VANCOUVER May 14 Canada unveiled new rules on
Wednesday to enhance pipeline safety and spill response, ahead
of the development of new projects proposed to carry crude from
Alberta's oil sands to coastal ports for export.
The new legislation will give Canada's energy regulator, the
National Energy Board (NEB), more power to enforce compliance on
safety and the authority to step in to lead spill response if a
company is unwilling or unable to do so.
Companies will also now be held liable, up to C$1 billion
($917 million), for all spills or incidents on their lines,
whether or not they are at-fault or negligent, putting the onus
on owners to ensure safe operations.
"This approach is called 'absolute liability' and it will
apply to all federally-regulated pipelines," said Natural
Resources Minister Greg Rickford at a press conference in
Companies found to be at-fault or negligent in an incident
will continue to face unlimited liability.
The new measures, which include a revamp of some legislation
dating back to the 1950s, build on a pledge last year to require
all companies operating major crude oil pipelines in Canada to
have C$1 billion on hand to fund spill clean ups.
In the case of a severe spill or incident, the government
said it will backstop the initial cost of clean-up and
remediation, with the NEB responsible for recovering those
additional funds from pipeline companies.
"The 'polluter pays' principle will be enshrined in law so
that it is clear Canadian taxpayers are not expected to foot the
bill in the event of a major oil spill," said Rickford.
The changes come a day after Canada moved to strengthen its
response plans for oil spills at sea and just weeks ahead of its
final ruling on Enbridge Inc's Northern Gateway
pipeline project, which is expected in mid-June.
The controversial pipeline, which would carry crude from the
oil sands hub of Edmonton, Alberta, to a deepwater port in
northern British Columbia, is one of three major domestic
projects currently on the books.
Kinder Morgan is planning to expand and twin its
Trans Mountain pipeline, which also carries oil to the Pacific
coast, and TransCanada Corp has proposed a line to
carry crude east to refineries in Quebec and New Brunswick.
The government has pushed hard to reassure Canadians that it
has policies in place to regulate those proposed projects, which
would allow Canadian oil producers, now dependant on U.S.
markets, to tap directly into more lucrative foreign markets.
But the projects are fiercely opposed by many
environmentalists and aboriginal groups, which fear spills and
the possibility that pipelines will hasten development of the
Alberta oil sands and exacerbate climate change.
In an effort to address some of those concerns, the
government pledged to involve aboriginal communities in pipeline
safety plans, and encourage more collaboration with industry.
Regulators are also carrying out more pipeline inspections
and audits each year, and will be able to fine companies that do
not comply with requirements up to C$100,000 per day.
There are about 73,000 kilometers (45,360 miles) of
federally-regulated pipeline in Canada, transporting more than
C$100 billion worth of oil, gas and petroleum products each
($1 = 1.0906 Canadian Dollars)
(Reporting by Julie Gordon; Editing by Bernard Orr)