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Canada to Boost Pipeline Safety as Northern Gateway Ruling Nears

May 14 (Bloomberg) -- Canada is increasing the liability of pipeline operators for spills and giving regulators more power to enforce safety measures.

Companies that operate major pipelines will be required to have access to C$1 billion ($919 million) in funds for the cleanup of spills. The government plans to introduce legislation that will hold operators liable for that amount even if they weren’t at fault or negligent, Natural Resources Minister Greg Rickford said today in a speech in Vancouver. When operators are at fault, their potential liability will be unlimited.

“Even in the most extreme and unlikely circumstances, the government will ensure that the environment, landowners and taxpayers are protected and the polluter pays,” Rickford said in the prepared text of the speech.

The National Energy Board, which regulates pipelines, will gain powers to advise operators on safety, including what materials to use and how to respond to emergencies. Regulators will also have the authority to take over cleanup operations if a company is unable or unwilling to do so. Rickford also said the government will “better integrate” input from aboriginal groups into pipeline safety.

Prime Minister Stephen Harper is trying to bolster public support for new pipelines as his government prepares to rule on Enbridge Inc.’s Northern Gateway project, which would carry crude from the nation’s oil sands to the Pacific coast. While crude producers say the route is needed to ease bottlenecks that are depressing the price of Canadian heavy oil, environmentalists and aboriginal groups have raised concerns about the risk of spills.

Spill Prevention

Harper’s cabinet has until June 17 to decide on the route after a regulatory panel recommended approval in December, subject to 209 conditions.

British Columbia Premier Christy Clark has said her province will only back the pipeline if its satisfies five conditions, including “world-leading” spill prevention and response systems on land or water.

Transport Minister Lisa Raitt said yesterday the government will beef up oversight of oil-tanker traffic by drafting safety plans in four heavily used zones, including southern B.C.

To contact the reporter on this story: Andrew Mayeda in Ottawa at amayeda@bloomberg.net

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

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