Spring 2007 Catalyst INSIDE THIS ISSUE · INSIDE THIS ISSUE: Why Lobby? The War on Drugs CCPA Survey Results Spring 2007 From the germ of an idea to a garden of products, chemistry

INSIDE THIS ISSUE:

Why Lobby?

The War on Drugs

CCPA Survey Results

Spring 2007

From the germ of an idea to a garden of products, chemistry is a part of everyday life.

CatalystTHE MAGAZINE OF CANADA’S CHEMICAL PRODUCERS

CHEMICAL

Responsible Care®

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Catalyst Spring 2007 • 5

CCPA

EditorMichael Bourque

Vice President, Public Affairs

Assistant EditorNancy Marchi

Public Affairs Co-ordinator

President & CEORichard Paton

Association OfficeCanadian Chemical Producers’

Association805-350 Sparks StreetOttawa, ON K1R 7S8Tel.: (613) 237-6215Fax: (613) 237-4061

Web site: www.ccpa.ca

NAYLOR

PublisherDavid Ritter

EditorJanine Strom

Project ManagerKim Davies

Senior Sales ManagerSteve Urias

Sales ManagerDavid Giesbrecht

Sales Representatives Robert Bartmanovich, Andrew

Arlukiewicz, Pat Johnston,Wayne Jury,Cheryll Oland, Drew Petursson, DawnStokes, Norma Walchuk, Ken Hodgert

ResearchHeather Zimmerman

Layout & DesignKayti Taylor

Advertising ArtAllan S. Lorde

Editorial Office

Naylor (Canada), Inc.2 Bloor Street West, Suite 2001

Toronto, ON M4W 3E2Tel: (416) 961-1028Fax: (416) 924-4408

Catalyst is published four times peryear by Naylor (Canada), Inc. for the

Canadian Chemical Producers’Association (CCPA).The CCPA

represents over 70 chemicalmanufacturers, which collectively

produce more than 90 per cent of allchemicals in Canada. Responsible Care®,

an initiative of Canada’s ChemicalProducers, is an ethic for the safe and

environmentally sound management ofchemicals throughout their life cycle.

Invented in Canada, Responsible Care isnow practiced in 47 countries.

Copyright by the CCPA. All rightsreserved.The views expressed in this

magazine do not necessarily reflectthose of the publisher or the CCPA.

The contents of this publication maynot be reproduced by any means, inwhole or in part, without the prior

consent of the association.

Published March 2007CDC-Q0107/5718

Canadian Publications Mail Agreement #40064978

Postage Paid at Winnipeg

FEATURES

12 THE WAR ON DRUGSThe RCMP helps the chemical industry recognizesuspicious clientele.Harvey F. Chartrand

15 NARROWING THE GAPOntario seeks to narrow the gap between R&D andproduct commercialization.By Hank Reardon

17 AND THE SURVEY SAYS…A Look at the CCPA’s Year-end Survey ResultsBy David J. Shearing, PhD

COLUMNS

?7 EdificationsWhy Lobby?By Michael Bourque

?9 Responsible Care®A Panel with Punch: 20 years of CCPA’s NationalAdvisory PanelBy Francis Gillis

DEPARTMENTS

18 Catalyst Speaks To…CCPA’s Richard Paton

20 Corporate Profile The future looks bright green for Fielding ChemicalTechnologies.

22 Fun Facts

22 Buyers’ Guide and Index to Advertisers

17

22

12

Contentsvolume 4, number 1, SPRING 2007

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Longtime members of CCPA understand very well howmuch they have gained from working in this collective.While a lot of the visible work by the association is donein Ottawa and provincial capitals with regulators and poli-cy makers, our leaders are able to find value right down tothe plant level by learning how to address communityexpectations, learn best practices and network with theirpeers. I was in a leadership group meeting once when anexecutive shared a pamphlet that his company created forits franchise operators on a safety issue. He was practicallymugged for copies as colleagues realized the value of thework that went into this document.

As we press ahead in these lean times for manufacturersin Canada, the question really becomes: “How can compa-nies not belong to an association and still understand theirlegal and regulatory obligations, and meet their responsi-bilities in process safety and security while influencinggovernments?” Fortunately, we are not asked this more dif-ficult question too often. A

Michael Bourque is Vice President, Public Affairs, Canadi-an Chemical Producers’ Association. He can be reached [email protected].

Edifications

IN THIS ISSUE we feature a timelyinterview with CCPA’s presidentand CEO, Richard Paton. With thepassage of new accountability legis-lation and its new rules and restric-tions for advocates, this goes someway to answering a question we getall the time: “Why do chemical

companies belong to a trade association like CCPA? Thisnew legislation will not restrict the activity of lobbying, butinstead makes it clear that we cannot operate in the shad-ows, or the ‘lobby’.” Registered lobbyists must conducttheir business with added transparency and be subjected toadditional scrutiny by the public and competitors.

So what are the reasons for having trade associations?Well, lobbying is part of it. We liken membership in ourorganization to belonging to a team. In a team environ-ment, individual egos are checked in favour of the team.Common goals are pursued for the greater good of theteam, and not just one member. Of course, players havetheir own objectives, but they can only achieve them bycontributing to the team effort. Individual effort andimprovement contributes to team improvement.

Michael Bourque

WHY LOBBY?

Contact Brian Wastle: 613-237-6215 ext. 232, [email protected]

Without CCPA membership how do I?

> Stay on top of impending laws across all levels of government?

> Get free access to the best practices of leading companies?

> Ensure the development of regulations are compatible with my company’s interests?

What other organization looks after my industry in these areas:Community ExpectationsEmissionsEnergyEnvironmental RegulationsExpansion

FeedstockOccupational Health and SafetyPermittingProduct Related IssuesProcess Safety

SecurityStaff DevelopmentTaxesTransportationWorkplace Safety Standards and Regulations

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years on the panel, and some membershave served considerably longer. JohnVincett, who has facilitated the panelsince its inception, maintains ahealthy mix of experienced and newmembers from a wide range of stake-holder categories.

