Major tar sands pipeline leak – lessons to learn, especially about regulators?

Tucked away in the business pages of Friday’s i newspaper was the following three-sentence piece: A major oil pipeline leak detected in the Canadian province of Alberta dates back to late June, the tar sands operator Nexen Energy has admitted. The company said about 5 million litres of bitumen, sand and produced water was spilt near its Long Lake oilsands site in a leak that has affected 16,000 sq metres, The pipeline was installed last year.

I guess you didn’t see the coverage on the BBC. I didn’t. There wasn’t any. The Canadian media had a few bits on it though. Most telling, in my eyes was this typical statement by a company executive, Ron Bailey: VIDEO

Let me develop his words for him. (What he says in quote marks; what he could/should have added after this):

No human impacts here immediately – but there probably will be in due course, most likely of the nasty health consequences variety.

We are deeply concerned – at the adverse publicity and impact on profits.

We sincerely apologise – to our shareholders.

We will take every step that we see reasonable … to respond to this – at least possible cost and to get back to full operations as quickly as possible so that we can carry on as if nothing really happened.

“… the regulators help us decide what to do – as we sure ain’t going to do more than the absolute minimum they will let us get away with.

To be fair to poor old Ron, clearly a bit embarrassed at being thrust before the cameras, these are exactly the same old platitudes trotted out after every oil & gas industry foul up. It might just as easily have been Mark Miller or Francis Egan talking about the induced earthquakes in Lancashire, mightn’t it? (Check this 38 degrees video out)

Nexen’s CEO is Fang Zhi – yes Nexen is a Chinese company – and he utters similar meaningless platitudes as a PR gambit here: ARTICLE/VIDEO

Setting aside the the issues about foreign ownership of companies, especially in this sector, I think the biggest message from all this is about the role of regulators.

Alberta’s energy and environment ministers say they’re troubled by a huge pipeline spill in the oilsands region, but they have confidence the provincial regulator will get to the bottom of what went wrong. Fair enough. But getting to the bottom of what went wrong is surely just the first step of what should be expected from them, is it not?

For years I laboured under the illusion that regulators were there to stop things going wrong. I thought they were there to determine what could go wrong and ensure that, as far as humanly possible, they would not go wrong. I believe far too many people labour under similar illusions to this day.

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Report from the OGP (International Oil & Gas Producers)

As the never-ending catalogue of calamities in the oil & gas industries (data 1970-2007) continue to mount up unabated, it is clear that regulation and regulators are inadequate. Why is this?

One obvious answer, especially in the current political climate of austerity, is that their resources to do the job properly are being relentlessly cut. Doing the job properly involves a hell of a lot of costly research and and a lot of human resources in monitoring effectiveness and trying to enforce the regulations. It is very expensive.

The truth is, they never have been funded adequately to do the job as well as they themselves would like, let alone as well as environmentalists would aspire to. Thus we are left with the unavoidable conclusion, supported by the collective experience and observations of years of environmental activism, that the whole regulatory regime is little more than a PR initiative on behalf of the government agencies that are pursuing their economic growth agenda. This is as true in Canada, it would appear, as it is here in theUK.

It is the way of the neoliberal capitalists calling the shots. And if you don’t believe this – just wait and see what TTIP delivers!!!

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