December 1, 1949

LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

Yes.

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PC

Alfred Johnson Brooks

Progressive Conservative

Mr. Brooks:

We have not always shared in the benefits that have been given the maritime provinces, as I have pointed out on various occasions previously. We have been discriminated against when you consider some of the benefits that have been given to Nova Scotia-and that has applied particularly to subventions. In New Brunswick we have obtained very little if any benefit from coal subventions, since under the act only coal exported from a province receives that benefit. We export very little coal from New

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Brunswick, and as a result Nova Scotia coal, which receives the subvention, can be brought into our province to undersell our coal at almost every point. In Campbellton, Chatham, Bathurst and many other parts of New Brunswick, coal brought from Nova Scotia can be purchased for less than New Brunswick :oal, as a result of the subventions paid by this government. That is why I am anxious to see that this legislation does not discriminate against the New Brunswick coal industry.

I was interested to hear the hon. member for Gloucester say that an electric generating plant was to be established at Grand Falls. As I remember it, some land was cleared at that point last summer and the right of way for a railway spur was obtained, but nothing more was done, and I understood the project had been abandoned. I was pleased indeed to hear the hon. member say that the undertaking has not been dropped, but that the development is to go ahead, since that will mean a larger market for our coal, which in turn will benefit the coal producers and miners of my constituency.

I do not intend to say anything further with respect to this legislation except to point out once more that the market for New Brunswick coal is limited almost entirely to our own province; and, as was pointed out previously this morning, our whole economy, which is based upon the production of electricity, depends upon the success of our mining industry. I might add that our pulp mills obtain a great deal of their coal from the Minto mines. In past years we also sold to the railways; but as the hon. member for Cape Breton South (Mr. Gillis) pointed out earlier, quoting an answer to a question I placed on the order paper not long ago, United States coal was a strong competitor in the market provided by the Canadian National Railways.

If this legislation will help us hold the market in our own province provided by our electric plants, our pulp mills and the railways, and will give us some assistance which will enable us to produce our electricity at less cost, I am sure it will be a very great benefit to our people. I hope, as I said a moment ago, that we shall not be discriminated against in this instance as we have been in the past with respect to subventions, and as we were during the war with regard to other legislation affecting maritime coal mines.

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LIB
LIB

William F. Carroll

Liberal

Mr. Carroll:

When the house rose for the noon recess I was discussing production in the coal mines of the maritimes. I intended to make some reference to the production capacity of the United States mines whose products are in competition with maritime coal. Before doing that may I say that in 1937 the production of the mines of Nova Scotia amounted to 7,226,954 tons. In 1944 the production had fallen to 5,745,672 tons. That was not owing to the lack of markets, because in those days we were not producing sufficient coal to fill the markets of the province of Nova Scotia. Since that time our coal production has increased somewhat. In 1948 the coal production of Nova Scotia amounted to 6,430,991 tons, and of New Brunswick, 522,136 tons. The production in New Brunswick had increased from 361,184 tons in 1945 to 522,136 tons.

I want to say a word about man-day production. In 1945 the man-day production in the coal mines in Nova Scotia had fallen considerably from the pre-war average. In 1945 production per man-day in Nova Scotia was 1-58 tons. In New Brunswick it was 1'72 tons. In 1948 the man-day production rose to 2 * 19 in Nova Scotia, about 50 per cent, and in New Brunswick to 2-42 tons.

Perhaps it might be well to put the whole Canadian man-day production on the record. On Cape Breton Island, Nova Scotia, the man-day production in 1934 was 2-54 tons. In

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1939 it was 2'60 tons, and in 1944 it was 1-73 tons. I have indicated how it has risen since. In New Brunswick in 1934 it was 1-33; in 1939, 1-42 and in 1944, 1-47. In Saskatchewan in 1934 it was 5-12; in 1939, 5-85; and in 1944, 8-66. That tremendous production in Saskatchewan was due to the fact that it was mostly stripping operations. They have pretty deep seams to strip.

Here I want to recognize the fact that the little mines in southern Saskatchewan, I believe in Estevan, not only undertook to mine coal but established their own markets. They went into the city of Winnipeg. I do not know whether it was through their own company or through subsidiaries, but at their instance they created their own market by having installed central fire-heating plants, powered by coal. I believe that was one of the best things I saw in my trip through Canada a few years ago.