The panel does not vote on recom-mendations or explicitly seek consen-sus on issues, though there will oftenbe a definite thrust in one direction oranother in panel comments. But thereis a diversity of viewpoints on thepanel which is, says Brian Wastle,CCPA’s vice president of ResponsibleCare, “a remarkable strength.” Herefers to the book The Wisdom ofCrowds, which holds that the wisdomof the collective goes far beyond thesum total of its individual members.The non-consensus approach makesthe role of the panel facilitator espe-cially challenging, he says, “but we areblessed with a facilitation process that

distils (panel discussions) down to keymessages to be taken to companiesand the association board.”

CCPA president Richard Patondescribes the group as an “indepen-dent panel of critics” who were “keyplayers in the development of theResponsible Care codes” and whohave “acted as CCPA’s conscience incontinually reviewing how CCPA isprogressing in implementing theResponsible Care ethic.” Patonemphasizes the panel’s independence.He notes that it is chaired by an inde-pendent consultant who selects panelmembers.

In practice, Vincett recommendspotential panel members to CCPA. Todate, the association has neverattempted to veto recruitment of any-one so recommended. Panel membersthemselves suggest stakeholder cate-gories that should be represented andpotential members.

A stakeholder consultation processunique to the Canadian Chemical Producers’ Association marked its 20thanniversary last year.

In this excerpt, Francis Gillis looksback over the past two decades.

THE CCPA NATIONAL Advisory Panel,which, at any one time, includes adozen or so members from variousstakeholder sectors, held its first meet-ing in June 1986. The panel’s first taskwas to provide public input into theshaping of a new initiative calledResponsible Care. The issues and rosterof members have changed over theyears, but the group continues to play acritical role in CCPA decision-making.

Responsible Care remains theframework and guiding ethic foralmost all panel discussions. Panelmembers see themselves as reflectingpublic priorities and concerns aroundthe role of chemicals in society. Theirattendance at meetings indicates abasic faith in the integrity of theprocess – or at least a willingness togive CCPA the benefit of the doubt –and the tenor of discussions is con-structive. But the group has neverbeen accused of pulling its punches,which makes for lively meetings.

For much of its history, the panelmet four times a year. The panel nowmeets twice a year, for a total of eightto 10 hours at each meeting. Variousmembers are also involved in CCPAcommittees and all members are invit-ed to regional CCPA executive lead-ership group meetings. The currentpanel includes community activists,an NGO leader, a national labourunion staffer, a retail chain manager,and academics involved in epidemiol-ogy, health, risk management, corpo-rate social responsibility andenvironmental engineering.

Members are drawn from acrossCanada. They serve at least three


Responsible Care®

20 years of CCPA’s National Advisory PanelA PANEL WITH PUNCH

By Francis Gillis

governance structure of CCPA, andthat is unique to this association,” saysWastle. “Our benchmarking indicatesno other such structure in the chemi-cal or other industries anywhere in theworld.” He speaks of three directionsof input on any key issue at CCPA: anexpert committee (a mechanism com-monly used by associations); regionalLeadership Groups that include execu-tives from all member-companies thatmeet three times a year (unique toCCPA); and the panel (unique to

CCPA). “In most cases, the input doesnot widely vary,” Wastle says. “I don’tthink that is accidental, given thatResponsible Care is the underpinningof everything our members do. Butthere are nuances and subtleties thatarise from one avenue and maybe notthe other.” Now, he adds, panel mem-bers are also permanent invitees toLeadership Group meetings, “hencecontributing input from othersources.” He notes that the Responsi-ble Care verification steering commit-tee includes representation from thepanel, and “we are finding ways toincorporate panel members into otherassociation committees.”

Wastle notes that it took manyyears for some departments withinCCPA to actively seek panel input asthey moved forward on various issues.Now, whether it is CCPA’s position onclimate change, chemicals testing,major environmental legislation or ahost of other matters, panel input iseagerly sought by various committeesand staff. This is “a huge testimony tothe value of the panel. In addition tocommittees, you would expect to beinterested in panel input, such as pub-lic affairs and Responsible Care verifi-cation, business and economiccommittees. Government policy com-mittees are now interested. Otherswho in years past said, ‘We know whatthe critics are saying,’ are now saying,‘We’d better find out. When is thenext panel meeting?’ This is strongevidence of the panel’s value. Fromboard to members to committees, theyare saying, ‘This is information weneed to get, and the panel is the obvi-ous route.’ ”

Wastle adds that CEOs, Responsi-ble Care coordinators and other com-pany people who attend panelmeetings always say the experience isnot what they expected – the advice iswiser than they would have obtainedfrom external sources, and discussionsare emotionally and intellectuallystimulating.

Ironically, it took a budget crisis atCCPA to bring the value of the panelinto sharpest relief. In 2003, as theassociation reassessed its every activity,the question arose: can we afford the

Paton adds that the panel plays akey role in helping to determinewhether CCPA advocacy positions onenvironmental or economic policy areconsistent with Responsible Care.“CCPA has committed, as part of itsgovernance process, to ensure that theviews of a wide variety of stakeholdersare considered when making policy,”he says, “and one of the key inputs todecision-making are the views ofpanel members.”

“The panel is hardwired into the

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panel any longer? A conviction beganto grow among member CEOs, Wastlerecalls, that perhaps CCPA did notneed the panel after all, that the sameinput could be obtained from one-on-one dialogue. But after Paton and anumber of CEOs attended two panelmeetings, where budget constraintsand other issues were on the table,“they came away with the absoluteconsensus that the panel’s diversity(and the totality of its input) wasgreater than the sum of its parts.”They concluded that the panel wasirreplaceable, a status that Wastle says“was not perhaps recognized by thebreadth of CCPA in the past.”

