Category Archives: Oil&Gas

Report: Kinder Morgan Pipeline Operator Ignored Alarms During Recent Abbotsford Spill

December 3, 2012Energy and Resources, Oil&Gas, Pipelines and SupertankersBC Oil Pipelines and Supertankers, KinderMorgan, Oil and gasCommon Sense Canadian

Read this story from the Vancouver Sun’s Gordon Hamilton on a new report from the National Energy Board which reveals operators of an Abbotsford tank farm, connected to Kinder Morgan’s Trans Mountain Pipeline, ignored alarms suring a recent spill for hours. (Nov. 28, 2012)

A National Energy Board report reveals that Trans Mountain Pipeline operators ignored warning alarms for three-and-a-half hours before responding to a gasket failure that resulted in a crude oil spill last January at its Sumas tank farm near Abbotsford.

It took six hours after the first warning sounded for Trans Mountain’s Sumas operator to arrive on the scene, where a spill was discovered. The crude oil did not escape from a containment area but noxious fumes were released into the atmosphere, affecting nearby residents.

The NEB estimates 90,000 litres of crude oil escaped.

This latest oil spill report comes at a time when pipeline owner Kinder Morgan is applying to expand the pipeline’s capacity from 300,000 barrels a year to 750,000 barrels to feed Asian markets. It has given the company a black eye, said Ben West, of the Wilderness Committee.

The report is critical of monitoring staff at Trans Mountain’s control centre at Edmonton, stating that the control centre operator failed to set an alarm within the required time limit of 15 minutes after an oil transfer had taken place at the Sumas tank farm the evening of Jan. 23, and then failed to respond to leak warning alarms that sounded every hour until the operator’s shift ended.

The NEB report finds that the leak was detected later than it should have been, the control centre operator did not follow procedures and there were improper alarm settings in a recently-installed data acquisition system. The board states Trans Mountain Pipeline has identified corrective actions to address the report’s findings.

“The board finds that these actions are appropriate to prevent the occurrence of similar incidents in the future.”

The report, which was released earlier this month, states that the operator assumed the alarms were being caused by high winds and did not send a field technician to investigate.
Further, the operator failed to understand that the volume in the tank was dropping.

Audio: Damien Gillis Talks Chinese FIPA, Fracking, Water on Nanaimo Radio

December 3, 2012Energy and Resources, Fracking, Oil&Gas, WATER, Water and HydrocarbonsAudio, FIPA, fracking, LNG, Oil and gas, Water and EnergyCommon Sense Canadian

Damien Gillis appeared recently on Nanaimo’s CHLY Radio to discuss a number of key political and energy issues in Canada. Gillis and host Rae Kornberger of A Sense of Justice cover the controversial proposed Canada-China trade deal and how that relates to energy and environmental issues in BC particularly. Included amongst these is natural gas fracking in northeast BC and the enormous volumes of fresh water required for these operations. Listen to the interview in two parts – as well as one highlight clip dealing with proposed water licences for fracking. (recorded Nov. 28, 2012)

Highlight Clip: Water Licences for Fracking (6 min)

Full Interview – Part 1: Chinese FIPA

Full Interview – Part 2: Water, Fracking and Fort Nelson First Nation

TransCanada Announces Yet Another Proposed Gas Pipeline to Kitimat – May Skirt Environmental Assessment

November 27, 2012Energy and Resources, Fracking, Oil&Gas, Pipelines and SupertankersBC Oil Pipelines and Supertankers, fracking, LNG, Oil and gasCommon Sense Canadian

Read this story from Larry Pynn in the Vancouver Sun on TransCanada’s proposed gas pipeline from Dawson Creek to Kitimat, BC, which leading environmental critics fear could avoid any environmental assessment under the new Harper regulatory regime – despite crossing 320 watercourses and affecting close to 300 different fish and wildlife species along the route. (Nov. 26, 2012)

TransCanada’s planned 650-kilometre natural gas pipeline to Kitimat would cross about 320 watercourses including the habitat of more than 100 species at risk, such as white sturgeon, woodland caribou and marbled murrelet, company documents show.

