procurement or employment?
Hon.
Mr. J. Harrison: — Yeah. I mean, well just kind of
thinking right off the top of my head, when we did the announcement with
Minister Vandal a few weeks ago, Mike Natomagan was down from Pinehouse to be a
part of that announcement. You know, we work hard and, you know, we want to
make sure that we have northern communities that are aware of what we are doing
at SRC. I mean it’s not always, you know, particular to communities right along
that Highway 155 corridor, because what we are doing is really kind of up
further north on the CLEANS stuff. And some of the other commercial projects
that we’re doing are, you know, around diamond assaying or whatnot. I mean
that’s, you know, kind of the stuff we’re doing at the lab in Saskatoon.
But I would say that we always kind of
keep an eye open to make sure that if there are relevant opportunities for
communities, that we fully explore those. So you know, whether that’s in that
nuclear space — you know, we canvassed some of that already — where it makes
sense, we’ll continue to do that.
You know, I don’t want to kind of get
way off again — sorry, Madam Chair — across into other ministries to either ICT
[Immigration and Career Training] or whatnot, but I can say that
. . . And if I were to speak to that, I could probably take another
10 minutes talking about some of the other initiatives to engage communities
that we are taking very seriously in other areas for which we have responsibility.
Ms.
Nippi-Albright: — Thank you. You’ve talked about that
you’ve engaged FSIN, right, our federation of sovereign Indian Nations. Did you
also . . . Have you engaged the Métis Nation of Saskatchewan as well?
And how often do you meet with them in terms of bringing them into the economic
reconciliation?
Mr. Crabtree:
— I think in answer to that, we’re very responsive to those organizations.
Quite often they will contact us and say, we’d like to discuss . . .
we’ve heard about this particular initiative; can you come and explain this to
our leadership? And we’ll have an initial conversation and then often bring
them to SRC to talk in a wider sense.
The large projects that we’ve talked
about that are “historical,” the CLEANS project and the ASCP project, were very
driven by the geographical areas that we’re required to operate in. As we move
into some of these other opportunities — and we’re talking about the lithium
and the nuclear and the rare earths, which are really new; it’s really in the last
year that these have started to ramp up — I think that the challenge will be
for us to be able to reach out and engage effectively across both First
Nations, Métis, wider Indigenous, non-Indigenous, based on where these newer
sectors are going to be operating.
So I think we’re starting a different
phase of our engagement, which is going to be much broader, which is why we’ve
invested in these large tech bays. And I would encourage you, if you have the
opportunity, come and visit us at these tech bays. I think you’d find it
interesting. And we’ve had Métis Nation . . .
Hon.
Mr. J. Harrison: — Yes, MNS [Métis Nation of
Saskatchewan] have been through, you know, as have actually . . . I
think Mélanie Joly was through, right?
Mr. Crabtree:
— Yeah.
Hon.
Mr. J. Harrison: — Mary Ng was through — Minister Joly,
Minister Ng.
Mr. Crabtree:
— In February.
Hon.
Mr. J. Harrison: — Yeah, okay. Yeah. So we do that from
SRC’s perspective. But I would just say too again without getting too far
outside, I mean view it just not as SRC but as a whole-of-government approach
to engagement.
So you know, I look forward to talking
about it in detail at TED [Trade and Export Development] or ICT estimates, but
you know, we take this engagement and the inclusion and how we can work with
communities really seriously on kind of engagement and preparing for
opportunities that might exist into the future, whether that’s through job
training, whether that’s through, you know, advanced education or college
system. But it really all works together. It’s not just kind of a stand-alone
silo, whether it be SRC or TED or ICT or Advanced Education. It’s really
something that we take seriously about having a whole-of-government approach,
making sure that the right solution is at hand for the right time and the right
group.
Ms. Nippi-Albright:
— So just my last question because I’m going to run out of time here. So just
with Mike, just question with Mike and with SRC. You know, there’s all these
exciting initiatives that you guys are taking on and you’ve already identified
that it could be a challenge in reaching out to as many people in a short time
frame. Will you be considering or intend to have a proactive approach to engage
Métis locals that are within the vicinity of wherever the activity’s going to
happen? Is that something that your board and your management . . .
is that something that could be looked into? Rather than a reactive of letting
people come to them, is there a proactive approach that you are willing to engage
in to identify First Nation, and I’ll say more so Indigenous community?
Mr.
Crabtree: — In answer to that I think in a lot
of the initiatives that we’ve been talking about this evening there is actually
a regulatory requirement for us to reach out. So as a baseline there is a
regulatory requirement in a lot of these cases.
And what I think we do quite well is to
be able to, as Ryan said before, go over and above that because we want to talk
about not only the regulatory-based engagement, but what are the opportunities
that these new sectors provide to the local communities.
So one of the things we want to do is
. . . I keep mentioning these tech bays that we’ve created at 51st
Street. What we’re looking very actively now is how do we take these on the
road. How are we able to take the same sort of impact for messaging to local
communities.
Ms.
Nippi-Albright: — So will you be prepared to give the
list of the Métis locals and settlements that you’ve reached out to already?
Mr.
Crabtree: — I think the one we’ve reached out to
at the moment is . . . It’s Métis Nation. And I think that
. . . I hate to kick this forward a year but I think, you know, in
the discussion that we’re having around this table, next year hopefully we’ll
be able to sort of say, you know, it’s gone up by a very, very significant
factor. And I think what we will do is we’ll make sure that we keep — and we do
— keep very effective records on who, what, when, on that.
Ms.
Nippi-Albright: — Thank you.
The
Chair: — Time for one more.
Ms.
Nippi-Albright: — One more question? Well, okay. What
question shall I ask? No, I just want to say . . .
The
Chair: — Or if other members have a question
they would like to ask? We can open it up.
Ms.
Nippi-Albright: — I just want to say thank you for taking
this time to give the information and to also take away from your family,
giving up your suppertime, and just taking this time to answer the questions
that I’ve asked.
And I just want to say thank you so much
for this opportunity. And I’ve learned a lot about your process and also your
plans in terms of the dollars that you’ve allocated here. So I just want to say
thank you so much for giving me the time. Thank you.
The
Chair: — Minister, if you have closing
remarks you may go ahead too.
Hon.
Mr. J. Harrison: — Sure. Thank you. I appreciate those
comments; I really do. And I just want to kind of maybe take the opportunity —
I don’t get to do it enough — to really thank our team. Mike, thank you. Leads
our team at SRC, does a remarkable job, leads with integrity, leads with
extreme skill and competence. Thank you, sir. We’ve got the chance to work
together for many years.
And I’ve learned a lot as well, largely
through these folks that are around the table here today. Ryan, thanks so much.
We’ve got to work together for many, many years as well. And through both of
you and Jocelyn, to our team at SRC, who are doing work that really is going to
change what the future of this province looks like, genuinely is going to
change what the future of this province looks like. So thank you for all of
that, and thanks to our team.
The
Chair: — Thank you. Tough keeping both of you
on task as to the topic of this evening. But having reached our agreed-upon
time for consideration of these estimates, we will now adjourn consideration of
the estimates and supplementary estimates no. 2 for Saskatchewan Research
Council.
We are adjourned. Oh, we’re recessed,
sorry. Recessed until 7:30 p.m.
[The
committee recessed from 18:28 until 19:30.]
The Chair: — Welcome back, everyone, to the
Standing Committee on the Economy. I’m Colleen Young, chairing the meeting this
evening. And we have, sitting in for Jennifer Bowes, Mr. Trent Wotherspoon; and
in for Aleana Young, Mr. Doyle Vermette. Members also appearing this evening
are Ken Francis, Delbert Kirsch, Greg Ottenbreit, and Doug Steele.
General
Revenue Fund
Highways
Vote 16
Subvote
(HI01)
The Chair: — Welcome back. And we will now
consider estimates and supplementary estimates no. 2 for the Ministry of
Highways. We will begin with vote 16, Highways, central management and
services, subvote (HI01). Minister Carr is here with her officials. And I would
ask officials to please state their names the first time speaking into the
microphone, and Hansard will turn your mike on for you when need be.
Minister,
you can introduce the officials you have brought here with you this evening and
present your opening remarks.
