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Section II – Analysis of Performance by Program Activity

The performance information presented in this report is based on NRCan's 2007‑08 results structure which improves our ability to deliver meaningful programs and results for Canada and Canadians.

Strategic Outcome

Canadians derive sustainable social and economic benefits from the assessment, development and use of energy, forest and mineral resources, and have the knowledge to mitigate environmental impacts and respond effectively to natural and man-made hazards

Operating Context

NRCan operates within the context of Canada's vast endowment of natural resources, and a vibrant and growing global market for these resources. Canadians and the world expect that this resource endowment will be explored and developed efficiently and responsibly, with due regard to economic development, social development and environmental integrity. The keys to managing the breadth of the resulting resource-sector opportunities and threats are an authoritative, growing, widely disseminated understanding of the Canadian resource endowment, and world-class expertise in resource-related science and technology.

NRCan views this Canadian natural resource context as three interdependent spheres: our rich natural resource endowment; the people of Canada and their ideas (i.e., their expectations, knowledge, skill and ingenuity); and the public and private sector systems that link people and ideas to resources.

Within this broad resource sector framework, NRCan's activities during 2007-08 were directed toward achieving our strategic outcome. As the departmental results structure evolves, three elements have increasingly come to the fore as a basis for program planning, direction and accountability. These elements are:

  • economic development;
  • environmental responsibility; and
  • safety, security and stewardship.

Economic Development — A fourth consecutive year of strong global economic growth in calendar 2007 sustained the global demand for energy, minerals, metals and forest products. The upward trend in global demand for resources — as measured by price change — continued during 2007‑08. As a stable and reliable net exporter of these resources, Canada has been, and will continue to be, in a strong position to realize huge economic gains from this demand.

A cloud over this picture of strong global resource fundamentals was the significant decline in the value of the U.S. dollar — the currency of commodity trade — relative to many other currencies, including the Canadian dollar. With domestic resource development being transacted in Canadian dollars — which are appreciating in value relative to the U.S. dollar — the increase in global resource prices over 2007‑08 was less favourable to Canada than it may first appear.

After a slight decline during 2006‑07, oil prices returned to the realm of double-digit percentage price increases during 2007‑08. This trend continues to present strong opportunities for both Western Canadian, and Atlantic offshore petroleum production. High oil prices also continued to drive increases in the demand for the exploration and development of other established, and novel or alternative energy resources in which Canada has a strong position: natural gas, gas hydrates, uranium, hydroelectricity and biofuels. Canadian primary energy consumption increased in 2007 by a substantially smaller amount than GDP indicating improvements in energy efficiency comparable to all OECD nations.

Metal prices also remained relatively strong over 2007‑08; gold prices were a notable exception, yielding double-digit growth. Overall, minerals and metals exploration spending reached record levels in 2007, and even similar levels of spending is indicated for 2008. However, global economic uncertainties may moderate this record growth.

The context for Canada's forest sector is considerably more unsettled. While the value of the global forest products industry continued to grow in calendar 2007, Canada's industry continued to grapple with substantial challenges. These challenges included tough competition from tropical nations practising plantation forestry and operating newer technology forest product mills; a major slowdown in U.S. lumber demand consequent to a deeply troubled housing market; and a ten-year trend of surging raw softwood log exports from Russia to key markets in Asia and Europe. On the other hand, the stable regime for U.S.-Canada trade in softwood lumber that was negotiated in 2006‑07 by the Canadian and U.S. federal governments continued to serve the interests of Canada's forest sector during 2007‑08. Furthermore, Russia implemented the first phase of a log export tax during 2007‑08, which could renew opportunities for Canadian forest products exporters in future years.

The importance of natural resources in the global economy holds tremendous promise for communities close to areas where Canada's resources are located, including Aboriginal and northern communities. Commercial diamond mining in Canada's North – which marked its tenth anniversary in 2007‑08 – is a key example of the fulfillment of this promise. However, when these communities have few other economic opportunities, their dependence on resources makes them vulnerable to commodity market downturns, depletion of local reserves, or — in the case of forestry — major disturbances such as pest infestation and fire. Over the past five years, dozens of Canadian forest products mills have closed, and many thousands of forest sector workers have been laid off.

Environmental Responsibility — Understanding and awareness of the environmental footprint of resource exploration and development continue to increase in step with the economic growth that fuels demand for natural resources. This increase is due, in part, to vast improvements in the ease of access to knowledge and information of all types. It is also a consequence of the broadening of horizons that prosperity brings: as a larger share of the world's population has their immediate basic economic needs met, so then do these people seek to improve the long-term sustainability of their economic activity and the amenity value of their surroundings.

Canadians, consumers in key developed-world resource markets such as the U.S. and the European Union, and a growing fraction of the rest of the world expect the Canadian resource sectors — including Canadian firms participating in foreign resource exploration and development — to adhere to, and actively participate in the development and promotion of the highest standards of environmental responsibility. In 2007-08, developed world financial markets saw increasing efforts by institutional investors, investment analysts and, in some jurisdictions, regulators to deepen corporate reporting on social and environmental responsibility. Private sector executives have noted higher societal expectations for corporations to take on a public role, particularly in areas of environmental concern and balancing the growth in natural resource demand with limited supply.

In 2007‑08, the biggest single issues of environmental responsibility continued to be climate change and air quality, with intense interest and activity around the December 2007 United Nations Conference on Climate Change in Bali, Indonesia. Scrutiny of the impact on carbon emissions of global petroleum resource development and, for Canada in particular, oil sands development continues to be intense. The role of sustainable forest management in the global carbon balance was given particular attention in Bali, and Canadian forest products exporters have reported industrial consumer concerns in the E.U. that link oil sands development to the sustainable management of the boreal forest. Management of the water resource requirements of oil sands development is also subject to increasing scrutiny.

Environmentally and socially responsible mining practices and processes are also of significant importance to Canada. Concerns are rising around the world regarding water, mine waste management, acid drainage and mine site reclamation. Although the Canadian minerals and metals sector has significantly reduced the environmental impact of its activities over the past two decades, this issue will continue to be one of the most important challenges for the sector in Canada and for Canadian mining companies working abroad.

Turning to environmental change, the very large scale mountain pine beetle (MPB) infestation continued to spread in Western Canada during 2007‑08, but at a slightly reduced rate. Nevertheless, the projection remains that the substantial majority of lodge pole pine in British Columbia will be killed within the next five years, and concern about the spread of the infestation over the Rockies into Alberta remained intense.

Calendar 2007 was a near-average year for wildland fire in terms of hectares of forest burned.

Safety, Security and Stewardship — Maintaining Canada's Arctic sovereignty is a priority for the Government of Canada, and NRCan has a key role to play in the management of northern and Arctic offshore resources. Arctic access could be eased if the more than 50‑year trend of reduced Arctic sea ice is sustained. The extent of Arctic sea ice cover was lower in the summer of 2007 than in any of the previous three years; on the other hand, as of late March 2008, winter Arctic sea ice cover was substantially greater than in any of the previous three years, although this increase represents relatively thin, first-year ice.

International interest in the circumpolar region continued to grow in 2007‑08. This included a demonstration of Russia's interest in the form of the widely publicized Arktika 2007 visit to the North Pole seabed in August of 2007. The Danish LOMROG 2007 expedition also conducted surveys to delineate the Arctic seabed north of Greenland in August and September of 2007.

Other than the MPB infestation, the number and impact of natural disasters in Canada in 2007‑08 were fortunately within historical norms. Similarly, current and legacy hazards due to resource exploration and development did not change significantly in 2007‑08.