But under Conservative government changes to environmental laws, there’s no guarantee the Coastal GasLink project will undergo a federal environmental assessment.

“It’s a travesty of the public trust,” said Otto Langer, retired head of habitat assessment and planning for the federal fisheries department in B.C. and Yukon. “If we can’t have an environmental review on a project of this sort, this is proof we have gutted Canada’s environmental protection.”

The federal government is soliciting public comment on whether a federal assessment is warranted for the Coastal GasLink project.

Céline Legault, spokeswoman for the Canadian Environmental Assessment Agency, said that even if the project is not subject to a federal environmental assessment, “all applicable federal legislative, regulatory and constitutional requirements must be fulfilled.”

TransCanada has also submitted its project description to Victoria in advance of an official assessment by the B.C. Environmental Assessment Office.

Langer dismissed the notion of a provincial assessment because the B.C. government is “giving the green light everywhere” to projects and that its environmental review process is too soft on industry.
“It’s pretty sad,” he said. “I don’t know how we slipped down this slope so quickly … and I don’t know where it will all end.”

B.C.’s Environmental Assessment Office reported in August it had conducted assessments of 162 projects in the last 20 years. Only two were refused outright — Kemess North copper-gold mine in 2008, and the Ashcroft Ranch landfill project in 2011.

Coastal GasLink’s 1.2-metre-wide pipeline would extend from near Groundbirch, a community 40 kilometres west of Dawson Creek, to a proposed liquefied natural gas facility near Kitimat.

The buried pipeline would initially have a capacity of 1.7 billion cubic feet of natural gas per day, which could be expanded to five billion cubic feet per day.

TransCanada documents outlining the pipeline project say it would cross four major drainages — the Peace, Fraser, Skeena and Kitimat rivers.

Of 286 species identified along the pipeline corridor, about 37 per cent (107 species) are recognized as species of management concern, Trans-Canada says.

Vancouver Sun Op-Ed: Rush to Deplete BC’s Gas Reserves Makes No Sense

November 27, 2012Energy and Resources, Fracking, Oil&Gas, Water and Hydrocarbonsfracking, Oil and gasCommon Sense Canadian

Read this op-ed in the Vancouver Sun by Ben Parfitt of the Canadian Centre for Policy Alternatives and renowned geologist and energy expert David Hughes, calling into question the BC Liberal Government’s policy for dramatically expanding natural gas development. (Nov. 14, 2012)

British Columbia is no petro state. So why do our political leaders insist that we are a global energy power?

At the University of Calgary last month, Premier Christy Clark boldly asserted that B.C. could one day export four trillion cubic feet of natural gas per year, an amount that would put us on par with the output of Alberta’s oilsands industry.

Clark also said that over the next 30 years such exports “could add over a trillion dollars” to our province’s gross domestic product.

These sound like impressive numbers. But drill into them a bit, and they appear to be overstated, which raises critical questions.

What does exporting four trillion cubic feet of gas per year from B.C. actually mean, when viewed against what we have? What would the economic, energy security and climate consequences be of producing all that gas and more?

Consider the following facts.

Last year, B.C. produced a record 1.2 trillion cubic feet of natural gas — among the most water-depleting and energy-draining gas on earth, due to the deployment of highly controversial fracking technology.

The bulk of that gas went to Alberta to assist in the most water-depleting and energy-draining oil production on Earth. The next biggest slice went to the United States. What was left we used here in the province.

Presumably, we would not simply shut off the taps on these markets in the event that five new liquefied natural gas (LNG) terminals are built on our coast, and we begin shipping four trillion cubic feet of our gas to China, Japan and elsewhere. The government’s energy policies would therefore see gas extraction rates quintuple in northeastern B.C. — and probably a whole lot more because natural gas will likely be burned to power all those LNG plants.