Hon. Ms. Carr: — Great. Thank you very much. I am
pleased to be here to share some highlights from the ’24‑25 provincial
budget for the Ministry of Highways. Tonight I have here with me my chief of
staff, Josh Hack, who’s in the back row there. And then I have Kyle Toffan, my
deputy minister; Tom Lees, assistant deputy minister of operations and
maintenance division. Right behind me, Wayne Gienow, assistant deputy minister
for design and construction division. Beside me, Ryan Cossitt, assistant deputy
minister for policy, planning and corporate services division. Back here to my
left is Karri Kempf, executive director of corporate services branch; and
behind me Dave Munro, director of strategic planning and budgeting.
The
provincial budget provides record investments in our province’s present and
future, with a focus on education, health care, and the well-being of our
communities. Saskatchewan’s strong economy enables our government to invest in
programs and services for our residents that they need and deserve.
Transportation
plays a pivotal role when you consider these two points: first, it’s how we
safely get to and from services and activities that ensure our quality of life;
and second, it supports our province’s strong and growing export-based economy.
In other words, our government continues to make strategic transportation
investments that enhance safety, enhance our citizens to access what they need
and enjoy, and support economic growth that keeps Saskatchewan strong.
I
would like to spend some time focusing on the details. The highways budget for
’24‑25 invests $741 million in road safety while improving key
transportation corridors to continue to meet the growing needs of
Saskatchewan’s families and communities. It provides 404 million for
capital projects.
Our
government has invested more than $13 billion in transportation since
2008, improving more than 20 700 kilometres of highways across the
province. In meeting our Saskatchewan growth plan goals, this year we will
improve more than 1100 kilometres of highway, the fifth year of our 10‑year
growth plan goal to build and upgrade 10 000 kilometres. We have delivered
more than 5900 over the first five years of our 10‑year plan. That’s well
ahead of the pace needed to meet our target.
Major
projects are essential in supporting Saskatchewan’s export-based economy. Our
shipments rely on timely and predictable access to world markets. Ensuring our
transportation network is safe, reliable, and resilient is top priority. We
continue to make improvements to strategic transportation corridors around the
province. This year, we’re investing 56.5 million to continue multi-year
projects that increase safety and improve traffic flow. Those projects include
twinning and passing lanes on Highways 6 and 39. This is a strategic corridor
that connects Saskatchewan to our largest international trading partner.
Corridor
improvements on Highway 5 east of Saskatoon. This is the corridor that will
improve connection to and from our largest city and the largest potash mine on
the globe. We will also keep working on significant safety measures that we’ve
been implementing for several years. A key part of these safety measures will
be our ongoing passing lane strategy. We’ve built more than 50 sets of passing
lanes over the past decade. Upcoming projects include Highway 10 east of Fort
Qu’Appelle and Highway 17 north of Lloydminster.
Planning
work will commence soon on other high-priority highways as well. This will
continue to improve safety in transportation corridors across Saskatchewan. It
will also make it easier and more efficient for shippers to export their
products to more than 160 countries around the globe.
We
are making targeted investments to improve intersection and corridor safety,
which enhances road safety. We will continue to make improvements that will
help reduce fatalities and injuries, building on our recently completed
five-year $100 million safety improvement investment program. This year we
will invest $17.6 million through our safety improvement program for
improvements in intersections, guardrails, lighting, and other assets. These
investments are an important part of our strategy to protect Saskatchewan
people and communities.
And
of course we will continue to invest in road improvements across the province.
Our government understands the importance of these investments in supporting
growth and keeping people safe. We’ve invested more than 13 billion over
15 years to improve more than 20 700 kilometres.
This
year we will improve 1100 kilometres of highways, including 260 kilometres of
repaving, 365 kilometres of medium treatments like micro surfacing, 400
kilometres of pavement sealing, 58 kilometres of thin membrane surface and
rural highway upgrades, and 25 kilometres of gravel rehabilitation. Rebuilding
and preserving over 26 000 kilometres of highway network preserves our
high standard of living. These improvements also ensure Saskatchewan shippers
can continue to compete on a global scale.
We
also continue to invest in bridges and culverts. We’ve allocated
59.3 million to repair or rebuild 17 bridges and roughly 100 culverts
across the province. The largest of these investments is the replacement of the
Highway 6 bridges or overpass at Regina’s Ring Road. These bridges are the
major southern entrance to Saskatchewan’s provincial capital and connection to
the Trans-Canada Highway.
One
important part of that project is we’re raising the height of the overpass by
more than half a metre, which will benefit farmers and shippers who need to
move larger equipment to keep pace with industry standards and efficiencies. We
hope that will eliminate incidents where their overpass has been hit by
over-height loads.
Since
2008 our government has made significant investments to maintain and operate
the northern transportation network. We will continue our commitment to
northern Saskatchewan in this year’s budget by investing more than
$73 million. This includes 16 northern airports that we operate and
maintain, the ice roads we build in the winter for the benefit of communities
and businesses, the Wollaston Lake barge we operate in the summer, and the thousands
of kilometres of roads we maintain that connect northern Saskatchewan
communities to the rest of the province. This network gives people access to
jobs, health care, education, and public safety services. It connects them to
friends and family and our growing provincial economy, including critical
minerals and forestry.
Some
highlights of this year’s northern investment include continued improvements to
Highway 155 north of Buffalo Narrows, and gravel improvements on Highway 924
south of Sled Lake, and Highway 916. We will also complete Saskatchewan’s
portion of the Garson Lake road, accomplishing a long-standing commitment of
our government. This road connects northwest Saskatchewan to northern Alberta,
improving safety and access to economic opportunities.
Our
government understands the significant impact our municipal programs have in
supporting rural Saskatchewan which contribute to the success and growth of
this province. With this budget our government is investing over
29 million to support municipal and industry partners making strategic
transportation investments. This includes 17.4 million for rural
integrated roads for growth program to improve and maintain rural roads and
bridges. This represents a 2.4 million overall increase with a one-time funding
increase of 1 million for capital projects and 1.4 million to operate
and maintain corridors for heavy trucks.
We’re
also investing more in our urban connector program with 8.6 million to
improve and maintain community roads that connect to our highway network. This
includes a one-time funding increase of 2 million for capital projects.
Connecting our communities is essential in supporting Saskatchewan’s economic
growth.
And
we also have our community airport program supporting Saskatchewan’s growth and
economy. In Saskatchewan, aviation supports tourism by bringing visitors to our
province, aids the resource sector by transporting employees and equipment to
mining operations, and assists agriculture by enabling farmers to efficiently
manage their crops. Aviation also enhances quality of life by connecting air
ambulance to rural communities to move patients and providing air services for
policing to protect communities.
Recognizing
this, we will continue to support our community airports. That includes an
$850,000 investment in our community airport program to continue support for
community airport improvements. When combined with the matching community
funds, this is a total investment of 1.7 million to priority local
airports. Since 2008, 43 communities have made more than $10 million in
improvements under this program.
Our
budget also includes funding for shortline railways. They are an important
connection for farmers and industry to get their products to port. Saskatchewan
has 21 000 kilometres of shortlines run by 13 operators. Every one of them
receives a proportionate share of funding for track maintenance and
improvements. They are also an important part of preserving our roads by more
efficiently moving heavy bulk goods on our shortlines. This year we’re pleased
to continue our $530,000 investment for short line railway improvement program
for critical safety improvements and operational maintenance work.
In
conclusion, the Ministry of Highways is proud to play its part in supporting
the government’s overall vision for Saskatchewan. More people and more jobs
provide additional opportunities to invest in classrooms, care, and
communities. We are making strategic investments in transportation corridors
and highway safety to support our people and our growing economy. With these
investments, we will ensure Saskatchewan continues to be the best place in
Canada to live, work, and raise a family, and that all roads lead to prosperity
for this new decade and beyond. Thank you. I look forward to some questions.
The Chair: — Thank you, Minister. I’ll open the
floor to questions from members, and I’ll recognize Mr. Wotherspoon.
Mr. Wotherspoon: — Thanks, Madam Chair. Thank you,
Minister. Thank you, officials here tonight. Thank you to all those that are
involved in the work of highways and transportation across the province. All of
you are involved in a very important undertaking with respect to
transportation, our highways, our rail, our shortline, our airports, and so
much more. So thank you for all your efforts and all those that are involved in
that work across the province.
A
bit of a technical question on the financing side, just to start here. When the
province borrows money to support the construction of highways in the province,
are the funds borrowed matched directly with the highways such that your
financing charges will remain the same in the life of the asset? So is the
borrowing specific to the project so that the borrowing, the financing, will
remain the same through the life of the asset?
Hon. Ms. Carr: — Thank you so much for that question.