In the Drumheller area of Alberta, in 1934 the man-day production was 3-73 tons; in 1939 it was 3-94, and in 1944, 3-58. In the Mountain Park area in 1934 it was 3-75 tons; in 1939, 3-71, and in 1944, 3-87 tons. In the Cascade area of Alberta, in 1934 it was 3 09 tons; in 1939, 3-21, and in 1944, 4-34. In the Crowsnest area of Alberta, in 1934 it was 3-07; in 1939, 3-84 and in 1944, 3-67. In Crowsnest, British Columbia, in 1934 it was

3- 97; in 1939, 4-38 and in 1944, 4-23. On Vancouver island in 1934 it was 1-82; in 1939, 1-84 and in 1944, 2-03.

It will be seen that the man-day production in the western provinces is much higher than it is in the maritime provinces. The real difficulty there is of course markets and the availability of markets. I understand that even today the domestic coal users in northwest Ontario are supplied by Alberta coal, which I think is a very good compliment to subventions, because that is the only way that those western mines could be made competitive in that area.

I now turn to the situation in the United States so far as production is concerned. I refer to the states whose products are competitive with maritime coal-West Virginia, Kentucky, Pennsylvania and Ohio. In 1934 the man-day production in West Virginia was

4- 73 tons as compared with 1-97 in the mari-times. In 1939 it was 5-51, and in 1944 it was 5-61. Instead of their man-day production decreasing during the war, it went up. I think it is fair to say that it went up on account of the mechanization and the improvements in the underground transportation systems in these mines.

In Kentucky in 1934 the man-day production was 4-33; in 1939 it was 4-68, and in 1944 it was 5-08. In Pennsylvania in 1934

it was 3-98; in 1939 4-77 and in 1944 5-28. In Ohio in 1934 the man-day production was 4-23; in 1939 5-35 and in 1944 6-77. I do not think anybody is putting forth the contention or the argument that it is as easy to mechanize the maritime mines as it is the mines in these states to which I have referred.

I now wish to say something about the prices that are charged for United States coal coming into our Canadian markets. For some time there was a coal stabilization board which stabilized the coal output of certain states at a certain price. I understand that that board has gone out of existence. I think that some method, co-operative or otherwise, should be developed with the coal industry in the United States. For example, the mines there that have the greatest production per man-day can get their coal out at a very small cost, but they are allowed to set the price for coal that comes into Canada, instead of making the price uniform for that state, because there are many mines in those states in which it costs more to get out the coal. I do not know whether anything can be done about that or not, but it is something that I thought I should bring to the attention of the minister.

With reference to markets, there are other competitors of coal in this country so far as fuel and power are concerned. I think it is a good thing. I believe there are some people in this country who are concerned about our reserves of coal. What I do know is that there are enough reserves of coal in Nova Scotia to pay off this debt in the usual fashion.

Perhaps I have some old-fashioned ideas about the fuel problem; but it is my belief that the good God has placed on the earth, in the sky and in the sea all the natural resources that will be necessary for the use of man until the end of time. Of course those resources will have to be harnessed and made useful by the ingenuity and scientific experience of man.

In the old days in my province wood was the only fuel we had with which to warm ourselves. Occasionally power was produced through the use of windmills. Then wood became scarce, and coal was taken from the ground. Coal then became scarce, with the result that oil and hydroelectric power have come to the forefront. Now we are confronted with the greatest force of all. I understand that in about 1955 atomic power will be harnessed to a point where it can be used to do the work formerly done by coal, oil and all other means of power. Especially will that be true in our large industries.

After hearing the discussion in the house yesterday one could not help concluding that it is a great pity so much of our wood has

been burnt. Speaking about my own province I would hope that in a very few years every domestic consumer of coal would be able to use it as a fuel, instead of wood. In this way the farmers of Nova Scotia will be able to crop the old spruce tree and put it to some of the uses for which it was intended.

I have said that there are other fuels and power competing with coal. There are. I do not wish to be critical of any of the coal companies in Canada, particularly in my native province. I must say however that if the coal companies down there had paid more attention to the preparation of their product, especially for domestic use, their markets would not have to be extended or sought far afield. That is one respect in which they were lax, namely the preparation of their coal for domestic use.

It was about fifteen years ago that a small company down there, I believe it was the Bras d'Or Company, undertook a program of giving to the people of Nova Scotia a coal which could be used in their own homes. Not only did they clean it, but they oiled it. It was that action which brought the matter to the attention of other industries in that part of Canada.

This is not the first time that the Minister of Trade and Commerce (Mr. Howe)-but not as the minister of that department-has come to the rescue of the Nova Scotia coal industry. In 1945 the Acadia Coal Company was in distress and losing money. Mr. Gordon who was at the head of that company felt there was one procedure which would be helpful in that situation.