Earth Sciences Program Activity

Map of Montreal, Montain, Rock, Person reading a map
Earth Sciences Program Activity [D]


The Earth Sciences Program Activity provides the essential component of the science and technology (S&T) that Canadians need to make informed economic, social and environmental decisions. Geomatics Canada, Canada's national mapping agency, provides geographic information on Canada's landmass and offshore including topographic maps, legal surveys of Canada Lands, geodesy for accurate positioning, and the reception and archiving of earth observation data. The Geological Survey of Canada, Canada's national geoscience agency, works with the provinces and territories to provide the geological information that ensures a competitive investment climate for mineral and petroleum exploration, elucidates groundwater resources, maps the geology of the seafloor, helps reduce the risk posed by natural hazards such as earthquakes, magnetic storms, landslides, and naturally-occurring toxic substances. The Earth Sciences Program Activity also manages horizontal programs in climate change impacts and adaptation, and GeoConnections; delivers on Canada's commitment to monitoring nuclear explosions under the Comprehensive Nuclear Test Ban Treaty, responds to nuclear emergencies, and provides logistics support to Arctic science through the Polar Continental Shelf Project.

Key Achievements

New economic opportunities created for Canadians – Economic opportunities often develop from the release of public-good information, such as that provided by NRCan, which is required to understand the investment risk associated with assessing, managing, regulating and monitoring potential environmental impacts of exploration, development and transportation of mineral, oil and gas resources. Exploration for unconventional sources of energy, such as coal bed methane and gas hydrates, and the development of these potential resources are necessary for a secure supply of energy. In addition, the department's S&T provides the science basis for an environmentally responsible and sustainable framework for the extraction and use of these natural resources. Economic opportunities also arise from having a robust, reliable system of legal surveys for those lands for which the Crown has responsibility. All related programs are on track to meet expected results. More information on these programs and on the following key achievements can be found at

The department's Targeted Geoscience Program (TGI‑3) supports existing base metal mining communities by generating and disseminating geoscience knowledge to increase the likelihood of the discovery of new base-metal deposits or extensions of known deposits. Companies are applying the new TGI-3 geoscience knowledge to their exploration strategies, and are proactively seeking to share their new data, and to collaborate in its interpretation of the data with TGI‑3. Partnerships with the provincial geological agencies have been a key to TGI‑3's success.

Geoscience knowledge created by the NRCan Beaufort-Mackenzie Project has contributed to new exploration investments in the Beaufort Sea. Industry active in the region had access to this knowledge and Imperial Oil and ExxonMobil applied it in their geological analysis of the area, and successfully bidding $585 million for an exploration licence for a 205,000 hectare parcel in the Beaufort Sea. This investment represents a 10‑fold increase in the value over bids in previous years.

In the Mackenzie Valley, new geoscience information created and published by NRCan's Mackenzie Corridor Project contributed to increased exploration investment in the region and to the successful discovery of the Summit Creek Play by Northrock Resources and Husky Oil. NRCan's regional geological expertise has led to further interest of companies active in the region. For example, MGM Resources, Devon and Kodiak Resources have sought the regional expertise of NRCan's geoscientists prior to undertaking new field work and drilling programs.

In eastern Canada, the release of NRCan geoscience data and interpretations contributed to a dramatic increase in the level of petroleum exploration. In Quebec, new exploration permits generated over $1 million in revenue for the province, along with an increase of private sector investment from $2‑3 million to approximately $10 million last year (the projected increase for 2008‑09 will be nearly $20 million). Similar increases have been reported in New Brunswick, including $50 million a year over several years in drilling and supporting services around Sussex, and new multi-million dollar drilling and seismic surveys in Newfoundland.

On the east coast, geoscience information provided by NRCan, such as the interpretation of geological structures, is being used by industry to prepare assessments leading to investment decisions. In addition, this new geoscience information has been made available to the Canada-Newfoundland and Labrador Offshore Petroleum Board (CNLOPB) in order to assist in the Board's own assessments of offshore resources, contributing to enhanced management of these resources.

New geoscience knowledge has created an improved understanding of seafloor stability off the coast of Labrador, a critical factor in ensuring safe exploratory drilling. The first state-of-the-art seabed information to be collected in more than thirty years — accomplished through collaboration with industry, universities and the provinces — has been made available in the public domain. This data are of critical importance to a recently launched environmental assessment by the CNLOPB off the Labrador Shelf prior to the leasing of lands for exploration in 2008.

NRCan provided geoscience expertise to the Joint Review Panel (Mackenzie Valley environmental assessment review panel) on sixteen issues that were reviewed in regard to the Mackenzie Valley pipeline. The department's contribution to the impact of the work of the Mackenzie Valley Environmental Assessment project has been cited as an example of the importance of NRCan's role as a provider of an independent, neutral and balanced perspective supporting decisions of national importance and scope.

NRCan is investigating the potential of gas hydrates, an ice-like substance to provide a new source of clean-burning natural gas under its Gas Hydrates Program. Based on sparse preliminary data, the Canadian Arctic is believed to hold vast but unproven quantities of gas hydrates that could exceed all current conventional gas reserves. In March 2008, a collaborative effort with researchers from the Japan Oil, Gas and Metals National Corporation and Northwest Territories' Aurora Research Institute at the Mallik site in the Mackenzie Delta was successful in achieving the first sustained production of natural gas from solid hydrates by depressurization.

Did you know? Hydrocarbon exploration and development and commercial fishing are two key sectors of Canada's maritime economy. NRCan continues to contribute to hydrocarbon-related activities and, in addition, has contributed to improved fishing management through the provision of new seabed mapping data that has been incorporated into marine management plans. This information has contributed to the voluntary closure of certain fishing areas for the conservation of stocks, which in turn will lead to a stronger resource within a sustainable ocean management framework. Adoption of NRCan seabed maps by the fishing industry increased cost-effectiveness and led to the reduction of the environmental impacts from dredging and dragging. This work has been recognized by a 2008 Excellence in Technology Transfer Award by the Federal Partners in Technology Transfer.

NRCan's United Nations Convention on the Law of the Sea (UNCLOS) Program has been designed to produce a scientifically sound and defensible claim to support Canada's sovereign rights on resources on or below the seabed in the Atlantic and Arctic continental margins, beyond the current 200 nautical mile-exclusive economic zone. The survey program has been developed in collaboration with the Department of Foreign Affairs and International Trade and the Department of Fisheries and Oceans to maximize the area of Canada's claim and contribute to its successful acceptance.

In 2007‑08, several UNCLOS-related surveys were undertaken, including one in conjunction with Sweden and Denmark, using a Russian nuclear icebreaker under contract. In some of areas, severe ice conditions and the extreme lack of visibility made it impossible to collect data emphasizing the fact that, although substantial progress is being made, the environmental challenges NRCan faces are considerable. More information on UNCLOS can be found at

Secure land tenure is achieved through properly demarcated boundaries and the clear ownership of property rights as recorded in the Canada Lands Surveys System (CLSS) and the land registration systems it supports. This year's results in connection with various comprehensive land claims programs in the North are as follows. In the Yukon: for the Kluane First Nation, 18 parcels were surveyed bringing 75 percent of the claim to completion; and for the Kwanlin Dun First Nation 33 parcels were surveyed, bringing 65 percent of the claim to completion. For the Carcross/Tagish First Nation, 43 parcels were surveyed bringing 35 percent of the claim to completion. In the Northwest Territories for the Tlicho First Nation, 15 parcels were surveyed representing 4.8 million acres of land, bringing 50 percent of the Tlicho land claim to completion.