What not enough of us have asked the government about is what such policies mean in terms of depleting our non-renewable fossil fuel resources and undermining our ability to meet our legislated greenhouse gas emissions reduction targets.

Now is the time to do so. Here’s why.

According to British Columbia’s Oil and Gas Commission, our current reserves of natural gas total roughly 33 trillion cubic feet. Based on our premier’s projections of 4 trillion cubic feet per year of gas exports, we’d drain our entire reserves in just 8 years, or less if we continued to supply our own needs and those of our existing customers.

Now the likelihood is that we have far more gas. Estimated total resources for B.C. exceed 1,200 trillion cubic feet. But even optimistically assuming we can successfully extract one quarter of those resources, we’d be completely out of gas in 75 years — that is if we exported it all and left nothing for ourselves or for our neighbours.

Speaking of neighbours, Alberta’s Energy Resources Conservation Board projects a 35 per cent decline in its own gas production over the next decade. And according to Canada’s National Energy Board, total Canadian natural gas production is down nearly 20% today from its peak in 2002.

The only western Canadian jurisdiction whose reserves and production show growth is here in B.C. And our elected leaders’ vision is that we rush whatever we have out of the country.
Premier Clark and B.C. Energy Minister, Rich Coleman, call their gas export plans a “strategy”. Their choice of wording is an insult both to the English language and to basic economics.

Enbridge’s Line 9: Shipping Tar Sands Crude East

November 22, 2012Canada, Energy and Resources, Oil&Gas, Politics, Tar Sands, Western CanadaAlberta Tar Sands, Enbridge, Oil and gas, Politics, Thomas MulcairDamien Gillis

This article is republished with permission from Watershed Sentinel.

In a move that could cost him significant political support, federal NDP leader Thomas Mulcair has endorsed controversial west-to-east pipeline proposals that would move tar sands crude from Alberta through Ontario and Quebec to Atlantic Canada and points beyond.

During a Sept. 28, 2012 speech to the Canadian Club of Toronto, Mulcair said, “Let me be clear, New Democrats support recent proposals to increase West-East pipeline capacity. This is an initiative, led by industry, that will pay economic dividends for every region of our country: new markets for [tar sands] producers in the West, high-paying value-added jobs and lower energy prices in the East.”

Mulcair called this a “pro-business common sense solution.”

With a bottleneck of crude at the storage hub in Cushing, Oklahoma, pricing discounts for diluted bitumen (dilbit) at US Midwest refineries, and strong opposition to tar sands export pipelines in both BC and the US, the industry has seized upon “eastern access” to Atlantic tidewater as a solution. Canada’s top two pipeline/utilities companies – Enbridge and TransCanada Corp. – are each developing plans to pipe crude east, while environmental groups across Ontario, Quebec and New England have been gearing up for a major fight on the issue.

The “Wrong Product”

Ironically, only hours before Mulcair’s speech, Alberta Federation of Labour president Gil McGowan issued a press release (Sept. 27) stating: “The bottom line is Alberta is selling the wrong product [dilbit]. The glut of bitumen on the market is a result of bitumen looking for appropriate refineries. If the product was SCO [synthetic crude oil], we could be selling the product to any refinery in North America.” As well, many pipeline safety issues could be avoided (see March-April 2012 Watershed Sentinel).

Tar sands producers generally produce either “synthetic crude,” which has passed through an on-site upgrader, or dilbit, which is raw bitumen thinned with lighter petroleum products and proprietary chemicals. With increased production over the last few years, tar sands producers (which are mostly foreign-owned) are now piping out more dilbit in order to cut their costs. According to Alberta Energy, there are only five operating upgraders in Alberta, and in 2011, “about 57% of oil sands production was sent for upgrading to synthetic crude oil within Alberta,” a percentage that will rapidly decline as production vastly increases. Over the next decade, tar sands producers reportedly plan to triple the amount of dilbit they pipe.