Formerly there was down there an old-fashioned town by the name of Thorburn. It was burnt-out, so to speak. However in that vicinity there was another good seam of coal known as the McBean seam. The Acadia Company came to the department headed by the present Minister of Trade and Commerce and placed their plan before him. They wanted to borrow money, and offered a plan indicating to the minister that if they were supplied with sufficient money they could open up and mechanize the mine so that the Acadia Coal Company would be placed in a position whereby instead of losing $100,000 a year they would make a small profit.

The Minister of Trade and Commerce is not susceptible to ideas unless they are well supported. In other words, if I may use a common expression, he is from Missouri. Not being satisfied, what did he do? He placed at the disposal of the coal company the services of an expert engineer from the United States who, after looking over the field, endorsed the soundness of the economics

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in the situation. Treasury board did not hand out money, but proceeded to guarantee a loan to the extent of $750,000 from the banks.

Let me assure the minister today that that action was greatly needed, particularly in the county of Pictou. Indeed I think the hon. member for Pictou (Mr. McCulloch), in the event of the passing of the minister before the hon. member, should constantly pray for the repose of the minister's soul.

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PC

Arthur Leroy Smith

Progressive Conservative

Mr. Smith (Calgary West):

How soon

should we start praying?

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LIB

William F. Carroll

Liberal

Mr. Carroll:

A good deal has been said about markets. In what he said the hon. member for Cape Breton South (Mr. Gillis) was quite right: we do need markets. Our securing of markets however must always be premised on the assumption that we can secure cheap coal. That is the first important point. We see therefore that production enters into the picture of markets. We may have all the production in the world, but if we cannot have it at competitive prices, cheaper than we are getting it today, we shall not be able to secure the markets.

I say our markets will come when through our methods of production we are able to get cheaper coal. Only today I was informed that two months ago there was available in Ontario a market for 500,000 tons of industrial coal, but the maritime operators could not supply it. They were competitive, but they did not have the coal-and that is where production enters into the picture.

I can remember that in 1938 there was a tremendous cry throughout the country to get coal into Ontario. An industry in Hamilton gave a contract to the Dominion Coal Company in that very year-and with the possibility of future orders-for 15,000 tons. The company could not supply the order, because their production was not sufficient.

I say therefore that production must be the initial step in the situation-and it must be cheap production. Some years ago it so happened that a commission was set up in this country to look into the situation in connection with coal. I believe it was intended that its investigation should be purely factual, so that it might bring to the attention of the present Minister of Trade and Commerce-not so much to the attention of the coal industry-what was necessary to give us a satisfactory national coal program. This has something to do with the situation to which the hon. member for Cape Breton South referred this morning. Everything possible should be done in the mechanization of these mines to protect the lives of those who go down into the mines to dig the coal.

One of the first things that we attempted to find out was what could be done in the

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maritime provinces to safely mechanize the mines. The Minister of Trade and Commerce (Mr. Howe) said that we would have to get a man who knew something about safety measures as well as production. We did get a man who was recommended by a certain coal organization in the United States and by John L. Lewis, the head of the United Mine Workers of America, a Mr. Young. This gentleman went into the whole situation.

The minister of industries, not acting in the capacity of villain in which he was painted the other day but as a Canadian keenly interested in this country, obtained the services of Mr. Wheeler, a gentleman who had been loaned to the British coal control to see what could be done in the mechanization of mines over there. I do not know whether it was necessary to frighten the parliamentarians over there, but anyway this gentleman was brought to Ottawa and in conference with Mr. Young went into the whole question of mechanization as it affected production and safety. Their report does not appear in full in the report of the commission, but I imagine it can be found in the files of the mines department or some place down there anyway.

In the meantime a small-scale mechanization was decided upon in connection with these mines, what was called a short-term plan. This was concurred in by the engineers I have mentioned. The Dominion Coal Company anticipates that within five years 40 per cent of its daily output of over 7,000 tons will be from totally mechanized mines. The company estimates that the productivity of these mines will be increased by five tons per man-day and, with the return to pre-war productivity in the other mines, the over-all unit production will be 3 [DOT] 5 tons per man-day on an 18,000 tons daily output. The company considers that this program will cost about $2,500,000, excluding the necessary outlay for a preparation plant. Old Sydney collieries believe that its two mines can be totally mechanized and that their productivity can be raised to five tons per man-day. The company's plans anticipate that this will be accomplished within a period of five years at a cost of a little over $1,000,000 excluding provision for preparation.