With regards to borrowing, our ministry doesn’t actually do any borrowing. So
any questions regarding how that would happen would be directed to Finance.
Mr. Wotherspoon: — Okay. Just a question with respect
to the line here, with respect to P3 [public-private partnership] finance
charges adjusted to opening accumulated deficit. Now in ’23‑24 there was
an adjustment of 28 million there, but not in the current year. I’m just
wanting to get a sense of what that’s all about.
[19:45]
Hon. Ms. Carr: — Thank you very much for the
question. I’m going to turn it over to Ryan Cossitt to address that for you.
Mr.
Cossitt:
— Thanks. Good evening. Ryan Cossitt, ADM [assistant deputy minister] of
policy, planning and corporate services. So that is a one-time change. It’s a
piece that accounting changed from the Public Sector Accounting Board. That
value is, I believe it’s $28.7 million. It was a one-time adjustment based
on a different calculation according to accounting standards.
Mr. Wotherspoon: — Thank you. In relation to highways
projects that would be P3s, does the interest rate on the P3 financing change
or those charges vary over the life of the agreement?
Hon. Ms. Carr: — And this time I’m going to turn it
over to Kyle to answer.
Mr.
Toffan:
— Kyle Toffan, deputy minister. The amount that the province pays the project
co, in the case of P3 projects, stays the same. They’re called monthly service
payments or annual service payments, depending on whether you’re talking months
or years. That stays the same. And how much we pay for principal and interest
is at their risk. So we pay them a certain amount for operations, maintenance,
rehab, and debt servicing, and how they service their debt and how they deal
with that is on them.
Mr. Wotherspoon: — So within the P3 arrangement, you
have your costs that are fixed there, and the interest rate itself isn’t a
component within that agreement? That’s the vendor that takes that risk on?
Mr.
Toffan:
— Yeah, that’s essentially right. So they have equity and they have debt on
their side, and they determine how best to finance the project. And you know,
there are fluctuations but it’s at their risk.
Mr. Wotherspoon: — You touched on the different
components of the resurfacing this last year or the forecast for the year
ahead. Could you just break down again what was completed last year? The
various components, the amount of kilometres. So whether that’s, you know, a
major project or whether that’s resurfacing or whether that’s the
. . . well I guess some of the other processes, what, medium surface
repaving — medium treatment, sorry — light and engineered seals. Breaking down
those components for last fiscal and then the forecast for this year.
And then where I would go with it as
well is, I’d appreciate the price per kilometre that you’re working with for
both last fiscal and forecasting for this one.
Hon. Ms. Carr: — Okay. So as far as kilometres go and
the types of projects and treatments we’re going to be doing, we have the major
projects like the twinning and the passing lanes. And in ’23‑24 we
planned five. We forecasted that we’d be doing 17. And for ’24‑25 we’re
planning for 19.
Rural
highways or the thin membrane surface. In ’23‑24 we planned for 115 and
we’re forecasting that we’ll have actually done 128. And in ’24‑25 we’re
planning for 58.
Repaving.
In ’23‑24 we planned for 230, and we’re forecasting that we’ll get done
192. And for ’24‑25 we’re planning for 260.
Medium
treatments. In ’23‑24 we planned for 300. We think we’ll be done 321. And
in ’24‑25 we’re planning for 365.
Then
we have the light engineered seals. In ’23‑24 we planned for 340, and we
think we’re going to be done 405. And in ’24‑25 we’re planning for 400.
Gravel
rehabilitation. We planned for 35 and we’re forecasting to be done 42. And ’24‑25
we’re planning for 25.
And
then you asked for the price per kilometres. So for light seals, there’s two
types. There’s the engineer-graded aggregate seal. It can be anywhere from 65 to
$85,000 a kilometre. And we have the racked-in chip seal. It can be anywhere
from 80,000 to 90,000 a kilometre.
The
medium treatments, we also have two types there. We have the micro surfacing,
which can cost 90 to $150,000 a kilometre. And then we have the thin overlay,
which can cost anywhere from 170 to $300,000 a kilometre.
Repaving,
we have three types there: repaving the mill and overlay, 425 to $625,000 a
kilometre; or repaving reconstruction, 1.1 to 1.2 million; and then we
have the TMS, the thin membrane surface rehab, which can be anywhere from 100
to $200,000 a kilometre.
For
gravel rehabilitation, it can be anywhere from 400 to $600,000 a kilometre.
With
the TMS rural highway upgrade, we have two types of treatments: the
strengthened secondary road, which can be 500 to $750,000; and we also have the
thin membrane surface to primary weight upgrade, which can be anywhere from a
million to 1.5 million.
And
then we have our major projects. We have the passing lanes, per set is 3 to
3.5 million per kilometre. And then we have the twinning, which is 4 to
$6 million per kilometre.
Mr. Wotherspoon: — Thanks for having that information
ready and available. I’ve got pretty good notes on everything. Can you just
give me the gravel number again? I was scratching down the number
. . . [inaudible] . . . 400 to 600.
Hon. Ms. Carr: — 400 to 600,000.
Mr.
Wotherspoon:
— That’s what I thought, yeah. Got it here. Thank you. And can you describe
what sort of inflation each of these components have? You don’t have to break
out each individual one, but just some of the trends that you’ve experienced
over the last five years on this front.
Hon. Ms. Carr: — Great. Thank you for that question.
Over the past couple of years we’ve seen our projects increase up to 20 per
cent approximately. And then just over the past six months, as we’re watching
some tenders and stuff come in, it seems to have stabilized. It doesn’t seem to
be going any higher at this point in time.
Mr. Wotherspoon: — And 20 per cent over the last couple
of years, you’re saying?
Hon. Ms. Carr: — Yes.
Mr. Wotherspoon: — And what would you say over like a
five-year period, do you think? I’m sure you track that.
Hon. Ms. Carr: — So over the years it’s been pretty
consistent. So it’s really just that past couple of years where we’ve seen that
increase, and now it’s stabilizing at that level.
Mr. Wotherspoon: — So when you say consistent before
that, so a lower rate of inflation on the years prior to that? So it was 20 per
cent in the last two, and before that then were you experiencing 2 per cent, 3
per cent, 4 per cent, 5 per cent annual?
Mr.
Toffan:
— It’s not really that precise, but over the past five years prior to the
two-year period we talked about, you know, we had some years that we had dips
actually during COVID when we were looking for, our industry was looking for
work to do. And we did put stimulus on the market at that point in time. So we
were getting things like, you know, 2 per cent higher, 2 per cent lower, those
kind of ranges. Kind of like CPI [consumer price index] would be, in that
range, that StatsCan produces data on.
Mr. Wotherspoon: — That’s good. Well thanks for that
information. Could you describe what happened with the major projects in the
previous fiscal year? You described that 17 were forecast and that five were
completed.
[20:00]
Hon. Ms. Carr: — So I’m not sure if I misspoke or if
you wrote it down wrong, but we planned for five and we actually finished 17.
So we’ve . . .
Mr. Wotherspoon: — You know what? I wrote it down the
other way or maybe you presented it the other way.
Hon. Ms. Carr: — It’s very possible. But yeah, we
just got more work done than we had anticipated, some on Highway 5 and some of
the passing lane work.
Mr. Wotherspoon: — Thank you. Thank you for that. And
what was spent on winter highway maintenance in the previous year? I suspect
that nowhere near what was budgeted. And then how were those dollars utilized?
Hon. Ms. Carr: — You’re comparing ’22‑23 to ’23‑24?
Mr.
Wotherspoon:
— I’m just looking for ’23‑24, the previous fiscal year.
Mr.
Toffan:
— So I’m just going to provide some numbers here on winter maintenance. ’22‑23,
I’ll use that kind of as a starting point. So the budget for that year was
37.237 million, and then the actual was 65.551 in millions of dollars.
In
’23‑24, our actual, it’s still being worked out. So our budget was
42.237 million. Our actual is in the range of 59 to 61 million. We
don’t have exactly what that is. We’re still closing out the fiscal year. And
of course our budget is $52.237 million in ’24‑25.
And
just one additional point I want to make. We have steadily increased this
budget since ’21‑22 fiscal year, which was around 29.7 million. It
was $37.2 million in ’22‑23, $42.2 million in ’23‑24, and
then 52.2 in ’24‑25. So we’ve steadily been increasing it. Actually last
year was a jump of about $10 million.
