February 15, 1979

LIB

Alastair William Gillespie (Minister of Energy, Mines and Resources; Minister of State for Science and Technology)

Liberal

Hon. Alastair Gillespie (Minister of Energy, Mines and Resources and Minister of State for Science and Technology):

Mr. Speaker, the hon. member inadvertently misquoted my position: that is not a new tactic on his part. Hon. members will realize that I have repeatedly stated in this House that the situation is serious. Hansard will show that I have said it is a serious situation, but I have also said that it is a manageable situation. 1 believe it is manageable and I have indicated to the House why.

We have some excess oil producing capacity in the west which can be traded for offshore oil which would, therefore, take care of the eastern refineries. I have reported this to the House on numerous occasions in the last couple of weeks. What the hon. member for Northumberland-Durham does not realize is that Venezuela is a different kind of source of supply for Canada than is the Middle East. We have had a very long history of supply from Venezuela. Venezuela has been our major supplier; roughly 40 per cent of our imports come from Venezuela. 1 was in Venezuela about a month ago and at that time I sought the assurance of the Venezuela government and Petroleos de Venezuela, the national oil company of Venezuela, that they would continue to supply Canada. They gave me that assurance.

In the case of Exxon and Imperial Oil we are dealing with a very special situation because Imperial Oil gets all its oil from Venezuela. That is the difference between Imperial Oil and the other companies the hon. member mentioned. I think I would have been remiss if I had not insisted on the undertak-

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Oral Questions

ing that Imperial Oil establish a direct contracting relationship with Venezuela so that Exxon cannot siphon off supplies which should be coming directly to Canada.

Topic:   ORAL QUESTION PERIOD
Subtopic:   MEASURES TO ENSURE ADEQUATE SUPPLY OF OIL TO CANADIAN REFINERIES
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?

Some hon. Members:

Hear, hear!

Topic:   ORAL QUESTION PERIOD
Subtopic:   MEASURES TO ENSURE ADEQUATE SUPPLY OF OIL TO CANADIAN REFINERIES
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PC

Allan Frederick Lawrence

Progressive Conservative

Mr. Lawrence:

Mr. Speaker, due to the ineptitude of this minister and this government we will have serious difficulty next autumn, at the very latest, with respect to our oil supplies. In the reversal of the minister which took place within the last hour he admitted that next fall, at the very latest, we will have serious supply difficulties. He has indicated some remedy with regard to Imperial Oil of Canada, but what is he doing about a similar situation which is affecting at least four other Canadian refineries and companies with respect to offshore oil?

Every Canadian refinery in eastern Canada will suffer under the allocation agreement, because our own pipelines may not have enough capacity to bring even Canadian western crude into eastern Canada. What is the minister doing about these other four companies? What is he doing about the other six Canadian refineries in eastern Canada?

Topic:   ORAL QUESTION PERIOD
Subtopic:   MEASURES TO ENSURE ADEQUATE SUPPLY OF OIL TO CANADIAN REFINERIES
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LIB

Alastair William Gillespie (Minister of Energy, Mines and Resources; Minister of State for Science and Technology)

Liberal

Mr. Gillespie:

Mr. Speaker, I do not know what has distracted the hon. member or what has preoccupied him. I do not know why he has not been following the debates in this House. I have made it very clear over the last several weeks that the exchange arrangements, which have been authorized by the National Energy Board, of the companies the hon. member has mentioned will replace the shortfall these companies otherwise would have. Using western crude on a temporary basis, it is possible to make up for the shortfall of crude which would have been affecting those refineries. That is quite clear, it is on the record, but the hon. member seems only now to have realized what has been going on.

Topic:   ORAL QUESTION PERIOD
Subtopic:   MEASURES TO ENSURE ADEQUATE SUPPLY OF OIL TO CANADIAN REFINERIES
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PC

Allan Frederick Lawrence

Progressive Conservative

Mr. Lawrence:

Mr. Speaker, the minister has not only tried to pour oil on troubled waters with respect to the public of this country, but he has even lulled into lethargy some of his cabinet colleagues who should have known what the situation was yesterday. One need only go through the quotations of the minister in this House over the last ten days. I ask the minister again, very sincerely, why he has not informed the Canadian public of the seriouness of this situation. Why has he not told us the truth regarding an extremely serious situation which we are going to face because of his ineptitude?

Topic:   ORAL QUESTION PERIOD
Subtopic:   MEASURES TO ENSURE ADEQUATE SUPPLY OF OIL TO CANADIAN REFINERIES
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LIB

James Alexander Jerome (Speaker of the House of Commons)

Liberal

Mr. Speaker:

I think the hon. member will recognize that that question has an element of argumentation.

Topic:   ORAL QUESTION PERIOD
Subtopic:   MEASURES TO ENSURE ADEQUATE SUPPLY OF OIL TO CANADIAN REFINERIES
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CONTROL AND MONITORING OF OIL PRICES AND SUPPLIES

PC

J. Michael Forrestall

Progressive Conservative

Mr. J. M. Forrestall (Dartmouth-Halifax East):

Mr. Speaker, if the Minister of Energy, Mines and Resources and his colleagues would take eastern Canada seriously, maybe they would make some inroads and get some political support there. I have two questions for the minister. What authority does the minister believe-

Topic:   ORAL QUESTION PERIOD
Subtopic:   CONTROL AND MONITORING OF OIL PRICES AND SUPPLIES
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?

An hon. Member:

Oh, oh!

