[ Page 4403 ]

CONTENTS

Routine proceedings

Oral questions

Assistance to grape growers. Mrs. Wallace –– 4403

Federal subsidy for coastal transportation. Mr. Wallace 4403

Duties of Mr. Lenko. Mrs. Dailly –– 4404

Gas scrubbing plant contract. Mr. Skelly –– 4404

Discrepancies of Hudgins statement. Mr. Macdonald –– 4404

Request for employment statistics. Ms. Brown –– 4405

Problems of hog producers. Mrs. Wallace –– 4405

Salmon derby discrimination. Mr. Kahl –– 4405

Matter of urgent public importance

Construction of Alcan pipeline. Mr. Gibson –– 4406

Mr. Barrett –– 4414

Mr. Wallace –– 4421

Mr. Bennett –– 4428

The House met at 2 p.m.

Prayers.

HON. K.R. MAIR (Minister of Consumer and Corporate Affairs): Mr. Speaker, I have three special guests in the Speaker's gallery today: Mr. Hugh Bardon, his wife, Frances, and their daughter Lisa. In a rare incident of national nepotism, I might say that Mr. Bardon is an Assistant Deputy Minister of Consumer and Corporate Affairs in Ottawa and is my first cousin. I would ask the House to make them welcome.

HON. J.A. NIELSEN (Minister of the Environment): Mr. Speaker, two friends from Vancouver are visiting the House today: Mr. Terry Stewart and Mr. John Norton.

Oral questions.

ASSISTANCE TO GRAPE GROWERS

MRS. B.B. WALLACE (Cowichan-Malahat): Mr. Speaker, my question is for the Minister of Agriculture. Today I want to talk about grapes. It has been estimated that there will be 13,500 tons of production this year yet the B.C. wineries are able to contract for only some 8,700 tons, a figure which is down from last year.

The wineries' president has indicated that one of the major causes is the time delay in programmes now in place under the Minister of Consumer and Corporate Affairs (Hon. Mr. Mair) , and also the government policy which has cut back B.C. winery listing from 100 to some 66.

MR. SPEAKER: Hon. member, would you please approach the question?

MRS. WALLACE: My question is, Mr. Speaker: Is the Minister of Agriculture prepared to assist the grape growers this year to ensure they continue to produce when the programmes now in place widen the distribution of B.C. wines?

HON. J.J. HEWITT (Minister of Agriculture): Mr. Speaker, the problem basically is that the wineries have not yet recovered from their reduced sales in British Columbia. The grape growers are producing substantial quantities of grapes; I think the figure estimated now is 12,500 tons. I am in constant contact with the grape growers and the wine industry. We're trying to do our best, Mr. Speaker, to ensure that both industries survive and prosper in this province. However, it is a situation that has to be dealt with, I think, between those two industries, and I don't believe the province of British Columbia should be in the middle.

We've done our bit with regard to the wine policy. I'm hopeful that these two industries will negotiate and will come to a conclusion that will benefit both of them.

MRS. WALLACE: On a supplementary, Mr. Speaker, do I take it that the minister is saying that while he has been in consultation he is not prepared to give any assistance to ensure that the grape growers are able to continue in production so they will be there when his colleague's programmes come into fruition?

HON. MR. HEWITT: Mr. Speaker, the matter hasn't come to that situation yet. I understand that what is happening now is that the Grape Marketing Board and the wineries will be meeting, if I'm not mistaken, this Friday, to discuss the purchase. But, Mr. Speaker, I don't believe that when a product has been overproduced and there is not a sale for it, the government should be picking up those losses. I think that the industries have to recognize that it will take time for the wine policy to take effect and they should be working together to solve their problems jointly.

MRS. WALLACE: By that time there won't be any grape growers.

FEDERAL SUBSIDY FOR

COASTAL TRANSPORTATION

MR. G.S. WALLACE (Oak Bay): Mr. Speaker, my question is to the Minister of Energy. With regard to the announcement on April 18 of the $8 million subsidy from the federal government for coastal transportation, can the minister tell the House whether he has received any or all of the $8 million? If not, when does he expect that he will be receiving it?

HON. J. DAVIS (Minister of Energy, Transport and Communications): Mr. Speaker, according to the agreement between Canada and British Columbia, the $8 million a year - which, incidentally, escalates with inflation - is to be paid quarterly. The first payment was made shortly after July 1 of this year to British Columbia.

MR. WALLACE: On a supplementary, can the minister tell the House whether the $10.8 million subsidy to the B.C. Ferry Corporation listed in the first quarter financial report includes any of that portion of the $8 million subsidy which the minister has just referred to?

[ Page 4404 ]

HON. MR. DAVIS: The answer, Mr. Speaker, essentially is no. The provincial subsidy is being increased so that the amount available to B.C. Ferries in total will increase in two stages, the provincial subsidy substantially covering the fare reductions and the $8 million a year escalating to cover the middle and upper coast.

MR. WALLACE: Following on the minister's answer, Mr. Speaker, about the $8 million being used for coastal transportation on the mid and north coast, can the minister tell the House why he has not introduced a bill to enable the government to pass this federal money on to the B.C. Ferries, as was done with B.C. Railway in the form of Bill 47?

HON. MR. DAVIS: Mr. Speaker, my understanding is that these moneys can be passed on by order-in-council.

MR. D.F. LOCKSTEAD (Mackenzie): Supplemental. In view of the discussions now taking place between CP Rail and Northland Navigation, how much subsidy is the government considering paying to this new proposed consortium?

HON. MR. DAVIS: None, Mr. Speaker.

MR. LOCKSTEAD: Well, if such a request were received by the government from this consortium, would the government consider paying a subsidy to this consortium?

MR. SPEAKER: Hon. member, the question is hypothetical.

DUTIES OF MR. LENKO

MRS. E.E. DAILLY (Burnaby North): To the hon. Provincial Secretary. Order-in-council 2502 of July 29 shows the Provincial Secretary as taking a second executive assistant in addition to Dianne Hartwick at a salary of $19,500 per year. Now in addition, the Provincial Secretary, Mr. Speaker, also employs Dick Lillico at $22,000 and John Plul at $25,000. This now makes four political appointments for a total salary of $86,000. My question is, Mr. Speaker: what ministry will Mr. Lenko be working in and what will be the terms of his reference for work?

HON. G.M. McCARTHY (Provincial Secretary): Mr. Speaker, Mr. Lenko's duties will be attached to the office of the Provincial Secretary.

GAS SCRUBBING PLANT CONTRACT

MR. R.E. SKELLY (Alberni): A question to the Minister of Economic Development (Hon. Mr.

Phillips) . Has B.C. Rail or any other government agency or Crown corporation entered into any contractual arrangements with Westcoast Transmission to provide land and/or services for a gas scrubbing plant at Hasler Flats near Chetwynd?

HON. D.M. PHILLIPS (Minister of Economic Development): Mr. Speaker, I will have to take that question as notice.

DISCREPANCIES OF

HUDGINS STATEMENT

MR. A.B. MACDONALD (Vancouver East): Mr. Speaker, a question to the Attorney-General (Hon. Mr. Gardom) . I have here the affidavit filed with the Legislature of Mr. Hudgins on July 20 and the statement of Mr. Hudgins that he made on March 25,1976, where there are clear discrepancies. I'm asking the Attorney-General: will he take a look at this matter and report back to the House?

HON. G.B. GARDOM (Attorney-General): I'd respond to the hon. member from Vancouver East more charitably than my colleague did, but with exactly the same tenor of response. This matter is under investigation, as you should know.

MR. MACDONALD: On a supplementary, Mr. Speaker, will the Attorney-General, who now knows about the matter - and he's made it clear to the House and I appreciate that - undertake to report back to the House what disposition is going to be made in this case?

HON. MR. GARDOM: No, I don't undertake to report the results of investigations. You should well know, being a former Attorney-General, that's not part of the province or the responsibility of the job.

MR. MACDONALD: Oh, certainly it is.

MR. G.V. LAUK (Vancouver Centre): On a supplementary to the Attorney-General, Mr. Speaker, the information is before the Attorney-General with a view to possible perjury charges. Is the Attorney-General, or his officer, going to interview Mr. Hudgins with respect to which statement is true? If so, has that interview taken place and when can we expect a report?

HON. MR. GARDOM: I cannot respond as to whether or not an interview has or has not taken place, but I can inform you, as has done my colleague, that the matter is under investigation. That will be the answer you're getting today, period.

MR. LAUK: Mr. Speaker, on a further

[ Page 4405 ]

supplementary to the Attorney-General, there is an investigation and there is an investigation. Is the Attorney-General suggesting that all that's being done is a perusal of the available documents, or are witnesses being interviewed? If so, when can we expect the results of that investigation?

REQUEST FOR EMPLOYMENT

STATISTICS

MS. R. BROWN (Vancouver-Burrard): This question is for the Minister of Human Resources. Mr. Speaker, on January 17, almost eight months ago, the second member from Vancouver-Burrard asked the Minister of Human Resources whether he would be willing to tell us the number of employable people who were receiving assistance in 1976 and 1977, as well as the number of persons under 60 who were receiving assistance in 1975-1976,1976-1977. Those are very, very simple statistics, Mr. Speaker, which his ministry keeps.

My question to the Minister of Human Resources is: why is the minister so reluctant to make these figures public? When will he be willing to table the answers to questions 18 and 20 which were asked of him eight months ago?

MR. SPEAKER: Hon. member, it's improper in oral question period to refer to questions which are already on the order paper.

MS. BROWN: This was an oral question which was on January 17. 1 was referring to the date of an oral question. We've had eight months of this legislative session since then.

HON. W.N. VANDER ZALM (Minister of Human Resources): It wilt give me great pleasure to determine very quickly what happened to the reply or response to that particular question. I'll make it known to the House at that time.

MS. BROWN: What does that mean?

PROBLEMS OF HOG PRODUCERS

MRS. WALLACE: Mr. Speaker, I have another question for the Minister of Agriculture. Some two weeks ago I asked him about the hog situation and -I quote his words - he said he "would be giving any assistance" he could. Now in the two-week period since the federally inspected plant closed, the hog producers have shipped out of province some seven loads of hog - it's probably more than that now - at a cost of something in excess of $14,000. His department's response, I understand, has been an offer to adjust freight-cost allowance under income assurance. My question is: will the minister now make good his commitment by giving the hog producers of this province some immediate financial assistance to cover this freight differential until the federally inspected plant is available?

HON. MR. HEWITT: Mr. Speaker, the hog situation, I think, has improved somewhat. One of the previously provincially inspected plants has now gone to federal inspection, which gives a facility that can take the production of hogs. We have agreed to pick up a $3 per hundredweight cost for the period July through August, or part of July and August, as assistance. That has certainly met with agreement, as I understand, from the hog producers. We - are working on a contractual arrangement between a processor and the hog producers and I hope we'll be able to arrive at a conclusion whereby all hog production will be able to be funnelled through that organization, which will resolve the problem hog producers have faced in the past.

MR. D. BARRETT (Leader of the Opposition): Mr. Speaker, a question to the Minister of Energy, Transport and Communications. I'd like to ask the minister if the provincial government had a direct intervener at any of the NEB hearings related to the possible roots of the natural gas pipeline from either the arctic area or from Prudhoe to the lower 48.

HON. MR. DAVIS: The answer is, yes, Mr. Speaker, through the British Columbia Energy Commission representation by the Attorney-General.

MR. BARRETT: A supplementary, Mr. Speaker. Could you give me the name of the intervener and how they intervene?

HON. MR. DAVIS: Mr. Speaker, I'll have to take the questions as notice but I will get those details.

SALMON DERBY DISCRIMINATION

MR. L.B. KAHL (Esquimalt): I have a question of the Minister of Consumer and Corporate Affairs. Will the minister investigate the awarding of the $25,000 cash prize in the B.C. Salmon Derby to an individual who did not in fact, catch the largest fish, and also investigate the fact that a great fishing area in my constituency is being discriminated against by virtue of making all fishermen in that area fish under a 10-pound handicap?

AN HON. MEMBER: They're already labouring under a political handicap.

HON. MR. MAIR: Well, Mr. Speaker, 1, unlike my colleagues in the House, take this very seriously, however fishy the story may seem to be. The fact of

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the matter is that in beautiful southern Vancouver Island we are blessed with the largest fish in the area.

In order to make this particular derby something which people will enter, it has been necessary to create a handicap situation, so I am instructed. Like golfing or like horseracing, there would be no contest unless there were this handicap, and only people in Pedder Bay and Sooke and places like that would enter. So unfortunately, my colleague from Esquimalt's (Mr. Kahl's) constituent, while he did catch the biggest fish, did not get the prize because his fish had to have a certain poundage subtracted from it. I very much regret that, but.... Oh, Mr. Speaker, I was just beginning.

MR. SPEAKER: Sorry, hon. minister, the bell terminated the question period.

Interjections.

MR. SPEAKER: Let me suggest to the hon. members of the House that there is nothing improper about members from all sides of the House asking questions in question period.

The hon. member for Prince Rupert on a point of order.

MR. G.R. LEA (Prince Rupert): On a point of order, I think that all sides of the House can take the question from Esquimalt in good fun, as it was meant.

MR. SPEAKER: What is your point of order, hon member?

MR. LEA: I wonder why the Speaker didn't rule it either frivolous, as he has questions from this side of the House, or facetious, as he has from this side of the House. What special rights do they have on that side of the House?

MR. SPEAKER: Anytime, hon. member, that a minister indicates he or she wishes to answer a question, you'll notice, as I have in the past and I will in the future, that I allow them to answer the questions.

MR. LEA: No, you haven't.

MR. SPEAKER: I have too, hon. member.

[Mr. Speaker rises. ]

MR. SPEAKER: It is the duty and the obligation of the Speaker in question period to use some discretion in the number of supplementals that will be asked in the questions as to whether they are out of order or in order as they are presented to the

House. It's also my duty to rule on questions. But I have, and you all will have observed, on many occasions suggested a question is out of order, only to have the person to whom the question was directed indicate they would answer. It is not the position of the Speaker to interfere with the right of a minister, if he so desires, to answer a question even though it may appear to me that the question is irregular or out of order. That's for the minister to decide. The only thing I can do in question period is give you the directions according to the rules that are before the House.

[Mr. Speaker resumes his seat.]

MR. G.F. GIBSON (North Vancouver-Capilano): Mr. Speaker, having asked leave to move a certain motion last night, and having received your concurrence that it was in order to ask for leave, should I once again read the motion or would I simply ask for leave at this stage?

MR. SPEAKER: In order to have the motion before the House, I think it would be proper to have it read to the House and then ask leave.

MR. GIBSON: Mr. Speaker, I ask leave to move the adjournment of the House for the purpose of discussing a matter of urgent public importance, namely the position of the province of British Columbia and the immediate communication to the federal government of that position in respect to conditions we would wish to see implemented or sought for the province from the federal government and by the federal government on behalf of the province in respect of the negotiations with the United States on the matter of the Alcan gas pipeline.

MR. SPEAKER: I presume the hon. member will now ask for leave.

MR. GIBSON: I would ask for leave to move that motion, Mr. Speaker.

Leave granted.

MR. GIBSON: Mr. Speaker, might I commence by expressing appreciation to you, sir, and to the House for the opportunity to bring to the floor a question that I think is one of great urgency and importance to this province.

We are talking about the impact on British Columbia of the largest single project, with the exception, perhaps, of the initial link of the CPR, to be undertaken here. It is a project of a magnitude of expenditure in the province of British Columbia of $1.3 billion. It is imminent in terms of years, if it is finally decided upon, and the conditions upon which

[ Page 4407 ]

that line will pass through British Columbia are very shortly to be negotiated between Ottawa and Washington.

Any debate under the terms of standing order 35, 1 suppose, is a bit unusual, Mr. Speaker. They tend, I imagine, to be advisory rather than adversary, with no particular action being supported or condemned -mostly suggestions on a common problem and an opportunity. I think this is a problem and an opportunity for British Columbia.

In moving the motion, I recognize that raising the topic at all in a public forum is fraught with some danger. 111-chosen words or ill-advised positions, were they taken on behalf of the whole House, certainly could give assistance to our competitor - the competitor of the Canadian alternative, which is, of course, El Paso Natural Gas - or could prejudice the Canadian position with our friendly bargaining power, the United States. El Paso, as you are aware, sit, is basically saying that Canadians are not to be trusted, and is using some historical quotes in that regard. I'll be getting into the bargaining position later. I'm confident in this particular debate common sense will avoid any dangers there might be, and will hopefully achieve the goal of good advice being given to the government for speedy implementation.