Mr. Wotherspoon: — Thanks. And so actually 42 was
forecast this year, and it looks like right now the year was budgeted and right
now it’s forecast as closer to 60 million, 59 million. The budget
this year is 42 million, which is . . . No, the budget this year
is . . .
Mr.
Toffan:
— 52.237, yeah.
Mr. Wotherspoon: — Okay. So less than what was spent
last year. Now the auditor has been weighing in on this for a number of years.
Has the auditor’s recommendations factored into some of the adjustments that
have been made on this front?
Mr. Toffan: — Yeah, so we have had this come up at
Public Accounts recently where we did talk about wanting to, you know,
obviously increase the budget which has been done this year to better align to
actuals. I think the reality of the situation of our budget though is that it
fluctuates so much on the capital side as well. So lots of years we’ll spend
less because of heavy rainfall, those types of things. So we have the ability
to move money from different parts of our budget to maintain this winter
maintenance budget.
Mr. Wotherspoon: — It actually seems surprising a bit
that the forecast number is 60 million to be spent in the previous year.
You know, by all accounts it seemed that that was a lighter winter, less snow,
but I know there’s lots of activities that are involved. So you just question
whether or not, if we had a more normal winter next year, question the adequacy
of the budget. But in the 50 million, that’s forecast there. But, yeah,
any comments, Minister?
Hon. Ms. Carr: — Yeah, I would like to just comment
on that. I think we might have had a bit of a lighter winter; I would agree
with that to a certain extent. But last spring we had some fairly significant
snow events in April and May in different areas of the province. And not just
on one occasion; I believe there were three separate occasions between the
Southeast and the Southwest. It didn’t all happen at the same time.
So
those significantly affect what happens with our budget. And wouldn’t we all
like to predict the weather? It would make life much easier for all of us.
Mr. Wotherspoon: — No, good comments. When I was
thinking of the winter behind us, you’re right, April last year was in this
fiscal, and certainly we had snow then. I think everyone would maybe welcome
rain right now, but they’d take snow as a second place for moisture right now.
Looking
at the actual capital budget itself, now it’s down $25 million here this
year, which is quite a bit, hey, when you look at where capital budgets had
been and the need out there. And then if you build in that inflation as well,
knowing the fact that the last two years alone it’s costing 20 per cent more to
build out the infrastructure, those dollars aren’t going real far.
I
guess, could you speak to . . . I know many in the industry and those
that understand, you know, the surfacing program and the projects that need to
be rehabilitated, have really weighed in with concerns and questions with the
very limited capital budget and the cut this year.
Hon. Ms. Carr: — So I’m just going to go really high
level to start with, and then I’m going to turn it over to someone that can get
into the details for you.
But
I mean the premise of the question is you said that there was a cut. And there
absolutely has not been a cut within this budget. We have provided stimulus
funding over the past couple of years, which has — I don’t want to say inflated
that budget — but has added more dollars to that budget.
And
it did have to do with getting more work out there, and it was a bit harder to
call for contractors and stuff. So we added that extra work for that reason,
and they were fully aware at the time that it would not be permanent funding,
that it was stimulus funding at that point in time. So that’s exactly what has
fallen off, and we have a very stable capital budget.
But
I’m going to let Ryan address a few more of the details within that.
Mr.
Cossitt:
— Thanks, Minister. The minister did a really good job. The bulk of the answer
is the $18 million for stimulus that dropped off. We’ve successfully been
able to get a lift of $25 million over the last two years, that’s to our
base capital budget. So it had been 340, 341 historically for quite a few
years. That’s now increased to about 366. And that is our ongoing base capital
budget. We’ve also received inflation dollars of at least $30 million for
the last two years now in a row.
So
as the minister said, the difference really when you take out stimulus is less
than a million dollars this year than it was last year for overall capital. The
capital budget this year is about 403.9. If you take out stimulus it was just
around 404.2 last year. So relatively stable, I would say, in terms of the
capital budget and the amount of work that we put on the market.
Mr. Wotherspoon: — Some of the folks that have been
examining the budget that are involved in the work as well just identified, you
know, that if you go back to 2015‑16 your capital budget’s at
$560 million; ’16‑17, 470 million. And so if you then factor in
what inflation will have done over that period of time — a period much longer
than even five years, you know — a $400 million capital budget is
significantly smaller in scope and in scale in a very significant way if you
factor in inflation.
So
I haven’t heard anyone, you know, characterize this budget as a strong capital
budget. I’ve heard nothing but concerns on that front from across the province.
Has the minister heard concerns with respect to the limited capital budget?
Hon. Ms. Carr:
— I just want to I guess correct the record a little bit with regards to the
years ’15‑16 and ’16‑17. Those were exceptional years because of
the Regina bypass project and the money that was put into the market because of
that. So that was money over and above what’s normally spent in a capital
budget. If we look over the years, it has been a very stable budget.
[20:15]
And you asked specifically if this year
I’ve had any concerns from stakeholders. We had a stakeholder meeting on budget
day where we went over the highlights of the budget, and I didn’t hear anything
regarding concerns. They were thankful for the stability in the budget that we
had, and there was no decrease in our capital budget.
Of course they fully understood that
stimulus funding was exactly that, and that it would not be there going
forward. And I haven’t heard from anybody since regarding capital budget, any
concerns.
Mr.
Wotherspoon: — I understand over the last couple of
years that roughly $25 million hasn’t been spent out of the capital
program each of those years. And there’s a sense that that then contributes to
the reduction in the budget, in the capital plan in the next year. I guess
could you speak to that and why those dollars can’t be deployed to projects
that are needed?
Hon.
Ms. Carr: — Thank you for the question. And I’m
just going to start off by reinforcing that there are no cuts in this budget.
You keep saying that it’s down; it’s lower; there’s cuts. That is not the fact.
We have a very stable capital budget and
the numbers actually show that. When we talk about stimulus funding, that’s
exactly what it is. It’s not meant to be there permanently. It was there for a
purpose at that point in time and all contractors were aware that that would
not be there in the future, and they’re aware of our stable capital budget that
we have.
And when we put work on the market, we
actually, we overcommit. So we might budget $400 million for capital
projects, but we put $500 million out in the market hoping that we get
that $400 million actually spent. And this year we’re forecasting that
there will only be $9 million of work that doesn’t get done out of our
capital budget.
And there’s various reasons why capital
projects carry over, such as contractor delays, unexpected project issues, or
scope changes. The ministry’s primary reason for project delays are weather and
contractor delays, both of which pose a unique challenge for the Ministry of
Highways. Weather can impact projects in multiple areas of the province at any
given time. While weather can result in a delay to the project, it can also
result in project work being expedited. Optimal weather was one of the main
reasons that the ministry overspent our appropriation in ’21‑22, so we
actually spent more than we budgeted.
Contractor delays are not unique to
highways, but what is unique is who those contractors are. Unlike vertical
infrastructure work that utilizes many contractors across multiple sectors, the
province’s heavy construction industry are the main contractors for horizontal
infrastructure, of which Highways is the main proponent.
Mr.
Wotherspoon: — With respect to, I hear concerns just
when dollars aren’t utilized, and there’s a hope that there could be projects,
maybe smaller-scale projects that those dollars could be deployed to, to be
able to utilize the capital program. So that’s a call I continue to hear from
those that are involved in the building of the roads, and it’s why I bring it
here again this year to estimates. Thanks to the minister for some of the
information that she provided as well.
When
you’re looking at the tenders, what per cent of tenders actually hit the market
on or close to the advertised date?
Hon.
Ms. Carr: —
Okay, so with regards to the
tenders that are put out, we work with our industry and we indicate when we
think a tender may be out, and approximately just over 80 per cent of the time
we are able to meet that target date within that. But we’re just going to touch
a little bit on some of the comments that you made. So you can go ahead, Kyle.
Mr.
Toffan:
— Yeah, so we do put out fall tender packages, winter tender packages, spring
tender packages, and the point of doing that is to let the industry know that
things are coming along a certain time frame. Of course as the minister pointed
out, there is around 20 per cent of times when we don’t hit that target.
Usually it’s because of engineering taking a little bit longer or the products
a bit more complex than we originally thought and we do update the
industry as those challenges present themselves.
We are always trying to capitalize on
our budget that we have available. And I think you mentioned, you know, why not
some smaller projects put out. And we do that, especially for things like
culverts, some small bridges that are prefab, maybe those types of things,
maybe you know, we can get done quicker.