On July 23, 2012, the US National Academy of Sciences began hearing expert briefings on whether dilbit increases the risk of pipeline spills, as environmentalists claim. Gil McGowan’s point is a crucial one: not all refineries in North America can handle dilbit, nor can all refineries in eastern Canada. That fact is significant to understanding who would benefit from “eastern access” pipelines plans.

Line 9 Reversal

Enbridge is now moving quickly on a plan to pipe tar sands crude through Ontario, Quebec, and New England to Atlantic tidewater in Portland, Maine. From there it would be shipped by tankers to refineries in the US and elsewhere.

In May 2012, Enbridge announced a $3.2 billion expansion of its North American pipeline system, including expansion of its Lakehead system which pipes dilbit from Alberta to US Midwest refiners. Some of that dilbit also reaches refineries in Sarnia, Ont., via Enbridge’s Line 5 (which brings dilbit from Superior, Wisconsin, across northern Michigan to Sarnia), and Line 6B (which pipes dilbit from Chicago across Michigan to Sarnia). Both Line 5 and Line 6B extend from the tar sands across Alberta, Saskatchewan and Manitoba before entering the US at Superior, Wisc. According to rabble.ca (Sept. 11, 2012), in Sarnia “tar sands are already being refined [by Imperial Oil and Suncor] at an estimated rate of 225,000 barrels per day.”

It was Enbridge’s Line 6B that ruptured in Michigan in 2010, spilling 20,000 barrels of dilbit into the Kalamazoo River. During repairs, Enbridge has quietly been increasing the capacity of that pipeline to 500,000 barrels per day (bpd).

Enbridge also intends to reverse Line 9, which currently carries 240,000 barrels per day of imported conventional oil from Montreal to Sarnia. On July 27, Canada’s National Energy Board granted approval for the reversal of a portion (9A) of Line 9 between Sarnia and Westover, Ont. (where an oil hub is located that diverts crude to Imperial Oil’s refinery in Nanticoke, Ont. and to Pennsylvania refineries).

Enbridge intends to file for the reversal of the remaining portion (9B) between Westover and Montreal this autumn. On Oct. 23, Enbridge filed a document with the NEB showing it plans to increase the capacity of Line 9 to 300,000 bpd and switch it to carrying “heavy crude,” which includes tar sands oil.

In order for tar sands crude to reach the Atlantic, another pipeline – the Portland/Montreal Pipe Line (PMPL – which brings imported conventional oil from Portland, Maine to Montreal) – would also have to be reversed. The PMPL passes through Quebec, Vermont, New Hampshire, and Maine.

The Portland/Montreal pipe is majority-owned by Imperial Oil and Suncor. Officials with PMPL have reportedly been in talks for over a year to reverse that line.

Enbridge also intends to export tar sands crude from Portland, Maine. According to the Globe and Mail (June 1, 2012), “In a recent conversation with Streetwise, Stephen Wuori, Enbridge’s president of liquids pipelines, said his company believes it can export crude from the US without consequence. Asked if it would be possible to send oil to international markets from Maine, he said the answer is yes.”

More recently, the Globe and Mail reported (Sept. 6, 2012) that Enbridge “has met with officials from refineries in Quebec City and Saint John to discuss their appetite for Western Canadian crude. Companies could barge oil from Montreal to Quebec City, and then perhaps ship it by rail to Saint John.”

TransCanada’s Mainline to the East Coast

TransCanada Corp.’s natural gas Mainline runs 14,000 kilometres from the Alberta/Saskatchewan border to where Quebec meets Vermont. The Mainline, which pipes natural gas to Ontario, has been operating at only half-capacity in recent months because of competition from US shale gas. Canadian Natural Resources Ltd. and others have been urging the company to switch to carrying crude in its gas Mainline. TransCanada Corp. is also one of the owners of Ontario nuclear power-generator Bruce Power, which has been pushing the nuclear option for tar sands/energy production in Alberta and Saskatchewan.

