July 15, 1942

NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

I understand that what is being done in this item is to restore a position which previously obtained, from 1936 to 1938, in connection with the United States trade agreement. In the new agreement of 1938 the arrangement was dropped and is now being revived. It is not a new proposal at all, except with reference to a portion coming under the intermediate and general tariffs. Everything is to be made free. This machinery and apparatus for use exclusively in producing unrefined oil from shale, for instance, is of a class or kind not made in Canada. It is intended, I think, to help in the development of the oil shales of New Brunswick and eastern Canada generally; that is part 1. Part 2 is to help in the development of the oil sands. Part 1 does not include the motive power, which I understand is of a class or kind made in Canada, and the protection heretofore given on that is being continued. I see no great objection to the passing of this item as it is, if we understand the position historically and what is now being sought. I have an idea that previously it was all one item and it is now being separated. In any event all this machinery and apparatus, which is of a class or kind not made in Canada, is being put on the free list. That is in accordance with government policy; I am not objecting to it, and I think we might carry the item.

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Subtopic:   CUSTOMS TARIFF
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SC

Charles Edward Johnston

Social Credit

Mr. JOHNSTON (Bow River):

The minister is to be commended for removing the duty on this apparatus, because this may tend to increase the production of oil in areas where oil is contained in the shale and tar sands. But I do not think the results for which we hope will come about simply through the removal of this duty. The government should go further. I realize that the Minister of Finance is not concerned in what I

am about to say, but I think our endeavours to develop the present production of oil from all sources, including the tar sands and the shale, should be greatly increased. The government should go much further than merely removing the duty on this equipment, because the situation is becoming exceedingly critical.

I brought up this question in the house over a year ago, but up to the present time practically nothing has been done to develop the production of oil from our tar sands. I am sure the minister recognizes the seriousness of our oil situation just as much as anyone else, probably more so than a great many people in this country. We see now that the oil fields of Iraq and Iran are in a very dangerous position; in fact the entire Persian field is in a most critical situation, and according to information appearing in the public press the United States is becoming acutely aware of an oil shortage in that country. A great deal of our crude oil comes from the-United States; and when we see them going to the extent of setting up plants for the production of synthetic oil from coal, it becomes apparent that the situation is serious. We in Canada are favourably situated in that regard; we have the largest potential oil field in the world, bar none. Right now, when the situation is so critical, when the possibility of having our supply of oil from the Persian field cut off is becoming more apparent day by day, the government and the Minister of Finance should insist that the development of these oil fields be hurried along as much as possible.

The minister will remember that when I brought up this question in the early part of 1941 I was ridiculed; I was called a defeatist and an alarmist when I dared to suggest that before this war was over our oil supply from Iraq and Iran might be cut off. I am not satisfied with the progress that has been made, and I want to commend the Minister of Finance on the removal of the duty from this equipment, which may hasten our progress in this direction. Certainly I am not satisfied with the progress that has been made in the development of the tar sands.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

Operations are going on at the moment, I am told.

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SC

Charles Edward Johnston

Social Credit

Mr. JOHNSTON (Bow River):

Just in an

experimental way, I think.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

I do not think so.

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SC

Charles Edward Johnston

Social Credit

Mr. JOHNSTON (Bow River):

When I spoke on this matter previously the Minister of Munitions and Supply took me to task and said that the prospect of developing oil from the tar sands was too remote for this war, that perhaps we would have it for the next

Customs Tariff

war. I am glad to note that once more the Minister of Munitions and Supply has been forced to change his opinion. Perhaps the Minister of Finance has had to sit on him a little; and if that has brought about the good results shown here I hope the minister sits on him good and hard, so that some real action may be taken.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

I am not sitting on him.

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NAT

John Ritchie MacNicol

National Government

Mr. MacNICOL:

Under this item is

machinery to be admitted free for the removal from the oil sands of bitumen and other ingredients, or merely the oil?

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LIB

James Angus MacKinnon (Minister of Trade and Commerce)

Liberal

Mr. MacKINNON (Edmonton West):

While my colleague is looking up the information I might just say, for the information of the hon. member for Bow River, that I have ascertained by inquiry that final investigations of the McMurray and Waterways district are in progress at the present time, looking toward the actual production of oil from those sands. I do not know how far the minister concerned may care to go in giving details of arrangements that have been made, but I can assure the hon. member that this work is definitely under way.

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SC

Charles Edward Johnston

Social Credit

Mr. JOHNSTON (Bow River):

Then may I ask the minister whether he will consider the advisability of setting up a committee of this house when parliament reassembles to make a thorough investigation of 'the progress being made in the development of oil from these tar sands, as well as developments in the manufacture of synthetic rubber in Canada. If the minister will give the committee that assurance I think it would be to the advantage of our war effort.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

If I am the minister to whom the hon. member refers, all I can say is that I will bring what he has said to the attention of my colleague, the Minister of Munitions and. Supply.