And that’s one reason why we only underspent
$9 million last year. Previous years it’s been, you know, double digits —
quite a bit higher than that — so we’re getting better. And we’re getting
better also because we’re engaging our industry partners quite a bit more than
we would have in the past, mostly our heavy construction association but also
our engineering community.
Mr.
Wotherspoon: — No, thanks for that information as
well. And you know, I’ve heard from the industry just that it’s quite
challenging when there’s a delay in a project hitting the market, and just a
recognition that that’s a real challenge. Could the minister speak to how you
go about . . . Hear concerns sometimes on communication on that side.
Can you speak to how you communicate with industry when work isn’t hitting the
market in a timeline that’s been communicated?
Hon. Ms. Carr: — Great, thank you for the question.
So I guess, first and foremost, we have a pretty open-door policy when
stakeholders have questions or want to contact us or have meetings. I don’t say
no to meetings. I take all the meetings that are requested of me. But with the
officials, they have all of their phone numbers, and they’re able to contact
them at any time.
More
formally, we meet with the heavy construction association on a biweekly basis to
go over everything that’s happening and what’s coming up. We have a monthly
newsletter that goes out. So there are several different forms of communication
to be able to talk with, whether it’s my office or the officials. It’s pretty
open.
Mr.
Wotherspoon:
— Thanks for the information. I was just hearing concerns, you know, along
these lines and bringing them forward here. With respect to 2023‑24, what
were the advertised volumes or quantities of material tendered versus the
actual volume produced and laid down? And in 2024, what is the advertised
volume or quantities of material tendered?
[20:30]
Hon. Ms. Carr: — Okay, so hopefully I’m getting you
the right numbers that you were looking for here. Within the 2024 budget, the
fall tender plan of 2023, excavation was 25,000; granular was 408,200; asphalt
concrete was 293,100; and sealcoat was 3.56 million. The winter ’23‑24
tender plan was 20,000 for excavation; 466,500 for granular; and 185,000 for
asphalt concrete. And then the spring ’24 one was 47,000 for excavation; 84,255
for granular; and 52,920 for asphalt concrete.
And
I’m going to let someone else answer the question around the end product on how
they track what was used and . . .
Mr. Wotherspoon: — The actuals.
Hon. Ms. Carr: — Yeah.
Mr.
Gienow:
— Hi. Wayne Gienow, ADM of design and construction. So we don’t actually track
each year how much of those quantities are done. What we do is we track the
actual commerce, the accomplishments that we went through at the beginning of
the session because that’s really the outcome of the project, right. So that’s
really what’s really important.
The
other part of that is with each of these quantities, some of these are
multi-year projects, so we think they’ll take two years for some of them. The
contractor may decide to do them all in the first year; they may decide to
split them up between multiple years. But that’s really up to however the
contractor wants to do that, right. So we don’t track, you know, what that
breakdown is year over year.
Mr. Wotherspoon: — Okay. Thanks. So you have the fall
tenders or the spring tender, you have the advertised amount. You track the
kilometres in the projects, but you don’t track the volume produced and laid
down?
Mr.
Gienow:
— Correct.
Mr. Wotherspoon: — Okay. Along a little ways here, I
mean one of the big irritants I think for industry and for many across the
province was of course the PST [provincial sales tax] that was imposed on
construction labour, many other areas as well. Now of course highways specifically,
this has the consequence of charging 6 per cent more for projects that are
public projects. It just really doesn’t make a whole bunch of sense at all. On
many fronts, but certainly on the highways side here, it really defies logic.
Does
the minister continue to hear concerns on that front as well? And you know,
you’re charging of course 6 per cent, and so that’s costing the public more, 6
per cent more. There certainly haven’t been those sorts of increases as well to
the capital program. It doesn’t make sense either way: building it and then
paying for it and collecting it.
Hon. Ms. Carr: — Thank you very much for the
question. This is a policy, as you’re fully aware, that has come forward from
the Ministry of Finance. It is something that is not really in the control of
the Ministry of Highways. We’re following policy set forward by Finance.
Mr. Wotherspoon: — Appreciate that. As Highways
minister, do you, you know, communicate opposition to that policy?
Hon. Ms. Carr: — Well I think it’s fair to say that
the policy that is set forward by the Saskatchewan Party government is the
policies that we follow.
Mr. Wotherspoon: — I thank you. We won’t spend
. . . I can follow up again with the Finance minister. And it just
points out, you know, I think it really doesn’t make much sense on so many
sectors but certainly not this one.
Moving along and looking a bit at some
of the program, I notice that on the news releases for identifying the northern
program from last year to this year, last year in the news release that was
released with the budget, it identified an $89 million budget. This year
it communicates a $73 million budget, so a reduction of $16 million
for northern infrastructure. Can you speak to what’s happening there?
Hon. Ms. Carr: — Thank you very much for the
question. And I think just to start off with, we don’t actually have a set
amount for the North, the South, the East, the West. It’s based on projects
that need to be done at any given point in time.
So
when we talk about the North last year, you’re absolutely right, we invested a
bit more in the North with that $89 million number. And this year it is
just over 73 million. Last year we had two significant projects that we
decided to go forward with in the North: the Garson Lake road at
$7.7 million and then the Sandy Bay airport at $6.9 million. So
obviously those are projects that money was spent on. And now they’re
completed, so that’s why you would see, I guess, the difference from last year
to this year.
But
as I said, there isn’t dedicated funding for any given area of the province.
It’s based on need and what has to be done at that particular point in time.
But
when I look at the numbers for the North, if we go back to 2008 fiscal year,
that year it was 46.7 million. And of course we were already talking about
80.7 million for last year and still doing 73.4 million for this
year. So the numbers are up significantly, and since 2008 they have kind of
just gone up incrementally over the years.
Mr. Wotherspoon: — And of course factoring in inflation
on these projects, it’s probably . . . you kind of have to factor
that in to look at these in the proper light. But thanks for the information as
well about the projects that were advanced last year.
Specific
to the Garson Lake road, now that highway has now been built out right to the
Alberta border, is that correct? And can I get an update as to the status of
what’s happened on the Alberta side?
Hon. Ms. Carr: — Thank you for the question. So the
Garson Lake road, I’ll stand a little bit corrected, is 95 per cent done but is
expected to have a June completion date to be done 100 per cent.
And
as far as your question around Alberta and what their commitments are, Alberta
has recently announced funding earmarked for the planning and design work aimed
at its connecting road over the next several years. So they have made a
commitment to get it done. They haven’t said exactly how much they’re going to
be spending, what that timeline is at this current point in time. But with
advocacy from us and from our ministry, and the importance of that road, they
are going to start working on that.
And
of course there are some benefits to getting the road completed. Completion of
the Saskatchewan portion of the road allows for easier access to traditional
lands; increases the safety for existing road users; and ensures that when the
connection to Alberta is made, economic development in the area proceeds and
that the Ministry of Highways is positioned to meet those needs.
Mr. Wotherspoon: — Yeah, thanks for that. It’s a
project that we’ve followed up lots over the years. I know the . . .
Well the member for Cumberland, it’s not on his side of the province but he’s
been a strong advocate for this as well as, you know, the previous member for
Athabasca long pushed for that road. The concern had always been making sure as
well that Alberta obviously is in sync and building out their side of it. Now
you said several years for them to connect their side?
Hon. Ms. Carr: — I’m not going to make any
assumptions. They’ve announced that they are committed to moving forward with
it, and they haven’t put any dollars in yet. So we’ll have to talk to them
further to see exactly what their plans are, but they have made the commitment.
Mr. Wotherspoon: — Okay. I’ve followed up as critic
over the years with the respective ministers previous, and it’s rather critical
that, you know, building our road out to the border is one thing, but
ultimately it’s the flow and the connectivity that’s critically important to
ensure maximum value of this highway as well. So just continued work on that
front to make sure that we’re not going to have some sort of a stranded asset
and stuff there as well and that we’re getting the full value out of that
infrastructure.
Now
when I chat with my good buddy, the MLA [Member of the Legislative Assembly]
for Cumberland, he talks lots just about, you know, roads and it’s about safety.
And it’s about people’s lives in getting from point A to point B, getting back
to family, getting to work, many goods of course that come out of the North
that are transported along there as well that are of benefit to the province.
And he reiterates all the time the concerns around safety. And I think that’s
important for us to have, you know, in perspective when we’re talking about the
northern highways budget.
I’m
going to kick it over to the MLA for Cumberland just to ask a couple specific
highways questions.