Since the budget crisis, each panelmeeting has been sponsored by aCCPA member-company, which helpsto cover costs. Part of the meeting isdevoted to discussing issues of particu-lar interest to the sponsoring compa-ny. Vincett comments that sponsorsmay have “stepped up to the plate” inthe spirit of supporting a process val-ued by the association as a whole, butthey come away from meetings feelingthey “got good value” for their money.Wastle says the sponsors have foundthat panel input on their company-specific issues gives them a muchmore profound understanding ofstakeholder viewpoints. He notes thatone of the sponsors is looking atunderwriting a second panel meeting.That companies are “willing to getout their chequebooks,” he says,“means they are getting a tangiblecompany value.” A

Part 2, available on www.ccpa.ca,features comments from a number ofpanel members, past and present.

Reprinted from Careline: GlobalResponsible Care News by arrange-ment with the publisher. Careline is aquarterly magazine that tracks Responsi-ble Care developments around the world.For further information, send an email [email protected].

Francis Gillis works on the panel withJohn Vincett, president of Public Dia-logue Alternatives, and provides meetingreports. He is North American editor ofCareline and a senior associate of PDA.


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The membership of the Nation-al Advisory Panel will comprise 12to 16 individuals who have thebackground and experience toenable them to assist CCPA inobtaining a broader understandingof the needs and concerns of thegeneral public, especially at thelocal level. It is understood thatpanel members serve as individuals,not as official representatives of any

groups of which they may be mem-bers. The experience of panel mem-bers will likely include involvementwith the community, the academicworld, business, consumer environ-mental and other special-interestorganizations.

For more information onCCPA’s National Advisory Panel,visit: www.ccpa.ca/ResponsibleCare/NAP.asp#c.

to tragic results such as explosions, fireand environmental pollution. Hun-dreds of pounds of chemical wastes areusually produced in these clandestinelabs. These toxic byproducts are rou-tinely dumped into city sewers, a largeinflow that is more than most munici-pal water filtration systems can handle.

Every pound of “meth” producedresults in five to six pounds of toxicwaste. Every pound of ecstasy producedresults in 12 to 13 pounds of toxicwaste.

Some residential properties used fordrug labs are so badly contaminatedthey have to be torn down – and quiteoften, when the labs are found in town-houses, the neighbouring units must bedemolished as well.

Thick clouds of corrosive vaporsmay emanate from these drug labs,killing surrounding plant life. RoyalCanadian Mounted Police (RCMP)drug enforcement officers must wearchemical-resistant suits and self-contained breathing apparatus whenraiding clandestine labs. Other chemi-cals like lithium or sodium react incan-descently to moisture. If the houseblows up and firemen hose water ontocontainers of lithium – these will con-flagrate as well.

Recognizing this mounting threat,the RCMP established the NationalChemical Diversion Program in 2001.ChemWatch is a partnership betweenthis program and concerned chemicalproducers, distributors and retailers,aimed at raising the level of awarenessof the clandestine drug laboratory prob-lem across Canada. ChemWatch teach-es people in the chemical business torecognize the telltale signs of syntheticdrug traffickers intent on obtainingchemical precursors for the productionof controlled substances. Limiting theaccessibility of these compounds to ille-gal drug manufacturers is the name ofthe game.

“Where there is easy profit to bemade, there is organized crime, and it isgaining a steady foothold in the clan-destine drug lab business,” says Corpo-ral Brent Hill, the RCMP’s Ontariocoordinator for the National ChemicalDiversion Program. “We know that theproduction and distribution of metham-phetamine and ecstacy are not alwaysindependent operations, but quite oftenare directly linked to organized crime.”

“Smaller ‘addiction-based’ labs pro-ducing mainly methamphetamine arestill common,” notes Sergeant DougCulver, national coordinator for syn-

C L A N D E S T I N EDRUG LABORATO-RIES are operat-ing in middle-and-upper-classneighborhoods

across Canada, and their threat (bothcriminal and environmental) is spread-ing. The diversion of chemical precur-sors to these illegal drug labs isincreasingly common. A precursor is asubstance that, following a reaction,becomes an intrinsic part of a chemicalproduct – in this case, dangerous “recre-ational” drugs such as ecstacy andmethamphetamine.

Despite the best efforts of healthexperts and legal authorities, thedemand for synthetic drugs continuesto rise. These drugs are produced atmakeshift labs hidden in ordinary com-munities – usually in nondescript sub-urbs and even in high-rise apartmentbuildings. Illegal drug labs pose a seriousthreat to the safety of the public andemergency first responders such aspolice, fire and ambulance workers.“Drug cooks” – usually not accom-plished chemists – are often unaware ofthe dangerous consequences associatedwith the toxic chemicals they are using.Mixing the wrong chemicals may lead


Feature

WAR ON DRUGSThe RCMP helps the chemical industry recognize suspicious clientele.

By Harvey F. Chartrand

THE

ecstasy production across Canada. East-ern European organized crime groupsalso have their tentacles in this illegaldrug trade. An organized crime outfitmight even set up a front company todo business with a legitimate enterprise.

“These criminals are not accom-plished chemists,” Cpl Hill notes.“Because they’re not in the business,they don’t know the legitimate uses forthe chemicals they are purchasing.They know why they need a chemicalto make dope, but they don’t knowwhy they would need it for a legitimatereason. And these folks will pay 10 or100 times the legitimate cost, becausethey need the chemicals to make thedope and they need the dope to makethe profits. And the profits are so hugethat these guys will pay anything forthose chemicals. They will not ques-tion a price or try to negotiate the bestprice. To produce a tablet of ecstasycosts $.50 to one dollar. One tabletsells for $10 to $15 on the street. Theprofits from the drug trade are so astro-nomical that the dealers will pay topdollar for the chemicals needed tomanufacture these drugs.”