That work has been undertaken in those two mines, and as a matter of fact, so far as the Old Sydney collieries are concerned, it was undertaken two years ago. Mr. Gordon, general manager of the Dominion Coal Company and its subsidiaries, I think is the most progressive, the most courageous man who has ever occupied that position. He is a man of great vision.

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PC

Arthur Leroy Smith

Progressive Conservative

Mr. Smiih (Calgary West):

What is the production per man per day after the two years?

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LIB

William F. Carroll

Liberal

Mr. Carroll:

The last figure I got for 1948 was 2 [DOT] 6 tons.

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PC

Arthur Leroy Smith

Progressive Conservative

Mr. Smith (Calgary West):

No progress.

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LIB

William F. Carroll

Liberal

Mr. Carroll:

' That is the over-all production. In those particular mines it is much more. Mr. Gordon was not satisfied with having to pay tremendous prices for coal loaders and that sort of thing which would have to be imported into this country and he went down to Washington and organized the situation so that this equipment will be manufactured in the Trenton steel industry at Sydney.

The other day I picked up a clipping which makes a reference to these mines I am talking about, the Old Sydney and the No. 1-B, which reads:

Dominion Coal Company has just installed a new 1,800 h.p. mine hoist for its No. 1-B colliery, Cape Breton island. The new hoist and another like it at the colliery are the most powerful hoists ever built for underground service in any colliery in the world.

The new 70-ton hoist will pull 17 full cars of a gross weight of 110,000 pounds on a fairly steep gradient at a speed of 1,350 feet per minute.

Then followed something that made me feel good and should make everybody in Nova Scotia feel good:

It took over a year to build the new hoist at the Trenton Steel Works of Nova Scotia Steel and Coal Company, another subsidiary of Dominion Steel and Coal Corporation. After tests, it was recently stripped down and shipped to Cape Breton for installation.

The giant hoists are required because of the increasingly greater depth at which subterranean mining is being carried out.

That is one of the things that Mr. Gordon proposed three years ago and it is one of the things that he has carried out in connection with the small plan. But a long-term plan has been submitted by the two engineers I referred to, it being prepared in consultation with the mining engineers of the coal company and with another engineer from the west who was there at the time. This will cost a tremendous amount of money. It will require the continuous efforts of a skilled staff for several years to develop the engineering data necessary to determine whether the erection of a full-sized cleaning plant is warranted. However, as I said a moment ago, I am not going into that overall plan. I have no doubt in the world that it is the intention of the company to go ahead with that over-all long-range plan.

This morning there was an item read by the hon. member for Cape Breton South (Mr. Gillis) who knows more about actual coal mining in this country than anybody else I

know. He has spent many a hard tiresome day in the mines, and many a hard tiresome hour walking back a mile and a half from the actual mining operation to the surface. He drew the attention of the house to the fact that at Campbellton in the Atlantic region there are tremendous piles of coal that have been purchased from the United States. I think there is something rotten in the state of Denmark so far as that is concerned, but there is no doubt about the facts. It is not as large a quantity as last year, but it is there because of the fact that certain coal was dumped in this country about five or six months ago- the practice may be continuous-and sold to the Canadian National Railways at a very low price. I do not want to contradict the hon. member for Royal (Mr. Brooks), but there are no subventions on maritime coal going into the Campbellton area. Therefore if the United States sells coal there at a much cheaper cost than Nova Scotia coal, or other maritime coal, the competition is not met by subvention. I do not know much about subventions at the present time, and as a matter of fact never did, but I do not think there is any subvention paid on Nova Scotia coal competing with coal produced in New Brunswick.

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PC

Alfred Johnson Brooks

Progressive Conservative

Mr. Brooks:

Mr. Speaker, I think the hon. member is very much misinformed because ever since a subvention has been given there has been one on Nova Scotia coal coming into New Brunswick. I know that for a fact, and I think the minister will bear me out.

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LIB

William F. Carroll

Liberal

Mr. Carroll:

It was just about two years ago that I got the information. I do not know whether I am right, but in any event I am not contradicting the hon. member. We had a meeting in Fredericton a few years ago and that very question was raised. I am sorry, Mr. Speaker, to have overstepped my time, but particularly on behalf of the province of Nova Scotia and the island of Cape Breton I am very thankful to the government for the assistance they are offering to the companies. It is not an indication of failure on their part. It is a loan to the coal companies. I want to thank the government for that, but I feel down to the bottom of my heart-it is not out of my mouth yet-that the two gentlemen who are responsible for it are the Minister of Trade and Commerce (Mr. Howe) and our minister from Nova Scotia (Mr. Winters). A few years ago they were two in one. The present minister from Nova Scotia was assistant to the Minister of Trade and Commerce. They were two in one. I do not know whether it was at that time that the Minister of Trade and Commerce made his assistant aware of the

Coal

interests of the coal industry in the maritime region, but we are indebted to these two gentlemen for the present measure.

