Pipeline leaks due to human error an increasing problem, says NEB

Data shows an average of 20 leaks per year over the past three years were the result of improper operation

CBC News | January 29 | Human error — whether it’s burying a pipeline too shallow or not fastening bolts tight enough— is increasingly a factor contributing to pipeline leaks, federal data suggests.

Figures compiled by the National Energy Board show that in the past three years, incorrect operation — which covers everything from failing to follow procedures to using equipment improperly — has caused an average of 20 leaks per year. That’s up from an average of four annually in the previous six years.

“It’s both probably one of the most difficult things for an organization to deal with, but also the most important,” said Mark Fleming, a professor of safety culture at Saint Mary’s University in Halifax.

Fleming said operators have made improvements in safety practices, but to achieve the higher levels of safety required by other industries such as the airline or nuclear power sectors would require extreme attention to detail.

‘Within the first year or two things fail’

What may seem inconsequential at first can later contribute to a disaster, Fleming said.

“It’s like a ball balancing on the top of a pyramid,” he said.

“Safety, particularly very high levels of safety, requires constant attention and effort. And the tendency is for it to degrade.”

Pipelines installed in the U.S. in the past five years have the highest rate of failure of any built since the 1920s, and human error is partially to blame, said Carl Weimer, executive director of the Washington-based Pipeline Safety Trust.

“A lot of new pipelines being put in the ground just aren’t being installed right, or things don’t get tightened up quite enough, so within the first year or two things fail,” said Weimer.

The consequences of the improper management of pipelines have come to bear in several spills in recent years, resulting in oil coursing down rivers, gushing onto city streets and contaminating many hectares of Canadian wilderness.

Recent examples

Alberta Energy Regulator investigations into Plains Midstream Canada, for one, found that the company hadn’t inspected its pipelines frequently or thoroughly enough, did a poor job of managing the ground around its pipelines and hadn’t properly trained control room staff.

A subsequent audit found the company had improved its safety practices, but not before those failures helped contribute to a 4.5-million litre oil spill in 2011 near Peace River, followed by a 463,000-litre oil leak into the Red Deer River a year later.

In 2015, a Nexen Energy pipeline south of Fort McMurray, Alta. burst, spilling about five million litres of emulsion including about 1.65 million litres of oil near its Long Lake oilsands operation. The AER’s investigation into the incident continues, but Nexen’s preliminary conclusion was that the pipeline design was incompatible with the ground conditions, and wasn’t installed properly.

“There’s been a lot of learnings in our industry that have resulted from some very unfortunate incidents,” said Patrick Smyth, vice-president of safety and engineering at the Canadian Energy Pipeline Association.

Financial implications of safety

Smyth said CEPA, which represents pipeline companies like TransCanada and Plains Midstream, have improved their safety practices in recent years.

He points to the fact that CEPA members spilled only about 2,500 litres of oil in 2015, with companies implementing stricter safety practices and using better inspection tools to prevent leaks.

But even as companies make improvements on safety, Fleming said getting pipelines towards the higher safety standards of industries like airlines will likely require significant financial sacrifice.

“To be able to do that, you need to have a very cautious approach to doing work, and that’s something that’s hard financially,” said Fleming. “It does have some cost implications that we are often very uncomfortable talking about.”

By Ian Bickis, The Canadian Press Posted: Jan 29, 2017 10:31 AM MT Last Updated: Jan 29, 2017 10:31 AM
As posted at http://www.cbc.ca/news/canada/calgary/human-error-pipeline-spill-neb-1.3957370

Countering Sen. MacDonald’s ‘Canadian oil needs to get to world markets’ argument

Hill Times – Access to world markets for Canadian oil has been available since 1956 when the Westridge dock was constructed in Burnaby, B.C., and linked to the Trans Mountain pipeline. The dock’s export capacity has rarely been used to its full potential in more than 60 years.

Conservative Senator Michael MacDonald’s Feb. 27 column in The Hill Times, “Canadian oil needs to get to world markets” includes errors in fact.

Access to world markets for Canadian oil has been available since 1956 when the Westridge dock was constructed in Burnaby, B.C., and linked to the Trans Mountain pipeline. The dock’s export capacity has rarely been used to its full potential in more than 60 years.