Replying to the question of the hon. member for Davenport, this item provides for the free entry of "machinery and apparatus for operating oil-sands by mining operations and for extracting oil from the sands so mined." His question was whether machinery for extracting other substances-

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NAT
LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

-from the sands so mined will be admitted free. Such machinery is not covered by the item. I do not know enough about machinery to know whether the machinery provided with free entry by this item could be used for both purposes. If not, it is not covered.

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NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

I was hoping this item would go through. May I ask the minister whether any machinery is to be imported for the development of the oil shales, and whether there have been any developments with respect to the oil shales in New Brunswick. Months ago I brought to the attention of the oil controller the position in New Brunswick, and I was met with the statement that it was not part of government policy to go into the production business itself. I can understand that. Then I urged that investigations should be made, and I was promised that some investigation would be made. What I am asking now is whether investigations have taken place, how far have they proceeded, and is there any prospect of the development of the oil shales of New Brunswick, which are known to be a substantial natural resource of that part of the country, where we need development if we can possibly get it.

I am not deprecating what the minister is doing by this item. This machinery is not made in Canada, and was admitted free some years ago. I think there is some differentiation, and I was hoping that the minister would give the history of the position, which I attempted to give somewhat inadequately a few moments ago. This item is not a new departure. It simply restores the item to the position which obtained up to 1938, at which time the item was dropped.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

From 1936 to 1938, yes.

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LIB

Clarence Decatur Howe (Minister of Transport; Minister of Munitions and Supply)

Liberal

Mr. HOWE:

With reference to the point raised by the leader of the opposition, I think I announced to the house that the federal government, in partnership with the provincial government, was making a very thorough investigation of the oil shales of New Brunswick. The investigation is practically completed, but I have not seen the final report. An interim report which I saw indicated not too hopeful a situation. The shales did not have the oil content that it was hoped would be found.

As regards the Alberta tar sands, we are making a very thorough investigation. We are not only checking all available data, but are making a close examination of refinery results in that area. We are having refinery runs made of the product, as well as laboratory tests, and we are drilling to find the extent of the sands with a view to a large scale development. In both cases I think we are taking the steps which are necessary before large expenditures would be warranted.

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NAT

Ernest Edward Perley

National Government

Mr. PERLEY:

Would the Minister of

Munitions and Supply enlarge upon the statement he made on May 15 with respect to this

Customs Tariff

development? The minister said, in connection with the investigation to which he has just referred, that they were studying the Gower system of processing. I wonder if he would enlarge upon that and tell us what the results of investigations into that system of processing have been.

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LIB

Clarence Decatur Howe (Minister of Transport; Minister of Munitions and Supply)

Liberal

Mr. HOWE:

I would not like to discuss the system of processing. That is under study as well, but I am not enough of an oil technician to be able to discuss it, even if I knew the full results of the investigation, which I do not. The whole investigation has been placed in responsible hands, and we hope to have a report within a month or six weeks which will tell us what development is justified and what process is likely to obtain the best results. I am sorry that my information does not allow me to go any further.

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NAT

John Ritchie MacNicol

National Government

Mr. MacNICOL:

There were only two plants operating in the oil sand area. There was the bitumen plant, forty or fifty miles north of Fort McMurray, operated by Mr. Fitzsimmons, and they were doing a pretty good job in extracting bitumen. They were shipping thousands of barrels of bitumen and tar. When I was up there last summer I saw two hundred barrels going up the river. The other plant, which was manufacturing oil, was turning out a year ago somewhere between 200 and 250 barrels a day, but unfortunately the plant was burned down in the fall. It has been rebuilt, and the last information I had was that before now the rebuilt plant should be turning out about 600 barrels a day.

I am in accord with this item, which is to admit free the machinery required for the further development of these sands. All the machinery used in the oil plants came from the United States, and there is not a great deal of it even there. This machinery requires constant replacement; so that if this item, which will admit free machinery not made in Canada which is required for extracting the oil from the oil sands, will assist in the development of these sands, I think we should all be in favour of it.

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Item agreed to. Customs tariff-422a. Concrete road-paving machines, self-propelling, end loading type, with a capacity of 21 cubic feet of wet concrete or more; concrete and asphalt road finishing machines; form graders; sub-graders; combination excavating and transporting scraper units; concrete mixers, transit type; dump wagons or trailers, having a capacity of 10 cubic yards or over, not self-propelled; backfilling machines and equipment, mounted on self-propelling wheels or crawling traction, semi-or full-revolving boom and scraper type; steam or air driven pile hammers or extractors; well-points; truck turntables; all the foregoing of a class or kind not made in Canada, and complete parts thereof: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 12J per cent.


July 15, 1942