TransCanada Corp. has not disclosed much about its west-to-east pipeline project, but recently Globe & Mail reporters Nathan Vanderklippe and Shawn McCarthy provided (Sept. 6, 2012) some details on “a massive $5.6 billion new pipeline system that would carry large volumes of western crude to refineries in Ontario, Quebec, and beyond.”

Their news report states:

The East Coast project described to [us] by industry sources would involve converting roughly 3,000 kilometres of underused natural gas pipe – the Mainline is made up of a series of parallel pipes – into oil service. It would also involve building at least 375 kilometres of new pipe from Hardisty, the Alberta oil hub, to the Mainline at Burstall, Sask., and from near Cornwall [Ont.], at the other end, to Montreal. Another 220 kilometres would be required to reach Quebec City. Oil could be loaded onto ocean-going vessels either on the St. Lawrence River, or destined for American refiners via Portland, Maine, through a pipeline [PMPL] to Montreal whose flow could be reversed…The TransCanada proposal would send 625,000 barrels a day across the country to Montreal, Quebec City and potentially Saint John, NB, where Irving Oil Ltd. runs a large refinery. Tanker exports could then also take the crude to Europe or Asia.

In late July 2012, RBC Capital Markets urged that TransCanada Corp. stop focusing on the controversial Keystone XL pipeline to Texas and instead convert its Mainline to carry 900,000 barrels per day of tar sands crude to Sarnia, and then use Enbridge’s Line 9 to move it to Montreal.

So potentially, more than 1.4 million barrels per day of tar sands crude could be piped through southern Ontario and Quebec – the most populated area of Canada – to points east. The industry considers “eastern access” pipelines to be in addition to projects like Northern Gateway.

Upstream/Downstream

Refining is currently considered a financially viable business in North America mainly for companies that both produce (“upstream”) and refine (“downstream”), largely because they can buy dilbit and other feedstock cheaply and then sell the refined petroleum products for a high price internationally.

In the tar sands, companies with both upstream/downstream facilities in North America include Imperial Oil, Suncor, Shell, Husky, Valero, Marathon, ConocoPhillips, Cenovus, BP, and Flint Hills Resources/Koch Industries. Many of these companies have already invested billions to convert their refineries in the US Midwest and Gulf Coast for processing tar sands crude.

In 2010, Royal Dutch Shell closed its Montreal refinery and converted it into a fuel storage terminal. Imperial Oil put its Dartmouth, NS refinery up for sale on May 17, 2012, but is also considering converting it into a storage terminal. By the terms of its sale to Korea National Oil Corp., the North American Refinery in Newfoundland only refines the province’s offshore oil, with most of its refined petroleum products exported to the US. As of March 2012, Shell is considering upgrading bitumen at its Ontario refinery and Suncor is considering the same thing for its Montreal refinery. The resulting “synthetic crude oil” would still have to go to another refinery to be made into products like gasoline, diesel, and jet fuel.

Peter Boag, president of the Canadian Petroleum Producers Institute – which represents the refining and marketing sector – told the Globe and Mail (Sept. 6, 2012), “Significant changes to the crude diet to really ramp up the volumes of western-based heavier crudes in Eastern Canada is going to require some significant investment in refinery reconfiguration.” As Gil McGowan put it, Alberta is selling “the wrong product.”

The Irving Empire

According to the University of Calgary’s Jack Mintz (Financial Post, Dec. 16, 2011), the only refinery on the Atlantic that can currently process “heavy sour diluted bitumen [dilbit]” is “the Irving Refinery” in New Brunswick. Otherwise, he said, “this type of crude cannot be processed in eastern North America.”

Enbridge has been planning its “eastern access” pipeline since at least 2008. On March 11, 2008, Reuters reported that “Enbridge Inc. is looking at moving oil sands crude to the US Northeast and Eastern Canada,” and quoted Enbridge CEO Patrick Daniel: “If we move to reverse Line 9 [in Ontario], that could come before [Northern] Gateway [in BC]. If it is a large volume, 400,000 barrels a day, [Northern] Gateway would come first.”