In 2011, the National Energy Board (NEB) provided Kinder Morgan with a favourable and unprecedented ruling when it allocated guaranteed access to the dock under 10-year take-or-pay contracts with five crude oil shippers. Kinder Morgan promised that 79,000 barrels a day of tidewater access would lead to the development of international markets for Alberta’s crude.

This has not occurred.

Although guaranteed access means the dock can service 60 crude oil tankers a year, according to statistics compiled by Port Metro Vancouver, not even a third of that number were loaded during the 12 months ending Oct. 31, 2106, (the most recent statistics available)—and most of those tankers went to U.S. ports. The equivalent of one tanker was loaded with Alberta’s heavy oil and destined for a non-U.S. port during the entire year.

If Canadian oil needs to get to world markets so desperately as Sen. MacDonald claims, why isn’t existing access being used? It’s because there is no demand for it.

This leads us to the next set of claims in Sen. MacDonald’s piece: “The lamentable state of crude oil pipeline infrastructure makes parts of this country reliant on foreign oil and our petroleum exporters dependent on the United States, which buys Canadian product at a deep discount.”

Eastern Canada has a dependency on imported oil because the refineries located there are configured to process primarily light oil. Energy East is intended to facilitate the transport of diluted bitumen from Alberta’s oil sands so will not reduce eastern Canada’s reliance on imported crude to any significant degree.

But there is another source of dependency on imported oil that is rarely acknowledged. Oil sands producers are dependent on imported condensate as a diluent for bitumen blending purposes. This is because oil sands heavy does not flow down a pipeline unassisted—its too dense.

Canada does not produce enough condensate to meet oil sands producers’ demand. Since 2005, condensate imports from the U.S. have increased significantly. For every three barrels of increased oil sands production, a barrel of condensate is imported. Thus, as oil sands production expands, Canada’s import dependency expands with it.

If Sen. MacDonald would like to see a reduction in Canada’s reliance on foreign oil imports he must advocate for a reduction in oil sands production or an increase in upgrading and refinery capacity in Alberta. Otherwise, the minute bitumen is shipped along a pipeline, it generates a growing dependency on crude imports.

The next issue is the suggestion that Canadian producers are somehow dependent on U.S. markets. The majority of Canadian producers are not “dependent” on the US. They have integrated refinery operations there. To a significant extent Canadian producers supply their own crude to themselves or their joint-venture partners as U.S. refiners.

When Suncor sells into its Commerce City, Colorado refinery, or Cenovus supplies its facilities in Wood River, Illinois and Borger, Texas, owned in a joint venture with Phillips 66, or Husky supplies its refinery in Toledo, Ohio, it owns in partnership with BP, or Imperial and its parent, ExxonMobile, deliver crude from their joint venture to ExxonMobile’s U.S. facilities, it is hardly accurate to suggest that they are “dependent” on the U.S. market.

Finally, Sen. MacDonald’s statement that the U.S. “buys Canadian product at a deep discount” is incorrect. There is a natural price discount between U.S. oil and Canadian heavy oil that will always exist because of quality and transportation cost differences.

Oil is traded in U.S. currency. Canadian crude is priced against a benchmark to U.S. produced light oil; West Texas Intermediate (WTI). To examine the differential and whether there is a discount that is outside the expected natural range requires that we compare WTI to Canadian crude prices. To do this for oil sands crude is to look at the price for WTI as compared to the price for Western Canadian Select (WCS)—the highest grade of Canadian heavy.

The natural discount for WCS compared to WTI, according to the NEB is about 30 per cent —or roughly $20 US per barrel. A price differential of WCS to WTI of less that $20 U.S. would therefore be considered a “premium” price for WCS. WCS has been trading at “premium” since 2014. Currently, the differential is only $14 U.S. a barrel.

Robyn Allan is an independent economist and was an expert intervenor at the NEB Trans Mountain Expansion hearing

By ROBYN ALLAN PUBLISHED : Monday, March 6, 2017 12:00 AM. Hill Times.

Pipelines to be a ‘fundamental’ issue for NDP leadership race: Julian

So far, the party has agreed to disagree on some pipeline projects. But candidate Peter Julian says it’s time for the NDP ‘to have that debate.’

