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Providing coverage of Alaska and northern Canada's oil and gas industry
October 2012

Vol. 17, No. 43 Week of October 21, 2012

BC government lets loose

Emerges from shadows to accuse Enbridge of avoiding safety commitments for Northern Gateway; company says no activity without risk

Gary Park

For Petroleum News

The British Columbia government, having kept its powder dry for most of this year, has emerged guns blazing in the final stages of regulatory hearings into Enbridge’s Northern Gateway project.

Environment Minister Terry Lake showed up in the northern city of Prince George to accuse Enbridge of providing “incomplete” responses that are “lacking in commitment” when it was challenged to include enhanced leak detection systems or an automatic shutdown in the twin pipelines to export 525,000 barrels per day of Alberta oil sands crude and import 193,000 bpd of condensate.

About 60 percent of the 720-mile pipelines to and from the port of Kitimat will cover British Columbia territory.

“Their answers suggest that the company is not taking the very real concerns of British Columbians seriously,” he said in a statement.

Lake said it is “crystal clear that (Enbridge) is putting off making commitments about including enhanced leak detection systems or an automatic shutdown until after they get approval to proceed.”

“The only way to protect British Columbia’s interests is to ensure that these commitments are made up front, so that everyone will understand how they intend to run this project,” he said.

Mounting pressure on government

The government has emerged from the shadows over recent weeks under mounting pressure from communities, First Nations and environmentalists who are opposed to Northern Gateway.

New Democratic Party leader Adrian Dix, who is a strong bet to defeat the Liberal Party government of Premier Christy Clark next spring, said Lake’s comments are all about politics.

“What we’ve had now for really a couple of years is a government that hasn’t been serious about its approach and B.C. has paid the price for that.

“Now, late in the day, having finally heard what British Columbians have to say, the government is playing catch-up.

“I think what the people of B.C. want are serious, well-considered positions, not positions that change every day based on the Liberal Party’s latest polling,” he said.

Dix said the Liberals “want to be on all sides of this question.”

Withering attacks

Lake’s stance came a day after Enbridge faced one of its most withering attacks, when former British Columbia energy minister Richard Neufeld, now a federal senator, said the company has so badly mismanaged the project that he doubts it can proceed even if the National Energy Board and the Canadian government approve the application next year.

“I just think Enbridge has left a sour taste in most peoples’ mouths,” he said, scoffing at the company’s promises to create 3,000 construction jobs and 560 long-term jobs, arguing most of those jobs will go to people outside British Columbia.

Neufeld also said Enbridge has not done enough to gain support from British Columbians in remote regions, especially First Nations.

A Joint Review Panel of the NEB and Canadian Environmental Assessment Agency is in the final stages of hearings that started in January.

Questioning of Enbridge is scheduled to end Dec. 18, followed by oral statements in January.

The NEB is expected to issue its recommendations by late 2013, turning a final decision over to the Canadian government of Prime Minister Stephen Harper.

Enbridge defends project

John Carruthers, president of Enbridge Northern Gateway Pipelines, told reporters outside the hearings that although his company has designed a state-of-the-art system “whatever industrial activity you have, there is some element of risk.”

“The real key is to try and get that as low as possible. In our case, we’re trying to get it to zero,” he said.

Barry Callele, Enbridge’s director of pipeline control systems and leak detection, told the regulators that the twin pipelines will have five overlapping leak detection systems, including aerial surveillance, foot patrols and 132 monitored pressure valves along the route.

“We will have one of the best instrumented pipeline systems not only in North America, but probably the world,” he said. “It is not an issue of trust us, wait until construction.”

But Chris Jones, an attorney for the government, argued that the “sensitivity of the pipeline … can only be determined when it’s actually been constructed and you’re able to test it in operation.”

He said U.S. data indicates there have been 31 leaks from Enbridge pipelines in the U.S. since 2002, including 22,000 barrels in the Kalamazoo River in Michigan in 2010 and six of the 10 largest spills were from Enbridge pipelines.

Of those six, none were detected by Enbridge leak detection systems, Jones said.

Ziad Saad, vice president of the Canadian Energy Pipeline Association, told a conference in Vancouver Oct. 10 data collected from the association’s member companies show there have been three spills a year in Canada over the past decade.

“We don’t pretend that we will have zero incidents next year, but that remains the goal,” he said.

Meanwhile, about 300 residents attended a public meeting Oct. 10 in Vancouver to register their opposition to plans by Kinder Morgan for expanding its Trans Mountain pipeline from Alberta to a tanker terminal in the Port of Vancouver to 750,000 bpd from 300,000 bpd and compete with Enbridge for markets in the Asia-Pacific region.






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