A Growing Trend of Long-Distance Shipments ofChemical PrecursorsAs it becomes more difficult fororganized crime to obtain chemicalsfrom domestic companies, more ofthese chemical precursors are beingimported from China and India. Theeconomic traffic that goes acrossCanada’s borders is at an all-time high,so even though border security isbeefed up, it’s hard for Canadianauthorities to keep up with the illegalflow of precursor chemicals. Manydeep-sea containers arrive daily andfew of them are screened.

“Delivery by a dubious route” is asure indicator of illicit activity. Theoperator of a clandestine drug lab inVancouver may order chemical precur-sors from companies in Toronto, pay-ing high shipping costs to bring themin from halfway across the country.

As many chemical companies aremoving their production facilities toChina, trans-border shipping will only

grow, while domestic chemical produc-tion declines.

“The Internet has been very devas-tating for us, because it’s a great way toorder long-distance chemical ship-ments with payment by credit card andno face-to-face transactions,” observesSgt Culver. “Sometimes, the addressthat the chemicals are being deliveredto is nothing more than a Mail BoxesEtc. outlet. I’ve seen 45-gallon drumsof chemicals come off the back ofcourier vans onto the downtownstreets of Vancouver into a Mail BoxesEtc.”

“We’ve seen all kinds of interestingthings at the back of a loading dock,”Cpl Hill reveals. “We’ve seen taxisshow up and load up with chemicals.Legitimate businesses do not use taxi-cabs to deliver chemicals! Of course, alot of the courier services become veryupset when they find out they’ve beentransporting hazardous chemicals,which weren’t identified as such tothem.”

When RCMP officers visit mem-ber-companies of the Canadian Chem-ical Producers’ Association, they dealwith senior management first.

“We need the policymakers of thecorporations to have buy-in,” says CplHill. “Then we need to focus on thesales department and filter the infor-mation through the entire organiza-tion. Who is loading the trucks? Whois working on the docks? Who is incharge of the warehouse? Due dili-gence is more than just knowing yourcustomer. There’s a whole selection ofthings to be aware of in protectingagainst chemical diversion. Companiesare targeted in many ways, not justfrom the guy arriving at the frontcounter. We need Responsible Care toinclude certain steps from ourChemWatch initiative. That will helpus tremendously, because the problemis growing. There are more drug labs inour communities now than there weretwo years ago, and we don’t foresee aslowdown in this trend in the shortterm.” A

Editor’s Note: An expanded version ofthis story is available on CCPA’sMemberLink.

thetic drug operations with the RCMPin Ottawa. “These are labs fueled by anaddict’s desire to have a ready supply ofthe drug; however, larger ‘economic-based’ laboratories or ‘super-labs’ arebecoming more prevalent. These labscan produce five-to-10-kilogram batch-es of an illicit drug at any given time.They are technologically more sophis-ticated and always controlled and oper-ated by organized crime, sometimes inleague with narco-terrorists, who usethe proceeds from the illegal drug tradeto finance their terrorist activities.”

“ChemWatch is set up as a volun-tary program,” Cpl Hill explains.“That’s why we came up with theChemWatch hotline number (1-800-387-0020), which operates 24/7. It’skind of like Crime Stoppers, butfocused on the chemical industry. Peo-ple can report suspicious transactionswithout revealing their identity. Thecriminals who broker these chemicalsare bad people and it’s vital that wemaintain the anonymity of those infor-mants who give us tips. We don’t need to know who is giving us theinformation. We just need to know theinformation.”

“We went out to the industry part-ners and solicited their assistance,because a lot of the chemicals we werefinding in the drug labs were divertedfrom perfectly legitimate commercialenterprises,” says Sgt Culver. “Whenwe first set up ChemWatch, we realizedthere was going to be a huge learningcurve. As soon as we started talkingabout this to people in the chemicalindustry, they gave us feedback, sayingthat lately, suspicious customers wereshowing up at their sales and distribu-tion offices. They weren’t sure exactlywhat these new customers were up to,so we started a nationwide trainingprogram with the chemical industry.”

Despite the RCMP’s most valiantefforts, steady growth in clandestinedrug labs is occurring nationwide.Organized crime is gaining a steadyfoothold in synthetic drug operations.Outlaw motorcycle gangs are heavilyinvolved in methamphetamine produc-tion and trafficking on the west coast.Asian-based organized crime is veryinvolved in chemical diversion and



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companies are forward-looking,”Wilkinson enthused. “Such initiativesare very attractive and encourage nat-ural partnerships with our ministryand the chemical industry.

“This involves a sustained commit-ment on our part to funding innova-tion,” Wilkinson adds. “If governmentplays its part right, industries will havethe tools they need to transform theircreative ideas into economic advan-tages. We have to help create thoseconditions that allow our industrybase to constantly reinvent itself tomarket realities. That’s why we’vebeen working closely with industryand academia to develop the strategicplan for our ministry. The Ontariogovernment must foster a culture ofinnovation, so we’re looking at barri-ers that concern industry, such as reg-ulatory and tax challenges to buildingcommercialization.”

David Colcleugh, retired chairman,president and CEO of DuPont Cana-da, who now teaches engineering atthe University of Toronto, believesthere is a growing interest in theOntario chemical industry to renewitself by starting up new companiesand moving existing companies in dif-ferent and more innovative directions.

“I have confidence in the leader-ship of the Ontario chemical industry– they want to grow,” Colcleughasserts. “I am very interested in seeingthat chemical companies in Ontariobegin to understand what green chem-istry really means and the scope of itsbenefits. This is something that chem-ical companies need to move towardsas a major strategy, because it is goodfor the environment and can createnew wealth. It is a new direction, filledwith opportunities to make moneywithout harming the environment.”

