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Canada Moves to Plug Oil Spill Gaps With Gateway Looming

An oil barge sailing into Chatham Sound near the Canadian port of Prince Rupert, 30 miles south of Alaska, runs aground and spills heavy oil into the Pacific Ocean.

The tide begins to move a crude slick along a migration route for killer whales. Canadian response teams struggle to deploy enough resources to contain the spill of 18,325 barrels. The U.S. Coast Guard is called in. After 16 hours, the oil has spread north.

This incident hasn’t actually occurred -- it’s a scenario presented in documents obtained by Bloomberg News from the nation’s transport department under access-to-information law. Shippers in Canada are legally required to be prepared for a spill four times as large.

Yet it could take at least 72 hours to respond to a spill that big in places such as Kitimat, British Columbia, end point of Enbridge Inc.’s proposed Northern Gateway pipeline, according to the documents.

Some of the equipment needed would be anchored more than 500 miles southeast, off the coast of Vancouver, adding to the response time, according to the documents.

The details of the scenario highlight the challenges Canada faces as it prepares for an increase of oil tankers off Canada’s Pacific coast to ferry heavy crude to Asia. A panel of tanker-safety experts appointed by the government last year estimated as many as 600 more tankers a year may ply the coastal region, which includes ecosystems similar to Alaska’s Prince William Sound, where the Exxon Valdez spilled 260,000 barrels of oil in 1989.

Safety Concerns

Prime Minister Stephen Harper’s government announced changes earlier this month designed to address the kinds of maritime safety concerns raised in the documents, which described the existing system as incoherent. The government’s first step calls for the development of a region-specific plan for four areas including the southern coast of British Columbia.

The government said it’s acting on recommendations made by the panel of tanker-safety experts who concluded the nation’s spill-response regime, created about 20 years ago, hasn’t adapted to the emergence of risk-based planning and alternative cleanup tools.

The new measures, released about a month before the cabinet is scheduled to decide on the C$6.5-billion ($6 billion) Northern Gateway proposal, would also make it easier for responders to use chemical dispersants, while making more money available to spill victims from an industry-financed fund. The changes, announced May 13, don’t explicitly require more on-the-water response resources.

The measures “are part of our government’s commitment to achieve a world class tanker safety system,” said Maryse Durette, a spokeswoman with Transport Canada, by e-mail.

Paper Capability

Gerald Graham, president of Worldocean Consulting Ltd., a Victoria, British Columbia-based company specializing in marine oil spill prevention, response and planning, said while new federal measures represent an improvement, they don’t fully address the risks.

“You can have all the capability on paper, but what does it mean on the water?” said Graham, whose company is advising an environmental group and First Nations on Northern Gateway, according to its website.

Six Hours

The Northern Gateway project won approval from a regulatory panel in December, subject to 209 conditions. One of those requires Enbridge to establish a response organization that could handle a spill more than three times the current legal limit. The company, which has said it is working to satisfy the conditions, would have to ensure recovery teams could be on the scene in as little as six hours.

Enbridge will have spill response equipment along the tanker route in the Douglas and Principe Channels, said Todd Nogier, a spokesman for the company in a phone interview. In addition, the company is having special tugboats built that will be tethered and lead tankers in and out of the channels.

A “world leading” maritime safety system is one of five demands British Columbia’s provincial government has put forward to secure its support for Gateway. Kinder Morgan Energy Partners LP has a separate proposal to expand the Trans Mountain pipeline to transport Alberta oil through Vancouver’s port.

Provincial Report

British Columbia last year commissioned its own spill response report, which highlighted a lack of response vessels suitable for open water and a shortage of rescue tugs in the north.

“It’s going to take a few years to get to a place where we’ve filled in the gaps,” Mary Polak, British Columbia’s environment minister, said in an interview. The federal government’s moves “certainly shows that they’re interested in achieving it. We are working with them to dive deeper into the detail.”

Under Canadian law, shippers are responsible for cleaning up offshore spills. The Canadian Coast Guard would oversee the industry response, while Transport Canada is the lead regulator.

In the event a company can’t or won’t respond, the Coast Guard would take over, using its resources and those of other agencies. That also raises concerns from pipeline opponents because Canada’s Auditor General said in a 2010 report the organization’s emergency response plan that was out of date.

Industry Group

The Coast Guard didn’t immediately provide answers to questions about its spill response capabilities.

Western Canada Marine Response Corp., based in British Columbia, is owned by Imperial Oil, the Canadian unit of Royal Dutch Shell Plc, Chevron Corp., Suncor Energy Inc. and Kinder Morgan’s Trans Mountain pipeline unit. It’s funded by over 2,000 members, including tanker companies, and is certified by the government to support cleanup operations.

The agency’s head recommended the government at least triple the industry’s capacity to respond to oil spills in British Columbia, according to the documents.

“There currently isn’t a national plan that brings everything together,” Kevin Gardner, president of the response corporation, told the tanker safety review panel at a June, 2013 meeting in Vancouver.

‘Risk-based Model’

The response agency would like to see a “risk-based model where the capacity is based on the risk for any given area,” spokesman Michael Lowry said in an e-mail this week. “Conversations are ongoing with government on how this new model will unfold.”

No oil tankers currently call at Kitimat or Prince Rupert, Lowry said. If Northern Gateway is approved, Kitimat would probably be deemed a “designated port” by the government, which would require quicker response times and more equipment nearby, he said.

Lowry said the agency typically responds more quickly than required by law. He declined to provide past response times for Prince Rupert, the area identified in the scenario, saying it hasn’t responded to many spills there.

Typically, even the best clean-up efforts result in between 10 percent and 15 percent recovery of spilled oil, according to Worldocean’s Graham. Aboriginal communities along the coast, which rely on the sea beds for food, “will continue to take any actions that are necessary to stop oil tankers,” the Coastal First Nations said in a May 13 statement.

To contact the reporters on this story: Andrew Mayeda in Ottawa at amayeda@bloomberg.net; Jeremy van Loon in Calgary at jvanloon@bloomberg.net

To contact the editors responsible for this story: Paul Badertscher at pbadertscher@bloomberg.net; David Scanlan at dscanlan@bloomberg.net Edward Greenspon

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