In southern Canada, 103 survey projects were completed to support First Nations self-government initiatives and specific land claims. This work included support for the transfer of 159,000 acres of land to First Nations in Manitoba and 41,000 acres in Saskatchewan. In addition, the CLSS On-Line was introduced to increase efficiency of the property rights system. All of these activities support capacity development in Aboriginal communities and sustainable economic development. More information on this program can be found at

Reduced stress on the environmental ecosystems and human health – The Minister of NRCan is responsible, under the Canadian Environmental Protection Act and the Canadian Environmental Assessment Act, for fostering the sustainable development of Canada's natural resources through the provision of geoscience expertise and advice. Program expectations over the reporting period have been met.

Through departmental programs such as the Environment and Health Program, the Mapping Groundwater Program, and the Legislated Environmental and Resource Assessment Service, NRCan provides key information and expertise for effective decision-making. For 2007‑08, key achievements include the completed assessments of nine Canadian aquifers, with three more assessments underway. Geoscience expertise was provided in 56 projects undergoing federal environmental assessments (i.e., Mackenzie Gas Project, Kemess North in B.C., White Point Quarry and Marine Terminal in Nova Scotia, and the Victor Diamond Mine in Ontario). More information can be found at

Canadians and their institutions understand and prepare for the effects of a changing climate – Faced with the impacts of a changing climate, Canadians need to understand, prepare for and adapt to the anticipated environmental, economic and societal effects on their communities, infrastructure and way of life. This Government of Canada priority is one of eight themes of the Clean Air Agenda. The department generates and publicizes earth sciences data and information aimed at improving the assessment of the vulnerability, and response, of Canada's landmass and coastal areas to the effects of a changing climate.

NRCan's Enhancing Resilience to a Changing Climate and the Climate Change Impacts and Adaptation programs are on track to make information available and to develop and implement mechanisms for collaboration between different levels of government, private sector entities and community organizations on complex adaptation issues. More information can be found at and

Increased safety and security of Canadians – NRCan provides information aimed at reducing the risks to Canadians from natural hazards by understanding and monitoring the actual and probable occurrences of earthquakes, geomagnetic storms, tsunamis, volcanoes and landslides, leading to the identification of risk mitigation options. In addition, in the event of a civil emergency, the department provides geographical and satellite information to a wide range of clients. All related programs are either on track or have met expectations.

Did you know? NRCan participated in a civil emergency exercise involving other government departments and some portfolio agencies. As well, lessons learned from two in-house civil emergency tabletop exercises are used to further enhance our capability to respond to any potential future civil emergency within our mandate.

Through NRCan's Reducing Risks from Natural Hazards Program, the department developed a seismic model that provides information on expected ground shaking from earthquakes at a given location in Canada. The model will form the basis of seismic design regulations of the National Building Code of Canada.

NRCan's security-related activities include cooperation with the United States government on maintaining the international boundary line and vista. More information can be found at


Energy Program Activity

Building - side view, Wind turbine, Field, Gas pumping
Energy Program Activity [D]

* Statutory payments for Atlantic Offshore. These expenditures were largely offset by oil and gas royalty revenues received during the year ($1.7 billion). Pursuant to the Atlantic Offshore Accords, NRCan receives the federal royalty revenues related to the offshore - which were greater than planned due to significant increases in oil and gas production - and subsequently makes payments to the provinces equivalent to the royalty revenues received. Refer to payge 72 for more information on revenues.


The Energy Program Activity fosters the sustainable development and responsible use of Canada's energy resources to meet the present and future needs of Canadians. It focuses on an integrated package of S&T, policies, programs, knowledge and international activities in the areas of energy efficiency (residential, commercial, industrial, transportation), renewable energy, electricity, bioenergy, nuclear energy, alternative transportation fuels and the production of conventional and unconventional fossil fuels to further sustainable development. Through its work, the program helps address the environmental impacts associated with energy production and use; promotes better environmental and consumer choices; develops and demonstrates new technology solutions; facilitates North American and international trade in energy; contributes to technical innovation, job creation and economic growth; facilitates environmental protection and increased public safety and security; and helps to ensure competitively priced, reliable and secure energy supplies for Canadians.

Key Achievements

Domestic and international energy policy analysis, development and advice that support sustainable development of Canada's energy sector – Energy is a major pillar of the Canadian economy, representing 7.2 percent of our GDP in 2006. The energy sector provides over 270,000 well-paying skilled jobs in Canada. At the 2007 Council of Energy Ministers' meeting, federal, provincial and territorial ministers worked to continue this growth through increased intergovernmental cooperation in advancing regulatory efficiency, collaboration on the development of new energy technologies, and improving energy efficiency.

Did you know? Although air emissions from energy have increased with economic growth, progress is being made. For instance, Canada's emissions intensity, expressed as carbon dioxide emissions from fuel combustion per unit of GDP, have declined by 21.6 percent between 1990 and 2006 (the latest year for which data are available). NRCan played a critical role in supporting the Government in the development and implementation of the Clean Air Agenda. In 2007‑08, NRCan worked closely with Environment Canada (EC) to finalize the Regulatory Framework for Industrial Greenhouse Gas Emissions and to develop the Horizontal Management, Accountability and Reporting Framework for the effective inter-departmental management of climate change and clean air programming.

NRCan also worked closely with DFAIT to advance the climate change, clean energy and energy efficiency aspects of the G8 Summit in Heiligendamm, Germany, as well as the follow-up to the Gleneagles Plan of Action on climate change and clean energy. In November 2007, Canada hosted the G8-International Energy Agency-Carbon Sequestration Leadership Forum workshop in Calgary, where NRCan was instrumental in developing the recommendations to G8 Leaders for early opportunities in carbon capture and sequestration. NRCan's policy analysis and technical expertise in energy, forestry and climate change adaptation anchors the Government of Canada's Kyoto implementation and post-2012 negotiations in bilateral and multilateral climate change fora, including the United Nations Framework Convention on Climate Change (UNFCCC), the U.S.-led Major Emitters Process, the G8 and Asia-Pacific Economic Cooperation. The department plays a leadership role in the UNFCCC's Experts Group on Technology Transfer.

Internationally, Canada stands out as one of the world's key energy suppliers with exports totalling over $86 billion in 2006. Canada strengthened its key energy relationship with the U.S., particularly through the North American Energy Working Group. The Trilateral Agreement for Cooperation in Energy Science and Technology, signed in July 2007 in Montebello, provides a formal framework for mutually beneficial research, development and deployment of energy technologies. NRCan's energy trade position was strengthened through a Nova Scotia-Chinese workshop on energy and the creation of a Canada-European Union energy dialogue initiated by leaders. More generally, Canada worked through the International Energy Agency to promote open and transparent markets and the diversity of global energy supply.

Sustainable development and safe and reliable delivery of electricity with a reduced environmental footprint – In January 2007, Prime Minister Harper announced more than $1.5 billion in funding for the ecoENERGY Renewable Power and ecoENERGY for Renewable Heat initiatives to boost Canada's renewable energy supplies.

Did you know? As of March 31, 2008, the ecoENERGY for Renewable Power program has registered 187 projects for a total capacity of approximately 11,700 MW. NRCan has signed 12 contribution agreements for 948 MW of capacity and committed $305 million over 10 years. It is estimated that by 2011, this program will result in the production of 14.3 terawatt hours (or 51.5 petajoules) of electricity per year of new, low-impact renewable power along with reductions in GHG emissions and critical air contaminants. As for the ecoENERGY for Renewable Heat program, it has received 323 applications and signed over 200 contribution agreements worth about $6 million. An additional 13 projects have been selected for pilot projects for residential solar water heating, and contribution agreements with each of them are underway. It is estimated that by 2011, this program will result in the installation of 700 solar thermal units in the industrial/commercial/institutional sector and thousands of units in the residential sector which have the potential energy savings of 0.35 petajoules and significant reductions in GHG emissions and critical air contaminants ( Program delivery is on track to meet these targets.