There's one other perhaps unusual feature of this debate. British Columbia has all too little leverage in law with respect to these affairs that affect us in such a consequential way. We have virtually no leverage in law with the United States, of course, and little even with Ottawa on this particular subject because of the interprovincial and international nature of the project. So again we will have to rely on common sense and fair play and the continuing relationship we have with Ottawa to ensure that the interests of British Columbia are protected. For that reason, as much as anything else, it is important that this whole House state its sense, its viewpoint on this particular project as it affects our province.

Here, as in few other cases, the quality of our ideas and the excellence of the presentation will be the deciding factor in how well British Columbia's interests are looked after.

Every member, I suppose, might see the purpose of the debate a little differently. I would hope to give the government my own advice as to how they should advise the federal government with respect to British Columbia's interests. It is not my purpose in any way to attempt to restrict the negotiating freedom of the federal government with the United States. I think that's tremendously important. We must not lessen their bargaining flexibility. But we do need to make B.C. views known.

It is not my purpose to in any way restrict the provincial government in dealing with Ottawa. Again, the flexibility of our government in their negotiations is of greatest importance in securing the greatest advantages for our citizens in this province and, if anything, I want us to strengthen that particular posture. We have to realize that there is a certain maximum in the benefits in respect of this project that Ottawa can win from the United States and we must do all that we can, from a British Columbia point of view, to ensure that those benefits are secured in a way which benefits us in this province as well.

We can't solve everything in this debate and in this issue, large as the issue is, Mr. Speaker. There certainly are those in the province who would wish to import other questions of our relationship with United States, questions of an international kind. There are those who would wish to, through the means of our negotiations on the Alcan pipeline, solve the matter of the flooding of the Skagit Valley, let us say, in a manner that is appropriate to Canada or redress ancient grievances on the Columbia River Treaty or open up Panhandle access or solve problems with respect to the Trident nuclear base, and so on. I don't think that we can go too far in attempting to resolve international questions through any leverage that the Alcan agreement might give us, but there are some items that are more directly related, items directly relating to energy, for example, and the importation of oil products through Cherry Point or items directly related in a physical sense to the Alcan pipeline, such as the paving of the Alaska Highway, that we might usefully touch on in this debate, particularly since those things that I noted are much sought after, in one case by the state of Alaska, and in the other case by the Washington state Legislature, in common with British Columbia.

I want to say a little bit about our bargaining position with the United States. There are two options open to the transmission of natural gas from the Prudhoe Bay fields to the lower 48. One is the Alcan Pipeline. Let me quickly mention its advantages. It has a lower cost. The estimates vary widely. The most general estimates are between 30 and 45 cents per thousand cubic feet, a lower cost than the El Paso alternative. This is something like a 20 per cent lower transmission cost; it's an important factor.

The Alcan alternative offers the advantage of a more rapid connection between the Alaska gas and the lower 48. It avoids, in particular, the very serious regulatory approval problems that the El Paso-LNG tanker alternative would meet in the state of California. Governor Brown of California has raised this particular point and has himself come out in favour of a pipeline link.

The Alcan route makes possible the arrangement of an interim swap of gas from the province of Alberta to the Americans to solve their short-term energy problems in exchange for an ironclad guarantee, which would have to be ironclad that that

[ Page 4408 ]

swapped gas would be returned from Alaskan sources when the day came that that pipeline was put in place.

Without the Alcan pipeline that's impossible, for a very simple reason: without the Alcan pipeline we will not have the possibility of the Dempster link to reach the five trillion feet of gas in the Mackenzie Delta so far proven. That five trillion feet would then be locked in. It would not be deliverable. It would not be available for southern Canadian requirements, and therefore we would not have gas for short-term swapping with the United States, and perhaps even our long-term exports would have to be reviewed.

The Alcan route has the very practical advantage of a midwest delivery point, which is where the United States needs the energy, and it has the important advantage of conserving energy in a transportation sense. The energy lost in transmission in the pipeline is only 6 per cent. The energy lost in transmission through the LNG tanker route is on the order of 20 per cent, a very serious and substantial difference in this day when we are pointing towards conservation in every way we possibly can.

So in a bargaining sense - in a context of Canada sitting down with the Americans across the table and saying: "here are the advantages for you; now what's in it for us?" - Canada has a good hand in the Alcan route.

The El Paso arguments are mostly of a negative nature. Their first argument in the bargaining scale is a political one based on the state of Alaska. They say there is more in the El Paso route for the state of Alaska. That is true, but I would suggest it's not a great deal more. The length of the pipeline through Alaska is not terribly different - or 150-some miles -and the major difference is the location of an LNG terminal, which would be a costly thing, but most of the capital plant would come from the lower 48. So I don't think that's a terribly strong argument.

The argument that El Paso depends on more than anything else is the argument of national security -security of supply of the energy from one American state, namely Alaska, to the main continental body of the country. They state, and they have stated in letters to congressmen and to the President, that Canadians cannot be trusted. They cite certain historical remarks, particularly out of British Columbia, in evidencing that position. I have no wish to go into those particular remarks, but....

MR. LAUK: Was it something your father said?

MR. GIBSON: No. I don't want to go into those particular remarks, but I will say that it is possible in this debate, if the House chooses to do so, to lay the El Paso arguments to rest - to say that there is not, in fact, a security problem, if it is possible between our two countries to enter into a treaty or into an arrangement in respect of the Alcan pipeline that is mutually advantageous. And it must be mutually advantageous. We cannot and will not be in a position of entering into an agreement with the United States which is in any way prejudicial to the interests of Canada. That's up to our negotiators in the national government to look after that and up to us to the extent we choose to do so from British Columbia to advise them on that.

What can we in this Legislature do to advance the Alcan proposal, at least those who agree with the proposal? First of all we can state agreement and the conditions under which we agree, because nobody is going to say: "I'm a very strong supporter of the Alcan proposal myself, but I am not going to say I agree with the Alcan proposal - period." I agree that the Alcan proposal is a good arrangement for British Columbia and for Canada only if we can receive certain stipulated recognitions in financial and other terms from the federal government and from the United States.

The Prime Minister put it well when he was describing his talk with, I think, President Carter. He said that it might not be possible to reach agreement, that there might just be too many things demanded of us. Nevertheless he considered that Canada was going to negotiate this in good faith and President Carter made a positive response to that.

When I say that we in British Columbia can state agreement with this proposal under certain conditions, I want to enter at this point a specific congratulation of the Premier.

AN HON. MEMBER: Hear, hear!

MR. GIBSON: Wait till my speech is over.

He alone of the 10 premiers in this country offered open support to this project and even lobbied governments in adjacent states to attempt to secure their support as well, with some success. There was not sufficient follow-through, Mr. Speaker, of which more later. So one thing this Legislature can do - or members of it as they speak in this debate - is to give their view on whether or not this project ought to proceed and under what conditions.

The second thing that can arise from this debate, if members choose to do so, is a reassurance on security: specifically, support for the treaty which has been entered into between our two countries in respect of energy pipeline transit through the countries, and which gives certain guarantees as to the continuation of conditions and fair treatment of those pipelines. This is an advantageous treaty to Canada, let me say, because more Canadian energy passes through the United States - specifically south of Lake Superior and from Portland, Maine, up to Montreal - than American energy passes through Canada, even after this pipeline is built. So it is an

[ Page 4409 ]

advantageous treaty. I think it would be a useful thing, if members choose to do so in this debate, to indicate their views upon that particular document.

Within the scope of what Ottawa can win for Canada, it's our job to demand a fair share for British Columbia. British Columbia has apparently not at all been well represented to date in the continued hearings that have led up to the decision by the federal cabinet to under certain conditions, support the Alcan route.

Mr. Justice Berger, was commissioned and investigated this question in the Northwest Territories. He produced what has to be called a monumental report, though I don't agree with all its aspects. Dean Lysyk was commissioned to enter into hearings with respect to the Yukon Territory. He would have heard British Columbia. His terms of reference could have been modified to include British Columbia and, even without a specific modification of terms of reference, B.C. Indian bands and the mayor of Fort Nelson appeared before the Lysyk inquiry to give their testimony about the impact of a pipeline.

Mr. Speaker, British Columbia as a province was not represented in the most important capital work to be undertaken in this province for a century. It was not represented at the most logical commission to hear our views with respect to social and environmental questions. No change in terms of reference was requested.

Well then, what about the National Energy Board? The National Energy Board handed down its decision, I think it was in late June of this year, and its decision in effect decided the pipeline route as far as Canada was concerned. The politics of the situation were such that if the federal government wanted to disagree with the National Energy Board, it would have to reject the proposition entirely and introduce legislation into the House of Commons. That would have been politically very difficult. So the National Energy Board decision was for all intents and purposes the definitive judgment insofar as the shape of the pipeline and the conditions under which it would go through Canada.

Was British Columbia represented at the National Energy Board hearings? Well now, there was a question, I noticed, to the Minister of Energy, Transport and Communications (Hon. Mr. Davis) on that subject during the question period. He took it as notice but I can give him the answer.

MR. BARRETT: He said yes.

MR. GIBSON: Well, the answer was that in a technical, legal sense, British Columbia was represented.

MR. BARRETT: No, I asked if there was an intervener and he said yes.

MR. GIBSON: Well, this gentleman I don't think intervened very much. His name is J.G. Smith. He is listed in the NEB list of people who had something to do with the inquiry. He is listed as being a representative of the Minister of Energy, Transport and Communications. So he's listed.

MR. LAUK: Is that a son-in-law?

MR. GIBSON: My staff phoned up the National Energy Board and asked what had been British Columbia's involvement in the NEB hearing. Here's the answer we got back.

"I didn't know they had ever been there."

That was the statement as to how extensively British Columbia was represented in the hearings of the National Energy Board whose decision was going to be definitive in terms of the pipeline route through Canada and the terms and conditions under which it would pass through various parts of this country.

"I didn't even know they had ever been there."

MR. LEA: What a way to run a hardware store.

MR. GIBSON: Later we made some inquiries of the Energy Commission as to who this Mr. Smith was and we were told that he was an Ottawa lawyer hired by the Energy Commission to represent the minister. His involvement was "very brief." He simply made the statement that British Columbia favoured the Alcan route. The main purpose of his intervention was so that the B.C. government could get a full record of proceedings.

Now isn't that interesting? Isn't that a positive contribution by the government of the province of British Columbia to a decision which will condition the expenditure of some $1.3 billion in our province, will affect the life of northern communities, will affect northern employment, will have enormous effect on the southeast part of the province as well, where a line is to be built by Alberta Natural Gas? The main purpose of his intervention was so the B.C. government could get a full record of proceedings.

Well, Mr. Speaker, I don't think that's good enough. I don't think that's a very good record of the interest of the government of the province of British Columbia in this particular case. Have there been any representations to the Prime Minister or to federal members? I asked the Premier in the House yesterday. I thought it was just a routine question, Mr. Speaker. But the Premier said no, there hadn't been any such representations. -1 could hardly believe my ears. In the hall afterwards, the Premier is reported to have said: "Well, we haven't talked to anybody because there's nobody to talk to until the decision was made." Well, I hope I'm not misquoting

[ Page 4410 ]

the Premier or I hope the press didn't misquote him. I hope he'll stand up in this debate and say his piece on it too. But it's important to talk to the decision-makers before the decision is made and not after.

Listen to what the National Energy Board came up with as a protection for the Yukon people. There were a number of protections, but here's the one I specifically want to read. It's at page 10176 of the NEB reasons for decision. This is what is called the third agreement:

"Foothills (Yukon) to pay or provide payment upon request by the government of Canada of money which could be used by the government of Canada to pay for the socio-economic indirect costs of the pipeline project in the area north of the 60th parallel incurred during a period expiring two years after a leave-to-open order has been granted, the scope of such indirect cost to be defined. The government of Canada should use the moneys towards payment of social and economic costs generally attributable to the pipeline project. While the board cannot now estimate the amounts involved, the project would otherwise burden Canadian taxpayers with substantial expenditures. The board recommends that the obligation of the applicant be limited to $200 million."

There is a clear and specific requirement of the National Energy Board upon the pipeline company for the protection of the people of the Yukon against social and other disruption caused by this project, and for the indemnification of those costs that will have to be borne by the government of Canada in an amount up to $200 million. Why was there no such requirement in respect of the social and other costs directly associated with the pipeline south of the 60th parallel - namely, in British Columbia? I'll tell you why not. Because British Columbia wasn't there to ask for it. It wasn't there to ask for it, and now the NEB report has come down and that report can't be varied, except through legislation.

You know, it's just extraordinary, Mr. Speaker. The mileage in British Columbia is almost as great as the mileage in the Yukon.

Interjection.

MR. GIBSON: No, the mileage in B.C. is not more, but it's almost as great. Here we have specific protections granted to the Yukon Territory and to the people of the~ province of the Yukon, but no specific protections granted to the people along the route in B.C. because the government of the province of British Columbia didn't ask for them. Who was intervening in these hearings? The Ministry of Energy for Ontario had four people there headed by Robert

Macaulay, Q.C., and you can bet he wasn't sitting on his rear end and not talking during the hearings. He probably appeared more than once. The Attorney-General for Quebec was represented along with the Attorney-General for Saskatchewan, the city of Yellowknife, the Legislative Assembly of the Northwest Territories, the government of the Yukon Territory, and so on and so on.

These people, these governments, these organizations saw this enquiry as being of some substantial import to their communities and to their areas, and they did their duty and they were represented. British Columbia was represented by somebody who apparently appeared hardly at all and stood up and said that B.C. supported the project. The main purpose of his intervention was so the B.C. government could get a full record of proceedings. I wonder if anybody read that full record. I wonder whose file it's in.

Mr. Speaker, we thought we had reason to hope that the Premier was at least in touch with Ottawa on these things. I cited a column of May 14 in the Colonist in which the Premier was interviewed by Jim Hume, which gave us some reason to believe that. Yesterday he admitted not. He did say - or perhaps it was the Minister of Energy, Transport and Communications (Hon. Mr. Davis) who said it - that there was some person from the B.C. Energy Commission in Ottawa yesterday who was buzzing around the scene, representing British Columbia's interests.

MR. LAUK: Who's that?

MR. GIBSON: Bob Green I think was the gentleman's name.

MR. LAUK: Who's he?

MR. GIBSON: I don't know who he is.

Mr. Speaker, the fact of the matter is that forces are way beyond that level of intervention at this stage. There are enormously powerful national forces engaged here with two countries involved. With no disrespect to this gentleman who apparently was in Ottawa yesterday on the day when the decision was made, which was a bit late, this is like sending a moth to influence that three-alarm fire we had down at the docks last night. It's just a little bit beyond that stage.

This, of course, is not the first time this kind of thing has happened. The representation at Destiny Canada was of a similar ilk. This is so immediate and quantifiably important that the government's lack of representation to date, I think, is just disgraceful. The time is almost past to influence these questions. The parliamentary debate is over in Ottawa. The cabinet is decided on a route for negotiations. The Prime Minister, fortunately, has said that he is still open for

[ Page 4411 ]

consultation with provinces. Only the Premier intervening directly, with the weight of the Legislature behind him, can succeed at this point in getting some acceptable concessions for the province of British Columbia. In that spirit, Mr. Speaker, what are British Columbia's interests?

First, some facts and history. As members know, the oil strike at Prudhoe Bay 10 years ago turned up some 24 trillion feet of what's called solution gas with the oil. As the oil is pumped out, the gas is automatically produced. It is being reinjected into the wells for the time being to maintain reservoir pressure, but it has to be produced fairly soon. That, incidentally, is why the American ploy that the gas can be left in the ground is simply not correct.

A company was formed called the Alyeska Pipeline Company. Perhaps that oil should have moved other ways to avoid the tanker traffic, perhaps it should have been a train. Who knows? In any event that decision was made and it's history now.

Basically the same groups that started the oil pipeline down the Canadian Mackenzie Valley - or actually two groups - found the competition a little heavy and merged into one to cut costs. It was U.S. dominated and it was dominated by the U.S. so-called seven sisters, the major international oil companies.

By this group, environmental and native rights were considered simply as hurdles to be got over rather than walls to be paid serious attention to. I think they probably assumed government acquiescence too. It didn't work that way. As time evolved, this group alienated a large number of people. One of the first groups that they alienated was the province of Alberta by insisting on a fully controlled consortium line through the province of Alberta without hooking into the Alberta gas trunk line system, which Alberta is very proud of. They assumed that they had a monopoly on the transmission of gas which led them to take some very intemperate and arrogant positions.

