Bureaucrats told Stephen Harper’s government environmental reforms would be ‘very controversial,’ records reveal

OTTAWA – Federal bureaucrats told the Harper government before it overhauled environmental protection laws last year that its reforms would be “very controversial,” reveal newly released internal records.

The briefing notes, marked “secret” but released to Postmedia News through access-to-information legislation, suggested that the government could work together with the oil and gas industry to promote the reforms, which are now the target of the Idle No More protests that accuse the government of neglecting the rights of First Nations.

The records include a list of suggested messages for Environment Minister Peter Kent’s parliamentary secretary, Michelle Rempel, to use in a Feb. 2, 2012 meeting with oilsands company Canadian Natural Resources Ltd. (CNRL), in order to gain its support. At that time, a parliamentary committee was also reviewing environmental laws in order to make recommendations to the government.

“Resource development is certainly among the major industrial sectors that are top-of-mind as we consider the modernization of our regulatory system,” Rempel was asked to say during the meeting with Bill Clapperton, vice-president of stakeholder and environmental affairs with CNRL, according to the records.

“The reforms, when introduced, may be very controversial. I hope we can count on your support.”

Kent said Tuesday people will eventually see evidence that the changes will improve environmental protection.

“Human nature does not easily accommodate any change or the prospect of change,” Kent told Postmedia News. “When change does happen, there are often very legitimate concerns that develop until in the fullness of time, the changes that are made, fulfil the commitment and the promise of those who made the changes.”

CNRL declined comment.

NDP deputy leader and environment critic Megan Leslie said she was angry after reviewing the briefing material. She said it suggests Rempel was giving a company privileged information about a review done by a parliamentary committee before its report was tabled in the House of Commons.

Leslie said it also shows that Idle No More protesters are correct about highlighting inadequate consultations with First Nations. “The final (parliamentary) report basically said exactly what the Conservatives wanted it to say in preparation for the total gutting of the Canadian Environmental Assessment Act.”

The records are the latest in a series of internal documents demonstrating the government’s co-operation with industry in delivering the reforms that eliminated environmental reviews for nearly 3,000 projects last summer.

Liberal environment critic Kirsty Duncan also highlighted recent Idle No More protests, adding that she was troubled to learn Rempel was “trolling” for oil industry support before the government introduced its reforms, while environmental and First Nations groups were left in the dark.

“I don’t think it comes as a surprise,” Duncan said. “The government has an agenda to gut environmental assessment and fast-track development.”

The revelations in the latest documents coincided with questions Tuesday from Green Party Leader Elizabeth May, who bluntly asked whether the government was considering merging Environment Canada with Natural Resources Canada. The claim was immediately dismissed by Prime Minister Stephen Harper in the House of Commons, and again later by Kent, who noted that his department had important responsibilities and laws to oversee.

“Environment Canada is going nowhere,” Kent said.

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Oil sands toxins growing rapidly

Canada’s oil sands mining operations produce vast and fast-growing quantities of deadly substances, including mercury, heavy metals and arsenic, new data released by Environment Canada shows.

The information on pollutants sheds new light on the environmental toll exacted by Canada’s bid to extract oil from bitumen, showing in stark relief how many nasty substances are being laid on the northern Alberta landscape in the process – and how quickly those are growing.

In the past four years, the volume of arsenic and lead produced and deposited in tailings ponds by the country’s bitumen mines – run by Syncrude Canada Ltd., Suncor Energy Inc., Canadian Natural Resources Ltd. and Royal Dutch Shell PLC – has increased by 26 per cent. Quantities of some other substances have increased at even faster rates.

The companies also released huge amounts of pollutants into the air last year, including 70,658 tonnes of volatile organic compounds, which can damage the function of human organs and nervous systems, and 111,661 tonnes of sulphur dioxide, a key contributor to acid rain.

The numbers are contained in Environment Canada’s national pollutant release inventory, which details the dangerous compounds generated by industrial Canada. New numbers published this weekend track 85 mining facilities that generate tailings and waste rock. Of those, the oil sands produce just under 50,000 tonnes of reportable substances in tailings, or 10 per cent of the total.

Metal ore mines are by far the worst, with 54 per cent, followed by iron ore mines at 25 per cent. Other mines – which include diamond, asbestos and phosphate – generate 5 per cent.