Following the extended shutdown of the NRU reactor in Chalk River, Ontario, in November 2007, and in the face of a worldwide shortage of isotopes directly or indirectly vital to the continued health of people around the world, the government introduced and passed emergency legislation to return the NRU back into service. The opinion of experts was that the risk of operating the NRU reactor was minimal in comparison to the risk of not restarting it. The reactor returned to service on December 16, 2007 and the much-needed isotopes were made available to health care facilities during the week of December 23, 2007. On February 4, 2008, Atomic Energy Canada Limited (AECL) announced the completion of the installation of a second seismically qualified motor connected to an emergency power back-up system. The NRU reactor is now operating at the highest level of safety during its fifty years of operation.

NRCan fully supports nuclear power as part of the Canadian energy mix as a stable source of baseload generation with minimal climate change impacts. To this end, a number of achievements have been made over the past year. In November 2007, Canada officially announced that it would join the Global Nuclear Energy Partnership which promotes a safer, more secure and cleaner world through the responsible development of nuclear energy for peaceful purposes. The department also announced that it would conduct a full review of the structure of AECL to allow the Government of Canada to set a clear, long-term strategic direction for AECL. More information can be found at

Over the course of the past year, NRCan moved forward on two important nuclear policy issues: the introduction of Bill C‑5 on the proposed Nuclear Liability and Compensation Act and the Government of Canada's decision on the approach for the long-term management of nuclear fuel waste. More information can be found at

As well, NRCan has continued progress on radioactive waste cleanup and decommissioning programs including the Nuclear Legacy Liabilities Program, historic wastes and the cleanup of Cold War-era uranium mines. In the second year of the program, key milestones include the completion of construction and the operation of a waste analysis facility at the Chalk River laboratory.

Internal evaluation – An evaluation of the Phase I Port Hope Area Initiative found that the Low-Level Radioactive Waste Management Office completed the expected technical studies, preliminary environmental assessments and negotiation of municipal administrative costs in a manner that was considered cost-effective. The evaluation recommended that the Office produce a framework to clearly define its roles and responsibilities and those of other government departments. More information on this evaluation can be found at:

A fair, efficient and competitive oil, natural gas and petroleum products marketplace that is consistent with Canada's social and environmental goals – The Canadian oil and gas extraction industries continue to deliver strong economic benefits for Canada, accounting for 3.5 percent of GDP in 2007. Capital spending of $53 billion has nearly doubled since 2000 while industry exports have increased from $40 to $70 billion over the same period.

Increased investment in Canadian natural gas exploration and development remains strong, with natural gas drilling at 12,600 wells in 2007 compared to 9,000 wells in 2000. In Atlantic Canada, the Canaport liquefied natural gas project and the associated Emera Brunswick pipeline are both under construction. Energy producers and pipeline companies are also considering major energy investments in the North via the Mackenzie Gas Project. There has been an increase of participation in regulatory hearings as the public becomes more knowledgeable and engaged about energy projects.

NRCan continued to provide timely and accurate information to the federal government, industry and the public concerning the development of crude oil, natural gas and refined petroleum products. In particular, the department published an annual outlook for updates for the natural gas industry, monthly oil market analyses and posts daily prices for crude oil, gasoline and other petroleum products, as well as the Fuel Focus publication on a biweekly basis. More information can be found at and

Canada now produces over one million barrels of oil each day from the oil sands. This rate of output could very well triple within the next ten years. While the development of Alberta's oil sands undoubtedly provides an economic stimulus to western Canada and to Canada as a whole, it also gives rise to important social, environmental and economic issues. The government's response to the report of the Standing Committee on Oil Sands can be found at (PDF document, 615 KB).

Key achievements during 2007-08 related to regulatory processes include:
  • The Major Projects Management Office (MPMO) was established within NRCan to provide a single point of entry into the federal regulatory system for all stakeholders and to provide overarching management of the federal regulatory process for major natural resource projects. The creation of the MPMO has laid the foundation for a more predictable and accountable regulatory system that will improve the competitiveness of Canada's resource industries while ensuring careful consideration of environmental standards and technical requirements.
  • The Frontier and Offshore Regulatory Renewal Initiative has emerged as the chief vehicle for intergovernmental dialogue on frontier and offshore oil and gas regulatory policy and achieved substantial progress since its inception. The new Drilling and Production Regulations were drafted to make them goal-oriented and consultations with stakeholders have been undertaken.
  • Amendments to the Canada Oil and Gas Operations Act received Royal Assent in December 2007. These authorize the National Energy Board to oversee the economic regulation of pipelines and related infrastructure in Canada's frontier.
  • The Deep Panuke project was the first offshore project to be reviewed in the context of the February 2005 Atlantic Energy Roundtable Memorandum of Understanding on effective, coordinated and concurrent environmental assessment and regulatory processes. The timeline for the review was significantly shorter than past offshore oil and gas projects in Canada and was comparable to other international jurisdictions.

With respect to energy infrastructure vulnerability assessments, the department updated the Canada-U.S. common methodology visit template and carried out five bi-national assessments. The department also provided expert advice to facility owners and Public Safety Canada to enhance the protection of critical infrastructure. Moreover, it reviewed the U.S.-Canada Power Outage Task Force final report on the implementation of the task force recommendations (September 2006) and monitored ongoing follow-up actions.

Improved energy efficiency of all sectors and increased production and use of alternative transportation fuels in Canada – Canadians spent about $152 billion in 2005 (latest year for which data is available) on energy to heat and cool their homes and buildings and to operate their appliances, vehicles and industrial processes. This amount represents 14.2 percent of the country's GDP. From 1990 to 2005, Canada's overall energy efficiency improved by an estimated 15.8 percent or 1096 petajoules. The change in energy use between 1990 and 2005, actual and without energy-efficiency improvements, is shown in the graph below. The difference in energy use due to energy efficiency — the estimated energy saving — represents a reduction in energy costs of $20.1 billion in 2005 and a reduction in GHG emissions of almost 64 megatonnes (Data source: Energy Efficiency Trends Analysis Tables at

The graph demonstrates a positive trend in energy-efficiency improvements, which is the target against which performance is measured. Moreover, renewable fuel production as a percentage of total transportation fuel and alternative fuel use as a percentage of total transportation fuel are both increasing in Canada. Our programs contribute to this positive trend. Detailed information on energy-efficiency program performance can be found in the Report to Parliament at As well, more information about grants and contributions related to this program can be found at

Secondary Energy Use [D]

In 2007-08, the government announced a suite of initiatives on clean energy under the banner of ecoENERGY and the program delivery is on track. These include regulatory activities and measures to encourage and assist Canadians to improve their energy use in all of the major end-use sectors: housing, buildings, equipment, industry, transportation, and renewable fuels (ethanol, biodiesel). Some of the key achievements under the ecoENERGY initiative include:

  • ecoENERGY for Buildings and Homes – NRCan issued more than 6,600 labels for new houses and 102,800 for existing houses. Five provinces have active projects related to increasing the stringency of the Model National Energy Code of Canada for Buildings. In addition, six provinces have announced changes to building codes to achieve an energy- efficiency rating of 80 on NRCan's EnerGuide Rating System.
  • ecoENERGY Retrofit – 102,800 homes had pre-retrofit energy evaluations and 17,000 homeowners received grants averaging approximately $1,000 each. All regions of Canada, except one province and one territory, have matching programs that provide homeowners with seamless access to both orders of government support for home retrofits. In addition, 96 retrofit projects were funded in small and medium organizations with under 500 employees or less than 10,000 square metres.