The other day the Minister of Trade and Commerce was variously described as a hero and a villain. I do not care in what capacity he was acting in this regard so long as he has not hurt the government and the country. I do not care whether he was a villain or a hero. I think he was acting as a real business executive. He is following the same role that he carried on during the war when the production of Canada was taken from nothing to a place where it was the envy of the world. He may have been a villain in the eyes of Germany in those days because he took quick steps to put the Germans in their place, and to keep them there at least for some time to come.

I want to say one word more, and perhaps it should be addressed to the Minister of Mines and Resources (Mr. Gibson). I shall be at his door in a short time, and I hope that he will have his geological and survey officials co-operate with the mines department of Nova Scotia as to mining methods and everything else. I hope a complete survey will be made of the west coast of the island of Cape Breton which happens to be in the constituency that I represent. We have coal there, but the trouble in the past has been that the people who had control of the coal did not mine it properly. They were given too much leeway. That is why I am asking the Minister of Trade and Commerce to interest his friend, the Minister of Mines and Resources, in this matter, or whoever may be the new minister. I hope the result will be that they will put at the service of the mines department of the province of Nova Scotia not only geologists but also technical advisers to see if something cannot be done for the purpose of bringing the industry to life again in that particular part of the province.

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PC

Percy Chapman Black

Progressive Conservative

Mr. P. C. Black (Cumberland):

Mr. Speaker, I represent the second largest coal producing centre in eastern Canada, the county of Cumberland. On behalf of the coal miners, business people and all other residents of that county, I want to express appreciation to the minister and to the government for introducing this legislation. I also want to express my appreciation to the members of the house for the good will they have shown towards the coal industry of the maritime provinces on the present occasion and previously. We are fortunate today in having the hon. member for Cape Breton South (Mr. Gillis) with us. He has as intimate a knowledge of the operations of the coal industry

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in Nova Scotia as anybody. He has the advantage of having rubbed shoulders with the miners of Nova Scotia, and he knows their viewpoint. We are fortunate in this discussion in having in the house the hon. member for Inverness-Richmond (Mr. Carroll) who has lived in the coal mining areas. He made a study of the industry over Canada, and after two or three years of investigation his royal commission brought down a report, which contains a great deal of information. Nothing much of a practical nature has been done with respect to it as yet, though I believe this legislation is along the lines of that study and in accordance with the views of the people associated with the coal mining industry in eastern Canada.

This industry is faced with great problems, problems of production, freight and markets; and over the years there has been the problem of human relations. To have this industry built up and put upon a sound basis would mean a great deal to our part of Canada. The federal government is going to do some financing, but the money will be paid back because the loans are made to these coal companies on the basis of ordinary industrial loans, to enable them to make improvements and install equipment they might not be able otherwise to obtain. But even if this should cost the federal treasury ten or twenty or fifty million dollars, most of that money would eventually return to central Canada, because a large proportion of the purchases made by the people of Nova Scotia and eastern Canada generally are made here.

For a long time in Canada we have needed a fuel and steel policy; I think everyone agrees that this is necessary. I have been associated with this matter in one capacity or another for twenty-five years. Relations between the workmen and operators twenty-five years ago were about as hostile as they could be. The coal operators in those days were hard-hearted, and did not have the sympathy for the viewpoint of the workmen that they should have had. Efforts were made to break the unions and discourage the miners. I and those associated with me took the stand that the miners were entitled to belong to a union of their own choice; and we supported them in that respect. Legislation was passed and regulations were drawn up to protect and benefit the miners. As the years have gone by I believe the attitude of the operators has changed, so that today there is far more good will toward the workmen and their point of view than there was twenty-five or fifty years ago. I am sure we cannot make a success of that great industry unless we have the confidence and good will

of the workmen. Theirs is a hazardous occupation, and over the years they have paid a high price in accidents and fatalities in the operation of these mines. The protective measures have been greatly improved, but there is still much to be done; and no matter how much is done, there is always a great hazard in coal mining.