Commercialization of new tech-nologies developed in research labora-

tories is a very difficult and expensiveprocess. “Everyone seems to thinkthat innovation is all about R&D,”Colcleugh observes. “The researchpart tends to be creative and a lot lessexpensive than the development part.Once you have an idea and it isresearched, then comes developmentof the idea and commercialization.Each step of the way from the success-ful research idea is a step change incost and effort, and often people ingovernment don’t understand justhow difficult that is, although they arebecoming more understanding of that.The leaders of the chemical industryin Ontario know how expensive anddifficult the commercialization processcan be. The OCVCI initiatives needsupport and are getting it from theOntario Ministry of Research andInnovation. It is an old story, but weneed more collaboration amongindustry, government and academicleaders. We are not as good at thiskind of collaboration as we shouldbe… other countries, including theUSA, do this better.”

David J. Shearing, outgoing seniormanager for business and economicswith the Canadian Chemical Produc-ers’ Association (CCPA), stressesthat: “We very much want the marketto direct R&D expenditures. We pre-fer market pull rather than researchpush, so that you have tax incentiveswhich encourage R&D taking place inOntario and the rest of Canada, but itcan’t be the government picking win-ners and losers. The only sustainablecommercialization strategy is one of acompetitive investment environment.Everything else will fail as soon asgovernment funding runs out.” A

Editor’s Note: An expanded version ofthis story is available on CCPA’sMemberLink.

TO WHAT EXTENT will economics andthe profit motive play a determiningrole in developing a new industrialR&D strategy for Ontario’s chemicalsector? And how will that R&D strat-egy deliver opportunities for commer-cialization in the province?

John Wilkinson, parliamentaryassistant to Minister of Research andInnovation (and Premier) DaltonMcGuinty, sees a bright future aheadfor Ontario’s chemical industry and itsR&D component, but it’s up to theindustry to make it happen, with gov-ernment setting the stage by providinga competitive business climate, aneducational system that produces thehighly skilled workers the chemicalindustry needs, and an environmentthat fosters collaboration betweenpublic research institutions and theprivate sector.

According to the Ontario Chem-istry Value Chain Initiative(OCVCI), a Hybrid Chemistry SectorStrategy must be developed to posi-tion Ontario as an innovative globalleader in fossil and bioproductresearch and commercialization. Thisstrategy will increasingly focus onindustrial biotechnology, includingbioproducts, bioprocessing, biofuelsand biomaterials – first through R&D,then through scale-up and demonstra-tion… right through to commercial-ization.

Much work is now being done tomake the transition to biofeedstocksand renewable carbons. Wilkinsoncites the recent opening by Suncor ofCanada’s largest ethanol-productionplant in Sarnia as an example for oth-ers in the industry to follow, as well asDuPont Canada’s stated goal of earn-ing 25 per cent of its revenues fromrenewable resources by 2020. “These


Feature

Ontario seeks to narrow the gap between R&Dand product commercialization.

By Hank Reardon

NARROWING THE GAP


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market conditions, notably in Alberta which add to oper-ating and investment costs; decreased rail transportationreliability in Western Canada; transportation security con-cerns; new initiatives that could impact the efficient cross-border shipping; and ethylene supply disruptions and risingelectricity costs, particularly in Ontario.

In order to encourage new capital investment in Cana-da’s value-added resource-upgrading industries, a corporatetax advantage is needed to overcome some of the disadvan-tages listed above, notwithstanding the attraction ofinvestment incentives and less onerous regulatory frame-works in competing jurisdictions. The federal announce-ment of a reduction of its manufacturing and processingcorporate tax rate and its elimination of the corporate sur-tax and capital tax are steps in the right directions. Alber-ta’s recent corporate tax reduction also helps.Governments need to continue to examine ways to taxsmarter and encourage investments in productive andenvironmental technologies. A two-year straight line capi-tal cost allowance would go a long way toward achievingthese goals.

CCPA is advocating on a number of other public policyfronts that could influence the 2007 outlook and percep-tions of the chemical industry. These include developmentof a coherent, federal/provincial energy strategy and cli-mate change targets that permit growth and provide policyand investment certainty. In addition, categorization of theDomestic Substances List (DSL) of commercial substancesin Canada has determined what substances need furtherassessment. Although much work will be required and thetask is challenging, this program, if properly designed andrun, should improve public confidence in chemicals andtheir management.

To read the full Year-End Survey and Outlook for 2007,visit: www.ccpa.ca/files/Library/Documents/Economic/Yrend2006.pdf. A

David J. Shearing is Senior Manager, Business and Eco-nomics at CCPA.

HighlightsSTRONG DOMESTIC DEMAND forCanadian basic chemicals pushedshipments from Canadian opera-tions to $29 billion in 2006 – a

10% increase in sales when com-pared to 2005. In constant dollar terms (i.e., afterallowance for changes in average selling prices), sales vol-umes in 2006 increased by 6% over 2005. Export sales,which represent two-thirds of total industry sales, were up6% in 2006 to $18 billion. Sales to US markets, whichaccount for almost 80% of the industry’s business outside ofCanada, were also up by 6%, as were exports to offshoremarkets. Supply-demand balances remained tight, allowingchemical producers to pass on higher feedstock and energycosts. Operating profits before interest, taxes and specialwrite-offs in 2006 were $1.7 billion, down 7% from 2005and down from the peak set in 2004. Despite being at thetop of the business cycle in terms of operating rates, animportant moderating factor for profitability has been thehigh Canada-US exchange rate.

Looking ahead, survey respondents expect sales value toincrease slightly by 1% in 2007, while volume is forecast tobe unchanged. Exports are predicted to grow by 3%, withan increase of 5% in exports to the US. Operating profit isexpected to increase by 18% to $2.0 billion in 2007. Fixedcapital investment is forecast to increase by 17% to $1.3billion in 2007. (The 2006 estimates are based on StatisticsCanada data and the 2007 forecast is based on CCPA’sannual year-end survey of business conditions and short-term prospects.)