Oil sands operations, however, produced the overwhelming bulk of several dangerous substances: for example, bitumen mines generated nearly all of the Canadian total of acenaphthene, one of a bevy of polycyclic aromatic hydrocarbons released around Fort McMurray. Such substances can cause tumours of the lung, skin and bladder, and some are carcinogens. And their volumes are growing in north-eastern Alberta: companies generated 42 per cent more acenaphthene in 2009 than they did in 2006.

Last year, oil sands mines also produced 322 tonnes of arsenic, 651 tonnes of lead and measurable volumes of mercury, chromium, vanadium, hydrogen sulphide and cadmium.

The numbers “are just ridiculously huge,” said Justin Duncan, a staff lawyer with Ecojustice who helped prosecute the 2007 court case that forced Environment Canada to release the data.

“You’re talking hundreds of thousands of kilograms of heavy metals going into some of these tailings ponds. If one of these things bursts, it’s a catastrophic risk to the Athabasca River system.”

The Environment Canada data do not include naphthenic acids, which researchers consider the most toxic component of the effluent brew.

Yet scientists say simply knowing how much pollution is generated by the oil sands does little to show how toxic the mines’ tailings are. What’s needed is the concentration of the substances – a figure Environment Canada does not provide.

John Giesy, a professor at the University of Saskatchewan and the Canada Research Chair in Environmental Toxicology, points to a potato as an example: a grocery store spud contains 600 to 700 chemicals, some of them carcinogens, but they’re in such small quantities that they’re not harmful.

“Everything is toxic. It’s the concentration that makes the poison,” he said.

The actual toxicity of oil sands effluent remains a nascent field of scientific inquiry. But some research that has been carried out by the University of Saskatchewan has found some surprising results. Some older tailings ponds, for instance, are capable of sustaining fish life. And virtually all tailings ponds can sustain invertebrate life; Julie Anderson, a PhD student, has discovered that mosquito-like midges will survive, but not grow, in tailings water.

To allow midges to grow, oil sands wastewater needs to be diluted roughly as much as the effluent from some sewage treatment plants.

And industry says it is working to improve. Travis Davies, spokesman for the Canadian Association of Petroleum Producers, said companies will spend $1-billion in the next year to reduce tailings, “so you have less of these in the environment for any extended period of time.”

Environmentalists, however, said the Environment Canada data show the full slate of dangerous compounds emitted by the oil sands and will serve as an important industry barometer.

“More information coming to light is essential, I think, to eventually have a meaningful discussion about the unacceptable risk of these tailings ponds,” said Simon Dyer, oil sands program director for the Pembina Institute.

Suncor leads attack over Kinder Morgan pipeline prices

A corporate spat has erupted in the race to carry oil to the British Columbia coast, as energy producers accuse a U.S. pipeline company of trying to charge exorbitant prices to ship crude.

The attack is being led by Suncor Energy Inc., the country’s largest oil company, and is aimed at the Canadian unit of Houston-based Kinder Morgan Inc., which is seeking approval for a $5.4-billion expansion of its Trans Mountain pipeline. The Kinder project would allow for the shipment of another 890,000 barrels a day between Edmonton and Burnaby, B.C., where it connects to a dock that stands to be an important outlet for Canadian oil to find new buyers in California and Asia.


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Major oil companies are eager to ship to the coast to take advantage of higher prices on world markets than they can get by shipping to refineries in the U.S. Midwest and Southeast. But some of them are balking at the price – known in the industry as tolls – which they argue would allow Kinder Morgan to earn returns on the project that are far above its historical 7 to 12 per cent.

“The average projected [return on equity] would be approximately 28.3 per cent,” wrote Greg Matwichuk, an Alberta chartered accountant who provided evidence on behalf of Suncor to the National Energy Board. That, he added, “is significantly greater than returns earned by other pipelines in Canada.”

The dispute about tolls, which is set to burst into greater view when a public hearing begins Feb. 13, is a window into the high-stakes game under way for Canadian companies fighting to get oil to Pacific Coast as quickly as possible.

Building new outlets has taken on major new importance in recent months, with existing export pipelines effectively full and Canadian heavy oil selling at a discount as high as $42 (U.S.) a barrel to the North American benchmark, West Texas intermediate.