More information on ecoENERGY programs and achievements can be found at or

Canadians derive new economic, environmental and social benefits through federal energy S&T – NRCan is advancing the Government of Canada's priorities of a clean and healthy environment and strong economic growth through strategic partnerships that increase Canada's energy S&T knowledge. NRCan is on track with the delivery of programs that support the development of cleaner and more efficient technologies, products and industrial processes, as well as encouraging deployment in new domestic and foreign markets.

NRCan's energy S&T is accelerating the development and market readiness of technology solutions in clean-energy activities through public-private partnerships. NRCan's efforts to develop and demonstrate new leading-edge technologies are helping mobilize the competitive nature and creativity of entrepreneurs, and industry partnerships are strengthening our standing in the international community — all leading to an increase in the export of innovative energy technologies. For example, NRCan co-developed the environmentally advanced EcoChill refrigeration and heat recovery system. A recent installation at a multi-sport complex in Fort Saskatchewan, Alberta is saving 2,000,000 kWh per year of natural gas, reducing GHG emissions by 353 tonnes of carbon dioxide equivalent per year and recovering 85 percent of the refrigeration system's rejected heat which is then reused to heat the building and water. The system was also selected to be used at the 2010 Vancouver Olympic Games in all ice and curling rinks, as well as the oval speed skating facilities where heating and refrigeration are required.

Did you know? Since 1982, NRCan has been partnering with Iogen, an Ottawa-based manufacturer of industrial enzymes and a leading developer of technology, to produce fuel ethanol from cellulosic biomass. This is important because the department estimates that ethanol produced using Iogen's technology could deliver about twice the GHG reductions compared to conventional grain-based ethanol. Using waste biomass feedstocks has the potential life-cycle GHG emissions reductions of 80 percent compared to gasoline, with the added advantage of a lower-cost feedstock than grain. These energy R&D efforts over the past 25 years have resulted in Iogen recently announcing that it expects to soon construct the country's first full-scale cellulosic ethanol fuel facility producing an estimated 70 million litres per year.

The department was instrumental in the establishment of the International Electrotechnical Commission (IEC) Technical Committee 114 on Marine Energy. NRCan is the chair of this 15-member committee to develop nation-wide standards. In addition, NRCan and the Standards Council of Canada established a mirror committee that provides advice on the IEC standards development process to ensure that the international standards properly reflect the development needs of a rapidly growing marine energy industry in Canada.

Did you know? Clean coal technologies have the potential to dramatically reduce air emissions. NRCan is actively conducting research on such innovative technologies, in particular, new zero-emission oxy-fuel combustion processes which combined with carbon capture, offers a means of burning fossil fuels with almost zero emissions. Many of these technologies are being developed by NRCan laboratories in collaboration with utilities and leading-edge researchers in universities and the private sector, to provide the knowledge and technologies for a new generation of cleaner coal-fired power plants. Carbon sequestration work in Saskatchewan's Weyburn-Midale — an international university-government-industry project — has demonstrated the safe disposal of carbon dioxide in geological formations and is leading to a best-practice manual on the subject.

Over the past year, significant progress was made advancing technologies along the innovation curve. For instance, 15 percent of projects moved from one stage to another, from bench-scale research to pilot-scale and from pilot- to full-scale demonstration. The distribution of energy S&T projects is now 21 percent basic research, 56 percent bench-scale, 14 percent pilot-scale and 9 percent demonstration, reflecting a balanced program. This suite of projects encompasses collaboration with more than a thousand national and international partners. Energy S&T continued to show strong results in numbers of codes published (34), active Memoranda of Understanding (69), active patents (52), issued licenses (21) and patents (42). These indicators illustrate a continued strong and diverse S&T performance that addresses key departmental and Government of Canada priorities.

More information on energy S&T programs can be found at

Sustainable Forest Program Activity

Two persons in forest, Forest fire, Air view of forest, Man studying tree
Sustainable Forest Program Activity [D]


The Sustainable Forest Program Activity promotes the sustainable development of Canada's forests for the social, environmental and economic well-being of present and future generations of Canadians. As the national science-based forest policy organization in Canada, this program activity plays a pivotal role in leading real change and results for a healthy forest and a strong forest sector by building consensus on key forest issues; shaping national and international forest policy agendas in response to forest-related international commitments and obligations; promoting the competitiveness of Canada's forest sector; generating, assembling and disseminating forest S&T and policy information; and in developing, implementing and transferring sustainable forest management knowledge, products, strategies and technologies to Canadians and to interested nations around the world.

Key Achievements

An integrated national forest sector innovation system that addresses current and emerging issues – The long-term competitiveness of the Canadian forest sector is dependent upon the ability of all of its stakeholders to develop the integrated national innovation system that is required to enable the innovation that is key to forest sector transformation. While still in the early stages of implementation, program delivery in this area is on track and meeting expectations.

In 2007-08, NRCan continued to support the development of the recently-merged national forest research institute, FPInnovations, which comprises four divisions – Paprican, FERIC, Forintek and the NRCan-created Canadian Wood Fibre Centre (CWFC). With funding support from the Forest Industry Long-Term Competitiveness Strategy (FILTCS), this merger has created the world's largest forest research institute whose primary objective is to maximize the value of Canada's forest fibre and develop new products and market opportunities. More information on key accomplishments related to FPInnovations and the CWFC can be found at

NRCan is also working closely with provincial and territorial partners, industry and academia to achieve progress on a national forest innovation system. In collaboration with the Canadian Council of Forest Ministers' (CCFM) Innovation Working Group, significant work was completed on a Forest Sector Innovation Framework to develop and strengthen partnerships and lead to greater collaboration between government, industry, universities and granting councils on desired forest sector outcomes. Also under the auspices of the CCFM, NRCan is playing a key role in the development of Canada's next forest strategy which focuses on forest sector transformation and mitigation and adaptation to climate change. More information can be found at

Canada's forest industry competes successfully in the global forest products market – NRCan is on track with the delivery of programs to improve industry operational efficiencies and reduce costs; find new end-uses for forest products and new markets in growth areas; address the technical barriers that can limit trade in new and traditional markets; and streamline the domestic policy and regulatory environment to support competitiveness while maintaining environmental and social values deemed important to Canadians.

NRCan is making significant investments that are leading to the development of innovative technologies and expanded access to new and existing markets. Under FILTCS, NRCan is promoting forest sector innovation and investment. For example, the recently established Transformative Technologies Program is leading to the development and adaptation of emerging breakthrough technologies. FILTCS is also providing investments aimed at expanding market access for Canada's forest products through programs such as the Canada Wood Export Program, the North America Wood First Initiative and the Value to Wood Program. Additional information on these programs and key results for the reporting period can be found at

Internal evaluations – An evaluation of the Value to Wood Program (VWP) (2002‑07) demonstrated that the research component has been successful in facilitating value-added product opportunities through mid-stage generic research, and that it has also developed improved processes that have contributed to increased quality, productivity and reduced costs. A key impact of the program has been on the finger-jointing and Ijoist manufacturing sector where, through economic forecasting techniques, benefits were estimated to be around $10 million annually. It is noted that the mechanisms for transferring research results to the smaller value-added firms and engagement with smaller companies in general, have been limited. The evaluation recommends that mechanisms be put in place to better monitor the impacts of the VWP, including improved monitoring of costs and benefits. More details on this evaluation can be found at
Moreover, an evaluation of the Canada Wood Export Program (CWEP) (2002‑07) found that the program has had a positive impact in coordinating the industry's efforts in addressing market access issues such as the international acceptance of wood products in offshore markets. The program promoted cooperation and coordination among key forest sector stakeholders and appeared to increase the level and cost-effectiveness of private sector marketing activities. CWEP also influenced building code development in several key markets and the program's market access activities appear poised to make a significant impact in the near future. The evaluation recommended improvements to the current project and performance monitoring practices. It is also noted that CWEP should invest more in market development for product sub-sectors not well represented in offshore markets and that it should take steps to better respond to the needs of the wood manufacturing sector in the context of the North American market. More details on this evaluation can be found at

Forest losses are addressed through the provision of balanced social, economic and environmental information and advice – Natural disturbances, such as fires and insects, can have major impacts on Canada's forests. A continuing priority for NRCan is to develop the knowledge, tools and sustainable management strategies needed to help mitigate losses from these disturbances and to develop ways of integrating our knowledge of the social, economic and environmental dimensions of our forests for balanced decision making. Program delivery is on track to meet these priorities.