Outlook for 2007Respondents indicate that sales values are expected to

increase by a modest 1% in 2007, driven entirely by a simi-lar change in prices as overall sales volumes are expected toremain unchanged. Exports are expected to increase by3%; however, domestic sales are expected to decline by 3%in 2007. This slowing of growth rates may signal that thecurrent business cycle has reached a plateau and demand inother economies will need to be carefully watched as 2007proceeds.

Looking forward, some of the key concerns for thepetrochemical sector are its ability to remain globally com-petitive; higher natural gas and natural gas feedstock coststhan offshore competitors; an increase in the Canada-USexchange rate leading to increased competition from off-shore producers, particularly the US market; tight labour


Feature

David J.Shearing, PhD

AND THE SURVEY SAYS…A Look at CCPA’s Year-end Survey Results

versity, as well as a Master’s in PublicAdministration from the KennedySchool at Harvard University. He hasover 15 years of teaching experience inpostgraduate studies of private andpublic sector management at Car-leton’s School of Public Administra-tion and Queen’s University’sExecutive MBA Program.

Catalyst spoke to Paton about theimportant services rendered by lobby-ists to the public and to government,challenges facing Canada’s chemicalsector in 2007, and the possible impacton the industry of a rapidly shiftingpolitical scene.

Catalyst: Lobbying has negative con-notations, yet it shouldn’t be a “badword.” Can you tell us why lobbyingis in the public interest?

Richard Paton: I think lobbying ismisunderstood. What CCPA is tryingto do is bring information to the gov-ernment that it would normally not beaware of when making decisions onthe environment, energy, transporta-tion or taxation. There is an IndustryCanada division that has a few special-ists who focus on the chemical indus-try, but it’s two, maybe three people atbest. And certainly the other depart-ments aren’t thinking about the chem-ical industry to any great extent. Sogovernments, especially with a lot ofdownsizing going on, increasingly needbusiness sectors to come forward andsay, “By the way, this is how this policyimpacts on us and here are the com-petitiveness realities that we face.”Frankly, government is not staffed ade-quately to be able to understand a par-ticular sector of the economy in suchdepth. So if government is not able totake advantage of that information,then it will probably come up withpoorer policies.

My job is to represent this businesssector to government and to representgovernment to this business sector. Ialso help the chemical sector under-stand the realities of government –what it can and can’t do, what itsagenda and priorities are…

Catalyst: Is the federal governmenttaking steps to make the chemicalindustry more globally competitive?Wasn’t manufacturing competitive-ness supposed to be one of the gov-ernment’s top priorities during thefall 2006 session?

Richard Paton: The federal Con-servative government hasn’t mademanufacturing competitiveness one ofits top five priorities, although in themacro-policy sense, it supports lowertaxation and higher productivity. Weare very pleased with [Finance Minis-ter] Jim Flaherty’s economic statementin which he talks about AdvantageCanada, which we believe is a greattheme. Canada should be thinkingabout how it would be an advantagefor companies to make their productshere and what kind of regime we needto achieve that – so I think that is astep forward. And there have beensome movements on the corporate taxstructure front that have real benefitsfor us, particularly with regard to thehigh dollar, high energy costs and theincredible competition from India,China and other Asian countries. Butwhen you weigh the total threat ofregulation on greenhouse gases againstsome of the other adjustments thathave been made, it’s not clear whetherCanada will come out as a better placeto invest or not. So I think there issome really hard work that needs to bedone by this government and theopposition parties in taking measuresto sustain a strong economy, especially

AS PRESIDENT OF the Canadian Chem-ical Producers’ Association (CCPA),Richard Paton leads one of the keyindustrial associations in Canada.CCPA represents 65 chemical-produc-ing companies. Domestic chemicalproduction is a $28-billion-a-yearindustry. CCPA is recognized as aworld leader in the quality of its workin terms of economic competitivenessand environmental/community respon-sibility through Responsible Care.

CCPA works extensively withmany other trade associations and ispart of 10 different coalitions andgroups that work on common policyissues. Paton is well known for hisleadership in these industry groups andhis ability to develop strategies for pol-icy advocacy.

“I guess I’m probably one of thelongest-serving trade association presi-dents in Ottawa right now,” Patonmuses. “I’ve been in this job for almost11 years.”

Prior to joining CCPA, Paton spent23 years with the Government ofCanada in a variety of departments,including the Privy Council Office,Office of the Auditor General andTreasury Board. In his last eight yearswith the federal government, he wasAssistant and Deputy Secretary of theAdministrative Policy Branch at Trea-sury Board and Deputy Secretary ofthe Program Branch.

Paton led the Treasury Board Secre-tariat in the two program reviews of1995 and 1996 that resulted in a bal-anced federal budget. He also led avariety of management and policyreforms in regulatory policy, alterna-tive service delivery, governance/boards of Crown corporations, realproperty and information technology.

Paton holds a Master’s degree inCanadian Studies from Carleton Uni-


LOBBYISTS PERFORM A VALUABLE PUBLIC SERVICE

Catalyst Speaks To…

An Interview with CCPA’s Richard Paton

hurt the economy and generate ineffec-tive policies on the environment!

Catalyst: What impact will JohnBaird’s appointment as federal envi-ronment minister have on the chemi-cal industry?

Richard Paton: By naming JohnBaird environment minister, the Harp-er government is sending out a prettyclear signal that it wants results. Bairdis what I call a closer, like in baseball –a guy who is put in to finish off theteam. Baird must take the Clean AirAct through to conclusion, or see thegovernment’s approach to environmen-tal policy through to some sort of result.So I think Baird is a very good choice,even though he has minimal environ-mental experience, but he is a veryquick learner and a superb communica-tor and he has boundless energy.