February 15, 1979

Oral Questions

Topic:   ORAL QUESTION PERIOD
Subtopic:   CONTROL AND MONITORING OF OIL PRICES AND SUPPLIES
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PC

J. Michael Forrestall

Progressive Conservative

Mr. Forrestall:

Never mind. You have trifled with us long enough, sir. What authority does the minister believe he has, or understand he has within his competence as minister, to control allocation, to monitor that allocation, to control prices and to monitor the prices of the very high-priced oil we will get as a result of the swaps, only one of which has the approval of the National Energy Board to date?

What monitoring and what control mechanisms does he have, or does he believe he has, that he can put into place to make sure that we do not freeze in the dark in eastern Canada next winter?

Topic:   ORAL QUESTION PERIOD
Subtopic:   CONTROL AND MONITORING OF OIL PRICES AND SUPPLIES
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LIB

Alastair William Gillespie (Minister of Energy, Mines and Resources; Minister of State for Science and Technology)

Liberal

Hon. Alastair Gillespie (Minister of Energy, Mines and Resources and Minister of State for Science and Technology):

I do not think the hon. member understands the situation. He seems to be arguing that we should not try in any way to make up the shortages that will occur in eastern refineries as a result of actions taken by others outside Canada. That is quite clearly what he seemed to be saying.

I have been stating in the House for two weeks that we can use western Canadian oil to make up that shortage. That is why we have taken the policy position, which the National Energy Board is administering, on submissions by refineries in eastern Canada which will provide them, in effect, with the same volumes of western Canadian crude. 1 do not think the hon. member really understands the situation. He seems to be saying that we should turn it all over to the multinational corporations, we should let the multinational corporations decide what is best for Canada, and we should stand back and accept the shortages which would inevitably occur with that kind of policy.

Topic:   ORAL QUESTION PERIOD
Subtopic:   CONTROL AND MONITORING OF OIL PRICES AND SUPPLIES
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?

An hon. Member:

The Pagliacci of the country.

Topic:   ORAL QUESTION PERIOD
Subtopic:   CONTROL AND MONITORING OF OIL PRICES AND SUPPLIES
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PC

J. Michael Forrestall

Progressive Conservative

Mr. Forrestall:

Thank God some time in the spring the people of this country will get rid of clowns like that.

The question I am putting to the minister is simply this. What assurances at this point can the minister give the House, the refineries and the people of eastern Canada that starting April 1 there will be an adequate supply for the refineries? We do not believe him when he tells us all is well. Let him tell us precisely what assurances he can give us that there will be an adequate supply of oil for eastern Canadian refineries, starting April 1.

Topic:   ORAL QUESTION PERIOD
Subtopic:   CONTROL AND MONITORING OF OIL PRICES AND SUPPLIES
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LIB

Alastair William Gillespie (Minister of Energy, Mines and Resources; Minister of State for Science and Technology)

Liberal

Mr. Gillespie:

Mr. Speaker, I have told the House repeatedly that we received assurances from the head of Petroleos, the national oil company of Venezuela. I received assurances from the Venezuelan government at the highest levels that Venezuela wanted to continue the export of 200,000 barrels of oil a day to Canada. That is 40 per cent of our imports. They are our major supplier.

It is because Exxon decided, for its own purposes, to intervene and to divert something in the order of 25,000 barrels a day of that oil from Canada that I took the position with Imperial Oil. Imperial Oil accepted the first time around.

They have made certain other arrangements which may tide them through. Also, I have made it quite clear to them that the kind of exchanges we are talking about will not be available to them and that the shortages they then may face will have to be made up by the competitors.

Topic:   ORAL QUESTION PERIOD
Subtopic:   CONTROL AND MONITORING OF OIL PRICES AND SUPPLIES
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SUGGESTION PETRO-CANADA PURCHASE VENEZUELAN OIL

NDP

John Edward Broadbent

New Democratic Party

Mr. Edward Broadbent (Oshawa-Whitby):

Mr. Speaker, despite the bland and misleading assurances of the minister in the past week, which were repeated today-

Topic:   ORAL QUESTION PERIOD
Subtopic:   SUGGESTION PETRO-CANADA PURCHASE VENEZUELAN OIL
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?

Some hon. Members:

Oh, oh!

Topic:   ORAL QUESTION PERIOD
Subtopic:   SUGGESTION PETRO-CANADA PURCHASE VENEZUELAN OIL
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NDP

John Edward Broadbent

New Democratic Party

Mr. Broadbent:

-Canadians can now, with this oil crisis, see very clearly what it means to have our major natural resources owned and controlled by multinational corporations. That is the message.

Topic:   ORAL QUESTION PERIOD
Subtopic:   SUGGESTION PETRO-CANADA PURCHASE VENEZUELAN OIL
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?

Some hon. Members:

Hear, hear!

Topic:   ORAL QUESTION PERIOD
Subtopic:   SUGGESTION PETRO-CANADA PURCHASE VENEZUELAN OIL
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NDP

John Edward Broadbent

New Democratic Party

Mr. Broadbent:

Just an hour ago, in his press conference outside the House, the minister acknowledged that the request made by Imperial Oil to its parent company to ensure we received a fair allocation had been ignored. The minister acknowledged that, but he repeated his insistence that the branch plant go back and tell its boss what to do. The minister expects us to accept that. Who does he think he is kidding?

Considering that the east coast in particular needs the assurance of supply, and considering that the parent company-in this case, Exxon-has not met the request of the Canadian subsidiary, why is the minister not taking steps to ensure that Petro-Canada be the exclusive purchaser of that Venezuelan oil about which he talked so glibly today?

Topic:   ORAL QUESTION PERIOD
Subtopic:   SUGGESTION PETRO-CANADA PURCHASE VENEZUELAN OIL
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February 15, 1979