The mountain pine beetle (MPB) infestation in B.C. and its rapid spread eastward constitute a major threat to Alberta's forests and Canada's boreal forest. The new Federal Response to the MPB Infestation Program was implemented in 2007‑08 with the Province of B.C. and other areas requiring front-line control efforts. The national response consists of three key elements: controlling the spread into Alberta and the boreal forest; protecting forests and forest communities; and recovering economic value from beetle-killed wood. Detailed information on key accomplishments under the Federal Response to the MPB Infestation Program for 2007-08 can be found at and

Internal evaluation – An evaluation of the MPB Initiative (MPBI) (2002‑07) shows that the program achieved its objectives to a large extent, notwithstanding the devastation and spread of the beetle. The evaluation of MPBI's R&D program found that those interviewed for the evaluation rated much of the research as outstanding. Stakeholders and researchers praised the R&D program's focused approach to funding priority research areas, its proposal mechanism, and its involvement of stakeholders at all stages. The Private and Federal Forestlands Rehabilitation Programs were also shown to have largely achieved their objectives. The MPBI's management approach was effective and oversight ensured that all programs were well coordinated, cost-effective and well communicated. The evaluation provided recommendations to improve the design of future private forestlands and First Nations programming. More details on this evaluation can be found at

Under FILTCS, NRCan supported the continued development of a national forest pest strategy in 2007-08 to ensure an integrated response to this increasing threat. This work is being done under the auspices of CCFM and in collaboration with provincial and territorial governments. As well, NRCan continued to work with CCFM toward the implementation of the Canadian Wildland Fire Strategy to enhance strategic and operational coordination and cooperation among jurisdictions responsible for forest fire management in Canada.

Canada is a globally recognized leader of forest sector sustainability – In collaboration with other federal departments and national partners, NRCan is on track in delivering a wide variety of programs and initiatives aimed at positioning Canada to achieve desired forest sector outcomes in international processes; to meet international commitments; and to encourage the emulation of our high standards of sustainable forest management by other forest countries.

Did you know? The department continued to provide authoritative information, knowledge and advice regarding the state of Canada's forests overall. With specializations in biotechnology, pathology, and entomology, a bibliometrics evaluation of NRCan's scientific publications, journals and papers demonstrates that NRCan is viewed by the forest community as the authoritative source of forest science information nationally. Based on five independently ascribed performance indicators, the evaluation ranked Canada (NRCan) fifth in the world overall, second in the number of publications produced, and fourth in areas of specialization. More details on this evaluation can be found at

In October 2007, NRCan successfully renewed its program of technical cooperation with Russia that focuses on carbon budget modeling and accounting, forest fire management, forest certification and model forest development. NRCan has also been actively working with the Department of Foreign Affairs and International Trade (DFAIT) and the Canadian International Development Agency (CIDA) to advance efforts toward an international, legally binding instrument on sustainable forest management. Internationally, NRCan participated in meetings of 30 like-minded countries to advance the conceptual and tactical objectives of the proposed instrument; and nationally, NRCan coordinated the contributions of provinces and territories through the International Forestry Issues Working Group of the CCFM.

The International Model Forest Network (IMFN) Secretariat successfully completed its move to NRCan under a multi-year agreement with the International Development Research Centre. IMFN is a voluntary association of partners from around the world working toward the common goal of sustainable forest management and use. In 2007-08, the Secretariat substantially advanced conceptual and operational planning for a circumboreal model forest initiative with the participation of Sweden and Russia. Support was also provided for the development of a proposed Mediterranean model forest network and an emerging Russian national network. More information on the IMFN can be found at

Did you know? Dr. Werner Kurz is the recipient of a 2008 Public Service Award of Excellence in the Innovation Category. The NRCan scientist received the award for advancing our scientific understanding of forests and increasing Canada's international reputation for the steps it has taken in the careful management of this most precious resource. Dr. Kurz was also recognized for his contribution to the Intergovernmental Panel on Climate Change which shared the 2007 Nobel Peace Prize with former United States Vice President Al Gore.

Canada's climate change forest-reporting obligations are met and forest-based options for adaptation to, and mitigation of, climate change are developed – NRCan is committed to developing an integrated science-based policy approach to assist Canada's forest sector in adapting to climate change and mitigating its impact. To this end, the delivery of programs is on track and meeting expectations. Throughout 2007‑08, extensive work continued on improving the forest sector's ability to understand, predict and assess changes to ecosystems as a result of climate change. NRCan has taken a lead role in determining possible climate-induced changes to natural forest disturbances, such as fire, insect infestations and disease. NRCan provided its contribution to Environment Canada's April 2007 National Inventory Report, 1990‑2005: Greenhouse Gas Sources and Sinks which represents one of Canada's reporting commitments under the United Nations Framework Convention on Climate Change. The department also continued to improve information on forest contributions to climate change targets through the development of the National Forest Carbon Monitoring, Accounting and Reporting System.

Internal evaluation – An evaluation of NRCan's forest-related climate change activities showed that the department has developed a comprehensive foundation for understanding the implications of climate change for Canadian forests. These activities have resulted in several internationally-recognized publications, as well as important forest-related input to the International Panel on Climate Change. NRCan's development of the National Forest Carbon Monitoring, Accounting, and Reporting System has played a crucial role in meeting international reporting obligations. The evaluation also noted that NRCan should work to develop an overall strategy on forest carbon monitoring, data needs assessment, and data management for climate change. Details on this evaluation can be found at

Forest-dependent communities have choices and options for economic opportunities – In collaboration with stakeholders, NRCan is on track with the development and implementation of capacity-building programs and initiatives aimed at helping forest-dependent communities manage forest sector transition challenges and seize new forest-based economic opportunities. In July 2007, NRCan launched the new 5-year $25-million Forest Communities Program (FCP) and entered into long-term funding arrangements with 11 local community organizations from across Canada to develop and share new knowledge, tools and best practices in such areas as innovative forest tenure arrangements, the valuation of ecological goods and services, bioenergy and youth engagement in forestry. The program is establishing community level projects and is expanding to also support national and international initiatives with federal partners, provincial governments and non-government organizations that share common interests and objectives. Additional information can be found at

In 2007-08, the $5-million per year First Nations Forestry Program (FNFP) — a jointly funded forestry capacity-building initiative by NRCan and INAC — supported approximately 150 capacity-building partnership projects across Canada to assist First Nations at the community level to sustainably manage their forest resources and participate in forest-based opportunities, both on and off reserve. More information on FNFP projects and its achievements can be found at


Minerals and Metals Program Activity

Conference, Two men in front of machinery, Scientist
Minerals and Metals Program Activity [D]


The Minerals and Metals Program Activity promotes the sustainable development and responsible use of Canada's mineral and metal resources. A fundamental objective of the program is to develop technologies and solutions to problems in order to increase the competitiveness of the mining and processing industries; and to use new materials and processes to enhance the competitiveness of the manufacturing, transportation and energy sectors. The program activity includes significant international activities to address barriers to market access and to transfer knowledge on Canada's model for sustainable mineral resource development. Minerals and metals activities also focus on assessing the investment climate for exploration and mining in Canada and abroad and on making policy recommendations. The program aims to increase the contribution of mineral development to the prosperity and well-being of Aboriginal and northern communities.