One of the realities of this portfoliois that the critics are very nasty. Nomatter what you do, it’s never enough.There is a level of fantasy in thinkingthat we can meet the Kyoto targetswithout any cost to the economy orwithout regulating industry into theground.

However, we have to take action andBaird is a man of action. He will dealwith his critics, who frankly need to bedealt with. He must tell them to be real-istic – let’s start taking action here and

quit dreaming about all kinds of sce-narios, like ending our reliance on fos-sil fuels. The World Energy Council inGeneva predicts that global energy usewill increase by 70% between now and2030. China is building a new coal-fired power plant every week and about100 coal-fired plants are planned forthe United States. One can make theargument that we shouldn’t build coal-fired plants in Canada, but don’t thinkthat they aren’t going to happen some-where else. And yet the same Canadi-an environmentalists who are againstcoal-fired plants are also againstnuclear, so the nature of the environ-ment debate seems to have a hugenumber of dead ends. If you are forreducing greenhouse gas emissions,then you must be pro-nuclear. It’s assimple as that. That’s what France’sstrategy is. That’s what Japan’s strategyis.

We’ve got to bring some realism tothis debate. And I’m hoping that Bairdis the kind of guy who tells it like it isand enables us to make some progresson the environmental front, becausewe are really not making muchprogress. So CCPA is hoping to workwell with Baird and end up with a pol-icy that’s good for the environmentand good for the economy and isacceptable to the provinces and otherstakeholders. A

in the area of manufacturing. Some ofthese issues are addressed well in theIndustry Committee of Parliamentchaired by James Rajotte.

The prediction was that we wouldlose 300,000 to 400,000 jobs in themanufacturing sector from about 2002to 2008. That’s a huge amount of lostemployment! It isn’t showing up in theemployment numbers today, becausewe are doing well with a lot of oil andgas development in the west, etc., but ifall that activity slows down, it wouldcreate huge pain for a lot of families inOntario and Quebec, in particular. Peo-ple may have forgotten the 1992 periodwhen industrial plants were closing left,right and centre and even being torndown to save on property taxes. Thosewere the days that Bob Rae (then Pre-mier of Ontario) had to deal with anincredibly difficult economy. We don’tforget about those times and they canoccur again. So I think one has to bevery careful to make sure you have theeconomics right and that environmen-tal policies lead to continual improve-ments in performance. And this shouldbe done in a way that enables the econ-omy to move forward at the same time.I don’t see these as mutually exclusiveunder our Responsible Care ethic. Youcan get a better economy and a betterenvironment. However, if environmen-tal regulation is not done well, it can


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byproducts to perform our services on,the government insists that thesereclaimed materials be viewed as haz-ardous waste. This means that thegenerator has to complete cumber-some paperwork and arrange for spe-cial shipping, requiring time andimposing costs just to do the rightthing… which is to give new life tospent chemicals. The provincial gov-ernment must get serious about legis-lation to foster recycling. Until itdoes, it is creating a barrier to thegrowth of the chemical recyclingindustry here.”

Effective in 2009, a ban will beimposed on the burning of spent oil inspace heaters, an amazing policy shiftfor the Ontario Ministry of the Envi-ronment (MOE), according toMcGregor. “If the Government ofOntario is prepared to ban the burn-ing of spent fuel because there is analternative choice that works for theenvironment, then the burning of allspent organics should be considered aswell. For the first time, I not only seesome change at MOE, but I actuallysee it in writing! The ban has beenpublished on the Environmental Bill of

FIELDING CHEMICAL TECHNOLOGIESInc. (www.fieldchem.com), located inMississauga, Ont., is Canada’s largestsolvent and refrigerant reclamationcompany.

“No other Canadian solvent recy-cling company uses a hybrid pervapo-ration system to dry chemicals – infact none that we know of in theworld,” says Fielding’s CEO EllenMcGregor. “We designed, built andoperate a unique pervaporation pilotplant. This year, we’re embarking on aprogram to build the pervap capabilityalongside the fractionation capability.This will give us an ability to dehy-drate chemicals and make us morecompetitive. Fielding is the onlyCanadian company in its industry thathas fractionation capability or a tech-nology like this to dehydrate thinnersand IPAs (isopropanols). Right now,in North America, there is a massiveshortage of fractionation capability.Our biggest competitor is the inciner-ator, because it is cheaper to burnthan to recover.”

Fielding faces some big challengesin the current economic and politicalclimate. “The Ontario governmentcontinues to regulate spent chemicalsas if they are hazardous waste materi-als,” McGregor says. “For us, haz-ardous waste is a raw material, so evenwhen we may purchase chemical


Corporate Profile

The future looks bright green forFielding Chemical Technologies

By Harvey F. Chartrand

nately, no facility exists in Canadathat can consistently destroy CFCs,so Fielding can only collect andarrange for their safe destruction,shipping them to a facility in Texas.“We need policy and legislation thatinsists on recovery before destruction,but of equal importance is the needfor regulated facilities that canreceive residuals from recovery effortsas a fuel or for safe destruction,”McGregor observes. “To date,Ontario has been fearful of the politi-cal ramifications of permitting suchfacilities. Hence the bulk of residualsfrom our solvent and refrigerant busi-nesses are shipped to U.S. facilities.”

McGregor is also proud of Field-ing’s emergency response capability.Fielding is the only emergency respon-der in Canada that is verified byResponsible Care and capable of recy-cling chemicals recovered at a spillsite. Offering first-class training andconsulting services, Fielding is helpingother members of the CanadianChemical Producers’ Association

(CCPA) keep current with legislativechanges affecting the handling ofchemicals.

