Imperial Oil CEO apologizes over tainted-water leak

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The head of Imperial Oil Resources Ltd. IMO-T says he’s “profoundly apologetic” for two incidents at the company’s Kearl oil sands mine that have released an unknown quantity of tailings-tainted water into the environment, including a leak that has continued for almost a year.

Water tainted with dangerous levels of arsenic, dissolved metals and hydrocarbons has been seeping off the Kearl project onto Crown lands north of Fort McMurray, Alta., since May, including next to a small fish-bearing lake and tributaries to the Firebag and Muskeg rivers. The federal government, local Indigenous communities and the public at large were not informed of the leak until months afterward, when a separate incident at Kearl spilled 5.3 million litres of waste water.

“As CEO of the company, I just want to share with you … how apologetic we are as a company that those two incidents have happened,” Brad Corson said at the company’s Investor Day on Wednesday.

Imperial Oil followed reporting rules, he said, “but with our very important neighbours – the Indigenous communities – we should have been providing regular updates. I feel very bad about that and I’m profoundly apologetic.”

Mr. Corson said the company is “providing all the resources that are necessary” to address the operational failures that led to the incidents and make sure they don’t happen again.

The Alberta Energy Regulator slapped Imperial Oil with an environmental protection order and a non-compliance order over the leak and spill – the first such notices against Kearl since it started operations.

“One is one too many, and we’re committed to make sure it doesn’t happen again,” Mr. Corson said.

Simon Younger, Imperial Oil’s senior vice-president of upstream operations, said Wednesday the cleanup from the 5.3-million-litre spill is complete, but the company is awaiting a final nod from the AER to certify the work.

“I want to be crystal clear with it: It should not have happened. That was an operational and a process control, process measurement failure that we now fully understand and have fully mitigated, not just at this pond but at all of our ponds,” he said.

“We have already done everything we need to do to ensure that that never occurs again.”

As for the leaking, Mr. Younger said the complex nature of the problem meant the company had to investigate it for months, including by drilling monitoring wells and completing a geochemistry study.

“We did not want to go back to our neighbouring communities until we fully understood the issue and had a mitigation plan. And that was a mistake,” he said.

He said pumps are now in place at all four of the leak locations, and work to fix the issue will be completed in May.

Seepage was always anticipated from the tailings ponds, he said, and an interception system was set at a deep groundwater level. But the leaks are at far shallower levels than the company expected, so it is expanding the interception system with a series of trenches and wells.

As the company fixes the problems with its tailings ponds, it’s also working to drive up output from Kearl to 300,000 barrels a day “as soon as possible,” Mr. Corson said Wednesday.

The second half of 2022 saw Kearl hit its largest-ever production, and the site is on track to produce 280,000 barrels a day in 2024.

The company also experienced record earnings and cash flow from operations last year, at $7.3-billion and $10.5-billion respectively, benefiting from strong commodity prices.

Even as it increases production, Imperial Oil is looking to reduce greenhouse gas emissions across its operations to net zero by 2050.

Sherri Evers, vice-president of commercial and corporate development, said Wednesday the company is on track to reach its interim 2030 goal to reduce the emissions intensity of oil sands operations by 30 per cent compared with 2016 levels.

Imperial Oil’s emission-reduction goals are “backed by very detailed strategies and roadmaps,” Ms. Evers said, including leveraging carbon capture and storage technology, using hydrogen in operations and renewable diesel in the mine truck fleet at Kearl to reduce emissions by as much as 70 per cent compared to conventional diesel.

Imperial Oil is also pursuing a project aimed at extracting lithium from brine, and investing in a renewable diesel plant, which will make it Canada’s largest manufacturer of the fuel when it begins operations in 2025.