Key Achievements

Investment in Canada's exploration and mining industries is strengthened – NRCan is meeting expectations with the delivery of programs that promote an internationally competitive investment climate for the mineral industry within Canada. Based on 2007 exploration budget data, Canada has excelled in attracting the attention of investors in search of new mineral deposits. With more than 21 percent of the world's total exploration budget ($2.7 billion in 2007), Canada remained the single largest exploration investment recipient in the world.

Over the reporting period, NRCan, working with the Canada Revenue Agency, Finance Canada and the provinces and territories, was able to clarify the wording of the federal Income Tax Act so that the costs of consulting with Aboriginal and other communities, and of conducting certain environmental studies, are recognized as eligible for the 100 percent tax deduction accorded Canadian Exploration Expenses and to funding using flow-through shares. This change provides incentives for good social and environmental practices by companies conducting exploration. In addition, the Mining Exploration Tax Credit, which is the key component of super-flow-through shares was extended for another year in Budget 2008.

In addition, the Government of Canada took steps in late 2007 to ensure that the economies of Cape Breton Island and Nova Scotia could benefit from a new coal development opportunity. When the Donkin Coal Block Development Opportunity Act received Royal Assent in December 2007, the legal framework was established to facilitate the exploitation of coal and to regulate employment at any Donkin mine.

Despite intense competition from other countries, Canada has maintained its lead position in worldwide exploration and mineral development related equity financing. In 2007, Canadian-based companies raised more than $19 billion through Canadian financial institutions, or just under 36 percent of all equity — worldwide — for mineral exploration and development.

Despite this recent success, Canadian proven and probable (mineable) reserves of base metals and precious metals have been generally declining for more than twenty-five years. However, sustained high levels of exploration have led to modest improvements in the reserves of most base metals. Nonetheless, this issue will need to be tracked closely to assess the ongoing status of known reserves.

Market access for mineral and metal and related industries is promoted and, where necessary, protected; Canada's international prominence and investment in mining are secured – The Government of Canada advocates a risk-based approach for minerals and metals to identify and address risks to human and environmental health. NRCan is meeting expectations or is on track with the delivery of related programs. Working with other departments to avoid unnecessary barriers to trade, NRCan engaged in discussions with the World Trade Organization and a coalition of other nations concerning the scientific basis for European Union proposals to classify and label nickel compounds on the basis of hazard characteristics. NRCan also provided ongoing secretariat support and participated in the third annual meeting of the Intergovernmental Forum on Minerals, Metals, Mining and Sustainable Development. This international forum discussed intergovernmental collaboration in support of mines ministries' engagement in the development of national and regional positions for the U.N. Commission on Sustainable Development's review on mining in 2010-11.

During the reporting period, NRCan worked with its counterpart agencies in the Government of Chile to develop a Memorandum of Understanding regarding Cooperation on Sustainable Development of Minerals and Metals, which is a deliverable of the Canada-Chile Partnership Framework. Discussions focused on areas of common interest, including S&T cooperation on environmental technologies and processes, Canada's mining cluster model, mine closure and rehabilitation, market access, transparency, corporate social responsibility and sustainable development.

In February 2007, the Government of Canada announced its official support for the Extractive Industries Transparency Initiative (EITI). This international coalition of governments, industries, investors and non-governmental agencies supports improved governance in resource-rich countries through the full publication and verification of company payments and government revenues for oil and gas and mining industries. The goal of EITI is to foster greater transparency and accountability in the extractive sectors to help natural resources generate large revenues in order to foster economic growth and reduce poverty ( or (

Canadians benefit from research and development with respect to minerals, metals and value-added products – NRCan is meeting expectations with the delivery of related programs. An example is the department's participation with industry partners in the first phase of an international research initiative that seeks to replace conventional blasting with novel, energy-efficient alternatives. The Explosive-Free Rock Breaking Technical Committee, a joint NRCan and industry initiative, is conducting a global search for further promising technology, knowledge and expertise for advancement and adaptation for the Canadian mining industry. This undertaking represents a great opportunity for NRCan to demonstrate world leadership in a major research initiative that impacts the productivity, energy efficiency, and sustainability of the Canadian mining industry.

Did you know? In collaboration with Canadian mining equipment manufacturer Mining Technologies International, NRCan helped develop the world's first hybrid mining vehicle — a diesel-electric scoop tram. NRCan is now helping to evaluate the hybrid system, first at the Experimental Mine in Val-d'Or and then at four mining operations for a period of three months each. The hybrid scoop tram is expected to have a significant positive impact on the health of mine workers, the economic viability of underground mining operations and the energy costs associated with ventilation. This innovative achievement could also open up important new market opportunities for the only Canadian manufacturer of scoop trams.

In partnership with Georgian BioFuels, NRCan successfully tested a B50 (50 percent blend) biodiesel fuel to determine the impact on emissions quality. As a test project, the Quinsam mine in British Columbia is adopting a clean engine package with the potential to be powered by a renewable resource fuel. In certifying diesel engines destined for use in underground mines, NRCan laboratories also prescribe the amount of clean ventilation air required underground to dilute emissions in order to protect mine workers' health.

In Budget 2007, the Government of Canada committed to provide $6 million per year to help relocate the CANMET Materials Technology Laboratory to new state-of-the-art facilities at McMaster University's Innovation Park in Hamilton, Ontario. The investment is in addition to the $40 million that was allocated in Budget 2006 to help NRCan reposition the laboratory as a leader in research for the steel, automotive materials and other metal-manufacturing industries.

Two major initiatives began during the reporting period toward developing materials technologies to reduce greenhouse gas emissions. NRCan began funding research to help the automotive industry develop lighter-weight vehicles through the development of higher-performance structural materials that continue to meet the safety requirements of Canadians. NRCan also began working with industry, universities and partners in the United States and China on a five-year, $22 million project to study the use of magnesium in the front of automobiles. The goal is to reduce the weight of vehicles by 60 percent and to subsequently improve fuel efficiency and significantly reduce GHG emissions.

A joint NRCan-industry project team has developed and patented a new technology to detect cracks on a metal's surface, such as aircraft skins, oil and gas pipeline surfaces, and other structures. The device can detect and measure cracks of various sizes and angles below the surfaces of metals covered with protective coatings. In addition, NRCan conducted research to develop recommendations to the Canadian Standards Association on the types of coatings for use in the Mackenzie Valley Pipeline project.

The safety and security of workers and the public throughout Canada are improved with respect to explosives – Over the reporting period, NRCan has met all program expectations related to the safety and security of workers and explosives. In 2008, the department published new restricted components regulations to help protect Canadians from the threat of criminal and terrorist bombings in the Canada Gazette Part II. These regulations restrict the purchase of nine potentially explosive chemicals to persons who have a legitimate need for them. These chemicals, known as explosives precursors, are not themselves explosives but can be used to fabricate homemade explosives. As part of the process, extensive consultations were held with the Royal Canadian Mounted Police, the Canadian Security Intelligence Service, and explosives regulators worldwide as well as with various stakeholder groups to ensure minimal negative business impacts and consistency with the directions being taken in other countries around the world. Consultations were also completed on the revised user fees for the explosives safety program. In addition, NRCan has signed an agreement with DFAIT to provide expert advice on blast effects and their mitigation to assist with the development of standards for embassy protection and ensure the quality of blast-protection work done by third parties. More information can be found at

Canadians are provided with information to improve decisions regarding minerals and metals; regulatory programs meet the Government of Canada objectives – Program expectations have all been met. Among statistics and information created over the past year, NRCan produced the 2007 version of the Principal Minerals Areas of Canada Map (900A) and a New Exploration Map of the top 100 off‑mine‑site exploration and deposit appraisal projects of 2007, based on expenditures.