Pipelines could shape up to be a defining issue in the NDP leadership race, as the party’s members and provincial wings have clashing views on resource development and the construction of new oil pipelines.

During the last election, federal leader Tom Mulcair (Outremont, Que.) didn’t commit to being either for or against the Energy East pipeline. Instead, he was pushing for more rigorous environmental reviews, and further involvement of First Nations in the decision-making process.

Since then, different parts of the party have been in different positions. Alberta Premier Rachel Notley, for instance, has stood by the federal Liberal government’s approval of projects such as the Kinder Morgan Trans Mountain pipeline twinning.

But others within the party, including the British Columbia NDP and MPs representing B.C. ridings, have staunchly opposed the project. (It is important to note that the NDP’s federal and provincial factions all fall under the same party. In other parties, they have separate provincial and federal parties.)

So far, the party has agreed to disagree on pipeline projects. But candidate Peter Julian (New Westminster-Burnaby, B.C.) says it’s time for the NDP “to have that debate” because the party’s position is “not unanimous at all.”

Candidate Niki Ashton (Churchill-Keewatinook Aski, Man.) said the “NDP is at a crossroads,” but that pipelines aren’t the only key issue the NDP needs to address, citing racial inequalities and other issues. She said the media is framing pipelines as a defining issue for the party, but she disagrees.

But, Mr. Julian thinks over the next eight months, pipelines will be a critical matter for the NDP, and that the future leader’s stance on resource development, including pipelines, will affect the NDP’s chances in the next federal election.

“It seems to me that this is the fundamental debate and will be one of the fundamental debates of the 2019 election,” he said.

The Hill Times asked each campaign in the race so far their position on pipelines and the future of resource development in Canada.

Peter Julian: no pipelines, build refineries instead
Mr. Julian said it is “very clear” to him that the NDP must oppose pipelines and work towards transitioning to clean energy.

Mr. Julian says the government should refine and upgrade raw bitumen from the oilsands in Canada, instead of exporting it. The risk of spilling the diluted bitumen the pipelines carry was not worth the reward, he said.

“As part of a just transition strategy, we need to make sure we are upgrading and refining in Canada, while we’re making the shift to clean energy. All [Justin Trudeau] is proposing is raw bitumen exports for the next 50 years,” Mr. Julian said.

He said he has “knocked on a lot of doors” in Saskatchewan and Alberta, two oil-producing provinces that have a strong interest in building pipelines. He said people respond when he talks about value-added development and transition to clean energy.

“I do not expect the Canadian Association of Petroleum Producers to be in agreement,” he said, “but I think this debate has to happen. The NDP is the only place this debate can happen.”

Mr. Julian said building refineries and using the resulting product in Canada would create more jobs than pipeline construction ever would, and it would decrease Canada’s dependency on oil imports. It would also eliminate the need for pipelines, he said.

Guy Caron: overhaul assessments process
Guy Caron (Rimouski Neigette-Témiscouata-Les Basques, Que.) said he is opposed to Energy East, TransCanada’s proposed 4,500-kilometre pipeline that would transport 1.1 million barrels of oil per day from Alberta and Saskatchewan to the refineries of Eastern Canada and a marine terminal in New Brunswick. Part of the route would run through his riding.

He thinks Kinder Morgan’s Trans Mountain pipeline expansion, which runs from Alberta to B.C., approved by the Liberal government with conditions last year, is an example of the Liberal government “steamrolling over the concerns of many local communities.”

While he is opposed to those two projects specifically, Mr. Caron does not say he is opposed to pipelines in principle. He does say he thinks a “complete overhaul of our environmental assessment process” is necessary to ensure each project has economic, environmental, and social benefits. And, “any new framework must include provincial/territorial, First Nations, and community input, and must contribute to the fight against climate change,” he said.

In terms of the NDP grappling with its stance on pipelines, Mr. Caron said, “the issues of energy and environment will always be a part of our political discourse, offering a diversity of views—just as within the NDP.” He said he “respects” Alberta Premier Rachel Notley’s “passionate fight for workers in her province.”

But in the long term, Mr. Caron shares his colleagues’ vision of transitioning to renewable energy.

