EDMONTON- Plains Midstream Canada will undergo a full-scale audit of all its Alberta operations, the Alberta Energy Regulator (AER) announced Thursday.
The audit has been issued under a section of the Oil and Gas Conservation Act, in response to the company’s failure to follow a number of regulatory requirements, AER said.
“Plains Midstream Canada has failed to follow rules that are in place to ensure energy development in Alberta takes place in a safe and responsible manner,” said Jim Ellis, CEO of AER. “All of Plains Midstream Canada’s operations will be subject to additional regulatory scrutiny until we are satisfied it can operate in compliance with AER requirements.”
AER says the audit will include a review of Plains’ operations regarding emergency planning and response, pipeline integrity management programs, risk assessment and mitigation, communications and stakeholder relations, and regulatory reporting and progress in connection with action plans required in response to enforcement.
The audit comes less than a month after Plains Midstream responded to a condensate release on its Kemp pipeline system, about 90 kilometres northwest of Manning, AB. The spill involved natural gas liquids and by-products of processed natural gas. Preliminary estimates from Plains Midstream suggested approximately 950 barrels were released over an area about 1.5 hectares.
“This action seriously restricts the ability of Plains Midstream Canada to obtain further approvals for operations in Alberta,” Ellis explained. “Until the company can demonstrate that it can operate within Alberta’s rules and requirements, every single interaction with the Alberta Energy Regulator will be subject to extra scrutiny while we conduct a full audit of its operations.”
All of Plains’ applications will require CEO approval by AER. Officials say Plains Midstream Canada has received 19 high and low risk deficiencies and noncompliances since January 1, 2011.