But oil companies’ pain stands to be a gain for pipeline companies. Once boring utilities, pipeline firms in Canada have in recent years moved farther away from a model that largely assured them returns, albeit modest ones, irrespective of operating costs or how much oil they pump. Today, they are seeking higher returns while at the same time accepting more risk, in the belief that the fast-rising oil sands will provide plenty of crude for years to come.

Kinder Morgan says that it is not looking for anything like a 28.3 per cent return on Trans Mountain – and that it is taking additional risk to build the pipeline.

Instead of passing along the cost of power or some construction overruns to customers, for example, Kinder Morgan is proposing to largely shoulder any rise in those costs – save several exceptions, including changes in the cost of steel or large first nations financial considerations.

The company also points out, in documents before the National Energy Board, that the intense public scrutiny of pipelines today could impose additional safety measures and development delays. “These risks and resulting costs are not immaterial,” the company says. In a statement, spokesman Andy Galarnyk added: “The return is not excessive. … The toll principles have been agreed to by 13 very large sophisticated parties (including BP PLC, Imperial Oil Ltd.) representing 708,000 b/d – which in itself is sufficient.”

In Canada, pipeline tolls are typically negotiated with oil companies then reviewed by the National Energy Board. Total SA joined Suncor in questioning the proposed tolls. Most other companies signed contracts that obligated then to support Kinder Morgan.

There is no doubt, however, that Kinder Morgan is looking for solid Trans Mountain profits. In the documents, it says it targets unlevered internal rates of return of 12 to 15 per cent. But those returns would rise substantially with the borrowing typical of pipeline projects. They are also well above the 9 to 11 per cent levered returns typical in the Canadian pipeline industry. U.S. profits have, however, historically been higher, and Houston-based Kinder Morgan warns it won’t build the expansion if it can’t meet targets.

Suncor, in response, say it is “critical” for the NEB to make sure there is a “just and reasonable” cost to shipping oil to the West Coast at a time when companies are desperate for new pipelines. The company says it is “disturbed” by how pipeline firms are “exerting market power that flows from the infrastructure shortage and need and necessity of take away capacity.”

Yet Suncor – through two subsidiaries – has already signed long-term contracts to ship oil through the expanded Trans Mountain system, whose tolls pale in comparison to the potential gains of accessing Pacific markets. Suncor has projected Trans Mountain tolls of between $4.15 and $5.48 (Canadian) a barrel. On Tuesday, the price difference between Canadian heavy oil and Maya, an international heavy blend, stood at just over $40 (U.S.).

The startling size of the price gap is weighing heavily on the province of Alberta, which through the National Energy Board posed Suncor a pointed question. It asked the company “to provide an estimate of the impact on Canadian oil producers if Trans Mountain decided not to proceed with the expansion.”

Confirmation Of Climate Hawk Kerry As Secretary Of State May Doom Dirty Keystone XL Pipeline

Joe Romm

The Senate confirmed John Kerry as a Secretary of State by a vote of 94 to 3. I believe this is a turning point in the fight to stop the Keystone XL pipeline.

Once again, I do not think that a man who had dedicated his Senate career to fighting catastrophic climate change would start his term as Secretary approving the expansion of one of the dirtiest sources of fossil fuels in the world.

Keystone is a gateway to a huge pool of carbon-intensive fuel most of which must be left in the ground — along with most of the world’s coal and unconventional oil and gas – if humanity is to avoid multiple devastating impacts that may be beyond adaptation.

How precisely could Kerry lobby other countries to join an international climate treaty — perhaps his primary goal as Secretary — after enabling the accelerated exploitation of the tar sands? Yes, you can say that the United States already has no standing to cajole other countries into climate commitments when we’ve expanded oil and gas drilling as well as coal exports. But none of those were Kerry’s decision, whereas Keystone is.

Kerry starts as Secretary of State with a clean slate. But approving Keystone would be like dipping that slate into the dirtiest, stickiest tar imaginable — it could never be cleaned again. Certainly the three Senators from Big Oil who voted against him – Ted Cruz (R-TX), John Cornyn (R-TX), and James Inhofe (R-OK) — must think he isn’t going to be the friend to Texas Tea.

Here is what Kerry said on the subject of climate change in his confirmation hearing:

The solution to climate change is energy policy. And, the opportunities of energy policy so vastly outweigh the downsides that you’re expressing concerns about … You want to do business and do it well in America, you have to get into the energy race … I would respectfully say to you that climate change is not something to be feared in response to—the steps to respond to—it’s to be feared if we don’t … I will be a passionate advocate on this not based on ideology but based on facts and science, and I hope to sit with all of you and convince you that this $6 trillion market is worth millions of American jobs and we better go after it.