As time went by, though, the gradual sensitization of southerners about the environmental and social difficulties of the Mackenzie pipeline led to the appointment of Mr. Justice Berger to study that particular gas pipeline route. There's no question it was a key appointment in the history of this development and it's what leads us to this debate today. I think one can safely say that without Justice Berger and his report, it is likely that we would not be debating this particular route today.

His report did the following things: It killed the Mackenzie route. At the same time, incidentally, it ended the strongest bargaining card of native groups in the territories. It ensured, in my view, probably a more "southern" north because now the Northwest Territories won't have the tremendous revenues that would have allowed them to go a somewhat more independent way, although the Polargas alternative down from the Arctic Islands may in due course give them those kinds of revenues. It ensured that the so-called Foothills Yukon route, the Alcan pipeline, would be the one that was built because that was the only real alternative, or at least the only alternative through Canada.

Westcoast Transmission had been monitoring the Alcan route for many years. They believed in it for a number of reasons which made sense then and makes sense now.

First of all, what the Alcan route does is not force the Canadian decision-making on the tapping of our own gas reserves. The only urgency in this problem relates to the American gas. Canadians at the moment have no problem with gas. As a matter of fact, we have an embarrassment of gas with the new discoveries in Alberta. So why should we be pressured into building a route which would prematurely tap Canadian reserves and then, finding no market for those Canadian reserves, force the export of the delta gas to the United States? This, of course, was part of the logic behind the U.S.-controlled consortium. It was part of the logic of the Alcan route that it avoids this.

The same logic allows us at a time of our choosing, whether by the so-called Maple Leaf route as it once was proposed or the newer Dempster connection, to tap our own delta gas at a time of convenience to Canada, not the United States. It avoids the very sensitive Alaska and Yukon wildlife reserve positions across the North Slope.

It allows Canadian control, and this is enormously important. The Alcan proposal is sufficiently smaller so that the Canadian companies can finance it without, incidentally, government guarantees of finance.

The Alcan logic gives the Alaskans a bigger bite of the transmission facilities of their own gas, which is one of the important political considerations in the United States. It goes along an established right-of-way, largely, which is important for questions of land claims and social impact and environment.

Because of its smaller size, economically it is far more digestible to Canada in terms of its impact on inflation rate, the value of our dollar and so on.

Finally, it protects the Polar Gas option, because we don't know which of our Northwest Territories gas is going to be in the national interest to tap first. There are about 5 trillion cubic feet proven in the Mackenzie delta; there are about 15 trillion proven in the Arctic Islands. We don't know which one is going lo be more advantageous to tap first. Had the Mackenzie line been built, we would no longer have had that option.

So it made a lot of sense. But this small western consortium was given almost no chance. The Canadian establishment was against it. TransCanada PipeLines, Imperial Oil, Toronto - you name it - if

[ Page 4412 ]

they were big in Canada, they were against the Alcan line and they were for the Arctic Gas line. The U.S. establishment was for the Arctic Gas line because, of course, they control it and, of course, it would have enabled them to prematurely siphon a lot of Canadian gas, which we would otherwise have been able to reserve here for our own needs. The big money was sure against the Alcan people. The Arctic Gas people spent $150 million on their application. They never dreamed they would lose.

I knew one of their lobbyists fairly well, an old friend of mine. It was just a subject we didn't talk about, because they just never dreamed that anything could happen other than these multinational corporations winning this one. But what happened in the end? Two relatively small - in this business -western Canadian companies put it together and won it.

Interjection.

MR. GIBSON: And not without the help of Mr. Justice Berger. That's right.

I want to pay an enormous tribute to Ed Phillips of Westcoast Transmission and Bob Blair of AGPL, ') because I think they've done a service to this country. That's my opinion.

So then a rapid series of events took place. Justice Berger came out against Mackenzie; the NEB came out for a project that was filed very late - hardly a year ago and much amended since then; Dean Lysyk said the Alcan route was okay under certain conditions, and the federal environmental report said the same thing; and here we are. But it's not over yet by any means, because the El Paso question is still there, which brings us once again to the question of the treaty, which, having been initialled by the government of Canada back in January, I think it was, was ratified by the United States Senate yesterday, and which, in my mind, is the definitive answer to the El Paso suggestion.

So now the Ottawa-Washington negotiations are to commence and I personally am convinced that the Alcan project is in the U.S. interest, and it may be in the Canadian interest if we can attain sufficient conditions.

The scope and importance to British Columbia is as follows: the: total package of the Alcan pipeline will cost $7.3 billion, plus a further billion for the Dempster connection, if and when it is made. The cost of the section of British Columbia will be $1.3 billion. The British Columbia mileage is 544 miles, of which 438 is in northeastern British Columbia and 106 in southeastern British Columbia. The labour-material breakdown is approximately 50-50. The average work force for the main two-year period will be about 1,600 in the construction period, with 2,400 peak.

MR. MACDONALD: In British Columbia or the whole country?

MR. GIBSON: In British Columbia.

The exact timing is still unclear, pending the negotiations between the two countries. Local purchases is a much more obscure question. This is one of the specific things the government of the province of British Columbia can do. What is the maximum form of local activity in the economy that we can get out of this particular project? For example, is there any way that any manufacturing or fabrication associated with this project might utilize the Squamish Railwest plant? There's a very good chance of that. What are going to be the revenues for the British Columbia Railway on northbound freight? It would be tremendous. Even that Fort Nelson line might start to break even with that kind of break. The annual taxes that will be payable will be something in the neighbourhood of $30 million in British Columbia, most of which would be compressor gas, rising to something like $50 million after the Dempster link is completed, if and when it is.

A very important factor for us in this Legislature is to recognize that in only 12 years the authority we have to export 800 million cubic feet a day - to Washington primarily - will lapse. At that time, if there's no other gas to fill the Westcoast system, the public of the province of British Columbia starts to lose a lot of money, because the B.C. Petroleum Corporation, which is the effective beneficiary of the throughput revenues above and beyond the 10.6 per cent return on the rate base, will have their revenues cut drastically, as 800 million cubic feet a day is over half the capacity of that pipe.

So at that point, if the Alcan route is available, we would be able to divert Alaskan gas - not Canadian gas, because the export authority would have expired - coming down the Alcan pipeline at that point through the west coast system, and offer transportation to the Americans on a sort of short-cut route with a facility bought and paid for and now standing empty because of a lapse of export authority. That's worth something like $80 million a year to the province in terms of present revenue.

MR. MACDONALD: By that time we'll need the gas.

MR. GIBSON: Yes, but this will be American gas. This would not be Canadian gas. The export authority for Canadian gas at that point would have lapsed.

Now those are some of the positive impacts, Mr. Speaker. What are the negative impacts? There certainly are negative impacts. All you have to do is take a short look at some of the things Mr. Lysyk

[ Page 4413 ]

found up in the Yukon, and the recommendations he made. He made recommendations, first of all, for a delay to enable land claims to be settled. He made recommendations for a planning and regulatory commission which would oversee the difficulties of the impact of this new pipeline. He made extensive recommendations with respect to manpower training and the employment of northerners, so that they could be trained in the needed skills well in advance of the time the pipeline was coming through. He made recommendations for a $200 million heritage fund which would again help to cushion the negative effects that he foresaw.

What are these negative effects as they pertain to British Columbia? Well, we don't know because our government has never investigated them. They haven't set up any kind of a commission to study it; they have made no statement on it themselves; they have made no statement to the National Energy Board; they haven't said that a construction programme of this kind, while it will bring some welcome features, will bring a lot of problems as well in terms of disruption of local communities by the influx of large numbers of construction workers, many of them outsiders - disruptions to the native groups along the pipeline route. I remind you again, Mr. Speaker, it's 500-and-some-odd miles of British Columbia that this pipeline passes through. We know that there will be significant effect. We know that there will be social disruption and we do not know the amount, because the government has not seen fit to inquire into this.

Therefore the National Energy Board comes down with a finding which states the conditions upon which this pipeline may be built if agreement is reached. Those conditions say nothing about compensation for the province of British Columbia and the people of the province of British Columbia who will be affected by this pipeline route. So all of the positive things about the pipeline may not matter at all if the negative things are overwhelming enough. We don't have a measurement of our government as to whether or not that is the case.

I want to suggest four principles that I think on an urgent and immediate basis the province of British Columbia should communicate to Ottawa as the things we would like to see if this pipeline route is to go through our province.

First of all, there's a kind of minimum standard. Since we don't have our own inquiry, let us look to the inquiry that's been done in the Yukon and say: "Establish this principle." British Columbians will. not be less well treated than Yukoners. I think that's a fair principle. There are a number of areas in which you have to look at that: the question of environmental impact; the question of land claims; the question of social disruption and compensation assistance for community; the question of a manpower scheme, complete with training and hiring requirements that must be entered into; the question of the maximum purpose of British Columbia material through British Columbia suppliers.

British Columbia should be no less well treated than the people of the Yukon Territory. The people of the Yukon Territory, I might remind you, Mr. Speaker, in the report of the NEB as a condition of the granting of a certificate for the pipeline, are to be the beneficiaries of a fund of up to $200 million for social disruption assistance. British Columbia deserves at least as much.

As a second principle, I would suggest that British Columbia should receive its proportionate share of the Canadian economic dividend that comes out of this enormous project. Most members of this House refer in their speeches from time to time to the multiplier effect, by which economic expenditures rebound through the economy and end up being worth much more than the original amount. The multiplier effect in the Canadian economy sends most of the eventual benefits back east, largely to Ontario, through the tax collection system and through, in particular, the fact that most of the material - 80 per cent of which is pipe, and much of the rest of which is valves - will be made in the province of Ontario.

Much of this should be returned to British Columbia on specific terms as our share of the national economic dividends. My own particular suggestion - and the government will have to arrive at its own conclusion on this - is a significant paving of the Alaska Highway as one of the means by which some of that economic dividend can be returned to British Columbia.

Interjection.

MR. GIBSON: He didn't have a pipeline to work with.

The third principle I suggest to the government is the achievement of any international objectives that can be legitimately tied to this particular project. This is a sensitive area into which I don't want to go in very much depth, but I would suggest to the government: get as much as you can.

We have a number of bilateral problems of which I know the Premier is well aware and on which he has been working. If any of those, such as, for example, tanker traffic in the Strait of Juan de Fuca, which is a directly related energy question, recalling the amount of gas that we deliver through the west coast to the state of Washington, can be legitimately and usefully put on the table by British Columbia in the successful prosecution of this negotiation, I would commend that third principle to the government.

I would suggest as a fourth principle that if, in the planning for this pipeline and its operation - the operation throughout future years will be very

[ Page 4414 ]

important - any measures can be taken which help B.C. and hurt others not at all or very little, then they should be taken for British Columbia. The prime example, of course, is the eventual use of American gas from Alaska, to utilize the under-capacity Westcoast Transmission system 10 or 12 years down the road for the transit of U.S. gas through Canadian territory and down through the United States at a profit to the government of the province of British Columbia, which is the effective beneficiary of the operating results of Westcoast Transmission, above and beyond their fixed rate of return.

I commend these four principles to the government as at least one set of thoughts on which they can approach the federal government, and I would hope on an urgent basis. The President and the Prime Minister, according to press reports, announced yesterday that negotiations between the two countries in great detail will be entered into in the next week, which is not surprising in view of the timetable of a September I decision date which both countries have been working towards.

That decision date can be extended; indeed, I personally expect that it will be. But there is a tremendous amount of urgency attached as we enter into the second week of August, looking at at least a pro forma September 1 decision date.

So I would suggest to the Premier that he put a team of ministers and officials on this, giving it the highest priority and giving it his personal attention; and that based on, among other things, the advice of this House today, the government as rapidly as possible formulate a position for communication to the federal government in a forceful and effective way. I think that this is a responsibility, the successful achievement of which will be of great usefulness to the province in years to come, and the failure of which will result in a good deal less prosperity for our people and some very unnecessary, unfortunate, avoidable disruption, particularly in the northeastern part of the province. All in all, it is a tremendously important issue.

As I have said earlier on in the debate, I happen to be an Alcan route supporter. I share that opinion, I think, with the Premier, based on his earlier statement. But there must be conditions. B.C. and this Legislature can only be in favour of this route if we can look at the final account of the negotiations and say: Is this a net benefit to our people? We want, naturally, to be helpful to our neighbour to the south if we can possibly do that; but we also want, in doing that, to make certain that it does not detrimentally affect the interests of our province and hopefully affects them in a strongly positive way.

It is my personal opinion that with good faith and good information on both sides, there is sufficient overlapping of interests so that kind of result can be achieved between the two countries. For it to be achieved as well in terms of the domestic distribution of costs and benefits in a fair way to the province of British Columbia, it requires the most urgent and forceful intervention by the government of the province of B.C. with Ottawa. I put that to the Premier as the most important charge on his time at this point.

MR. BARRETT: Mr. Speaker, in this debate, I would like to be informed whether or not the government wishes to go on the normal ebb and flow of debate. Is the government going to participate?

MR. SPEAKER: The hon. Leader of the Opposition has the floor.

MR. BARRETT: I'm asking a question, Mr. Speaker. I'd like to know if the government is going to participate.

MR. SPEAKER: If the hon. member is not going to participate, I see the hon. member for Oak Bay (Mr. Wallace) ready to take his place.

MR. BARRETT: It would be helpful in this kind of debate if ordinary courtesies of debate were to be followed in terms of the fact that this is unique. It would be more helpful for more enlightened debate if the government position were stated prior to the opposition being forced into a situation where the government wants to withdraw and state its position without a sharing of opinions or attitudes.

This is not an adversary debate, as pointed out so well by the member for North Vancouver-Capilano (Mr. Gibson) . It is a debate that is not quite unique, but certainly one of a sharing of opinions rather than taking a position an any specific resolution in front of the House. I regret that the government has not seen fit to state its position early in the debate so there can be some sharing of opinions without being forced to a vote of any specific motion by that member.

I don't think it's necessary to play politics or to divide the House on a basis of politics on an issue like this. If the government chooses to take that direction, I think they miss the thrust of the opportunity presented by the member for North Vancouver.

[Mr. Rogers in the chair.]

I'd like to say at the outset that everybody goes through life with the necessity of making choices. I suppose that the best thing I could say at the beginning is that if I had my druthers I'd rather not be faced with this choice at this time. I believe that Mr. Phillips of Westcoast Transmission, in his speech of March, 1977, to the 27th annual meeting of Westcoast Transmission, echoed some concerns that were touched on very briefly and clearly by the

[ Page 4415 ]

member for North Vancouver-Capilano. Mr. Phillips opened his comments by saying: "Is the northern pipeline a power play - the first U.S. thrust for a continental energy-sharing policy?" I'd like to point out that the member for North Vancouver-Capilano made the point very clearly that had the federal government committed us to the Mackenzie Delta pipeline it would have been a major victory for those who believe in continental energy resources. I want to quote Mr. Phillips' opinion in terms of the issue in front of us. Mr. Phillips, who is not an NDPer, by the way, said:

"The central thrust of what I want to say today is that the government of Canada must have the final word in resolving the pipeline power play."

That's an interesting choice of words - "the pipeline power play."

"The key to that is deciding just one question: is Canada's independence and sovereignty respecting its own energy resources established more clearly by approving two Canadian-owned-and-controlled pipelines, or is it through the Mackenzie Delta, which would have forced the immediate export of Canadian gas? "

We have been spared that option by the federal government, through no fault of the federal government but through the wise counsel of Justice Berger.

I want to point out another warning given by Mr. Phillips. He points out the pressures that exist between Canadians and Americans in their desire to get the existing reserves to market. He said:

"Another substantial mismatch in the Arctic Gas proposal is the magnitude of the two nations' energy requirements. Even projected out to the mid-'80s when Canada may need northern supplies, sharing a joint venture pipeline with the United States would be illogical. The United States consumes an average of 59 billion cubic feet of gas per day; Canada only 4 billion. Fifteen to one is a manifestly improvident balance on which two nations would equally share the equity ownership of a pipeline and split its capacity at two-and-a-half billion cubic feet per day each.

"A single utility in Los Angeles serving southern California has 3.4 million gas customers. In all the 10 Canadian provinces, there are only 2.4 million gas meters, a million fewer than in southern California alone. Expecting Canada to have an equal voice in the operation and the future expansion of the shared pipeline is not rational, considering the grossly different gas appetites to be satisfied."