Mr. Vermette: — Thank you. To the minister, your
officials, of course our northern leaders, our northern people, we want to have
safe roads. We expect our government to do that. We have many highway workers,
and we know they do their best, and we do appreciate the work that’s being
done. And they do try to keep our community members safe, our grandkids, our
kids.
But
sometimes it’s frustrating too to watch because we see industry, and industry’s
doing amazing things up there. And our Indigenous leaders, our northern
leaders, our community members understand, you know, the boom when you look at
the economy and the resources coming out of the North to help. And it is
positive. We like seeing that and we want the jobs and we want to work in a positive
way. But we also want to make sure that those big trucks and the roads are safe
for families to be travelling to go south or in for goods.
[20:45]
So
when I share that, there are some of the roads, I know, that leaders have
mentioned and that we’ve tried to . . . we’ve petitioned. We’ve asked
I think about Highway 106, I think about Highway 102.
Can you give us an update? Because I
know for a lot of our leaders, our community members have raised it and I know
others have raised it. And I know we had different times when, you know,
through years of petitioning and stuff we’ve asked for some of our northern
roads to be addressed. And hopefully maybe you guys can give us an update on
some of those projects that we’ve been asking for and I think are, probably you
realize for safety, should be done. So I’ll just wait to see what you and your
officials will tell us so I can bring some good news home to the constituency
of Cumberland.
Mr. Cossitt: — Thanks for the question. So I’ll
just start and then I’ll pass it to the minister to talk about some other
initiatives. There’s two big projects that I just want to highlight in terms of
a little bit of detail. So specifically talked about Highway 102 and 106, and
we do have work going on this year on both of those roads. 102 is quite a big
project so we’re starting this year with a lot of culvert work, but that’s
almost $1.5 million.
So
there’s a lot of work that’s going to start. And then there’s a lot more to
come in the following year as we do a major upgrade there. So we do expect to
get a bunch of crushing done, and then the remainder be completed in ’24. And
then again, I talked about culvert installations being completed in ’24, and
then a sub-base and an AC [asphalt concrete] in ’25. So that’s kind of the plan
for 102, so significant work there.
The
other one I’d highlight is 106. There’s two sections particularly on 106 this
year that we’re committed to. The first section is north of Smeaton, sort of
south of the junction to Highway 120. That’s $2.3 million this year, and
then there’ll be probably upwards of $9 million the following year to
finish off that project. It’s a two-year project. And then another portion a
little bit further north on 106, and it’s $3.4 million this year.
So
just two projects I just wanted to give a little bit of extra detail about in
the North, specifically to try to upgrade those conditions and, as you say,
improve safety. And then I’ll just let the minister speak to a few others.
Hon. Ms. Carr: — Sure, and I guess just to highlight
some more work that’s happening in the North over and above those two sections
that you were asking about: Highway 155, we’re going to be doing improvements
on approximately six sections of that highway between Buffalo Narrows and La Loche;
Highway 924, improvements of 22 kilometres of Highway 924 south of Sled Lake to
Highway 916. And then we have Highway 956, Garson Lake to the Alberta border,
which we’ve just talked about finishing that off.
Wollaston
Lake airport, we’re going to be doing some design work for some future runway
rehabilitation happening there. Cumberland House airport, design work for
future runway rehabilitation that will happen there, and of course several
culverts or bridge replacements, which as we all know are critical to ensure
the safety and reliability of the roadway.
Several
preservation treatments on pavement, such as seals and micro surfacing that
extend the life of the pavement, and several safety improvements such as
delineation lights to ensure safety along the highway.
As
well, last year we expedited the sign project north of La Ronge to ensure that
we had accurate signage, visible signage, and that it was good signage. So
that’s what we would like to highlight for you.
Mr. Vermette: — And I note there, I just
. . . When you talk about signs, I have to tell you this story. There
was a sign up there in La Ronge, and it said — I think it was 10 kilometres or
20 kilometres — anyway, amount of dollars that were going to be spent on the
highway. So me and my buddy, we drove the 10 kilometres to say, oh, they’re
fixing this 10 kilometres. And we checked with someone and actually made a
phone call, and they said, actually, Doyle, we’re taking that sign down. The
sign went in the wrong location. It was for somewhere else.
But
anyway, now having said that, we laugh about that lots on coffee row, but
seriously, Highway 102, there’s about 28 kilometres of pavement. Well we call
it pavement, you know. Some people will call it something else. But is there
any chance that when you talk about upgrades on that, are you looking at
upgrading that? And if you are, what exactly are you guys going to do to it?
Because it’s so bad. Like people complain that damage is done to vehicles. You
know, just the . . . I guess I travel it quite a bit, and actually
everyone who talks to me says, Doyle, when are they going to fix this? When is
something going to be done? You know, damage and stuff like that. So I’d just
share that.
If
you can give me an update on that, are you doing anything with the pavement the
way it’s falling apart? That’s all. You know, it’s crumbling sometimes. So I
just . . . If you could give me an update, that would be wonderful.
Mr.
Gienow:
— So with Highway 102 just north of La Ronge here, we’re actually repaving the
full, I think it’s 26 kilometres. So we actually have that out. Contract has
already been awarded. So they’ve done a lot of crushing already this year.
They’re going to finish that up. Next year, as Ryan said, they’re going to be
doing some of the culverts and whatnot, and likely doing a lot of the actual
roadwork the following construction season, depending of course, depending upon
their schedule and that type of thing.
But
when we look at that, it will be a full reconstruction of that road, right. And
I think it includes actually all the way up to Sucker River there. So it is a
really rough piece there just north of La Ronge.
Mr.
Vermette:
— Yeah. Well okay, so . . . And will that be in 2025, 2024? Just to
be clear, if you can clarify that. And could we do 28 kilometres, not 26, so
that it could be helpful for Sucker River . . . [inaudible
interjection] . . . I tried.
Mr.
Gienow:
— So it is the 26 kilometres. But like I said, it has already been tendered so
the contractor has that. But they’ve indicated likely they’ll just be doing —
like not just — but they’ll be doing the call and a lot of the preparation
work. So the actual road work will probably be in 2025. Now they may decide to
do something earlier, right. This is one of those multi-year projects where
they have the ability to do it in either year.
Mr. Vermette: — Well hopefully they’ll go with 2024
and I’m going to say, good job. Thank you.
Mr. Wotherspoon: — Thanks so much. I’d like to follow
up with some of the concerns that have been identified by the Saskatchewan
trucking industry. The Saskatchewan Trucking Association’s been a really strong
voice with respect to the illegal incorporation of drivers that has many
negative consequences for the industry and the province and safety.
I know the minister has heard these
concerns. I’ve met with the industry as well on this front and have heard these
concerns. I guess my question is, could the minister describe the impacts of
this activity and what undertakings she’s taken on to address it, including
what undertakings has she taken on with the federal minister?
Mr.
Toffan:
— I want to touch on a couple of the key facts on this issue. Of course the
Saskatchewan Trucking Association has brought this up numerous times. We’ve
heard this from the Canadian Trucking Alliance as well, various provincial
associations across Canada. Of course misclassification of drivers is illegal,
and it’s a widespread problem, and it’s all across Canada. It’s not a
Saskatchewan unique situation. It’s leading to unsafe practices, things like
human trafficking as well unfortunately, and also unfair competition in our
trucking industry.
Under
this driver’s inc. model, as it’s called, truck drivers incorporate as
individuals without their own truck, so they use the company truck — and that’s
at the request or requirement sometimes of the trucking company — and they sell
their services back to the carrier. Trucking companies do pay lower taxes and
avoid providing benefits and other essential protections like workers’
compensation and employment insurance because of this approach that they’re
taking.
And
so we’re taking it quite seriously. The tools and the powers needed to resolve
this issue though really don’t reside with the province; they reside with the
federal government. And so we have to make sure that through influence and
discussions with Transport Canada and other regulatory agencies at the federal
level that we’re drawing attention to this. And like I mentioned, the Canadian
Trucking Alliance is already doing that on behalf of their association. But
despite this appearing to be a very important transportation issue, most
federal agencies so far are being sort of standoffish on this. Unfortunately
there hasn’t been some real action taken.
In
Saskatchewan, SGI [Saskatchewan Government Insurance] is of course responsible
for tracking carrier safety and working with other local and national
jurisdictions to address this issue, so we do have a little bit of a role on
that insurance kind of side of the coin. We’re aware of this issue at Highways,
and we understand the importance of it and talk to the Saskatchewan Trucking
Association regularly about it. They bring it up every meeting we have, which
is usually every month or two.