[see video clip]

I simply don’t think this climate hawk will recommend that Keystone be approved.
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James Hansen slams Keystone: “Exploitation of tar sands would make it implausible to stabilize climate and avoid disastrous global climate impacts.”

State waters might see more oil-tanker traffic

The Seattle Times

Originally published Saturday, January 26, 2013 at 8:00 PM

State waters might see more oil-tanker traffic

Oil-tanker traffic is expected to increase in Washington waters under an expansion proposal by a Canadian pipeline company.

By Lynda V. Mapes Seattle Times staff reporter

Oil-tanker traffic in Washington waters is set to increase under a proposal floated by Canadian energy giant Kinder Morgan.

The company earlier this month announced that so much interest was expressed by potential customers in long-term purchase contracts for Canadian tar-sands oil that it is bumping up the proposed expansion of its Trans Mountain Pipeline announced last year.

The company said this month it wants to increase its pipeline capacity from 750,000 barrels per day announced last April to 890,000 barrels per day.

That translates to a big jump from its current capacity of 300,000 barrels per day, and an increase in tankers transiting the Salish Sea from five a month to up to 34 a month, if the expansion is approved, said Michael Davies, director of marine development for the Trans Mountain Expansion Project.

The preponderance of the tanker traffic would travel through the Strait of Juan de Fuca on the northern border of the Olympic Peninsula, proceed between the San Juan and Gulf islands, and enter Vancouver Harbor.

The company will be developing its expansion proposal to Canada’s National Energy Board over the coming months, with an eye to beginning operations by 2017, Davies said. The expansion will require twinning the company’s existing pipeline, and adding two more berths at its Vancouver-area Westridge Marine Terminal.

The increased tanker traffic would come on top of 450 to 480 more cargo ships per year traveling to the proposed Gateway Pacific Terminal near Bellingham, if a proposed bulk coal-shipping terminal is built.

Some see a need for caution, particularly if oil-tanker traffic escalates.

“This is one of those moments in history that will significantly increase the risk exposure of a catastrophic oil spill in Puget Sound, within a core area of the killer whale’s critical habitat,” said Fred Felleman, a Seattle resident who serves as an alternate on a steering committee engaged in a vessel- traffic risk-assessment analysis.

“You can’t just squeeze more traffic through the same waterway and expect everything to remain the same.”

The goal of the steering committee is to work with shipping interests and others to craft a common understanding of risks posed by vessel traffic and how to manage them, said Todd Hass, of the Puget Sound Partnership.

“Puget Sound has enjoyed a couple of decades without a major spill taking place, but we need to stay vigilant,” Hass said. “This is our best opportunity to look forward, anticipate changes before they are upon us, and make adjustments accordingly so that we reduce the chance that we will have a major catastrophic spill for the foreseeable future.”

Under the expansion, the number of tankers plying the Strait of Juan de Fuca would increase by more than 50 percent, to more than 1,000 a year, including 408 tankers shipping Kinder Morgan’s Trans Mountain Pipeline tar-sands oil, Davies said.

Chip Boothe, prevention section manager for the Washington Department of Ecology’s spill- prevention preparedness and response program, noted that while tanker traffic is scheduled to increase, it still would be a small portion of the approximately 5,000 to 6,000 transits a year of large commercial vessels coming into the region.

“We are not minimizing the potential for it to have an impact, but I am appreciating that we have a pretty robust marine-navigation safety system in this region,” Boothe said.

“Yes, there is a potential for increased traffic. Is that increase adequately managed in the system we already have in place, or does it need to be modified to assure we don’t increase risk? That is what we will be looking at.”

U.S. Sen. Maria Cantwell, D-Wash., in the 2012-13 appropriations bill for the U.S. Coast Guard, required a 180-day study to assess whether spill responses in place in the state would be adequate to address increased tanker traffic and tar-sands oil, which is different from Alaskan crude.

Davies said his company has never had a spill from a tanker at its dock since the Westridge terminal began operations in the 1950s.

Under the expansion, the company would be shipping the same types of oil it has since the mid-1980s, Davies said, in the same size ships.

“This is really nothing new to the pipeline, or the marine environment,” Davies said.