The coal mines of Nova Scotia are publicly owned by the people of that province. Years ago, in the days of Sir Charles Tupper, they were taken over from the then owners in England, and they have been leased to the operators. Personally I believe the areas leased were too large, and that it would have been much better for the industry and all concerned if this wholesale leasing had not been done. I believe with the government, that this is not an industry that should be operated by any government. It should be operated by private enterprise, under strict supervision.

The hon. member who preceded me spoke of the number of tons raised per man-day. A few years ago that figure was very much lower than it should have been, and I am pleased to note that there has been some improvement. The workmen were blamed for that condition, but they were not at fault. Perhaps there should have been a little more good will on their part at times; perhaps we should not have had some of the strikes that occurred. But many of the best workmen were attracted to other branches of industry, or were told that they should enlist in the services. For this reason many left their places in the mines, where they could have given better service even than on the field of battle. Inexperienced men took their places; the morale of the workmen deteriorated and the production per man was reduced. The workmen were not to blame for that situation, but it stands to their credit.

In recent years increased freight rates have made the delivered cost of the fuel higher, and the payment of subventions started in the early 1930's has been absolutely necessary to enable us to market the quantity of coal we are able to produce. That policy will have to be continued for many years, perhaps to an even greater extent than in the past. It is recognized in Nova Scotia that if we are to have full production in our mines it is necessary that we market yearly in central Canada from three to four million tons of coal. That cannot be done unless there is cheap water transportation and rail subventions. If the Chignecto canal were built and access given to Northumberland strait the shipment of coal would be made easier and transportation costs would be reduced.

There are in the county of Cumberland two of the large coal fields, Springhill and Joggins-River Hebert-Maccan-Chignecto-Fen-wick. Springhill is one of the best fields in Canada with the highest quality of coal, running over 14,000 b.t.u.'s. It has been operated for many years, and they have gone down from eleven to twelve thousand feet. One seam is nine feet thick, pure coal; another is six feet thick; another is four and a half feet; and there are other seams in that area. In Cumberland county we produce about six hundred thousand tons per year. In the Joggins-River Hebert-Maccan-Chignecto area there are several seams from sixteen inches up to three feet and more. There are experienced managers and workmen in those mines so that even with those thin seams, production per man has been higher than at any other mine in Nova Scotia. The b.t.u.'s of the coal from that field are not as high as the coal in the Springhill area, but it is splendid domestic coal. These mines should be equipped with washing plants in order to remove the impurities from the finer coal, and I believe that is a contribution which should be made by the federal government. This would increase the quality of the coal produced in that area and widen the markets.

Competition for markets has always been keen, especially during times of depressed business conditions. Back in the thirties, the mines were operating only one or two days a week. There was a surplus of hydroelectrical power which was not being used by the paper mills; and in industry that electrical energy was placed under boilers, and took the place of coal. In those days, there was also the competition of coal coming from overseas, which was brought to this country in the form of ballast. As business conditions improved, the market widened out. It is considered necessary to continue subventions, and to secure a market for three million or four million tons of coal in central Canada.

Maritime coal is now faced with competition from oil. Many domestic establishments are using oil today, whereas in previous years they had to burn coal. It is discouraging for the maritime provinces to find that the Canadian National Railways have been purchasing such large quantities of imported coal. This replaces the coal available in the maritime provinces, and the practice is one that should not be continued. The maritime provinces were disappointed also when it was found that the Prince Edward Island car ferry was equipped to burn oil. This replaced

25,000 or 40,000 tons per year, which it was considered the maritime producers should supply.

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There should be some development in connection with making chemicals from coal. So far, that has not taken place in Nova Scotia. Coal from the maritime provinces has been shipped in the roughest, cheapest form. Industries were built up in Germany, Great Britain, and to some extent in the United States, for producing chemicals, gasoline and oil from coal. As I have mentioned, washing plants should be established in the River Hebert-Joggins fields, in order to purify the coal, and get a higher percentage of carbon and more b.t.u.'s.

If the maritime provinces are going to compete for the coal market in central Canada they must receive assistance. A cheaper grade of coal might be used in the manufacturing of electric power. In the west, there is a cheap source of power in the form of oil and gas. This oil and gas was partly paid for by the maritime provinces when they contributed in purchasing the land from the Hudson's Bay Company. I believe the federal government should make contributions towards the utilization of cheaper grades of coal in the maritime provinces for the generating of electricity. This would provide that cheap power which is necessary if the maritime provinces are to compete with the other parts of Canada.