NRCan chaired the Kimberley Process Working Group on Statistics and is a member in good standing of the Working Group of Diamond Experts. Work is currently underway on many issues, including increased cooperation with the United Nations and improved transparency, interim measures to address non-compliance, revised peer review procedures, ensuring the submission of annual statistics and reports, and procedures for admitting new participants.

Did you know? In 2007, the Federal, Provincial and Territorial Mines Ministers agreed that regulatory improvement is a priority and acknowledged the importance of the new Major Projects Management Office (MPMO) at NRCan. The goal of the MPMO is to improve coordination with Canada's regulatory system by providing industry with a single, efficient point of entry into the federal process.

Policies enhance the productivity and sustainability of the minerals and metals industries – At the 64th Annual Mines Ministers' Conference (MMC), federal, provincial and territorial mines ministers agreed to press forward in key areas to support the competitiveness of the mining sector. The ministers unanimously agreed that engagement between governments, Aboriginal peoples, communities, industry and other interested parties is essential to ensuring the long-term sustainability of Canada's mining sector. As a result, the ministers directed that approaches be explored, including the development of best practices involving government, industry and Aboriginal peoples. In addition, MMC endorsed the creation of the Canadian Mining Innovation Council and asked that it develop a pan-Canadian mining research and innovation strategy. Participants reaffirmed their support for strengthening Canada's public geoscience information to stimulate exploration for new mineral resources. They also agreed to develop concrete, practical approaches to address the shortage of skilled labour that affects all resource sectors. In support of this initiative, cooperative work began to share accurate labour market information and intelligence — through the Mining Industry Human Resources Council — to improve inter-provincial mobility for mining sector workers, to develop information tools for employers and Aboriginal peoples, and to increase Aboriginal participation in the mining industry.

In partnership with the Prospectors and Developers Association of Canada, the Mining Association of Canada, the Canadian Aboriginal Minerals Association and INAC, NRCan released a Mining Information Kit for Aboriginal Communities in 2006. In 2008, the Canadian Embassy in Lima translated and adapted this kit for use by Indigenous communities and Canadian mining companies in Peru. Based on the Canadian model, the adapted kit provides basic explanations of the mining life cycle and applicable laws and regulations as well as highlighting local community experiences in mining. This adaptation could also serve as the basis for further versions in other Latin American countries and as a central element in the delivery of community workshops. Furthermore, NRCan and the Mining Industry Human Resources Council have initiated and secured funding for a new publication to support Aboriginal participation in mining — Mining Industry Human Resources Guide for Aboriginal Communities. The department has met all related program expectations.


Corporate Management Program Activity

Forest, mountain and water sceneries
Corporate Management Program Activity - NRCan is enabled by supportive corporate management functions


This program activity1 deals with results-based management and internal governance. In short, it is about the people, tools and supporting mechanisms required by the department to deliver on its mandate, mission and departmental priorities. Integrated and effective corporate management and services also help NRCan reposition its program enablers to deliver on the Government of Canada's agenda for management improvement.

1The resources for this program activity are distributed across all other program activities.

Key Achievements

Through NRCan's North Star initiative, the department is strategically transforming itself to become a more dynamic, collaborative and results-based organization. Our new natural resources policy framework gives focus and scope to departmental activities, enabling a shift from a sectoral approach to a more integrated model focused on a shared departmental vision and strategic outcomes that serve Canadians. Organizational changes — including a united science and policy function, cross-sectoral task groups on horizontal issues, and the introduction of collaborative communication and engagement tools — are changing the way we work internally and with stakeholders.

Did you know? The Major Projects Management Office officially opened its doors on February 26, 2008. This marks an important step toward improving the management and performance of the federal regulatory system for major natural resources projects. Key accomplishments during the reporting period include securing the approval of a Cabinet Directive on Improving the Performance of the Regulatory System for Major Resource Projects and negotiating a Memorandum of Understanding between the key regulatory departments most involved in natural resource projects2 to clarify the roles and responsibilities of departments in implementing the new Directive, including further guidance on how departments will work together to improve the accountability, transparency, timeliness and predictability of the federal regulatory system for major resource projects. More information on this horizontal initiative for which NRCan is the lead department can be found at

2 Natural Resources Canada, Canadian Environmental Assessment Agency, Department of Fisheries and Oceans, Indian and Northern Affairs Canada, Transport Canada, Environment Canada, National Energy Board, and Canadian Nuclear Safety Commission.

Regarding portfolio coordination, NRCan cooperated with portfolio agencies on common policy issues and reports to Parliament, and it provided assistance with appearances before House and Senate Parliamentary Committees. The department is currently assessing options to improve the portfolio coordination function. As a result, the Minister of Natural Resources will receive integrated advice on a more timely basis.

NRCan and the public service as a whole are facing unprecedented human resources (HR) and talent management challenges arising from an aging workforce, a competitive labour market, and critical skill shortages. In response to these challenges, NRCan developed a fully integrated HR plan incorporating sector-specific plans into one document at the departmental level. To maintain NRCan's representation of all four designated employment equity groups, numeric goals were established for the recruitment and promotion of visible minorities in the Executive cadre, and women as Research Scientists. As well, a HR Renewal Committee has been created to set the department's strategic direction for talent management. The department has begun implementing strategies for corporate-wide talent management, fostering a learning environment, a quicker and more collective approach to staffing across the department, and enhanced recruitment of younger professionals and other highly skilled personnel to fill mission-critical and other specialized positions.

As a knowledge-based organization, NRCan approved an Enterprise I-Strategy to serve as a foundation for the development of the department's Enterprise Information Management and Technology (IMT) Strategic Plan. The plan will guide the development and governance of the department's IM/IT environment at an enterprise level in support of the effective delivery of programs. In addition, a pathfinder project with Library and Archives Canada was completed to assess the viability of an innovative risk-based approach for the disposal of records. Based on the success of this pathfinder, this approach will be implemented on a broader scale with the Government of Canada.

Recapitalization of NRCan's real property holdings remains an ongoing challenge since the current capital allocation is well below the investment levels required to prevent the progressive deterioration of facilities. To temporarily bridge this gap and the associated risks of the decaying infrastructure, funding was acquired from the TB Management Reserve for priority health and safety projects totalling $8.3 million over three years. Building on the strength of a long-term capital plan, a well-developed real property management framework and a real property strategy for the National Capital Region, national portfolio rationalization and the development of strategic replacement projects continues. In 2007, a qualitative review assessed the potential of a public-private partnership option to replace two deteriorated facilities located at the Booth Street Complex.

Through innovative approaches to internal shared services, NRCan generated more than $5.5 million in cumulative savings and took steps to increase overall client satisfaction by the end of 2007‑08. These improvements include the introduction of innovative business tools such as e‑procurement; streamlining of end-to-end processes, including the introduction of express-lane staffing; ongoing client-focused service delivery; and an enterprise approach to fleet management and IT purchasing.

Moreover, NRCan developed a concept paper for the effective integration of classified information in departmental policies and programs which sets out a more efficient process for making confidential documents for departmental use.

NRCan also continued to manage its Management Accountability Framework assessment results which are available at