Mr. Caron says the NDP can’t leave out those who work in the oil industry now and are struggling with recent job losses and downturn in the sector. “Our plan will help them take their place in the economy of the future.”

Niki Ashton: pipeline projects must have social licence
Ms. Ashton, who just announced her candidacy for the leadership on Tuesday, said she is against pipeline projects that the Liberal government has approved, including the Kinder Morgan project. She is also against Energy East and Keystone XL. She wants to “move Canada to a sustainable carbon-free economy.”

“We have a prime minister who talked a good talk on working with indigenous peoples, talked a good talk on the environment, and then since he’s been in power, he’s approved pipelines that certainly respect neither of those fundamental parts and not indigenous peoples,” she said in an interview with The Hill Times.

Ms. Ashton said none of the pipeline projects that have gained approval from the federal government to date would go through if the approval process was based on the principles she envisions, including indigenous rights, environmental regulations, and Canada’s climate change commitments.

On whether or not she would be worried about her electability in the prairie provinces by opposing pipeline projects, she said she knows “the importance of the resource-based economy,” as she is from a mining town in the prairies herself.

But, she said “it’s not clear to me that [pipelines are] the way to create good jobs and to address the issues we’re facing.”

She said Westerners are facing similar challenges to the rest of the country, in that there is simply a lack of diversified employment.

Charlie Angus: transition to green, but don’t halt pipelines full-stop
Charlie Angus (Timmins-James Bay, Ont.), from historically mining-dependent northern Ontario, appears to be the most pipeline-friendly candidate in the race thus far.

In keeping with themes seen in his opponents’ platforms, on his website, his environment platform indicates he wants to “make sure developments, from dams to pipelines, have the consent of the people they will impact.” Mr. Angus points out the importance of that consent for projects on indigenous land.

When he announced his bid for the leadership at the end of last month, Mr. Angus, like many of his colleagues, indicated he wants Canada to move away from fossil fuels. But, as the Toronto Star reported, “he stopped short of calling for a moratorium on pipeline construction.”

“We don’t throw a generation of workers under the bus to make a political point,” he said.

Mr. Angus was unavailable for comment to The Hill Times due to a busy schedule, and his campaign did not respond to written questions by deadline.

By CHELSEA NASH, Hill Times, PUBLISHED : Wednesday, March 8, 2017 12:00 AM, cnash @chels_nash

PM Trudeau tells Houston energy conference U.S. needs Canada’s natural resources

HOUSTON – Prime Minister Justin Trudeau made it clear he is flatly against a proposed U.S. border adjustment tax, telling a global gathering of politicians and energy sector executives it would hurt the economy in both countries.

“Recognizing, of course, how much the Canadian economy depends on close collaboration and integration with the American economy, anything that creates impediments at the border – extra tariffs or new taxes – is something we’re concerned with,” Trudeau said Thursday night in Houston, Texas.

Trudeau came to the heart of the U.S. oil path to deliver a keynote address to the annual CERAWeek conference – a first for a Canadian prime minister – that attracts legislators, energy executives, innovators and experts from around the world.

Read more

Joanna Smith, The Canadian Press
Published Thursday, March 9, 2017 11:34AM EST

Martine Ouellet pledges to oppose Energy East as she’s crowned Bloc Québécois leader

Montreal – Ouellet was elected by acclamation after the only other potential candidate, Félix Pinel, withdrew Monday lacking the necessary support to complete his leadership application. Ouellet extended a hand to Pinel in her speech.

The new leader wasted no time going after Prime Minister Justin Trudeau, who she called a “friend of the oil industry.” She also promised to make opposition to the Energy East pipeline a priority, saying it was “the biggest threat to potable water in Quebec.”

Ouellet called on sovereignists to rally behind her to protect the “green jewel” that is Quebec and put an end to tax havens and the loss of corporate headquarters from the province.

“Our adversaries say we’re closed, but it’s exactly the opposite,” she said. “It’s because we’re open to the world that we want to become a country.”

Read more
Published on: March 18, 2017 | Last Updated: March 19, 2017 5:17 PM EDT

Montreal likely to block Energy East pipeline, Rona Ambrose says

OTTAWA — Interim Conservative leader Rona Ambrose says she’s not optimistic the proposed Energy East pipeline from Alberta to New Brunswick will be built, citing the opposition from the mayor of Montreal and anti-pipeline groups.

