Alberta report calls for stronger rules for pipelines

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A long-awaited report examining the safety of Alberta's pipeline network says the province needs to sharpen its requirements for the inspection of high-risk pipelines, and eliminate "gaps" in rules for stopping spills in lake and rivers.

The government-commissioned review said there should be clearer requirements for testing and inspection for pipelines in "high-risk" areas – such as those near roads and water bodies – and also a greater focus on public awareness of pipeline emergency events, more frequent audits of companies, and a more defined process for preventing oil spills into water bodies.

The authors noted that Alberta does not have specified minimum frequencies and requirements for inspection, or testing to confirm the integrity of production or gathering pipelines (smaller than the transmission pipelines that bring oil across provincial boundaries and international borders).

The report has ramifications beyond the 400,000 kilometres of provincially regulated oil and gas pipelines that crisscross Alberta. It comes as Alberta and Canada anxiously await a U.S. decision on the approval of TransCanada Corp.'s Keystone XL pipeline, which would be a major conduit for transporting oil sands crude to lucrative Gulf Coast markets.

But the 17 recommendations, released Friday after months of speculation about what they would contain, weren't meaty enough to satisfy critics of the provincial government and the Alberta Energy Regulator. Opponents said the report didn't address crucial issues, including whether the province is tough enough in enforcing its own laws against polluters, and the state of Alberta's pipeline infrastructure – some which has now been gathering oil and gas for decades.

"Sometimes here in Alberta, in my view, we're our own worst enemy," said Liberal energy critic Kent Hehr. "We haven't done enough on this file."

Opposition parties say a full review of the system is crucial at a time when Alberta companies are seeking approval for a number of major projects – including the Energy East and Keystone XL pipelines – and every action by the provincial regulator is under the microscope.

Alberta Energy Minister Ken Hughes agreed that the recommendations are incremental but said "this is one important step in improving the performance of the pipeline industry."

Mr. Hughes ordered the review of Alberta's pipeline system in July, 2012, following public outcry over a number of major domestic spills and just days after a damning report from U.S. authorities on Enbridge's massive 2010 Kalamazoo Spill in Michigan.

"There's no question that our reputation is on the line every single day," he said Friday.

Alberta's energy regulator was harshly criticized after the 2011 rupture of Plains Midstream Canada's Rainbow pipeline, which spilled 28,000 barrels of oil into a northern Alberta muskeg. An investigation found the company appeared to place a higher priority on keeping the pipeline running than on any concerns about a leak, but the energy regulator stopped short of issuing any new penalties, saying a 122-day shutdown following the incident was punishment enough.

Mr. Hughes said Alberta's new energy regulator – which replaced the Energy Resources Conservation Board earlier this year – has already moved to give the public more information about spills. Under the auspices of the new regulator, fines for polluters have also been increased to up to $500,000.

"It's a very strong message sent to the pipeline industry," said Mr. Hughes, who will meet with other Canadian energy ministers in Yellowknife this weekend and share the findings from the report, which was written by Group 10 Engineering and reviewed by the Alberta Energy Regulator.

The minister has now called for a 45-day comment period on the report.