Natural Resources

The House of Commons Standing Committee on Natural Resources met to study the management of Canadian Nuclear Laboratories (CNL) by U.S. companies. Witnesses were Ole Hendrickson, President of the Ottawa River Institute; Christian Leuprecht, Professor at the Royal Military College of Canada and Queen's University; Stephen Aplin, appearing as an individual; and Eric McGoey, Vice-President of Corporate Affairs at Canadian Nuclear Laboratories.

Ole Hendrickson argued that the government-owned, contractor-operated (GOCO) model has failed, citing ballooning costs and a growing nuclear liability that rose from $8.7 billion to $9.5 billion last year. He noted that a parliamentary e-petition calling for an Auditor General audit was not heeded, and that American contractors have no incentive to pursue safer in-ground waste facilities, instead favouring above-ground storage that requires centuries of monitoring. He recommended that the Government of Canada manage its own nuclear decommissioning and waste activities, and that the committee instruct the Auditor General to closely examine the GOCO model in an upcoming special examination.

Christian Leuprecht said the CNL contract was not competitive, with a single U.S. bidder and no Canadian content, creating risks to value for money, sovereignty, national security and accountability. He argued that the GOCO model added layers of management rather than improving efficiency, and that U.S. companies could sideline Canadian CANDU technology and access sensitive dual-use intellectual property, such as details on small modular reactors for the Arctic. He recommended an independent third-party threat and risk assessment, an economic review of the contract, and potentially folding AECL and returning CNL to a Crown corporation, noting that the U.K. reverted from a similar model.

Stephen Aplin testified that Canada has historically complied with U.S. restrictions on uranium enrichment, which he called a commercial smokescreen, and that this pattern of deference has left Canada vulnerable. He argued that handing control of Chalk River to U.S. companies, whose executives are likely subject to U.S. legal obligations to share information with their government, risks blocking research beneficial to Canada, such as CANDU fuel development, and undermines Canada's ability to defend the Arctic. He said the contract effectively surrenders Canada's nuclear leadership to the United States.

Eric McGoey said CNL operates under AECL's mandate, which owns all sites, assets, liabilities and intellectual property, and that CNL's role is to deliver that mandate safely and in full compliance with Canadian law. He disputed claims that there is no Canadian content, noting that consortium members BWXT Canada and Kinectrics employ thousands of Canadians, and that AECL controls intellectual property. He said the contract includes strong conflict-of-interest provisions and that all executives have a fiduciary duty to CNL, rejecting the idea that American citizenship precludes loyalty to Canada. He highlighted CNL's work on environmental remediation, such as cleaning up Port Hope, and its support for the existing CANDU fleet.

During questions, Leuprecht said the single-bidder process and lack of Canadian content should have raised red flags, and that the contract reflects priorities driven by economics rather than national security. He noted that AECL executives earned high salaries, with some American contractors making more than the Prime Minister, and that the Prime Minister's ownership of shares in a consortium company creates a perception of conflict of interest. Hendrickson added that the bulk of AECL funding goes to decommissioning and waste management, and that Canadian expertise in this area is now well established, making a return to a Crown corporation feasible. McGoey said the bid parameters were set by AECL and that the incumbents from the previous contract chose not to bid again, which meant GOCO experience had to come from outside Canada. Aplin argued that under the current U.S. administration, political pressure could easily be exerted on American executives to act against Canadian interests, regardless of contract terms.

The committee did not debate procedural motions or votes during this meeting.