In 2011, Enbridge appointed to its board a director of Irving Oil, which now owns 50 per cent of an oil terminal in Portland, Maine.

The Globe and Mail reported (Aug. 23, 2012) that Irving Oil “unveiled a proposal three years ago to build [another] 300,000 barrels-a-day [refinery] facility to serve the northeast United States,” and later partnered with BP on the idea – which is currently shelved. According to the same newspaper (Sept. 6, 2012), the Irving Refinery in Saint John buys about $10 billion per year of imported conventional oil, refines it, and then sends “eighty per cent of the plant’s production” south of the border.

Obviously, tar sands producers like Canadian Natural Resources Ltd. – which owns no downstream refineries – are eyeing that annual $10 billion in hopes that it will be used to buy crude piped east. Canadian Natural Resources Ltd. plans to greatly increase its tar sands production to one million barrels per day over the next decade. Frank McKenna – the former premier of New Brunswick and a current director of Canadian Natural Resources Ltd. – has been one of the most vocal proponents of west-to-east pipelines from Alberta, and has called for a new oil pipeline from Montreal to Saint John.

In mid-July, Canada’s Parliamentary Standing Senate Committee on Energy, the Environment and Natural Resources (with 7 Conservative and 5 Liberal members) endorsed west-to-east tar sands pipelines as a “nation-building” project.

Besides Frank McKenna and the Senate Committee, other outspoken proponents include Derek Burney (a director of TransCanada Pipelines Ltd.), Eddie Goldenberg (a lawyer with Calgary law firm Bennett Jones), the “ethical oil” people, and now the NDP’s Thomas Mulcair. Some commentators consider the west-to-east pipeline plans to be the centre of Alberta Premier Alison Redford’s “national energy strategy.”
But the plans by Enbridge and TransCanada Corp. seem largely to be a strategy for Big Oil to get a higher price for dilbit by export via the Atlantic – most likely to the US Gulf Coast, where their downstream profits would be highest.

Environmental organizations across Quebec, Ontario, and New England, along with some First Nations and landowner organizations residing along Line 9, have been rallying in opposition to these west-to-east pipeline plans.

All this is happening mainly because the Alberta government is too timid and subservient to require that all tar sands production be upgraded or refined on-site. Instead, it keeps allowing Big Oil to pipe out more and more of “the wrong product.” As a result, tar sands pipelines will continue to be fought across North America.

***

Joyce Nelson is an award-winning freelance writer/researcher and the author of five books.

Timelapse Animations Reveal Staggering Water Withdrawals, Industrial Activity for Fracking

November 19, 2012Energy and Resources, Fracking, Oil&Gas, WATER, Water and Hydrocarbonsfracking, Oil and gas, Water and EnergyDamien Gillis

Watch these timelapse animations of recent water withdrawals and industrial activity in Fort Nelson First Nation traditional territory for natural gas hydraulic fracturing. These short term licenses were all issued without public or First Nations consultation. Courtesy of FNFN Lands Dept. and mapper Bobby Concepcion.

American Gas Firm Launching $250 Million NAFTA Challenge to Quebec Fracking Ban

November 19, 2012Energy and Resources, Fracking, Oil&Gas, Water and Hydrocarbonsfracking, Oil and gasCommon Sense Canadian

Read this story from the Globe and Mail on US energy firm Lone Pine Resources’ forthcoming NAFTA challenge regarding lost economic opportunities resulting from Quebec’s ban on natural gas hydraulic fracturing. (Nov. 15, 2012)

A U.S.-incorporated energy firm, Lone Pine Resources Inc., is taking on Quebec’s stand against fracking, saying it violates the North American free-trade agreement and demanding more than $250-million in compensation.

Lone Pine Resources Inc., headquartered in Calgary but incorporated in Delaware, disclosed in a filing with the U.S. Securities and Exchange Commission this week that on Nov. 8, it filed a notice of intent to sue the Canadian government under NAFTA’s controversial Chapter 11.