Mr. Speaker, the lessening of the chance of that happening took place when the decision was not to go the Mackenzie route. The only saving grace of the Mackenzie route in my opinion is the fact that the Dempster linkup becomes a key factor for Canada's energy needs. Nothing in this bargain can be considered exclusive to that key point. If British Columbia loses the opportunity of insisting that it have a part to play in the timing of the linkup of the Dempster side route to Arctic gas, or if British Columbia, through naivete or otherwise, loses that bargaining position, it means that the major American oil companies, so aptly referred to by my colleague from North Vancouver as the "seven sisters, " will indeed have their way in any event. They may have lost the $150 million on the Mackenzie pipeline bump, but they will gain what they lost if the Dempster hookup is made without strong intervention by the Canadian government and by the British Columbia government. Not in my words, but in the words of Ed Phillips of Westcoast Transmission company:

"The only thing that stops this pipeline from being a sellout of Canadian energy resources is the handling of the Dempster linkup. Once the Dempster linkup takes place and there is no commitment in treaty and in bargaining and the first call for Canadian gas is for British Columbians and other Canadians, for their industry, their homes and their jobs, then we will have abandoned a secure heritage for at least two generations of Canadians who expect the same standard of living we have now."

I was totally opposed to the Mackenzie Valley pipeline. In principle, I think it's a mistake to risk the Alcan route, but as I started out by saying, we don't have our druthers. If I had my druthers, I'd rather wait until we had a chance to do it on our own. There is a possibility in this particular joint venture that we can make a fair deal for Canada, but there's been no historical, comparable negotiation with the United States where we have ever shown, either as a nation or as a province, the ability to go into a bargaining session well armed with facts, well buoyed with information, and committed to the long-term interest of Canada and British Columbia, not just some short term political announcement.

This is a complex matter, Mr. Speaker, and perhaps the easiest way in the brief time I have for me to simplify this for some of the British Columbia people who are listening is to make the comparison to the Columbia River Treaty. It is a good analogy. The Columbia River Treaty involved three participants -the federal government, the provincial government and, of course, the United States. I have never blamed the Americans for skinning us on the Columbia River Treaty. They were handed it on a platter. The idea that they would enter into international arrangements on the shared use of resources without any fiscal

[ Page 4416 ]

backup, without any engineering backup and without any environmental or long-term cost projections, was absolutely incredible in that day. But in this day, it's beyond incredible; it's insane.

My colleague, the member for North Vancouver, is at this stage of the game calling for the initiation of these studies. The people of this province have a right to ask, "why weren't these studies initiated before?"

If that member's information is correct - that at the National Energy Board hearings all British Columbia had was an occasional observer - then the answer in question period of the minister who is concerned, the Minister of Energy, Transportation and Communications, was incorrect. If the facts don't differ, the least we can say we have witnessed today is some confusion about what's going on.

I am very hopeful, Mr. Speaker, that we won't be treated in this House today to a lot of political rhetoric around jobs and investment without some substance in terms of what facts, what figures, what commitment, what position, and who is doing the bargaining around this very important issue. I don't blame the Prime Minister. He's a tough bargainer.

The Prime Minister and the federal government have made a decision to go along with the Alcan route. The Alcan route, as I have said, and as the member has said, gives us the option of delaying the entry of Canadian gas at our bargained-for time, if we wish to take that option. However, I do not see the Prime Minister of this country lifting any extra energy in the tough negotiations he has to go through fighting British Columbia's case unless British Columbia has presented a well-documented case to him to present to the Americans.

It can't be on the basis of public relations forms. It can't be on the basis of we wish or we hope this to happen. It has to be on the basis of well-informed, non-partisan, economic and social research that should be launched immediately with specific timetables given to those people who are charged with that responsibility.

We have been fortunate in another arena in terms of the speech of Mr. Phillips of Westcoast Transmission, Mr. Speaker. Like it or not, the government of the day has inherited a 10 per cent ownership of Westcoast Transmission. How ironic. I know the member for North Vancouver (Mr. Gibson) smiles because it was that socialist move of picking up El Paso shares that they were ordered to divest themselves of in a New York court that gave the people of British Columbia an opportunity to have a 10 per cent ownership in the pipeline that delivers 809 million cubic feet of gas to the Americans every single day. It was a socialist venture.

HON. MR. GARDOM: How much did it make? How much have we made on the shares?

MR. BARRETT: On the shares? I'm coming to that, Mr. Attorney-General.

It was a socialist government decision that was attacked by Social Credit. They said it was wrong, criticized it and voted against it, but it is out of that particular decision made by our government that we now have not only an opportunity to bargain on the Dempster line, but also a 10 per cent say at the shareholders' level of Westcoast Transmission.

For years and years Canadians had been hewers of wood and drawers of water. Major American capital investment made in this country has been made for one purpose and one purpose only. It is not the United Appeal. It is not a charity contribution. The only reason the Americans have made any major capital investment in this country is to export profits from whatever resource they've invested in. Not a bad idea, but let's recognize that we're talking about business and not brotherly love.

When we purchased that 10 per cent in Westcoast Transmission, people said: "What is your government doing - taking a flyer in the market?" I want to tell you, Mr. Speaker, when you buy a hunk of someone associated with the seven sisters, you're not taking a flyer in the market. Imperial Oil is not exactly the crying-towel group of the North American economy. We bought those shares - 1,157, 000 shares - at $22 a share. Where did we get the money from to buy those shares? Why, by gosh and by golly, we got the money to buy those shares because we became the sales managers for our own natural gas.

That's right, Mr. Speaker. My good friend, the former Attorney-General (Mr. Macdonald) , set up what was known as the "golden elbow." Yes, it was called "terrible socialism, " Mr. Speaker. I've noticed that in the fourth quarter review there's not a single word about the socialism. All they're doing is boasting about the profits. They don't call it socialist profits; they say "a little return." My friend, the former Attorney-General, said to all the gas producers: "We're going to give you an increase in your price of gas." That's what he did. He was a good fellow to those independent gas producers. You're a good fellow. You moved their price from 9 cents to 16 cents so that little independent businessman out there in the gas field could make a few dollars. [illegible], were helping free enterprisers.

MR. MACDONALD: It was a socialist "profit."

MR. BARRETT: That's right - a socialist "profit."

After helping those little gas producers, what did we say to our American friends? The previous Social Credit administration had been selling natural gas to the United States at 32 cents per thousand cubic feet. Dumb!

My good friend the Attorney-General said to our

[ Page 4417 ]

American friends: "The price is going up to 62 cents." That's what my good friend said. The Americans said: "Naughty, naughty." We said: "Tough luck." They bought the gas and with the amount of money we made, we bought 10 per cent ownership in Westcoast Transmission and the people of the province now own it, and I'll tell you how much money we've made on that,

But our biggest struggle, Mr. Speaker, was not with the Americans. Lo and behold, the reason I am recounting this story is that our biggest struggle was from the nitpicking of Social Credit and a federal government that opposed a public share in ownership in our natural resources. There's been no change of federal government, my friends.

The member for North Vancouver-Capilano makes a very interesting point. He says we have to bargain tough. Who are we going to bargain with - a federal government that's got the philosophy to which the Americans call the tune as to price, delivery dates and quantities of natural gas? Once burnt, twice shy. Even my mother told me that ' just as late as last week.

What happened when we went into the natural gas business and we doubled the price to the Americans? My good friend the Attorney-General got on the telephone and discovered that while we were charging 60 cents to the Americans, Louisiana was charging other Americans $1.25; Texas was charging $1.30. My friend the Attorney-General said: "If it's good enough for Texas, it's good enough for British Columbia." We said to the Americans: "The price is now going up to 99 cents." That's what he said.

The point of this story is, through you, Mr. Speaker, to the government and to my friend, the Liberal member: who was it that opposed the 99 cent figure? It was your relative. Yes, another Macdonald! It was Donald Macdonald, your father.

MR. MACDONALD: Thumper?

MR. BARRETT: It was Thumper, who said to you from Ottawa. . . . Not from Ottawa did he attack this Macdonald, but from Washington, D.C., he issued a press release attacking this Macdonald by saying that he was being savage in asking for $1. How humiliated do we Canadians have to be? While Americans are charging $1.25, our own national Minister of Energy attacked his son by name for asking for 99 cents.

MR. MACDONALD: We fixed him through the clan.

MR. BARRETT: We certainly did fix him. Yes, we did. We went the bureaucratic route, didn't we? You know what we did? I don't want all these folks leaving this House without knowing these kind of little trade secrets. They will never read them in the paper, you see, because it's socialists who are talking. But this is what my friend did. He came back to me and he said: "Boss, they won't allow me to charge them 99 cents." And I said: "Well, if you were Texas you could charge $1.25. I'll tell you what, Alex. You go to the National Energy Board and you put in an application and ask for $1.35, the same as some Texas gas." He did, and this is what happened.

I want you to understand the sequence of events because they've got nothing to do with science, nothing to do with economics, and nothing to do with rational arguments. They've got everything to do with politics. He filed an application at the National Energy Board for $1.35. That required public hearings. We would have gone to those public hearing and made the case for British Columbia, but 10 days before the public hearings were to start we got a telegram from the other Macdonald saying: "You can charge $1." We were only asking for 99 cents. He said we could charge $1. My friend Macdonald here said that they were afraid of the public hearing because the Canadians out in the bushes might find out that we were being forced to sell our gas to the Americans at 20 per cent less than what Americans charge each other.

So do you know what I did? After we found that we could have $1 instead of 99 cents, I sent Macdonald a telegram and I said: "A penny for your thoughts." It was a game. Yes, it was a game, folks. The game was to satisfy the international oil companies and their rapacious demands for resources, no matter where they came from, at the lowest possible price so that their profits could go up, up, up and up.

We bought in on the game. We became 10 per cent owners. I find it remarkable that that free-enterprise government over there to this day has not sold one of the shares of Westcoast Transmission. Here's why. My good colleagues, you supported this purchase and this is what it has benefited the people of British Columbia to own a little bit of your own action. Own a little bit of your own action, you serfs out there, and understand what it's all about.

We bought 1, 15 7 million shares. They were worth $22 a share on February 18,1974. At the present time the B. C. shareholdings in Westcoast Transmission represent 10.6 ownership. The government's stock in Westcoast Transmission has earned for the province of British Columbia $6,836, 806 to date. The Westcoast shares that we bought for $22 are now being traded for $32.25 on the open market. Why have those shares gone up, Mr. Speaker? They've gone up because Westcoast has got the winning lottery ticket on the pipeline sweepstake, and the winning lottery ticket, as my good friend from North Vancouver-Capilano pointed out, went to the unexpected winner, the Alcan route.

Okay, where does that take us?

We are now at the crossroads of being in a position to go to Ottawa and say: "We will go along with the

[ Page 4418 ]

Alcan route through British Columbia but we want some protection of our investment, we want some protection for the British Columbia people, and we want some protection of the future generations of people who will live in this province."

Pipelines in the north have only served as spearheads of southern development, Mr. Speaker. They don't carry commerce or trade or industry or people. They do not develop; they do not unify. They only carry a single resource southward at an enormous environmental, social and financial cost.

They will have to be abandoned in a relatively short period of time as oil and gas is drained from the north, leaving little behind but scars on the northern societies and landscape alike. While pipeline expenditures may fully serve their purpose for the oil industry, they can be viewed as lost or wasted money in terms of permanent value for all northerners.

What do they get out of it? A short-term employment boom? Let's deal with that. Alaska had the fantastic short-term employment boom with the Alyeska line. You go up and talk to Alaska politicians now, as I just did some two months ago, and -discover the social devastation. as a result of that major infusion of capital in a small population. Devastating unemployment, devastating alcoholism, devastating family breakdown, devastating cultural upheaval of the native and indigenous people in the area, a destruction of a way of life for people who for centuries had found a method of survival compatible with the good things that God has placed around them, only to be disrupted by the international oil companies' greed.

The tragedy of the Alaska government situation is that its only recourse out of this devastation is to beg to have the El Paso route take natural gas across Alaska so that at least they can duplicate the boom and perhaps avoid the same mistakes.

Alaska is not going to get that natural gas pipeline - not because the Canadian government is for or against it, not because the American government is for or against it. Alaska is not going to get that natural gas pipeline because the international oil companies are not in favour of it. Whatever the oil companies want, the oil companies get, whether it's governments, whether it's political parties, whether it's campaigns. Whatever the oil companies want, the oil companies get.

One thing that the member from North Vancouver made clear, and I agree with him, is that in the Alcan route that we are going to get whether we like it or not, there is an opening bargaining position for the governments of British Columbia and the people of Canada. That is the control of the valve at the Dempster connection.

I've got no quarrel of Americans renting our space to take American gas through an American Pipeline built on Canadian soil. We've lost that fight. Yes, it will provide short-term benefit for Canadian small businesses and for Canadian workers.

But I tell you, Mr. Speaker, the catalogue of this mismanagement of Canadian resources is legion. We have an opportunity now, at this time in the nation's history to stand up nationally and provincially and say to our American friends and to the international oil companies that we want to control the flow of the Canadian arctic gas through that Dempster pipeline and into the Alcan route.

My friend, the Liberal leader, whom we disagree with philosophically, I do not think will disagree with me on that particular point. That is the key that's at stake.

If I may make the analogy, it's like every British Columbian having their handle on the tap for the controlling of water into their own home. You don't go to your neighbour and give him the control of water in your home; you control your own taps. That's what this debate is all about. Do we have the guts, the desire, the drive and the commitment to control our own taps on that natural gas from the arctic?

Mr. Speaker, I'm growing long in the tooth in this business. I'm growing a little bit grey. As the sun sets in the west for my political career, I hope to be part of some role in saying that we stopped one sell-out. We stopped for our children and our children's children the last attempt at continental energy resources of a non-renewable nature such as the sell-out on natural gas.

I plead with this government, and that's a certain loss of pride for me, I'll tell you. I plead to this government to take the position with our federal government and with the United States that that tap at the Dempster connection will never ever go into foreign control, that that tap at the Dempster connection will remain as a sovereign control point of the development of northern gas and Arctic gas. That has to be point No. I in all negotiations as to opening the possibility of allowing that pipeline to be built. Without that request we are going like lambs to the slaughter on the same basis that we did on the Columbia River Treaty in a rush to say that we've created some jobs or that we've created some business.

Mr. Speaker, I want to refer the House to the "British Petroleum Statistical Review of the World Oil Industry." The last edition was in 1976. Incidentally, I don't want to scare the government, but British Petroleum is now a major negotiator in the coal fields. I know that they didn't do much research on it, but half of British Petroleum is socially owned. It's a socialist company, Mr. Speaker. I hope that doesn't scare them out of British Columbia, but I don't think they look at the dollar to see if they're socialist dollars or not.

On page 4 of their report we see a very interesting

[ Page 4419 ]

statistic. Of all the world's published proven reserves at the end of 1976, the United States of America had 216 trillion cubic feet, or 9.3 per cent of the total. In a later chart, it shows that the Americans use half of the world's daily consumption. Even though they only have 9.3 per cent of the world reserves, they use almost half of the current world production - 45 per cent. It tells you that the Americans have an insatiable desire for natural gas. They're going to get it from the easiest place they can, and that'll be us.

Canada, by contrast, has 2.5 per cent of the world Share of natural gas. That's not very much by world standards, Mr. Speaker, but by American standards, it is a little more than a quarter more than their known reserve.

So let us understand what the stakes are. The Americans see as our published known reserves of natural gas, over a quarter again of what they know as their continental supply within the borders of the United States. So we have a good bargaining position, Mr. Speaker. The bargaining position is the guarantee that we continue meeting our export commitments, as we did when we were a government, of 809 million cubic feet a day up till 1989.

I want to say that the member for North Vancouver was very gentle when he said that El Paso had some nervous skin condition about the pipeline on the surface in British Columbia. He was very cautious. He didn't say who it was in this House who gave El Paso the nervous condition. You know who it was, Mr. Speaker? I'm not as charitable as my friend. It was one of his former colleagues, the now Minister of Labour (Hon. Mr. Williams) , who stood in this House and said that we should threaten to cut off the natural gas supply to the Americans. It was a Liberal who did that. Yes, it's there in Hansard.

MR. GIBSON: Former Liberal.

MR. BARRETT: It was a former Liberal who made those hysterical comments.

MR. MACDONALD: An apostate Liberal.

MR. BARRETT: An apostate Liberal on his road to salvation by way of.... What was that word you used today - "pomposity"? That's the route.