We
are working with our federal-provincial-territorial partners at different
meetings that we have both at the minister level and also at the deputy
minister level, and I will continue to be bringing this message forward to my
deputy minister colleagues including my colleague at Transport Canada. And our
next set of meetings are virtually I believe, but we’ll have in-person meetings
this summer as well in the North.
[21:00]
Mr. Wotherspoon: — Thanks very much to the deputy
minister for canvassing very well the concerns and problems with this driver
inc. model and the reason that there needs to be action to address it.
To
the minister, recognizing that a large portion of the levers are federal
levers, have you undertaken direct engagement with the respective federal
ministers on this front or do you plan to do so in the year ahead?
Hon. Ms. Carr: — Well I think it is fair to say that
we will continue to advocate for this, and we just had a
federal-provincial-territorial meeting where this was a topic that was talked
about. So advocacy was done directly with Minister Rodriguez at that point in
time, and all the deputy ministers were there as well. And it is something we
will continue to advocate for timely, I guess, resolution to this issue.
Mr. Wotherspoon: — Thanks. Yeah, it’s an important file
for that action to happen on. Now most of this relates to federal regulation.
Now there’s some provincial regulation on this front, is my understanding.
Could you describe where there’s workplaces that would be provincial domain, where
there’s some provincial levers?
The Chair: — Your question, Mr. Wotherspoon,
might not fall under the portfolio of Highways, but it might fall under the
portfolio of the Minister Responsible for SGI, insurance and a few of those
other areas.
Mr. Toffan: — Yeah, that’s exactly where we were
going with it too.
I
mean obviously our main role is through advocacy and influence and working with
other jurisdictions to ensure that we draw awareness to the issue. Some of
that’s through fed-prov-territorial meetings and some of it’s through other
conversations as well, just one-on-ones with my colleague at Transport Canada
for instance, Arun.
And
you know, it’s obviously something that our industry is very concerned about,
but the levers do really exist at the federal level with transportation as an
area of their responsibility.
Mr. Wotherspoon: — Thanks. It’ll be a file we continue
to, you know, focus on.
With respect to rest stops in the
province, the trucking industry as well and the trucking association has really
identified that we have a deficit of proper rest stops for the industry
throughout Saskatchewan. A couple years back there had been a commitment to
deliver three of those rest stops. That never happened at that point in time.
I’m just looking to what sort of commitment might be in this budget here and
now for rest stops and then future actions as well?
Hon. Ms. Carr: — Well thank you very much for the
question. So I guess I’ll just talk a little bit about the review that you were
talking about. So the review resulted in a map of all known rest stops —
publicly and privately operated — being utilized, which was posted online for
operators so they were aware what’s there. Identification of the underserved
areas were then highlighted.
The
ministry has since repurposed an old tourist turnoff on Highway 16 west of the
town of Battleford for use as a truck rest stop and continues to look at other
opportunities to repurpose locations. The ministry hired a consultant to
complete a functional design for pilot rest stop projects on priority
corridors. The design work is currently in progress. The ministry is also
investigating options for partnerships between the province, municipal
governments, non-profit organizations, and commercial enterprises to help develop
and advertise truck rest stops on the provincial highway system.
In
’23‑24 the ministry began work on a truck pullout functional study to
determine placement for truck pullouts along Highway No. 1 near Moosomin,
Whitewood, and along Highway No. 7 near Kindersley. In ’24‑25 the
ministry will continue planning for the placement of the truck pullout
locations along our provincial highway system. So as you can see, we’ve
identified those three areas. The planning is taking place and the work will
continue.
Mr. Wotherspoon: — It’s important work. I know it’s
important to the industry and it’s important to the safety of our
transportation, of our highways and for all the users of them.
If we look at airports and ferries and
some of these areas, could you describe or provide the detail on which airports
will receive funding from the community airport partnership program in ’24‑25,
and how much, and then do the same for the year prior, ’23‑24.
Hon. Ms. Carr: — Okay, so I’ll start with ’23‑24
and then go ’24‑25. So in ’23‑24 under the CAP [community airport
partnership] program, the town of Birch Hills had a rehabilitation to the main
runway and taxiways and installed new line markings and numbers on the main
runway. And that was in the amount of, the total project cost was 81,830 and of
course this is a 50/50 cost share. So the Ministry of Highways portion was
40,915.
The
town of Carlyle had deep crack asphalt and apron pavement repairs. Total
project cost 30,846, our share 15,423.
Town
of Central Butte had a radio control system, and it was 3,250, our share being
1,625.
The
RM [rural municipality] of Eldon No. 471, crack seal runway, taxiway, and
apron and repaint all lines for a total of 31,515, our share being 15,758.
The
town of Kipling expanded a taxiway and apron, total of 20,562, our share being
10,281.
The
town of La Ronge had an upgrade, a replace of the ATB [air terminal building]
security doors, install four air-side automatic doors, six ground-side
automatic doors, and keypad or card swipe security locks for a total value of
120,000, our share being 60,000.
The
town of Luseland had airport electrical upgrade, 6,786, our share being 3,393.
The
town of Maple Creek had a rehabilitation of a small section of the runway for a
total value of 47,046, our share being 23,523.
The
city of Melfort had crack repairs on the runway and taxiway, $72,080, our share
being 36,040.
Moose
Jaw Municipal Airport Authority had a rubberized crack sealing on the runway,
taxiway, and apron in the amount of $50,000, our share being $25,000.
City
of North Battleford had an installation of a backup power generator at the
runway light . . . oh, I did something . . . oh, North
Battleford, $75,000 for the installation of backup power generator at the
runway lighting control building.
And
then the city of Swift Current had an upgraded airfield signage fixtures to LED
[light-emitting diode] backlit fixtures, $10,000 total, our share 5,000.
City
of Weyburn had mulch of existing pavement at the entrance where STARS [Shock
Trauma Air Rescue Service] lands to wait for patient transfers. The mulched
asphalt was reshaped and compacted as sub-base for the asphalt overlay, and
that was at a value of 177,200, our share being 88,600.
And
town of Wynyard replaced fencing and two gates to increase airport security,
17,152, our share being 8,576.
And
lastly, the city of Yorkton, repaint marking and numbers on runways, taxiways,
and aprons, 33,200, our share being 16,600.
So
for a total of all those projects, 878,204, our share being 439,103.
[21:15]
And
then if we go to the upcoming projects in ’24‑25, the village of Lucky
Lake has an airport runway rehabilitation, estimated project cost 121,500, our
share being 60,750.
City
of Yorkton has airport signage of 52,000, our share being 26,000.
The
town of La Ronge has apron 4 and 5 edge lighting at a value of 142,500, our
share being 71,250.
Town
of Tisdale has phase 1 to resurface the runway, $500,000, our share being 250.
The
town of Leader has airport crack sealing and repairs of 61,140, our share being
30,570.
The
city of Moose Jaw has apron 2 and taxiway C engineering and earthworks, phase 1
and 2 for $240,000, our share being $120,000.
City
of North Battleford has security and wildlife fencing, $100,000, our share
being 50,000.
City
of Prince Albert, YPA, airfield cameras, $66,000, our share being $33,000.
And
the city of Weyburn has a Weyburn airport revitalization, $178,000, our share
being $89,000.
Mr. Wotherspoon: — Thank you. Thanks very much for that
information. Obviously this ministry plays a very important role as well
interacting with the amazing shortlines in the province, the role that they
play in the province. But importantly, you play a very important role in
interacting on matters of rail performance and improvements on these fronts
that are very important to this province as exporters, certainly for producers.
So
looking specifically at actions taken to advocate and to bring about
improvements for rail performance for producers and all exporters, could you
describe the actions that you’ve taken as minister on this front with the
federal government and with respect to the CTA [Canadian Transportation
Agency], and on positions as well around advocating for reforms and
improvements around interswitching or joint running rights?
There’s
the long-standing issue for producers who are paying demurrage while, you know,
a ship sits, you know, hasn’t arrived at the port or at the terminal on time,
and it’s an unfair penalty that producers are left to pay. These are important
areas that Saskatchewan can play a lead role in addressing with the federal
government.
And then of course there’s the
outstanding, long-standing issue of not having appropriate representation for
Saskatchewan and the Prairie provinces with the Port of Vancouver. So I’ve
identified a few different areas around improving rail and improvements for
producers and exporters. I’m just interested in the actions that you’ve taken
with the federal government and with others on this front.
