Canada Raises Scrutiny of High-Traffic Tanker Ship Routes

Canada is beefing up oversight of oil-tanker traffic by drafting new safety plans in four heavily-used zones and increasing how much companies would have to contribute toward cleaning up spills.

Transport Minister Lisa Raitt unveiled the measures today in Saint John, New Brunswick, home of Irving Oil Corp.’s refinery, the nation’s largest. The four zones that will receive new “area response planning and resources” are southern British Columbia, Saint John and the Bay of Fundy, Port Hawkesbury in Nova Scotia and Quebec’s Gulf of St. Lawrence, according to the text of Raitt’s speech.

Raitt didn’t say if the British Columbia plan will affect Kinder Morgan Energy Partners LP’s Trans Mountain pipeline expansion or Enbridge Inc.’s proposed Northern Gateway line through the province. Canada will “lift legal barriers on the use of dispersants and other cleanup alternatives” to assist cleaning up spills, when the use of those measures will be “of net environmental benefit,” Raitt said.

“There is widespread agreement that we need to tailor response plans and cleanup resources for spills based on the geography of a region, its tanker traffic, and its environmental conditions,” Raitt said, according to the prepared text of her speech.

The Northern Gateway pipeline has been opposed by local aboriginals in part because of concern about environmental risks, and Raitt said the government will work with those groups to incorporate their views into protection plans. Prime Minister Stephen Harper’s government is expected to decide on the C$6.5 billion ($6 billion) Gateway project by mid-June.

Corporate Funds

New legislation will also boost the amount companies would have to pay out of the Ship-Source Oil Pollution Fund from today’s cap of C$161 million to the full total of about C$400 million now stored in the account, Raitt said. That would raise the amount of corporate money available to cover any spill cleanup costs to C$1.6 billion, she said.

“In the unlikely event that all domestic and international pollution funds have been exhausted, the Government of Canada will ensure compensation is provided to eligible claimants and recover these costs from industry through a levy,” Raitt said, without elaborating.

To contact the reporter on this story: Greg Quinn in Ottawa at gquinn1@bloomberg.net

To contact the editors responsible for this story: Paul Badertscher at pbadertscher@bloomberg.net Chris Fournier

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