Those provisions of the trade treaty allow U.S. and Mexican companies to sue Ottawa if they feel they have been wronged by a government policy or action.

Lone Pine is just one of many major natural gas companies affected by Quebec’s moratorium on hydraulic fracturing, or fracking, which involves injecting liquids deep into the ground. Fracking has been controversial over fears for its effects on the environment and drinking water, and has been banned in several European countries. The industry says that done properly, it is safe.

According to Lone Pine, Quebec passed legislation last June that, in addition to the moratorium, also completely cancelled permits for oil and gas activity in areas directly below the waters of the St. Lawrence River – including the revoking of a permit held by Lone Pine covering 33,460 acres.”

Company spokesman Shane Abel said in an interview that Quebec’s legislation denies the company any compensation for the loss of its permit.

“We think that the expropriation is arbitrary and without merit,” he said. “… We think that’s a clear violation of the NAFTA agreement.”

The NAFTA challenge, levelled at a major environmental policy, is fuel for critics of trade deals who are now attacking Canada’s proposed investor-protection agreement with China, which would extend similar rights to Chinese investors in Canada.

“It contradicts everything the government has said about the China investment treaty, about it having no impact on the environment and there being no threats to non-discriminatory environmental measures,” said Stuart Trew, trade campaigner with the Council of Canadians.

BP Settles for $4.5 Billion in Damages, Plus Criminal Charges Over 2010 Gulf Spill

November 19, 2012Energy and Resources, Oil&GasBP Disaster, Oil and gasCommon Sense Canadian

Read this story from the Associated Press on BP’s recent settlement for damages relating to its 2010 disaster in the Gulf of Mexico and related criminal charges. (Nov. 15, 2012)

NEW ORLEANS — A day of reckoning arrived for BP on Thursday as the oil giant agreed to plead guilty to a raft of criminal charges and pay a record $4.5 billion in a settlement with the government over the deadly 2010 disaster in the Gulf of Mexico. Three BP employees were also charged, two of them with manslaughter.

The settlement and the indictments came 2½ years after the drilling-rig explosion that killed 11 workers and set off the biggest offshore oil spill in U.S. history.

The settlement includes nearly $1.3 billion in fines — the biggest criminal penalty in U.S. history — along with payments to entities inside and outside government. As part of the deal, the BP will plead guilty to charges related to the deaths of the 11 workers and to lying to Congress.

“We believe this resolution is in the best interest of BP and its shareholders,” said Carl-Henric Svanberg, BP chairman. “It removes two significant legal risks and allows us to vigorously defend the company against the remaining civil claims.”

Also, BP rig workers Robert Kaluza and Donald Vidrine were indicted on federal charges of manslaughter and involuntary manslaughters, accused of repeatedly disregarding abnormal high-pressure readings that should have been glaring indications of trouble just before the blowout.

In addition, David Rainey, BP’s vice president of exploration for the Gulf of Mexico at the time, was indicted on charges of obstruction of Congress and making false statements. Prosecutors said he withheld information from Congress that indicated the amount of oil spewing from the blown-out well was greater than he let on.

Rainey’s lawyers said the former executive did “absolutely nothing wrong.” And attorneys for the two rig workers accused the Justice Department of making scapegoats out of them.

“Bob was not an executive or high-level BP official. He was a dedicated rig worker who mourns his fallen co-workers every day,” Kaluza attorneys Shaun Clarke and David Gerger said in a statement. “No one should take any satisfaction in this indictment of an innocent man. This is not justice.”

The settlement, which is subject to approval by a federal judge, includes payments of nearly $2.4 billion to the National Fish and Wildlife Foundation, $350 million to the National Academy of Sciences and about $500 million to the Securities and Exchange Commission. The SEC accused BP of misleading investors by lowballing the amount of crude spewing from the well.