Hon. Ms. Carr: — Well thank you very much for that
question. When we talk about the Port of Vancouver, I actually had the
opportunity to attend the annual general meeting this past year that was
actually held right here in Saskatchewan, so I had the opportunity to meet a
lot of great folks. And at that meeting we very strongly advocated for
additional representation for the Port of Vancouver and asked that that board
actually write a letter.
We’ve
already sent letters. One has come from us. One has come from the Minister of
Agriculture. If you talk to Minister Marit, he’s very passionate about this and
he can tell you how strongly he feels about it as well. But just asking them to
do that advocacy for us for the Port of Vancouver, because the bulk of the
goods that go out of that port truly do come from the Prairie provinces that
are represented, and so we do feel that we need that extra representation. It’s
just a matter of convincing the federal government that that’s what we need.
When
it comes to the National Trade Corridors Fund, that is something that has been
depleted and that is more advocacy that’s been taking place very strongly at,
whether it be our table or Government Relations’ table. Getting that fund
replenished so that we can work on those trade corridors to get all of our
goods to market.
And
I’m just going to turn it over to Ryan right now and have him touch on a few of
the more specific things that you asked about.
Mr.
Cossitt:
— Thank you, Minister. Thanks for the question. So as Minister said, we’re
pretty active, try to be as proactive as we get in this space. It’s sometimes a
challenging space because it is federally regulated on the rail and marine
side, as you know, and so we try to be as proactive as we can and as
collaborative as we can, for sure.
So
I would just say that we’re constantly reminding our federal and provincial and
territorial counterparts about our transportation needs, particularly some of
the interest we have for Saskatchewan in terms of providing the food, fuel, and
fertilizer for the world. And of course to do that we need to have a
competitive, reliable, and efficient national transportation system, as you
know, one that delivers low costs for our shippers and remains competitive and
a reliable level of service.
We’re
continuously trying to advocate, particularly to Canada, to make sure that
they’re doing everything they can to support that transportation system,
whether that be funding or regulatory legislative changes. So of course we work
routinely with Transport Canada and the Canadian Transportation Agency in
particular and, as I said, our FPT [federal-provincial-territorial] leaders and
colleagues.
We
try to advocate for a couple of principles in terms of our priorities for the
Canadian transportation system. It’s really about promoting, as I said, sort of
an integrated transportation system that delivers lower costs for Saskatchewan
business and improves the level of service overall. Of course it’s about
establishing a good legislative and regulatory framework that promotes
competition in customer service, balancing those competitive rates in improved
services for our shippers, and really providing an opportunity for our small
and medium-sized business in particular to make sure that they’re participating
in the economy.
So
over the past year we’ve drafted a number of submissions in letters and
consultations, as the minister alluded to, outlining our priorities. And I can
highlight a couple of notable examples.
In
the fall of last year, we participated in Transport Canada’s rail review. So
they did an extensive rail review and we did a broad-based consultation effort
within the province, with particularly some shippers but our partner
ministries, and made sure that we were kind of focusing on that promoting
competition overall in the rail sector, making sure that those competitive
rates are there and services for all businesses and providing a little more
certainty to transportation users across the supply chain. So a broad suite of
recommendations that we provided in terms of our perspective with respect to
the rail review.
Of
course we regularly meet with our shippers who rely on rail, and so we’re
advocating on their behalf, typically with the federal government, to address
their issues. And so that’s things like recognition that rail service is
impacting shippers operationally, financially, and reputationally in terms of
what their rail service looks like.
It’s
helping to compel railways, particularly class 1s, to invest in some surge
capacity, and we think that will help them to improve their resiliency when
there’s disruptions, whether it be labour, whether it be natural resources or
natural disasters or whatnot, and highlighting the impacts of those loss of
sales for our shippers and our industries when those services aren’t there. So
that’s kind of the tenets that we sort of take when we advocate and do work inside
the rail service space.
One
of the other ones I’ll just highlight quickly is just a few months ago we
provided some input into the Treasury Board of Canada secretariat supply chain
regulatory review. And that aimed to sort of create a regulatory road map that
was going to outline initiatives to generally improve federal regulatory
systems and support economic growth and innovation. That was the aim that that
review had. That was a public-based consultation, but we did a direct
submission and there again we did some broad-based consultation to make sure
that we were capturing our shippers’ and industries’ perspectives and that of
our other Crowns and ministries within the Government of Saskatchewan. So we
submitted that just a few months back, and we’re waiting to hear. And hopefully
that has a positive impact.
The
other one I’ll maybe talk a little bit about that I think you touched on is of
course the importance of federal legislative and regulatory changes, one of
which that’s particularly important is C‑33. That’s a broad-based suite
of amendments that Canada is proposing to modernize port governance, railway
and air operations and safety, and generally improve the supply chain
coordination.
There’s
multiple facets to that, but one of which that you mentioned already is port
governance. It does seek to address some changes to the Vancouver Fraser Port
Authority’s governance. Unfortunately it does not address the issue that we’ve
been asking for for years which is to increase the board membership for the
Prairie provinces. So they are willing to try to increase membership for the
local municipalities in BC [British Columbia] but not for the Prairie
provinces, so we’re quite disappointed by that. That bill is currently under
review in the House of Commons. It might be an opportunity when and if it
reaches Senate for us to make some sort of an opportunity to raise concerns.
But it doesn’t look promising, to be quite honest.
Two
other things I’ll just touch on quickly. The National Supply Chain Office was
part of an announcement that Canada made in the 2023 budget. And we continue to
work with that National Supply Chain Office to try to get better clarity in
terms of what their mandate and focus is going to be. It’s a new entity in the
federal family. We’re not quite sure where that’s going to fit between
Transport Canada and the Canadian Transportation Agency. They seem to be really
seized and focused on digitization and data collection, which may have a value,
but we’re not quite sure how that’s going to dovetail and fit with the rest of
what Canada is doing at the federal level. And so we’re continuing to try to
help shape that. And the minister and deputy minister and myself have been
involved in several conversations in the last year to try to get a little bit
more clarity in terms of what that has to offer.
And
then the last thing I’ll mention is just that we do have, as I think you’re
aware, a memorandum of understanding with Alberta and Manitoba for a Prairies
MOU [memorandum of understanding]. There’s a couple of tenets underneath that
MOU, one of which is an advocacy piece. And we’ve been quite active in this
last year of trying to combine our efforts among the three Prairie provinces
and be one unified voice to Canada on all of these matters, whether it’s port
performance, rail service, or funding levels.
So
we do have some concerted efforts. And in most of the items I’ve already spoken
to, we’ve made a real concerted effort to make sure that we were coordinating
and collaborating, making sure that we’re having a bit of a voice for the
Prairies as well as our own individual provincial needs.
[21:30]
I’ll
perhaps stop there, but that’s just a bit of a flavour of what we’ve been up
to. Thank you.
The Chair: — We’ve reached our time. So we’ve reached
our agreed-upon time for consideration of these estimates now, and we’ll
adjourn the consideration of estimates and supplementary estimates no. 2
for the Ministry of Highways. Minister, do you have any closing remarks?
Hon. Ms. Carr: — I’d just like to take the time to
thank you, gentlemen, for asking the questions this evening. Very much
appreciated, and hope you got the answers you were looking for. To all of my
ministry officials that joined us here tonight and were able to provide such
fulsome answers for us, and of course to the committee for being here and
listening so intently. Thank you to the Chair and Hansard and all the staff for
being here.
The Chair: — Mr. Wotherspoon, if you have any
closing comments you’d like to make?
Mr. Wotherspoon: — Well thank you very much, Madam
Chair and members. To the minister, thanks for your time this evening. Thank
you to all the officials, all the leadership of the Ministry of Highways and
Transportation for all your work. Thanks as well to all those that are
connected to this work all across Saskatchewan. Very, very important work. Wish
we could have had a couple more hours here tonight, but that’s how these things
go. So thank you for the time here tonight.
The Chair: — All right. That concludes our business
for this evening, and I would ask a member to move a motion of adjournment.
Mr.
Francis:
— I so move, Madam Chair.
The Chair: — Mr. Francis so moves. All agreed?
Some Hon. Members: — Agreed.
The Chair: — Carried. This committee stands
adjourned until Wednesday April the 10th, 2024 at 3:30 p.m. Thank you,
everyone.
[The
committee adjourned at 21:31.]
Published
under the authority of the Hon. Randy Weekes, Speaker
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