Another factor to be considered, Mr. Speaker, is the preservation of American exchange. The more coal we can produce in Canada, the less United States exchange will be required in Canada. I believe this country will be rewarded if the proposal to finance and fully develop the coal-producing mines of Nova Scotia is approved. This is a desirable and necessary proposal. No doubt it should go farther than it does, but I believe the plan the minister is undertaking is essential to the welfare of the maritime provinces. Once again, I express my appreciation to the minister, and to the members of the house, for what is being done.

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LIB

Gordon Benjamin Isnor

Liberal

Mr. Gordon B. Isnor (Halifax):

Mr. Speaker, I will be very brief. One of the western members told me that if I spoke on this question and took more than two minutes, we would not get this $10 million. I am most anxious to see this bill go through, and for that reason I am going to stay within the two-minute limit.

As one of the members from Nova Scotia, while not directly from a coal-producing area, I want to say that the effect of this bill will be felt throughout the whole province of Nova Scotia, as well as the other maritime provinces. For that reason we are certainly in favour of its early passage. It is a step which should have been taken years ago, as the member for Inverness-Richmond (Mr. Carroll),

Coal

who is an authority on the question, and our friend from Cape Breton South (Mr. Gillis), mentioned.

The main factors entering into this problem are production and markets. Perhaps transportation is a third item, but unless you have production it does not do much good to have markets, as has been clearly shown. I believe we can produce the markets through the sales organization of the biggest company in the coal industry, which produces 87 per cent of the coal produced in our province.

I wish to touch on one or two items that have not been mentioned so far as I know. We have 19 coal operators in Nova Scotia, the largest of which is the Dominion Steel and Coal Company, which produces 87 per cent of the coal. As the member for Inverness-Richmond (Mr. Carroll) mentioned, the production per man-day is about 1-97 tons.

Topic:   ASSISTANCE TO PRODUCTION IN ATLANTIC MARITIME PROVINCES
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LIB
LIB

Gordon Benjamin Isnor

Liberal

Mr. Isnor:

Two point one nine; that figure has gone up since I made a note of it. I mention that because it is estimated that with this new machinery there should be a daily production of something slightly over six tons per man. Production is the all-important question, because increased production naturally lowers your overhead costs and puts you in a position where you are able to meet the competition with which you have to contend. That is the one point, Mr. Speaker, that I wish to place before the house. We produce the second largest amount of coal in Canada. Alberta produced 8,826,239 tons in 1946. We produced 5,425,898 tons. We feel that that could be increased to eight or nine million tons a year at a lower price. If we did that we would be in a position to compete to a greater extent in the markets of central Canada. Someone has already told me that my two minutes have more than expired, and I shall take my seat.

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PC

George Alexander Drew (Leader of the Official Opposition)

Progressive Conservative

Mr. George A. Drew (Leader of ihe Opposition):

Mr. Speaker, because of certain remarks that were made earlier I wish to make some comments on the bill and the scope of the provision contained in it. The purpose has been stated to be an improvement of the producing methods of the coal mines of the maritime provinces. The provisions are very wide. They simply state that the minister, with the approval of the governor in council, may enter into agreements with the coal producers to carry out undertakings designed to increase the efficiency of the operations of the coal producers by means of mechanization. Subject to the provisions as to how interest is to be computed and as to the time that repayment is to begin and the placing of a first charge

upon the assets of the producer, everything else is upon a wide-open basis at the discretion of the minister. For that reason I should like to point out what I do think we should begin to consider more seriously here in Canada in seeking the most effective use of the very large coal resources we have, and particularly those coal resources in the maritime provinces which have been causing some difficulty for some years from the point of view of economic production.

Speaking earlier in this debate one hon. member said that on another occasion outside this house I had spoken of the way in which the use of our coal could be increased. I do not intend to enlarge upon that statement at this time, because we are dealing now particularly with the improvement of producing methods in the coal mines of the maritime provinces by making it possible to improve mechanization in the coal production of these mines. I do suggest, however, that the hon. member for Cumberland (Mr. Black) has put his finger on one way in which a great deal of this coal could be used. Today a very large percentage of the industrial production of the world, and particularly in the highly developed industrialized countries, is based upon a supply of electric energy. The use of coal is still the basis of electric production to a very considerable extent in most countries. We sometimes forget, particularly in the central provinces, in British Columbia as well as in Alberta and Manitoba, that most countries do not possess the great water resources that we do for the production of electric energy. The fact is that in most countries of the world today electricity is obtained primarily from coal, lignite, peat, fuel wood or some other obtainable fuel, and not based upon water supply. The great producers of electric energy before the war, namely the United States, Germany, the United Kingdom, France and Soviet Russia, produced most of their electric energy from coal, lignite, peat, or other fuels. Therefore we should look to the use of coal for the production of electricity in the most economic way in those areas where there are no great waterfalls which can provide electric energy.