Speaking to a Toronto business crowd Monday morning, Ambrose expressed frustration with the lack of pipeline approvals in Canada.

Prime Minister Justin Trudeau last November approved the Trans Mountain and Line 3 pipeline expansions and killed the Northern Gateway pipeline proposal, which would have run through the Great Bear Rain Forest in Northern B.C.

TransCanada’s proposed Energy East pipeline would see an existing pipeline converted to carry 1.1 million barrels of crude oil a day to New Brunswick to be refined.

“I’ve got to be totally honest with you. I just don’t see how it’s going to happen. I don’t see Energy East getting through Montreal,” Ambrose said, in response to an audience question about whether it will happen.

“And that’s just the political reality of it… I obviously will support any efforts to get it there.”
Ambrose says she thinks the federal government has done a political calculation and decided Kinder Morgan’s Trans Mountain pipeline, through Burnaby, B.C., is the one it can live with.

“I don’t know what to say to you. These issues become political with this government and they’ve made a political decision around [Northern] Gateway,” she said.

“[The Liberals have] said it has to have social license and we still don’t know exactly what that means. But if you think that [Mayor] Denis Coderre in Montreal and the groups that have gotten organized against Energy East are going to give the government social license to go through Montreal, I don’t believe it.”

A spokesman for Coderre says the city doesn’t need Energy East.

“The mayor deplores the project’s lack of relevance, both at the economic and environmental level,” Marc-André Gosselin wrote in French.

TransCanada said it’s listening to the questions and issues raised by the mayors and other stakeholders in the Montreal region, and along the Energy East route.

“Energy East is a project serving markets including refineries in Quebec and New Brunswick, which currently depend on hundreds of thousands of barrels of imported crude oil every day. That demand has not changed, nor has our commitment,” spokesman Tim Duboyce said in an email to CTVNews.ca.

“We continue to await direction from the [National Energy Board] on the next steps in the review process that will provide the opportunity for parties to raise issues and to provide answers.”

Published Monday, March 27, 2017 5:45PM EDT
As posted at http://www.ctvnews.ca/politics/montreal-likely-to-block-energy-east-pipeline-rona-ambrose-says-1.3342949

First Nations in Quebec Stand in the Way of the Energy East Pipeline

WENDAKE, QC, March 29, 2017 /CNW Telbec/ – On the occasion of the visit to Montreal (Mohawk Territory) of the Expert Panel mandated to modernize the National Energy Board (NEB), the Assembly of First Nations Quebec-Labrador (AFNQL) wishes to reiterate that First Nations in Quebec firmly opposed TransCanada’s Energy East pipeline by way of resolution in June 2016.

“When First Nations say no, it’s no, period”, said the Chief of the AFNQL, Ghislain Picard, adding that “First Nations invite our allies, especially Montreal Mayor Denis Coderre and leaders of environmental groups to join the circle in the fight against Energy East”.

“One hundred and twenty-two First Nations in Canada and United States, including many in Quebec, have said no to Energy East and have committed, by signing the Treaty Alliance Against Tar Sands Expansion, to stopping the Kinder Morgan, Line 3, and Keystone XL tar sands pipelines, as well as tar sands by rail transport projects such as the Belledune project” added the Chief of Ekuanitshit, Jean-Charles Piétacho, the Nation Innue’s spokesperson on fossil fuels.

The AFNQL resolution dated June 15, 2016 also demands a complete overhaul of the Energy East project review process. The federal government, on the other hand, announced that the review of the Energy East project by the NEB would follow its course, with a few minor adjustments, and would not be affected by the NEB “modernization”.

“The federal government recognizes that the NEB needs to be reformed but in the meantime, it allows it to continue the Energy East review. It’s completely absurd”, concluded AFNQL Chief Ghislain Picard.

About the AFNQL
The Assembly of First Nations Quebec-Labrador is the political organization of 43 Chiefs of the First Nations in Quebec and Labrador. www.apnql-afnql.com

SOURCE Assembly of First Nations of Quebec and Labrador
For further information: Mélanie Vincent: vincentmelaniemv, Cell.: 418-580-4442