It was that Minister of Labour who stood in this House and said that he would cut off the Americans' gas supply. I hope to hear from the government today and they renounce that position, because contracts should be honoured.

MR. LAUK: Did anybody else say that?

MR. BARRETT: No, it wasn't a socialist who said that. No, no, no! Had it been a socialist, there would have been headlines in The Vancouver Sun: "Reds Scare Yankees." But you don't need to worry about that headline. Most people would have assumed that was a baseball score.

Mr. Speaker, am I for the treaty? I have no option. Yes, yes, yes. I am for honouring the contracts to 1989. 1 am for the Alaska route because we have no option. I accept the reality, but what I am pointing out is that in accepting that reality I am warning the people of this country what is involved - all 200 of them who are listening - that we are on the verge of a major sellout of our resources if we don't control the taps at Dempster.

Now let's deal with other specifics in terms of hard bargaining. I believe this. I believe, as the member for North Vancouver said, that it's the Premier's responsibility. The Premier has to take this initiative himself. I believe that one of the first conditions should clearly be that 90 per cent of all the labour, skilled and unskilled, to be applied to the construction of that pipeline through British Columbia jurisdiction should be British Columbian taxpayers. I believe that British Columbian unemployed carpenters, unemployed plumbers, unemployed pipe welders, unemployed labourers should have first call on their jobs. It's more than chauvinism, and I'll tell you why. Not only is it necessary on the basis of providing British Columbians work, but it is the one key factor in giving us some influences over stabilizing the social structure of this province. When you have a massive itinerant work force, all social problems -alcoholism, prostitution, drugs, and crime - follow, such as was experienced in Alaska. If we don't learn from history, we're condemned to relive it.

The safest way to avoid those basic problems in a massive itinerant work force is to draw from the already stable social structure of skilled and unskilled people and say: "These are your jobs. Here. Buy your home in this province of British Columbia." It makes sense economically, and it makes sense socially. You will not be disrupting lifestyles; you will not be disrupting anybody's roots. As a matter of fact, you will be securing homes and futures for unemployed workers who do not have that security right now. No. 1: 90 per cent of all labour, skilled and unskilled, on the pipeline portion through British Columbia should go to British Columbia working men and women in this province.

Secondly, Mr. Speaker, do not be lulled by the $200 million figure held out as a carrot for the heritage fund. It sounds like a lot of money, but it was my good friend the member for North Vancouver-Capilano (Mr. Gibson) who said that the Mackenzie Delta people spent $150 million in public relations money alone to push the Mackenzie pipeline. If you can blow $150 million on PR, what are the stakes you're trying to blow the money on? Billions and billions and billions of dollars. So to be

[ Page 4420 ]

bought off by $200 billion, which is only a year and a half's liquor profits in this province, is not good enough, Mr. Speaker. Any buy off like that will drive people to drink in this province.

I've got a formula, so that people in this province will understand. When you go and buy a new suit in this province, as some cabinet ministers don't do because the sales tax is too high, if you go to buy a fridge or a stove or a car, you pay 7 per cent. Is that correct? Correct. It is shameful.

However, this is my formula: we say to the federal government that we want a permanent economic development fund set up and that the private oil companies that are investing in this pipeline put up 7 per cent of the total completed capital cost of the pipeline as a permanent economic development fund for the people of British Columbia. If it's good enough for the peasants of this province to pay 7 per cent sales tax, let the international oil companies pay a 7 per cent sales tax on their economic activity in this province.

You think about it out there, folks. If you have to pay 7 per cent and you're a resident and a British Columbia taxpayer, isn't it fair that a non-resident foreign oil company investing should also be charged that same 7 per cent? And I put something else to you, my friends, very clearly. It's not 7 per cent of today's projected cost - not on your life; 7 per cent on the completed cost of the pipeline. The estimated figures say it's going to cost $6.7 billion. My estimated guess here, and I'll bet anybody a cup of coffee and a doughnut....

Interjection.

MR. BARRETT: Black coffee for you, my friend. It'll go with the colour you'll be wearing after the next provincial election. Yes, my friend, a rolling doughnut. You know what to do with that.

I suggest that it be 7 per cent, because my prediction will be that that pipeline when completed will cost at least $12 billion. And I'll tell you why. Mr. Speaker, I don't want this to get around too much either, but there's some jiggery-pokery going on with the Canadian dollar right now. Oh, yes. Something funny's happening with the Canadian dollar. Six months it was $1.02 on the American market. All of a sudden it took a nosedive. If you're holding a big scoop of capital, and you're going to make an investment in a foreign country, wouldn't it be wise to drive that foreign currency down by withholding balance of payments? Drive the dollar down to 92 cents; dump your $6 billion into the economy; goose the Canadian dollar up to $1.04 and $1.06 and walk away with a handsome profit.

I know it sounds strange. I know that there are no people on the international money market who would do things like that. But if I can figure it out, they can too. It should be 7 per cent on the completed capital cost because inflation will hit this country and this province like the tidal wave that we had in Port Alberni.

A $6 billion to $10 billion capital infusion in this province's economy alone will drive inflation in this province up to double-digit figures. Those people who are on welfare, on fixed incomes and on pensions and on Mincome will find that within 18 months after the project is started, with no federal controls on prices, that food costs and living costs in this province, especially in the northern half, will soar dramatically.

What protection will there be for the northern MLAs and the northern residents of this province who are already paying over $1 a gallon for gas? What protection will there be for those northern residents when inflation hits with that kind of money pumped into the economy and their price of bread, food, clothing and everything else goes up? It will go up. Look at Alaska and see the costs rising dramatically in that jurisdiction.

1) Ninety per cent of labour from British Columbia. That applies as much as possible to B.C.'s secondary industry -and its total capability.

2) A 7 per cent payment on the total capital cost of the completion of that pipeline for an economic development fund with this proviso: all mitigating social and environmental costs be negotiated after the completion of the pipeline project so that we never again duplicate the folly of having to pay for the cleanup of the mess behind the Columbia River reservoirs on the Canadian side. Another analogy. My good friend the member for Port Alberni (Mr. Skelly) will be speaking about that. But mitigation of environmental and social costs have to be negotiated above and beyond the 7 per cent. Environmentalists have the right to expect that cleanup; British Columbians have the right to expect that cleanup. That cost should go to the people who are putting up the capital - 7 per cent plus for the mitigation costs.

3) 1 want to see, more than anything else, a paper, an agreement, a covenant, signed between the province of British Columbia and the government of Canada that Canadians and British Columbians shall have first call on arctic gas when it comes through that Dempster connection.

AN HON. MEMBER: On Canadian gas.

MR. BARRETT: On Canadian gas coming through that Dempster connection. We must have the protection in writing between this province and the government of Canada to show our children that when we made the deal we protected their interests by saying to them that when Dempster gas comes through, you will have the right of first refusal whether you need it for your homes, you need it for your jobs, or the development of secondary industry. Without that, Mr. Speaker, it will be a British

[ Page 4421 ]

Columbia sellout.

Three simple conditions, but they have to be in writing. I want to tell you, this is a new government. It is not vested by the sins of the former Social Credit administration, real or imaginary. It is not vested by the sins of the former NDP government, real or imaginary. But in every government's term of office there becomes a high-water mark as a test of principle and commitment to the well-being of all British Columbians. We've reached that day today in an unexpected fashion.

I had hoped that the Premier would have participated as the first speaker in this debate, not the last. Be that the case, Mr. Speaker, before I sit down, I want to make it loud and clear that anything less than these three conditions will be a sellout of British Columbia's interest.

The three conditions are: (1) Ninety per cent of all labour from British Columbia. The same formula should apply to small businesses and suppliers of materials as much as possible. (2) A 7 per cent, one-time cash payment for permanent rental of the corridor to be used by this pipeline, that 7 per cent figure to be based on the final, total capital cost of the project. An addendum to that: allowing a settlement of mitigating costs for social and environmental disruption to be tallied after the event. Leave that open. (3) A complete, signed guarantee that British Columbians and Canadians will have the first right of refusal on the Dempster arctic gas pipeline.

MR. WALLACE: Mr. Speaker, I was really impressed by the Leader of the Opposition's non-partisan speech.

I just feel that there's a series of events. The Leader of the Official Opposition referred to it as a high-water mark in charting the future of British Columbia. I think he's correct that we have a major issue of transporting natural gas from Alaska and it has, in effect, become an enormous international poker game between Canada and the United States and the showdown is September 1. I'm aware that President Carter can delay his decision for 90 days but, regardless of that possible delay, the outcome of negotiations will decide either who held the best cards in this poker game or, perhaps more ominously, which country plays poker best. The issue is of enormous significance for four or five reasons. I want to mention them quickly and say a little bit about each. The scope of the project, as the Liberal leader pointed out, matches - and far exceeds, in fact - any development project in the past. We're talking about perhaps an $8 billion project with something on the order of $1.3 billion being spent in British Columbia. We have the economic implications, both during and after the possible construction of the pipeline.

Thirdly, an issue that I'm rather surprised was not accentuated in debate earlier this afternoon is the essential question of our good relationships with our very powerful neighbour, the United States, for good or bad, as the case might turn out to be. It's been said so many times that it's very difficult for a mouse to sleep with an elephant and I think that we shouldn't lose sight of the fact that, regardless of whether we're negotiating on natural gas with the United States, any negotiation which is of such far-reaching economic importance to the United States must be approached, as the Liberal leader suggested, with the greatest degree of care, courtesy and diplomacy. You might take a quick, simple example of the problems of agriculture and all the responses which the American nation can very quickly develop if they're unhappy with trading problems across the border of one kind or another.

The fourth element, which hasn't been mentioned at all this afternoon - or very little - is the whole problem of native land claims, which must surely be intimately involved in any project of this nature.

Last, but by no means least, is the environmental and social impact of the pipeline. I just want to mention very briefly the confusion with which Canadians, by and large, must be facing this very complex issue. I've listened to comments in this House this afternoon which I believe to have been well researched, and I'm talking particularly, Mr. Speaker, about the economic implications as they involve employment. I notice on the front page of tonight's Victoria Times there is an enormous. headline which says: "30,000 Jobs From Alcan Pipe." Now prior to today I haven't read anything closely resembling these figures. So that the House may be aware of why I make that criticism, I would quote from The Financial Post of July 30,1977. Under the heading of "Unemployment, " this article by a lady by the name of Margaret Laws states:

"Neither the Arctic gas nor the Alaska Highway route would do much to cut into unemployment, although the Arctic Gas proposal was estimated to be slightly more attractive from this point of view. At the peak of construction in 1980, foothills estimates that the pipeline would bring about a 0.22 per cent increase in man-years of employment. The reason why the positive impact on employment growth is so small compared to the impact on gross national product growth is because the pipeline is highly capital intensive rather than labour intensive."

So, Mr. Speaker, I just make that point in passing because some of the outrageous statements that are made in the Times tonight. I think I should say, in fairness, that the statement is made by Barry Brown, a spokesman for the Pipeline Construction Association of Canada. I think this is an important aspect of this whole problem to put into context. He

[ Page 4422 ]

says:

" 'Our first problem would be to locate the skilled workers for pipeline work and then to provide accommodation for them and the thousands of other workers who would stream into this province.'

"Brown said 8,000 workers would be needed to work directly on pipeline construction and about 22,000 would be needed in supporting services.

" 'I would say it would take 30,000 workers but it could be more than that. It is a very big project.'

"British Columbia has some highly skilled workers but not nearly enough to handle the $10 billion project.

"We would have to draw on the pool of skilled pipeline workers in Alberta and Ontario - and in the United States as well."

" 'Canadian companies are able to supply all the major construction equipment and material but the contracts will not be confined to B.C. firms. The project will be shared across Canada.' "

[Mr. Schroeder in the chair.]

At any rate, Mr. Speaker, this is the kind of confusion which must be engendered in the minds of the public when they read these figures and perhaps ask why any government - the British Columbia government or the Canadian government - would show any hesitation in getting into a deal on the pipeline if that kind of boost to employment was to be part of the deal.

I hope that within this debate or at an early date, the Premier, on behalf of this government, will come forward with the most reliable available figures as to what exactly the impact of the pipeline would be in regard to creating new jobs, when we know very well, as the Leader of the Opposition pointed out, that whatever jobs are created at the peak of employment, this will certainly be only over the time during which construction goes on and that there will be a return of all the skilled pipeline personnel to other parts of the world. I gather that it's a highly skilled job and these trained personnel travel all over the world.

I also received a telegram this afternoon which is a copy of one sent to Prime Minister Trudeau by the United Fishermen and Allied Workers' Union, and part of the telegram says:

URGE NO DECISION TO BE MADE ON PIPELINE ACROSS CANADIAN TERRITORY CARRYING ALASKA NATURAL GAS. WILL RESULT IN FURTHER EROSION OF SOVEREIGNTY So OBVIOUS IN OUR FISHERIES DISCUSSION. URGE B.C. GOVERNMENT TO DENY PERMISSION FOR PIPELINE THROUGH BRITISH COLUMBIA UNTIL ADEQUATE ENVIRONMENT AND SOCIO-ECONOMIC IMPACT STUDIES ARE CARRIED OUT AND A THOROUGH OPPORTUNITY FOR PUBLIC B.C. DEBATE.

And I would assume that the Premier has perhaps just in the last hour or so received the same telegram. This telegram was received at 15:40 hours in my office.

Interjection.

MR. WALLACE: No, Mr. member for Burnaby, it was signed by George Hewison, who is the secretary-treasurer of the United Fishermen and Allied Workers' Union.

I may say I've also received a telegram from the Communist Party of Canada which I'm not about to quote. I've been accused of being many things in this House but I've never yet been accused of being a communist.

Mr. Speaker, as Canada and the United States sit down to bargain, it must be very obvious that there are costs and benefits to both countries. Each country must balance the costs and the damages against the economic benefits in trying to reach an agreement which is mutually satisfactory to both countries.

While I've listened carefully to the Leader of the Opposition and the Liberal leader, I have to take issue with them on one fairly basic point. That crucial opinion, in my view, is that Canada has to consider whether it should participate in the Alcan project at all. After all, Mr. Speaker - and this is where I find some difficulty in following the line of argument of the Leader of the Opposition (Mr. Barrett) - the whole purpose of the Alcan project, if we set aside the possible Dempster hookup for the moment, is to serve the interests of the United States in getting Alaskan gas to central and eastern United States. The Canadian government, in other words, has some options in looking at this very important international issue. The United States wants the gas and needs the gas.

I just want to emphasize that at this point in the development of B.C.'s natural resources and Canada's natural resources, we are not under some overwhelming pressure to go along with the development of the Alcan pipeline, which essentially is to distribute Alaskan gas to the central and eastern United States. But even if we do feel that there is self-interest involved - and there is, despite some of the possible costs involved - I was very interested to read our esteemed former member of the press gallery, Marjorie Nichols, who pointed out in a recent article from Washington that the Americans are far more sensitive to the El Paso option than appears to be the general feeling among Canadians.

There were at least two recent statements by

[ Page 4423 ]

President Carter, neither of which he was really asked to make. He was being questioned in fact, on one occasion, about another issue altogether. He was talking about the possibility of a new Panama Canal. He was answering a question at a public meeting which I happened to see on television. President Carter, in citing the need for a new Panama Canal, stated two or three times that it had to be capable of accommodating very large ships. He went on to stress that this was essentially to accommodate liquified natural gas, which would be used to distribute that gas to other parts of the United States. This statement was further repeated. He specifically referred to the need for these large tankers for the distribution of liquified natural gas.

I think it shouldn't be overlooked that he also has tremendous political support for the El Paso proposal. I'm talking about President Carter. For example, 30 major unions representing several million workers have endorsed the El Paso proposal, as has the executive council of the AFL-CIO. El Paso also has strong political support in the Deep South. It's interesting that El Paso is a major gas supplier to the President's own Georgia constituency.

So, Mr. Speaker, the situation, as I sense it in the media and in the comments of the Liberal leader and the leader of the official opposition, is that it's a foregone conclusion that there is going to be an Alcan pipeline. It seems to be the impression I've derived from listening to debate.

The first question I would like to ask the government of this province is whether, in general terms, the government believes that this is a foregone conclusion and that all that remains is for British Columbia and Canada to get the best deal it can in negotiations with the Americans. Is that the position we're in today? Or does the provincial government of British Columbia feel, as Mr. Trudeau obviously does, that it is only in the light of negotiations that we can really determine whether there is going to be a pipeline route along the Alaska Highway.