Fielding Chemical TechnologiesInc. is positioned for growth andintends to further expand its opera-tions and services in the near term.“Recognizing the regulatory hurdlesand the costs associated with expan-sion in Ontario, we are looking fortechnology transfer opportunitieswhere we can help or lead in thedesign/build/start-up and ongoing sup-port of like capabilities in newlydeveloped countries,” McGregor sumsup. “In so doing, we honor our vision:Providing Cradle to Cradle® Care ofChemicals.” A

Harvey F. Chartrand is an Ottawa-based freelance writer. His stories haveappeared in The Globe & Mail, TheNational Post, The Jerusalem Post,The Ottawa Citizen, Filmfax, PennyBlood and Shock Cinema. Mr. Char-trand is also the editor of Ottawa LifeMagazine.

Rights. So the MOE is coming aroundto our way of thinking and should beapplauded for taking this bold step.”

In January, Fielding had a very pos-itive meeting with MOE personnel,who encouraged the company to con-sider expanding its capabilities – aremarkable development, since up tonow the company’s expansion was notsomething the Ministry encouraged.

McGregor is proud that Fielding isthe first refrigerant recycler in NorthAmerica to be registered to ISO 9001and the first anywhere to receive ISO14001 registration. Fielding is also thefirst and only solvent recycling com-pany that is a verified member ofResponsible Care. In accordance withthe Montreal Protocol on SubstancesThat Deplete the Ozone Layer, themanufacture and recycling of CFCs(chlorofluorocarbons) is banned inCanada. In addition to reclaiminghigh-pressure, low-pressure and mixedrefrigerants, Fielding is Canada’slargest player in the collection andsafe destruction of CFCs. Unfortu-


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Furthering our commitment to environment protection, Fielding brings a range of Emergency and RiskManagement services to the market. We offer professional 24/7 emergency response services, and are the onlyprovider with the capability to recycle spilled material. We also offer a comprehensive range of training courses,from Basic Spill to Incident Command to Confined Space Entry.

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PULL UP A lawn chairin the sun, pour a nicecool drink and watchthe chemistry goingon in your backyard. Right in the green lawn, the flowerbeds and the cedar hedge, nitrogen, phosphorus, potassiumand sulphur are helping your garden retreat grow.

The easiest way to understand the significance of fertil-izers is to view them as food for your garden. Just as peopleneed an adequate and consistent diet to grow and stayhealthy, plants and crops have to get proper nutrition fromthe soil to thrive.

The menu for plants must include a balanced supply ofnitrogen, phosphorus, potassium and sulphur. As plants andcrops extract these nutrients from the soil during everygrowing season, they must be replenished through fertilizers,manure and compost added to fields or gardens annually.

The advantage of using fertilizers is that they can beapplied with more control to match crop needs and protectthe environment. Or they can supplement manure or com-post to ensure the soil gets an adequate supply of nutrients.

Steps to RememberFertilizers are composed of the same ingredients as

manure and compost. Added to the soil, they make nutri-ents easily available to plants and crops. Nitrogen, which isessential to plant growth, is extracted from the atmosphere.Air is about 78% nitrogen, so fertilizer companies have areadily available supply of it. Phosphorus comes from fossilremains found in phosphate rock, and potash fertilizerscome from ancient seabed deposits.

Research has shown that the protein, vitamin and min-eral content of our food are boosted by the nutrient con-tent of the soil. For example, potash fertilizer improves the


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CHEMICAL PRODUCERSCiba Specialty Chemicals Canada Inc. . . . . . . . . . . . . . . . . . . . .4

Imperial Oil Ltd.,Chemicals . . . . . . . . .inside front cover

NOVA Chemicals (Mktg Communications) . . . . . . . . . . . . . . .16

Rohm and Haas Canada LP . . . . . . . .11

CHEMICALS - FORMULATING &PACKAGINGRecochem Inc. . . . . . . . . . . . . . . . . . .10

CHEMICALS & SOLVENTSComet Chemical Co., Ltd. . . . . . . . . . .22

CHLOR ALKALI CHEMICALSPioneer Companies . . . . . . . . . . . . . .14

DANGEROUS GOODS COMPLIANCEICC The Compliance Center . . . . .14, 16

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HAZMAT TRAININGFielding Chemical Technologies . . . . . .21

INDUSTRIAL CLEAN-UP SERVICESFielding Chemical Technologies . . . . . .21

INDUSTRIAL VIDEO INSPECTIONSCoatings Inspection Ltd Div of P.W. Makar . . . . . . . . . . . . . . . .8

INSTRUMENTSBrinkmann Instruments (Canada) Ltd. . . . . . . . . . . . . . . . . . . .3

INSURANCEAIG Environmental . . . .inside back cover

PETRO CHEMICALS MANUFACTURERSDow Chemical Canada Inc. . . . . . . .outside back cover

RAIL TRANSPORTATIONGATX Rail Canada . . . . . . . . . . . . . . .11

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SOLVENT RECYCLINGFielding Chemical Technologies . . . . . .21

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TRANSPORTATIONHarold Marcus Ltd. . . . . . . . . . . . . . .19Procor Ltd. . . . . . . . . . . . . . . . . . . . . .16

TRUCKING FIRMSNorthwest Tank Lines . . . . . . . . . . . . . .6

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WASTE DISPOSALFielding Chemical Technologies . . . . . .21

WASTE TREATMENTFielding Chemical Technologies . . . . . .21

BUYERS’GUIDE AND INDEX TOADVERTISERS

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POTASSIUM (K) An important contributor Helps regulate blood pressure.to food quality. Helps plantsuse water more efficiently.

SULPHUR (S) Improves quality of food and Synthesizes proteins,feed crops. Increases oil content which are critical to in oilseed crops such as flax, human diets and survival.soybean and canola.

NUTRIENTS ARE FOOD FOR PLANTS AND PEOPLE

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