“This marks the largest single criminal fine and the largest total criminal resolution in the history of the United States,” Attorney General Eric Holder said at a news conference in New Orleans. He said much of the money will be used to restore the Gulf.

Fort Nelson First Nation Pushes for Shale Gas Water Licence Reform

November 19, 2012Canada, Energy and Resources, Fracking, Oil&Gas, Politics, WATER, Water and Hydrocarbons, Western Canadafracking, Oil and gas, Politics, Water and EnergyCommon Sense Canadian

Read this story by Mark Hume in the Globe and Mail on Fort Nelson First Nation’s concerns about long-term water withdrawal licence applications for shale gas development in their territory in northeast BC. (Nov. 13, 2012)

Kanute Loe, an elder with a small native band in northeast British Columbia, measures the impact of the gas industry on the environment by looking at the water levels dropping in the streams and rivers he fishes.

“I spend a lot of my time in the bush. I travel the rivers … there’s creeks that there’s no water coming out of,” he said Tuesday.

“All of a sudden we’re having trouble catching fish … Our rivers are getting harder to navigate … it’s almost like somebody drilled a hole in the bottom of the bathtub,” Mr. Loe said in Vancouver at a news conference to express aboriginal concerns about increasing water extraction by industry.

Sharleen Wildeman, chief of the Fort Nelson First Nation, said her band has grown alarmed at the growing needs of the gas industry, which draws water from streams, lakes and rivers. The water is mixed with sand and chemicals in a slurry that is injected deep under ground. The process, known as hydraulic fracturing or fracking, breaks up shale structures and releases gas deposits.

Ms. Wildeman, whose 800-member band is located near the booming Horn River gas fields, said industry in that area has 20 long-term water licence applications before the B.C. government. If those licences are approved, she said, it would authorize industry to withdraw “tens of billions of litres of water annually” for up to 40 years, for use in fracking operations.

“We are extremely concerned about a massive giveaway of water from our rivers and lakes, without any credible process identifying what the long-term impacts will be,” she said.

Ms. Wildeman is upset with a government consultation process “that has stalled,” and she said the band is demanding five conditions be met before any new water licences are approved.

She said the band wants baseline environmental studies done before licences are issued; multi-year development plans filed in advance to identify proposed water sources, gas-well sites, roads and camps; environmental plans that cap water withdrawals at ecologically acceptable levels; protection of culturally significant land and water resources, and an agreement that environmental impact monitoring and enforcement will be done by an independent body.

“Failure to embrace these fundamental reforms will lead to increasing yet avoidable conflict,” Ms. Wildeman said.

Unprecedented Internal Access to DFO for Enbridge

November 19, 2012Energy and Resources, Oil&Gas, Pipelines and SupertankersBC Oil Pipelines and Supertankers, Enbridge, Oil and gasCommon Sense Canadian

Read this story from the Vancouver Sun on Enbridge’s unprecedented access to the Departmen tof Fisheries and Oceans, including their own dedicated internal staff dedicated to the company’s project. (Nov. 10, 2012)

Enbridge Inc.’s proposed Northern Gateway pipeline project is getting special attention from the federal Fisheries department, according to an internal email obtained by The Vancouver Sun.

In what critics call an unprecedented step, the department has listed a “Northern Gateway Liaison” at a top level of its organizational chart, under a reorganization prompted by the 2012 budget’s sweeping Fisheries Act amendments.

The position will report directly to the executive director of the National Ecosystems Management Branch at the department’s headquarters.

“This suggests an unprecedented level of access and engagement for a specific project,” said Green party leader Elizabeth May, who in the 1980s was a senior adviser to a federal environment minister.

“This is the reality of a government that has told the bureaucracy, ‘be prepared to make sure this project goes through.’ ” B.C. NDP MP Fin Donnelly, his party’s deputy fisheries critic, said he’s never heard of a company getting such special treatment.

“This clearly exposes the Harper Conservative oil pipeline agenda. They are putting the oil industry ahead of fishing, tourism and all other industries.”