But certainly the Alcan route, as has been pointed out, crosses 542 miles of British Columbia territory, and it would have an enormous economic, social and environmental impact on British Columbia. It would seem to me that it's never been more vital than now that the British Columbia government, through this appropriate. forum - namely the Legislature -should make its position plain to Canada and to the United States prior to the onset of these historic negotiations. We must remember, Mr. Speaker, the aftermath of the Columbia River Treaty.

If early negotiations lead to a decision by the United States that the Alcan route is preferable, Canada must be tough and articulate and clear-cut in presenting its position. To do this in fairness to the interests of British Columbia and it's citizens, our federal negotiators must be notified of the British Columbia position now.

I would just repeat that Canada has only one option to consider if it believes that the gas should be transported at all and that's the Alcan proposal. But the United States still has two options, although, to be very accurate, I suppose the Americans have three options. Again quoting from The Financial Post of July 12 this year, there was a headline which reads: "United States Thinks About Just Leaving The Gas In The Ground." I know that the Liberal leader in his comments said that was not an option. But in trying to cover this subject, at least on a wide front, and to cover all the opinions that have been expressed, I think it's fair to mention that this was an article out of Washington by Hymen Solomon - and I suppose with a name like that he should have wisdom. This deals with the fact that the cost overruns of the Alcan route, together with construction delays, could really boost the initial projected costs by 50 per cent. I won't go into all the details, Mr. Speaker, but the article then goes on to point out:

"Under these circumstances, the gas which would finally be delivered to the middle and eastern United States would be so far out of line in regard to cost that, of course, it would make the whole expenditure of $10 billion just not feasible."

So maybe the Americans have three options: maybe it is Alcan, El Paso or leave it in the ground. But assuming that there is a lot of evidence that the Americans desperately wish to obtain the gas, it would seem that the two clear options are Alcan and El Paso. It's also clear, as has already been said, that Alaska itself, through the presentation made by Governor Hammond, would much prefer to have the El Paso route. The reasons for that are numerous, but he has pointed out that it has the smallest risk of construction delay and cost overruns; it doesn't intrude on the unique wilderness area or pose threats to wild life; it would make maximum use of existing pipeline experience and data. The El Paso route parallels the oil pipeline for all but the last 40 miles of the 800-mile route, and an estimated $1 billion investment in work pads, access roads and construction camps could be used.

Governor Hammond also points out that it would afford Alaska the opportunity to use a portion of its royalty gas and offer substantial economic benefits to the state and the nation. On the other hand the Governor of Alaska points out that the Canadian route would mean a balance-of-payments deficit to the United States of more that $20 billion dollars over the life of the project. Last, but perhaps the most important point of all, Governor Hammond points out that it avoids the passage of the pipeline through a foreign country. Again, I would just say in passing that the Leader of the Opposition, while quite rightly emphasizing the importance of Canadians

[ Page 4424 ]

having first access to gas which might be obtained through a Dempster linkup, perhaps overlooked the point that if we don't have the Alcan pipeline in the first place which is designed to convey American gas, there may never be a Dempster pipeline or a separate Canadian pipeline required.

If I was an American, I would just be very, very careful of the concept of depending on getting one of your vital natural resources transferred from point A to point B, if a very large part of the intervening country to be traversed was susceptible to people who might just want to turn off the tap when it suited their convenience. So I don't think that we should be in any way surprised or dismayed by the fact that the Governor of Alaska and the government of Alaska are obviously very sensitive to the problems that can arise when large volumes of the natural resources might have to be conveyed through another country. I think that if Canadians were facing that possibility, they would react in exactly the same way.

The point I'm trying to make, Mr. Speaker, is that the El Paso prospect is far from dead. In fact, it is very much alive. I just don't understand the kind of preconceived idea that seems to have pervaded much of the public response and much of the debate today that somehow or other the Alcan pipeline route is a foregone conclusion and that all we have to do is try and hammer out the best terms for British Columbia and for Canada.

The Leader of the Official Opposition says that if he had his "druthers, " he would prefer to wait for an all-Canadian product. I suppose we all would, as Canadians and patriots. But on the other hand, the Leader of the Official Opposition is saying that he has accepted as a fact of life that he has to support the Alcan proposal. I don't believe from all the reading I've done and from all the comments that have already been made in this debate, that that is an accurate summation.

At any rate, Mr. Speaker, the Canadian government and the American government are about to sit down and explore around a negotiating table the pros and cons of the Alcan pipeline proposal. There is one crucial aspect of the $10 billion poker game, because British Columbia has to let the federal government know now the costs - and I use the word "costs" in the wide sense: money, environmental, social, land claims - that it is prepared to pay for the economic benefit.

Since the British Columbia portion of the Alcan route would have a capital cost of $1 billion, with a large amount of provincial revenue annually, I'd like to ask the government the second question: is British Columbia prepared to co-operate in the Alcan route at any price? I hope not, because as has been mentioned earlier, we all know the social and environmental impact of many projects that have already proceeded, such as the Alaska oil pipeline, to which the Leader of the Official Opposition referred in talking about the social problems that have arisen and which I needn't repeat. We are all aware of the problems of alcoholism, crime, prostitution and many other serious social problems.

So I would like to know if the government of British Columbia has decided that it is committed to supporting the Alcan pipeline route at any cost. If it is not at any cost, how far is the government prepared to go in co-operating in the development?

I would suggest that the cost-benefit analysis must be weighed with great care and precision. I hope that British Columbia, if it hasn't already reached that point in its deliberations, would very quickly reach the point of spelling out just how far it's prepared to go - the price beyond which it will not go in seeking the benefits which the pipeline would obviously bring. Again, Mr. Speaker, in mentioning the seemingly preconceived notion many people have that this is a foregone conclusion, I would just like to quote Prime Minister Trudeau, who said yesterday that negotiations might be unsuccessful. So I would suggest that it's clear the Canadian government realizes the price demanded by the United States may prove to be too high to justify the benefits we would receive. This is a very factual and realistic note, I would suggest, on which to begin negotiations, because we all still have memories of the Columbia River Treaty.

Prime Minister Trudeau also recognized the National Energy Board report, which pointed out that Mackenzie Delta gas reserves constitute the cheapest alternative source of new energy supplies available to Canada, and that a spurline to the Alcan pipeline could ensure that Canadian Mackenzie Delta gas would be piped to Canadian markets. I would suggest that this, as the Leader of the Official Opposition states, is the most important part of the equation in this whole international poker game. What British Columbians and Canadians must decide is to what degree they are prepared to let the Americans up the ante.

Foothills Ltd. proposed a future hooking-up of Mackenzie gas via a spur along the Dempster Highway. The National Energy Board proposed diverting the Alcan route near Dawson City to lower construction costs of the Dempster link. Again, I understand that that proposed diversion by the National Energy Board would add an extra 6 cents per thousand cubic feet to the American customers.

The Prime Minister said another interesting thing yesterday, Mr. Speaker, if he is being quoted correctly. He said: "There is a point beyond which it will cease to be in Canadian interests to build this pipeline. We're not going into this to take the Americans for a ride and we expect they're not coming in to take us for a ride."

I'm not one of Prime Minister Trudeau's greatest

[ Page 4425 ]

admirers, but I have to admit that on this issue, and on the basis of some of these very straightforward thoughtful comments, I am somewhat relieved to learn that the Prime Minister does not feel that somehow or other we must build the Alcan pipeline and simply get the best deal we can. He is saying very clearly that negotiations might be unsuccessful. He is saying there is a point beyond which it will cease to be in Canadian interests to build this pipeline. What I'm trying to find out, and what I'd like to know from both the British Columbia government and the Canadian government, is: at: what point does it cease to be in our interest? How much are we prepared to pay - how much social damage, how much environmental damage, how much money? What are we prepared to put up with in order to gain in return certain benefits, the nature of which we are all very well aware?

Guarantees for the Dempster link would obviously be one of the strongest conditions that Canada could and should insist upon in negotiations. I would suggest that there are conditions that British Columbia must insist upon so that a point is not reached where the costs to British Columbia outweigh the benefits. Again, I would just refer to The Financial Post of July 30, where, as usual, economists differ in the degree to which they think there would be economic benefits.

I've already referred to the limited impact on unemployment, and I would just say that comments by certain economists make it plain that even the effect on the general economy would probably not be of the degree that many others have claimed. The National Energy Board estimated that the Arctic Gas project would have an annual positive impact on real gross national product growth of about 0.9 per cent from 1978 to 1985, compared to 0.5 per cent for the Alaska Highway project. So both in terms of dealing with unemployment and the economy in general, the economic benefits are perhaps not as extensive as so many authorities have claimed.

I would just ask three or four more questions of the British Columbia government. First of all, in the light of evidence both in the debate and in comments from the press, British Columbia has not been very active in letting the federal government know its position or the conditions that it would insist upon, if in fact this project were to proceed. The debate has shown very clearly that there have been some very important studies done. Again I won't take the time of the House to repeat all the information that the two former speakers have brought forward regarding, first of all, the Berger commission and then the Lysyk inquiry.

Nevertheless, Mr. Chairman, these were both federal inquiries initiated at the federal government, and I presume that the federal government was respecting jurisdiction by not appearing to poke its nose into British Columbia's affairs. But I would like to know why the British Columbia government either did not embark on one of its own inquiries or whether it did not take a more active role in participating in the Lysyk inquiry, which was confined primarily to the social and economic impacts in the Yukon.

While I'm no expert on northeastern British Columbia, I understand that in many respects the kind of problems that would be faced in northeastern B.C. would not be that greatly different from the Yukon. I can't recall the gentleman's name who was council to the Lysyk inquiry, but he stated the British Columbia representatives would be very welcome before his inquiry. It was something of a puzzle that British Columbia had played no active part in the Lysyk hearings.

It really surprises me that we are now almost at the last moment, it would seem, hoping to inform the Canadian government as to the kind of concerns we have about this whole project and the conditions as we as British Columbians feel must be met before we would be willing to co-operate in the finalization of the agreement.

One disturbing element in all this, Mr. Speaker, that I would hope the government will clear up is that the Minister of Energy stated yesterday that there was no doubt that the federal government knew that British Columbia backed the Alcan route. Questions have been asked off and on in this House and outside of the House as to what the government's position is. Did it favour the Mackenzie Valley pipeline or the Alcan route? As far as I'm aware, there has not been until now, or until yesterday, any definitive statement of the position of the B.C. government. Yet yesterday, we can open the newspapers and read that the Minister of Energy said there was no doubt that the federal government knew that British Columbia backed the Alcan route. Is not this an issue of the greatest public importance? If it is, why should the provincial government have been talking quietly and privately with the federal government as to what its policy is without at least giving this Legislature some insight into which particular proposal was favoured by the B.C. government?

And if the government has decided to support the Alcan route, might I ask, Mr. Speaker, if there have been studies done that are either not published or that we are unaware of on this side of the House? It would seem a little late to embark on them now. But if we haven't carried out the studies, how on earth can we enter negotiations or be a party to federal negotiations when we don't know what the cost is going to be?

The National Energy Board came up with the ballpark figure of $200 million for social and environmental damage vis-à-vis the Yukon. Has anybody on that side of the House got the foggiest

[ Page 4426 ]

idea of what the sum of money that might be appropriate to compensate British Columbia for the social and environmental impact of a pipe through 542 miles of northeastern B.C.? It's a very reasonable question, Mr. Speaker, in my view.

But many of the studies from which the Yukon and the National Energy Board are quoting statistics were done in a hurry and perhaps are less complete than one would wish. I am thinking particularly of the Lysyk inquiry which covered an enormous amount of mileage and put in many seven-day weeks in the course of trying to meet its terms of reference.

It would seem that British Columbia is even worse off than the Yukon, inasmuch that we either haven't participated in the inquiries that were conducted, or we have not tried to embark within our own provincial autonomy on studies relating directly to the particular way in which our province would be affected by a pipeline extending more than 500 miles across the northeast corner.

So I wonder if the government can bring the House and the people of British Columbia up to date right this afternoon with our knowledge - or the degree of our knowledge - as to the impact of this proposed pipeline, and the kind of figure for compensation that we are likely to convey to the federal government as some kind of basic minimum, under which we would accept no less from the American government as being the sum that should pay for the social, environmental and other costs of the project. Do we know that figure? If we don't know it, what are we doing to find out what would be a reasonable figure? Have there been discussions with the federal government? If the Minister of Energy (Hon. Mr. Davis) says that the federal government knew all along that we were backing the Alcan proposal, was he at the same time saying: "By the way, we think that northeastern B.C. should have $200 million or $300 million or whatever millions of dollars to compensate for all the the havoc and all the social problems and the infrastructure that will have to be created if we have an influx, even on a temporary basis, of workers and families who need skills and highways and hospitals and all the other services that go along with any suddenly appearing community."? Do we know that? If we don't know that, how soon are we likely to be in a position to come up with some kind of figure so that the federal government can be well aware of the position of British Columbia before it proceeds any further.

The native land claims have been mentioned very little in this debate. But I understand from discussions I have had with our federal MP, Mr. Oberle, that in fact, the pipeline would involve certain parts of northeastern British Columbia where land claims are an issue.

Mr. Speaker, I'm not suggesting that anybody in this House has a simple answer to the land-claims problem. All I'm asking is: where are we at in our approach to the federal government in relation to the minimum conditions we as a province would accept before we went along with an international project? It might just add one further obstacle to what is already a very difficult problem, namely the solving of native land claims.

The Minister of Labour (Hon. Mr. Williams) , in debating his estimates, gave us a great deal of information regarding his assessment of where the land claim situation is at the present time. But he could not speak for the federal government, obviously. As far as I can determine, the federal government continues to leave its position vague. I'm not aware of any recent specific commitments such as the Minister of Labour outlined as being his recommendation to the provincial government as to how it should respond.

AN HON. MEMBER: Tell him they're cut-off lands.

MR. WALLACE: Yes. But even on the aboriginal rights situation, a lot of the underlying problems are no nearer to solution now than they have been for I don't know how long as far as the federal government is concerned. Are we about to embark on this large international project with all the ramifications and perhaps just add one more difficulty to the whole tangled, difficult issue of native land claims, whether they be cut-off lands or aboriginal claims to the land in the first place?

In regard to employment, Mr. Speaker, I would agree with the leader of the official opposition that there must be every effort to give preference to British Columbia workers when they hold the appropriate skills and are willing to accept the fact that they would have to move to the area of construction and perhaps not have permanent employment beyond the period of construction. I feel that the British Columbia government should also clearly state its position to the federal government, that preference should be given to goods and services produced in British Columbia which will be required during the period of construction. Again, quoting the National Energy Board: "The greatest effects, it would seem, would be concentrated in iron, steel, metal fabrication, concrete and transportation industries." It would seem to me that it only makes sense that the British Columbia government should make every strenuous effort to insist on preference for B.C. workers and for B.C. goods and services.

I also learned from my good friend, the MP for Prince George-Peace River, Mr. Oberle, that there is enormous potential for this Alcan project if it proceeds to breathe new life into the B.C. Railway.

God knows, if there's any industry in British Columbia that needs something to breathe new life

[ Page 4427 ]

into it, it would have to be the B.C. Railway. The economic boost from the Alcan project, if it can be negotiated, should emphasize in every possible way an increased stability in the financial status of the railroad and perhaps even be a justification in extending the railroad from Fort Nelson to the Yukon border.

I might say that in my discussions with the MP for Prince George-Peace River (Mr. Oberle) , he is of the opinion expressed by the Liberal leader earlier on that there has not been an adequate or an early enough outlining of the B.C. position to the federal government. I see the Premier wincing and I see the Minister of Energy (Hon. Mr. Davis) looking as though he disagrees with my last statement. If I'm wrong and there have been private discussions between the provincial and federal government, I'll withdraw my criticism, provided right in this debate either the Premier or the Minister of Energy gets up and tells us what the private discussions were, what B.C. told the federal government as its minimum position to go along with this project and gives us the fullest possible outline of the B.C.-federal government understanding as of today.

Now if there's been a whole lot of private discussion and a lot of the criticisms I've made are groundless, they are criticisms I've made simply because we have not been told either in this House or in the public forum through the media. I find one of the most frustrating elements of being in this Legislature is the fact that time and time again a member can do an immense amount of homework using what information is available, can try to make constructive criticisms of this House, and then find that there's been a whole bunch of private discussions going on which the government chooses to tell us about when it suits it - which is pretty late in the day as far as this Alcan proposal is concerned. If there has been a whole lot of private negotiation going on, and Mr. Trudeau's well aware of the B.C. position and what our minimum conditions will be to participate in this project, then I think it's rather insulting to this Legislature that it's at this late date before we in the opposition can find out. It's no incentive to try to play an intelligent and constructive role in opposition if this is the way we're to be insulted by this government or any other government of the day.