In Europe, and particularly in Germany and Russia, shortly before the war highly successful developments had taken place in the production of electric energy by burning low-grade coal under ground and producing gas from which electric energy was produced at costs almost comparable with hydroelectric energy. Whether coal be converted to electricity by an underground process of that kind, or whether it be carried into the great burning furnaces of electric plants beside coal seams through continuous chains of hoppers, or whether it be used in

any other manner, 1 do believe that in the maritime provinces there are great opportunities for the employment of coal for the production of electric energy which could then be carried easily to every part of the province for the purpose of industrial production as well as the various domestic uses which would add to the comfort of the people of every part of the maritime provinces through the possibility of obtaining electric energy at a lower cost than they pay today.

This is not in any way in the realm of theory. In the sub-Moscow area of Russia there is a tremendous electric power plant using low-grade underground seams for the production of gas, which is then turned into electricity at very satisfactory cost levels. When I say that I do not mean satisfactory on the evidence of the information furnished by Soviet engineers, but on the evidence of engineers from Canada who have visited that project.

What procedure is used is of course something to be worked out by engineers who will examine the possibilities in each particular area; but it does seem to me that when we are considering the use of public funds to improve the productive value of the coal that we possess, either in the maritime provinces or elsewhere, we should be at the very vanguard of research in this field. After all, Canada is today in the very forefront in the production of hydroelectric energy. With our enormous coal resources placed in areas which are in many instances distant from the points where the coal will be used immediately, it undoubtedly is desirable to reduce it to the most easily transported form of power that there is.

There is another field of research which I suggest should be contemplated when a subject of this kind is under consideration. In Europe, through pressure of necessity, science had found ways of converting coal into textiles and into many of the things in daily use in the homes, offices and factories. Doubtless there are a number of hon. members here who had the opportunity to attend the world's fair at Paris in either 1937 or 1938, and if they did they will recall that in the German building there were demonstrations of the use of coal for such an infinite variety of useful purposes that it challenged the imagination and opened wide the possibilities to every country which has resources of coal such as we have.

Perhaps we might remember that Germany, which came so close to dominating the world through the use of vehicles moved by internal combustion engines, relied almost entirely upon liquid fuels produced from coal. In addition to the possibility of converting coal 45781-162J

Coal

into electricity there is also the possibility of liquefying coal and converting it into gasoline and oil, and other liquid products of that type. The German air force and tank force, which came so dangerously close to success in the last world war, relied almost entirely during the greater part of the war upon fuels provided in that way.

In the very nature of the expanding use of gasoline from crude oil obtained from the ground, and the steady consumption of existing supplies which within the measurable future will undoubtedly exhaust certain fields, the cost of that type of fuel is likely to increase to a point where we should be contemplating the use of coal for the production of fuel of that kind in the not too distant future.

I have mentioned these things at this time because the bill before us contains a wide-open provision for assistance to coal producers for the purpose of increasing the efficiency of their production by mechanization. I suggest that mechanization of that kind need not mean only mechanization in the actual hauling of the coal in its solid form, but also mechanization of another kind which would use coal for other purposes.

There is in the bill another feature which interests me, and that is that while $10 million is available as a total amount, the figure indicated as the limit to any one producer is $7,500,000. That would seem to be a large percentage of the total figure. It might be interesting to have the minister inform us if at the present time there is in fact any tentative arrangement in existence which indicates the necessity for single advances of that nature, in relation to the total of $10 million of advances to be made.

I am sure every hon. member supports the idea of mechanization in coal production. I should hope however that in supporting the idea of improving our coal production methods we might also urge that Canada lead the way in the scientific use of our coal resources in the best interests of our people.

Topic:   ASSISTANCE TO PRODUCTION IN ATLANTIC MARITIME PROVINCES
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Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Beaudoin in the chair. On section 1-Short title.


PC

Percy Chapman Black

Progressive Conservative

Mr. Black (Cumberland):

May I have a copy of the bill before we proceed to discuss it?

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LIB

Louis-René Beaudoin (Deputy Chair of Committees of the Whole)

Liberal

The Deputy Chairman:

Does section 1 carry?

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December 1, 1949