January 26, 2016 7:59 pm
Updated: January 26, 2016 9:53 pm

Pipeline audit reflects crisis point: Alberta policy expert

WATCH ABOVE: A new federal audit of the National Energy Board will likely have pipeline critics saying I told you so. Mia Sosiak Reports.


A federal audit released Tuesday says the National Energy Board (NEB) needs to do more follow-up on pipeline projects that it is monitoring.

For its part, the NEB said it had identified the “same areas for improvement” and has an action plan to address all of its findings by the end of 2016.

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“The NEB absolutely enforces and monitors all companies’ compliance with pipeline approval conditions and has complete confidence that compliance with pipeline approval conditions is appropriately and comprehensively evaluated by NEB staff and Board members,” Peter Watson, NEB chair and CEO said in a statement. “The audit makes recommendations regarding the documentation of this work and the NEB took immediate action after speaking to the CESD [Commissioner of the Environment and Sustainable Development] last year to begin rectifying this issue.”

READ MORE: NEB monitoring of pipeline safety still inadequate

Michal Moore, professor of energy economics at the University of Calgary School of Public Policy, says the report does two important things.

“The first one is that it highlights the absolute critical need we have for safe and well-performing infrastructure across the entire nation,” Moore said. “The second is the issue of whether or not we can adequately oversee and make sure the standards that we set for this infrastructure can be met. And it’s pretty clear that if we don’t put the money into it and if we don’t invest and constantly upkeep the infrastructure and make sure that it’s overseen, we’ll have errors and we’ll have spills and the public safety will be compromised.”

Moore believes that one of the biggest challenges is that rules need to be clearly defined and observed, but also enforced with the proper risk of punishment.

He also feels that agencies like the NEB need to be properly staffed. He points to the fact that hiring and retention are a challenge to every public agency, including the NEB.

Moore suggested action should be on behalf of all of Canada, and “not eight of 10 provinces or not a system of cities against the federal government.”

“This is going to have to solved by exerting  federal authority on those projects or those issues that are clearly benefiting Canada as a whole and should not be subject to what is known as the tyranny of the minority.”

Effects of social media on public policy

The report comes in the wake of heated debate over the proposed Energy East pipeline, which has largely been fought in the forum of public opinion.

Moore said these discussions need to move away from social media and move into forums that offer the opportunity for reasonable consideration with decisions based on expertise.

“Trying a case or trying as issue in social media where one person’s opinion instantly goes viral and becomes the opinion of (many) is not very useful as far as good public policy.”

Moore said this is reflective of a bigger issue.

“We’ve come to a crisis point: the issue of national infrastructure safety approval  or pipeline approval  is colliding against a distrust or a mistrust of government authority that we have to solve before we can move ahead.”

What’s next?

Moore is optimistic that the new chairman of the NEB will be responsive to the audit and expects that they will work with the new government to ensure they have the proper tools, including staffing, to ensure that the recommendations of the audit can be met.

Chris Bloomer, Canadian Energy Pipeline Association (CEPA) agrees with Moore that there needs to be more trust and confidence of the whole process around the industry.

When asked how you build that trust and confidence when battling comments and opinions like those of Montreal’s mayor Denis Coderre, Bloomer said that time and performance are key factors.

CEPA’s membership includes 98 per cent of all the pipelines’ capacity in Canada, and Bloomer pointed out that their goals align with public opinion—and with the NEB’s—when it comes to safety standards and expectations.

“Our goal is to have zero incidents on our mainline pipelines with our membership – which we achieved last year.”

Bloomer said the report is not about the industry’s performance, that in fact the pipeline is compliant. The report is more about the NEB closing off files, tracking things and other matters. His conclusion is that it’s not that the NEB is not doing those things, but that they are not doing them as efficiently as possible.

Government reaction

Catherine McKenna, Minister of Environment and Climate Change, thanked the federal Commissioner of the Environment and Sustainable Development for her work on the report in a Tuesday statement.

She said the government will ensure the recommendations are addressed.

“Our economy and the environment go hand in hand,” McKenna said. “This report is an objective and independent analysis of the efforts that the Government has made to protect the environment and outlines the importance of fostering sustainable development going forward.”

Reaction from the Opposition

Approval conditions for federally regulated oil and gas pipelines can cover a wide range of topics. Companies often agree to protect critical animal and plant habitats, provide economic opportunities for Aboriginal groups, and maintain safety and engineering standards for the pipeline itself before they get the go-ahead from the NEB.

It is the NEB’s job to ensure that companies are sticking to these conditions as they build and operate a pipeline. In about half of the cases the audit examined, that wasn’t happening.

Federal NDP MP Nathan Cullen told Global News, “the commissioner has uncovered a startling lack of monitoring by the National Energy Board for the pipelines that it approves. This report is indeed a call to action today.”

He said that many provinces have very strict systems in place and hold oil companies to an expectation to meet those expectations, but those regulations are meaningless “if less than half of the conditions that have been applied are actually even followed.”

“That is not a way to construct pipelines, that is not a way to build public confidence.”

With files from Monique Muise





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