I have looked far and wide, and I've read a great deal in the press elsewhere to try to find out if in fact this government has a definite, clearly defined policy position in regard to which route should be followed. And secondly, if it has a position, I don't think we should be kept dangling till the 11th hour or later to find out what it is. As the Liberal leader interjects, the Premier stated in this House yesterday that there had been no official representations. Have there been any unofficial? Or has it been the kind of conversations that the Minister of Energy refers to and is quoted in the press as saying: "But of course the federal government knew all along that we supported the Alcan proposal."

How official or unofficial was that transmission of B.C. government's position to the federal government? Was it a little conversation between the Minister of Energy and the federal Prime Minister or to Mr. Gillespie? I think the quotation referred to the fact that the Minister of Energy had talked to Mr. Gillespie. I just can't put my hands on the specific quote, Mr. Speaker, but certainly the statement from the Minister of Energy of British Columbia was that, of course, the federal government knew that B.C. backed the Alaska Highway route.

Oh, yes, perhaps I should just read further from today's Colonist of August 9. Mr. Davis is quoted as saying that he personally had talked with his federal counterpart, Alastair Gillespie, but that the provincial cabinet couldn't directly approach the National Energy Board because it doesn't like pressure. Well, Mr. Speaker, that seems a very, very sensitive attitude by the Minister of Energy in not wishing to appear to pressure the NEB. But I feel that the opposition parties in this province have been pressured by silence on the part of the B.C. government.

At any rate, Mr. Speaker, I feel I've covered the issues as I've seen them. I would simply say that I agree with the comment by the Premier that there have to be associated benefits which perhaps could be related to the negotiations, and he mentioned the possible paving of the Alaska Highway.

It would seem to me that a basic principle in developing the Alcan route is to utilize an already established corridor for the transportation of a vital resource. It seems to me the interrelated importance of moving personnel, vehicles and resources along the same corridor, and the economic advantages which will accrue from this, would make it very obvious that one of the associated parts of the project should be the paving of the highway. British Columbia would, of course, benefit greatly through such aspects as increased tourism if that were to take place.

In trying just quickly to sum it up, Mr. Speaker, I see this as an enormous project with far-reaching ramifications. I feel disappointed and concerned that the British Columbia government only seems to be getting into the matter of negotiation with the federal government at a very late date and with incomplete data.

I would like to say that I do not believe that it is either wise or certain that the Alcan project will proceed. Furthermore, if it should be negotiated I think we should be mindful of such other complicated negotiations as the Columbia River Treaty where we came off second best in a deal between two large countries. I also just wish to support the general contention by the Leader of the Opposition that the availability of Canadian gas

[ Page 4428 ]

through a Dempster linkup to the Alcan pipeline, if it's built, should only be done if we have the absolute guarantee that British Columbians will have first access to these supplies. Of course, as the Liberal leader (Mr. Gibson) has pointed out, the National Energy Board has control over the situation anyway. Therefore, it is perhaps not quite the serious matter which the Leader of the Official Opposition gave us to understand.

Nevertheless, if this pipeline is built there is no doubt at all that there will be very substantial social, economic and environmental complications which can't always be measured simply in terms of dollars and cents. But I do hope, regardless of the ultimate outcome of these negotiations, that at a very early date the British Columbia government will decide what its minimum conditions are for participating and, at an equally early date, it will take the citizens of British Columbia into its confidence so that all of them can know and respond publicly if they feel the risks are not worth it in relation to the questionable benefits.

HON. W.R. BENNETT (Premier): Mr. Speaker, we've heard the party statements of the three opposition parties in this Legislature as enunciated by their leaders. The presentation of their points of view is very important to this House, to this province, and to all of Canada. I would point out, Mr. Speaker, that while this is a very important debate - an extremely important debate - and a time when the parties in this House have an opportunity to put all they know about the gas pipelines clearly on the record and to state the positions of their parties clearly, this is not an emergency debate. This is not an emergency debate. At no time during the speech either of the mover of the motion, the member for North Vancouver-Capilano, nor during the remarks of the Leader of the Opposition, or in the remarks of the Leader of the Progressive Conservative Party, was any case made-. No sense of urgency or immediacy to this debate developed, but this is an important debate....

Interjections.

MR. LAUK: On a point of order, Mr. Speaker, the Premier is reflecting upon a decision already made by this chamber. Leave was granted to debate an emergency and he should not reflect on that leave. He had the opportunity to say "no" when leave was asked for.

HON. MR. BENNETT: Mr. Speaker, if I might continue, I will deal with that very point the first member for Vancouver Centre makes.

MR. SPEAKER: If I could just reply briefly to the hon. first member for Vancouver Centre, the House has determined that there would be a discussion this afternoon on a matter of urgent public importance, as outlined. It's up to the discretion of each of the members participating in the discussion that takes place this afternoon to state his or her point of view. I do not see that there is, in any way, a prejudice against the discussion that's before us by the hon. Premier stating what happens to be his point of view.

HON. MR. BENNETT: Mr. Speaker, if I might continue, I can clarify for that member and all members of this House that in fact, while this is a very important matter, it is not an emergency. Had I been in the House last night when the motion was introduced, I could have presented substantial comment that I believe, Mr. Speaker, would have allowed you to bring in another opinion. I considered briefly, upon coming into the House today, when I heard this last evening, that I would indeed present this information to the House.

Upon reflection, I realized that this debate is important, and such debate, and the opportunity for these party leaders, should be there. As such, I did not choose the opportunity, knowing that they had spent all of last evening and last night researching for their party's presentations in this House. I would not at that late date deny them their opportunity.

I would point out that I was not in the House last evening because the British Columbia government was receiving an official state visit from Premier Goppet, the Premier of Bavaria, who is here on an official visit. Bavaria is a province of a state of Germany of some 10 million people. Its relationship in Germany and in the European Economic Community is increasingly important to our country and our province, particularly as Canada has signed an accord with the European Economic Community. We now have an ambassador, His Excellency the Honourable Mr. Cadieux, in Brussels, and of course we have representatives of the European Economic Community stationed in Ottawa who have taken the opportunity to visit British Columbia as part of this new relationship. So, Mr. Speaker, it was only a very urgent, very necessary and very welcome opportunity to welcome these visitors on behalf of all members of this House that kept me from being here last evening.

Mr. Speaker, I believe I could have presented the information that could have prevented this opportunity to speak, but I don't think I would have been serving the interests of those parties to put themselves clearly on the record as to the provision of gas from the Canadian Arctic and the provision of American gas to American markets coming together in a common carrier for the benefits of both countries and the peoples of both countries. This subject is very important to British Columbians.

I might recall to you, Mr. Speaker, that this government of British Columbia has done more than

[ Page 4429 ]

any other government in both Canada and the United States to this date to have, first of all, the Alcan proposal even considered by the two governments and their regulatory agencies, the FPC in the United States and the NEB in Canada.

I assuredly don't have to point out to this House because this House was advised, and the Conservative leader (Mr. Wallace) was advised, and the Liberal leader (Mr. Gibson) was advised, and the Leader of the Opposition (Mr. Barrett) was advised last year when this government and myself as a representative of this government of this province initiated discussions with the immediate states involved in both the provision of this gas, those states that would be the first beneficiaries, but not the only beneficiaries, of Alaskan gas. That is, I initiated a meeting of the Governor of Alaska, J. Hammond, the Governor of Washington, who was then Dan Evans, and the Governor of Oregon, Governor Bob Straub in discussions that were held in Seattle.

I advanced the case that without prejudice at that time in supporting any proposals, it was in the interests of both our countries, but particularly our various jurisdictions, that what was called then - and just introduced then - the Alcan proposal had to be heard by the two governments: the government of the United States and the government of Canada, through their regulatory agencies. Until that time, and not until that time, no government had come out in support of this proposal being heard.

It was our contention, Mr. Speaker, that it was in everyone's interest that all of the alternatives for the delivery of gas from the northern part of Canada and the United States would be heard. The two alternatives before the FPC and the NEB at that time - that is, the El Paso proposal and the Arctic gas proposal - were both running into some difficulty. There were serious concerns about both proposals. It was very interesting in light of the negative aspect to those proposals that Westcoast Transmission and Foothills Pipelines (Yukon) Ltd. did not come up with a brainstorm or a flash of a new proposal, but they dusted off the old proposal of Frank McMahon for a pipeline following primarily the Alaska Highway route, connecting Alaska and the northern part of the continent to the rest of the continent.

It wasn't a new proposal. There was sufficient information available on both sides of the border and to both those companies to give credibility to that proposal being brought forth at that time. That proposal, I believe, was introduced first in April, and it was our government that took the first action, as I stated, on May 18,1976.

Following the meeting of May 18,1976, in which we got together the Governors of Alaska, Washington and Oregon, Mr. Speaker, we took a further trip eight days later to consult with our Canadian counterparts, the Legislative Assembly of the Yukon Territory of

Canada. Some of the people viewing the proceedings in this House and some of the press may remember that opportunity to hold those very important discussions with what would have been and what is the most fragile part of Canada to be traversed by such a proposal.

We had very serious discussions with the Yukon assembly. As a result of our meeting on May 26,1976, one day later, May 27, while we were there, the Yukon Legislature passed a unanimous motion in their Legislature endorsing the British Columbia position - that what was called the Alcan proposal be heard by the various regulatory agencies.

I say that now, Mr. Speaker, because I want to state quite clearly that our government acted with foresight at that time. Our government acted responsibly at that time, but above all, when many were merely talking, our government acted, and that was something that wasn't happening at that time. This debate might not be taking place today had not we initiated that action at that time.

As usual, there are those members in this assembly and those parties that have tremendous hindsight, Mr. Speaker. Even the clarity of their hindsight quite often is dim and clouded. I was very interested, when the Leader of the Opposition finally got around to discussing the proposal, how he viewed other such negotiations in the past and how he was prepared to deal with this negotiation. It was obvious that very little thought has been given to this proposal or any of the proposals by the official opposition, the New Democratic Party. I say that in contrast with the very extensive research that has been done by the Leader of the Liberal party who introduced this motion and whom I know has had a continuing interest both inside this House and outside in the provision of gas not only to Canadian markets, but by a common carrier between two countries for the mutual benefit of both our peoples.

From the awareness we created, from the amount of government action and reaction we created, from discussions we had with other representatives in the U.S. representing the federal agencies, through a motion of the federal House, the FPC was instructed to hear the Alcan proposal. Following some time behind, the National Energy Board agreed to hear the Alcan proposal.

So, Mr. Speaker, our first task has been accomplished, and that was not to favour any proposal, but to make sure all alternatives were heard. I believe that the research and the argument that was developed, not only by the proposing companies, but by the various departments of government working in concert, is to their credit. The very fact that, as I say, this proposal is being discussed today, is because of that earlier action that we took.

Following the agreement of the National Energy Board and the FCP to finally hear what is called the

[ Page 4430 ]

Alcan proposal, this government proceeded to hold some discussions internally. Last year we set up an energy transportation task force co-ordinating agencies and departments of government in British Columbia. These are not political agencies but agencies there to gather information for the government of B.C. to help it develop positions on the transportation.

This task force, Mr. Speaker, looked at not only the Alaska Highway gas pipeline proposal, but had the additional responsibility of studying the TransMountain oil pipeline proposal and the Kitimat oil pipeline proposal. The members of this task force involved the Attorney-General's department, from which there were two members; the Economic Development ministry, from which there were three members; the Energy, Transportation and Communications ministry, from which there were four members; the B.C. Energy Commission, from which there were four members. Mr. R.T. Green of the Energy Commission became chairman of this task force.

The Ministry of the Environment and the Environment and Land Use Committee had two members on this task force; the fish and wildlife branch had four members on this task force; the land management branch had three members on this task force; the marine resources branch had five members on this task force; the pollution control branch had two members on this task force.

AN HON. MEMBER: The Attorney-General?

HON. MR. BENNETT: Intergovernmental relations as a partial co-ordinating body and Treasury Board each had a member; Highways, Labour and Municipal Affairs were asked to appoint representatives if the proposal should be agreed to by the National Energy Board and endorsed by the government of Canada. These ministries will appoint members to this task force.

This is the task force that has been operating on behalf of the citizens of British Columbia since late 1976, Mr. Speaker, developing the data and, the research so that British Columbia could be ahead of any proposal to agree to the Alcan project.

Now no other government at that time was taking this type of action. The government of Canada didn't make up its mind until yesterday that it was going to approve the project. It is just yesterday that the government of Canada even announced to the Canadian people that they were going to agree to this project. Yes, they had had the advice of the National Energy Board. But they had taken some time, Mr. Speaker, to let the people know that they would not interfere in a political way with the decision of the National Energy Board. They weren't prepared to return to the pipeline debate of the '50s. Having learned their lesson, they would accept the advice of an expert judicial body called upon to make determinations of this nature. The government of Canada has quite wisely agreed to discuss, now in negotiation, the recommendations of the National Energy Board.

I might point out, though, that there will have to be some change and probably the federal government will have to legislate the final negotiated position because the National Energy Board has not supported wholly! in its recommendation the early, present representation of the Alcan proposers. It indicates a timetable and inclusion of the Dempster connection. That was not in the original proposal. It calls for a change in routing that was not in the original proposal as such. It is probable that from the negotiations with the province of Alberta and British Columbia and the Yukon Territory that the final position will have to be the subject of legislation in the Parliament in Ottawa.

As such, our federal representatives will have an opportunity, hopefully, to debate what is a national decision within that chamber. I'm hopeful that will take place, Mr. Speaker. I'm hopeful that is the way they will go. It is my view that because of the change in the original proposal - the recommendation of the National Energy Board - that is what will happen.

This task force has been holding meetings and making recommendations to the minister. Mr. Speaker, the Minister of Energy, Transport and Communications (Hon. Mr. Davis) , who has had the responsibility for bringing together the various ministries on a political level in this government, has from time to time held a series of meetings with counterparts in Ottawa, to prepare them should they come to the conclusion they just came to yesterday. There was nobody official with whom we could negotiate, but the minister was able then to keep those most likely to be involved aware of the British Columbia position and to maintain the type of contact between the two levels of government should their ultimate decision be to endorse this project. He was able to set up with the government of Canada what form the negotiations would take, should such a decision be made. So when the hon. Liberal leader asked me yesterday if formal presentation had been made to the federal government, I said no, because at the time the question was asked, the decision had not been made - or at least announced to me - that they had indeed recommended, met, and the government had agreed to the recommendations of the National Energy Board.

Since that time, I have been in consultation with the Hon. Allan MacEachen, the House leader and the president of the privy council, who has been named as Canada's negotiator in this very important transaction, to set up the terms on which negotiations will take place not only between British Columbia

[ Page 4431 ]

and the federal government, but between the government of Canada and the province of Alberta and the Yukon Territory. I've also been, as I have been before, in contact with the Premier of Alberta (Hon. Mr. Lougheed) as to the style and way in which such negotiations should take place. I would point out that our chairman of the task force, Bob Green, who is in Ottawa or Toronto at the present time will not only be reviewing the meetings to do with pipelines that he's there for now, but will be starting the first start of discussions. It will be in a very general way on Friday, but a very important meeting between ministers of this government - the Minister of the Environment (Hon. Mr. Nielsen) and the Minister of Energy, Transport and Communications -and the negotiator from the federal government, Hon. Allan MacEachen, will take place next Tuesday, to discuss many of the concerns that have been developed by the task force and the various ministries have identified various problems which may come up and which would be of concern to British Columbia should this pipeline go through.

The leader of the Conservative Party today brought in one of those headlines which quite often are wrong, as this one is, in regard to the number of jobs that would be created by the construction of this pipeline. Now I haven't read the article because I've been listening to the very informative debate that has taken place in the House this afternoon. The information that we've developed so far is that there would be approximately 3,000 jobs directly on pipeline construction, not 30,000. There's an extra "0" dropped in there, probably from the deficit of the last government that we had in British Columbia.

It means, according to the information that the economic research department advising cabinet and the committee have come up with, that another 3,000 jobs could be created directly in the services supplying industries in B.C. It means upgrading, of highway access, airstrip and communication facilities, and that could involve a not yet designated number of other work people in this province. It means, of course, that with the renewed interest in the north there could be other jobs indirectly, as have created in our own gas industry in the north which is already working at an accelerated pace far in excess of the slump that occurred in 1975 with the last government. It means that renewed interest in forestry, mining, and tourism could take place in that part of our province.

Quite properly, members have mentioned that it would make a great difference to our B.C. Railway. A large portion of the pipe would be hauled on the B.C. Railway and, yes, would use the Fort Nelson extension. A large part of the pipe and supplies, Mr. Speaker, we are led to believe, would be transported by water from Vancouver to the northern ports and then up the Stewart-Cassiar road, and, of course, we'd have a large amount of supply moved in that way. Mr. Speaker, there has been a large 'amount of economic analysis go into what is now developing into the type of information that British Columbia needs in order to carry on the very crucial negotiation that will take place with the government of Canada in concert with the province of Alberta and in concert with the Yukon.

Now the leader of the Conservative Party has suggested that it is advice to him from one of his party's federal MPs in central B.C. that in the northern part where this pipeline will travel there are extensive Indian land claims. It is the information from two ministries of this government that the proposed corridor does not encounter any Indian land claims, or traditional land claims, at this time. The final route has not yet been designated by Ottawa or negotiated - as such, we cannot say this with certainty - but the initial proposals do not encounter this as a problem. Now the reason there were major studies done in both the Yukon and the Northwest Territories was because of the large number of native land claims that were anticipated to be of concern and the fact that the federal government, having that responsibility, must hold an inquiry.

I would point out that the two provinces directly involved with proposed pipeline construction, both Alberta and B.C.... We said observers did not participate, other than observer status, at those hearings, because they were called primarily to deal with those two territories, although we did participate in an observer status, along with Alberta. And in both the Berger commission and in the Lysyk report, neither Alberta or British Columbia, of course, were interveners of that nature. In fact, Alberta, I understand, wasn't an intervener before the National Energy Board, although British Columbia did have an intervener.

It's all right for the Liberal leader to pooh-pooh the intervener, give some credit to other names, and suggest that the intervention by British Columbia was not adequate. But the very success of the British Columbia position and the reason we're debating this today concludes that our position has been upheld and this is the project that Canada must first consider.

It is not merely an accommodation, if we can put this in perspective, Mr. Speaker, to our friends, the Americans to the south of Canada. It's a country with which~ we have had a long and warm and friendly and honest relationship. Quite frankly, it is disturbing when you hear comments from some parts south of the border that because of actions of some governments in this country, they fear the election someday in the future of a government that would not honour contracts. I don't believe any existing government in Canada today nor this government nor

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anyone in this chamber would ever go back on a contract, particularly with our neighbours. While we might from time to time disagree with terms of contract, our way is negotiation. Our way is the negotiation between friends who trust one another. That's what this proposed pipeline project is all about, Mr. Speaker.

There are two projects left before this continent, one only of interest to the United States. The Alcan proposal is of interest to both Canada and the United States. Treaties are only signed when there can be needs resolved for both parties. Would our costs be lower by going into a common carrier partially with the Americans who also have gas in the northern part of this continent, or would it be cheaper, Mr. Speaker, for those countries... ?

MR. SPEAKER: Pardon me one moment. I believe the hon. second member for Vancouver Centre is on a point of order.

MR. E.O. BARNES (Vancouver Centre): Perhaps the Premier would like to adjourn the debate until the next sitting of the House so that the Minister of Human Resources (Hon. Mr. Vander Zalm) could be awake.

MR. SPEAKER: That is not a point of order, hon. member.

HON. MR. BENNETT: I'm sure he won't be late with your cheque. In fact, if he's late with the member's cheque, I'll deliver it personally.

I would say, Mr. Speaker, that the very reason we're in negotiation is that if there is an accommodation that will serve the interests of both countries, rather than each country going on its own to tap its own resources.... Although we are on different timetables of need, Canada does need in the near predictable future to tap the supply of gas in the northern part of our continent - in our northern territories. This energy is needed not just for the west to feel a little confident sometimes, and smug about their energy resources, but for Canada as a whole.

Right now, Mr. Speaker, there's a debate going on in Canada as to whether we will work together to meet each other's needs, or whether each region will go off in their own self-interested way to the detriment of others. This is not British Columbia against Canada; it's not British Columbia against Ottawa; it's not Alberta against Canada. It's whether two provinces and one territory of Canada working with their federal government can come to a mutually profitable common position in which this country can negotiate a satisfactory solution that will be mutually beneficial to two countries. That's what the whole negotiation is going to be about.

Yes, the Prime Minister is quite right when he suggests there may be a point for either British Columbia, or Alberta, or the Yukon, or collectively for all of Canada, that we cannot go beyond; where it would be better for us to construct our own gas pipeline, to tap our own resources and to set up our own corridor for future energy needs for this country and force the Americans to a higher cost proposal -to liquefy their natural gas, ship it down the coast by tanker and put it into gathering systems farther down the west coast of this continent. It may be, but it is to all of our interests that we do the best we can to advocate, not in a negative way, but the positive results that could accrue to every person in this country, particularly to the people in the provinces and the areas which the pipeline will cross.

We are not proposing just to be a land bridge for American gas to American consumers. What this means is that a lot of the positive proposals we would have could be part of a very dynamic plan that would, while benefiting Canada, be of the most benefit to British Columbia.

The most exciting aspect of this would be what I'd like to call an all-purpose transportation corridor from the north. It would have not only the gas pipeline as proposed and not only the Alaska Highway as it exists, but an upgraded Alaska Highway, as the federal government has the responsibility to do it now. They have the responsibility to pave it all -British Columbia only takes over the portions which are presently paved - to upgrade it and make it a major transportation link.

When you think of that gas pipeline coming down and when Canadian gas comes on and travels through that pipeline, we in British Columbia will be one of the first sources and have first option at the lowest price for Canadian gas. Our carrying charges will be less. It may not be that we will always have the reserves we have in British Columbia. It may be that in our long-term interests we must look to the northern supply of gas and we would be first in line, first among the provinces. It would be lowest in cost because we would not have the further carrying charges. This is of benefit to British Columbia.

The upgrading of the Alaska Highway is of great importance to the growth and development of this province and this country's north. But think of that other energy commodity that has somehow been lost in this debate, and that is oil. There is much oil in the northern part of this continent. When the reserves are proven and the need is there to supplement the Alberta gas and oil, and when the high cost of the oil that will be taken out of the tar sands is known, this corridor will be the logical corridor for a major oil pipeline traveling in concert with the highway and the gas pipeline.

Again, British Columbia is now first in line for Canadian oil because we're not even self-sufficient in oil now. We are dependent upon our neighbour to the

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east, Alberta. This would give us a continued supply and would not put British Columbia at the mercy of offshore oil as many of the proposals that are circulating around would do.

Those who go for short-term or what look like fast-money solutions without recognizing the economic impact that this could make on our province and our country in the future; those who talk only in very glib sentences and do not realize the greater obligation we have to guarantee and the opportunity that we have to bring this source of energy closer to British Columbia and to give us a future supply, are missing one of the greatest opportunities we'll have in this province. Their quick grab for nickels will make them lose sight of our greater opportunity. This is the opportunity we have.

This is the opportunity that we saw last year when we first started to ask to have this proposal considered. More than just being good neighbours and as an accommodation to the Americans, and more than just guaranteeing to central and eastern Canada that there would be a logical way to bring their energy needs down from the north to Canada that could be met by the consideration of this pipeline system and this transportation corridor, it could be the corridor for other transportation of energy and other transportation. This was an opportunity to give British Columbia the type of guarantee of future energy needs and transportation. We would become the most favoured of provinces, with the greatest guarantees and lower costs of what will be very important to Canada in the future - and that is the oil and gas reserves of the northern part of this continent. That's the point we shouldn't lose sight of and that's the very important point that we realized some 14 months ago when we first started to pursue this very important project.

Yes, there are other considerations and negotiations that have to take place, and they're logical. The Liberal leader and the Conservative leader and, when he got around to it, even the Leader of the Opposition mentioned some of those very necessary things we would have to do in the construction of this pipeline.

Yes, there would be a major economic impact and we have to be prepared to absorb it and handle it. Yes, we would have to be concerned that British Columbians get first opportunity for labour where we have the tradesmen and the skills and the workers, particularly with the type of unemployment that is in our province - a high unemployment. Yes, that has t o b e a consideration. There are logical considerations, and they have been brought up here today.

There are other considerations of environmental concern that must be part of any negotiation and any agreement that is made between the government of Canada, the government of Alberta and the Yukon Territory. In an environmental way, we must ensure that the pipeline project abides by all provincial statutes, that we do not relieve them of any of the obligations of present provincial statutes in order to have this pipeline constructed.

We would suggest that we set up a review process on precise pipeline route selection among the company and the provincial task force and the governments now so that when it is legislated and this route is selected, British Columbia is sure that it doesn't give us the problem with land claims that was suggested could happen, which are not foreseeable now, by the leader of the Conservative Party.

We must make sure that all of the environmental concerns and the environmental impact studies and the social impact studies give us the assurance that this pipeline will not create the type of havoc that has been suggested could happen by speakers earlier in debate.

I would point out, Mr. Speaker, that this task force has been developing this type of data and information since last year - since 1976 - so that British Columbia would be prepared. At that time, nobody believed the Alcan proposal was ever going to be the final decision. The big money, as the leaders have said, was backing Arctic gas. It proves that Imperial OR and the big oil companies can't buy their way all the time. It proves that when there is a logical proposal, when it has encouraged the backing and interest of some governments and people, the logical choice will be chosen. And in this case, it was.

I disagree with the Leader of the Opposition when he says it was $140 million of public relations money. They lost their proposal, but a lot of that money went into impact studies and engineering proposals and research. A lot of it was spent in legal fees and presentation fees and expert witnesses to the very expensive hearings. Those hearings are expensive, and they should be, because these decisions that will be made will be made on that testimony. They won't be made on the speeches of us who want to deal in philosophical commitment and the aim we want to achieve. They will be based on the type of expert advice we get from the departments of government that we have already gathered together to give us of advice so that British Columbia's interests will be protected and so that we can deal with this proposal in a positive way.

Earlier, it was mentioned that the government hadn't had meetings. The government has, both in a ministerial and political way. But again, I say that it was only yesterday, August 8, that the Prime Minister communicated to me that they had agreed to this proposal. Our minister responsible for co-ordinating the cabinet and policy direction of this government had meetings in 1976 in March, on May 5, on July 23, and on November 29. Those were meetings with the federal minister, Alastair Gillespie. He had

[ Page 4434 ]

ministers' meetings with Mr. Gillespie in 1977. He's had meetings with the Transport minister, Otto Lang.

1, myself, have in principle discussed the concerns that British Columbia has, the guarantees we would want in a general way because we couldn't advance them specifically, and the type of negotiation that had to take place when the federal government made a decision in two discussions with the Prime Minister of this country. I met in December, 1976, after which I came back to British Columbia and made a statement. From time to time from our trips to the Yukon Legislature with the governors, I have reported to this Legislature exactly what the government policy was.

I have just recently had a meeting with the Prime Minister when he was in Vancouver. Again, they still hadn't reached a decision. But after the National Energy Board suggested that British Columbia would have to have the type of negotiation and type of discussions with the federal government. that would allow us full opportunity to participate in an internal agreement before the federal government ever advanced the firm positions to their counterparts in the United States in Washington. Because the exploratory talks are starting immediately, the firm position of Canada has yet to take place. The federal government has just appointed both their negotiator and their staff negotiator. It's been impossible for British Columbia to do anything in a formal way up until this time, Mr. Speaker.

In fact, at one time, with the amount of energy and time that this province and this government was expending on the research and type of interdepartmental and interministerial. and agency research that was going into this project, if it hadn't gone then, probably the members opposite would have been standing up in public accounts next year or in estimates faulting the government for their tremendous expenditure of money that took place in developing the type of research for a project that never got off the ground.

But, Mr. Speaker, we took the type of action to ensure that this project would be heard. We took the type of action that would bring it to fulfilment. The type of debate that we are having now in Canada and in this Legislature is worthwhile, and the negotiation and the advice we've received from the other parties is well received and well taken. That will supplement the type of expert advice that this government has received from those in the ministries, the technical staff and the B.C. Energy Commission who have co-ordinated this task force.

Indeed, British Columbians can be sure that we will demand the type of guarantees that will ensure that British Columbia gets fair compensation, gets fair treatment, that all of British Columbians will be given first opportunity to work, that it will do something more than just create immediate employment. We're trying to relate the planning to other proposed, large-scale projects in British Columbia. The type of discussion we've had in our economic research is so that they don't all come on stream at the same time. When we can do something about the timing of this project and others, we'll be able to correlate them so that we don't have the type of boom and bust of a lot of projects coming on just because business and people and governments have more confidence in British Columbia today than they did two years ago.

SOME HON. MEMBERS: Hear, hear!

HON. MR. BENNETT: Mr. Speaker, I would point out that this government has involved in a very real way the Ministry of the Environment and the Environment and Land Use Committee. We have strong environmental concerns over this project and, yes, that has to be a consideration. One of the reasons this project is even proceeding at all in the type of negotiation we're in now is that of all the projects proposed, it had the least serious concerns of an environmental impact nature. It was following existing corridors - corridors that had been established. The Alaska Highway corridor - that's how it got the name the Alcan project.

I want to say that although route variations may change both by the recommendation of the NEB and in the negotiations, they will all be for the better.

I would like to say that more research, more ministerial discussion and more expert advice has gone into this government's study of the Alcan proposal in this last year in one day than ever went into that once famous proposal that was advanced not in this House but outside, called the "way out." I can remember it being advanced as the way to deliver oil from the north. He had no social impact studies, no environmental studies. All he had was a plane ticket to Washington, and he couldn't find anyone to talk to. I'm speaking about the former Premier of this province. He stood up in this Legislature and talked about the lack of study. I can remember that proposal. I can remember it being the coloured maps and the "way out." That's right, but the way out wasn't until December, 1975.

1 cannot remember a study or consultation in this Legislature. What do we get? We get a quick announcement with coloured maps and the plane trip to Washington. When everybody there stopped laughing he couldn't find anyone to talk to, so he held a press conference and came home on the train, I think. That was the train that was going to carry the oil.

I want to say that contrasting that with the approach we've taken shows that we have not only a government of action, a government of responsibility, but also a government that has indeed been responsible in the way it has approached this problem

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and in the way it approaches it now.

Yes, it's even responsible in the type of debate and discussion we're having today. I mentioned earlier that I believe that no case for emergency existed. Had I been here last night, I would have presented such information to the Speaker to help him with his decision. But today we believed that once that decision was made it was in the public interest to allow this debate. If not immediate and emergent, at least it was of great public interest to the people of this province and this Legislature to hear it.

AN HON. MEMBER: Hear, hear!

HON. MR. BENNETT: I'd like to just sum up, if I can, Mr. Speaker. The negotiation that goes on with the government of Canada and with our colleagues, the province of Alberta and the Yukon Legislature, will be the negotiation in which parts of Canada and the government of Canada try to come together for the common good.

We recognize that we have a great opportunity to benefit not only our areas but all of Canada, and a chance at the same time to be good neighbours - and not give anything away - and offer a negotiation in which both of our countries and all of our territories can benefit. The energy crisis that grips the world -and it's affecting the peoples of this world - is a very real problem. It's no time for the selfish bleatings of a few who would say sell out when what this world needs is co-operation.

Taking it to a more immediate sphere, the Canadian sphere, at a time when we are trying to develop Canadian unity, those who would advocate that British Columbia would say: "Give it all to us, and to heck with the rest of the country" - that's not the spirit or the type of attitude we need now in Canada. It would only reaffirm to some parts of Canada that indeed it's everyone for themselves, and let the country fall apart.

That's not the way we are going to approach these negotiations. It will not be the west versus the east; it will not be B.C. versus Ottawa. It will be Canada coming together to meet the best interests of our people, the best interests of our country, the best interests of all of the people in North America. All of our interests can be well served with nobody losing, everybody gaining, and the type of suspicion and doubt that has entered some people's minds south of the border erased forever.

We can continue the type of friendship that has existed between our two peoples for many years. While we may argue from time to time - and yes, we have difficulties with different debates and different negotiations that are going on between us - they can be resolved.

MR. SPEAKER: A point of order by the hon. member for Nelson-Creston.

MR. L. NICOLSON (Nelson-Creston): I wanted to bring your attention to the clock, Mr. Speaker.

SOME HON. MEMBERS: Oh, oh!

Hon. Mr. Gardom moves adjournment of the House.

Motion approved.

The House adjourned at 6:04 p.m.