Industry officials and environmental expert appointed to province’s new energy regulator

By Sheila Pratt, Edmonton Journal June 12, 2013

EDMONTON – The new board overseeing the energy industry includes experts from the oil and gas, forestry and electricity industries, as well an internationally known environmental expert from Toronto with experience at the United Nations.

Three Calgarians are on the board: Cameron Bailey from the oilpatch; rancher David Chalack; and Sheila O’Brien, who has 30 years experience in the energy industry.

They will be joined by Edmonton resident Peter Flynn from the electricity sector, and Elizabeth Dowdeswell, a former undersecretary general of the environment for the UN and a former federal assistant deputy minister of environment.

Energy Minister Ken Hughes said in a news release he is pleased with the diversity of the board for the new Alberta Energy Regulator, which will take over from the decades-old Energy Resources Conservation Board next week with the goal of streamlining approval of applications for new oil, gas and coal projects.

The new regulator, which officially starts up June 17, will also take over responsibility for handing out environmental permits for new projects and enforcement of provincial environment laws. That job is now done by the environment department.

The new board will “ensure our province leads the country and the world in balancing resource growth and our strong environmental commitment,” said Hughes.

Board chairman Gerry Protti, also appointed by Hughes, is a founding member of the industry lobby group the Canadian Association of Petroleum Producers. CEO Jim Ellis is a former deputy minister in the environment and energy departments.

The new board also includes: small business owner Fred Estlin from Grande Prairie; and Andy Neigel from Athabasca, who has 30 years in the forestry industry and runs Boreal Management Group.

Rachel Notley, New Democratic environment critic, says the new EAR started off with a “serious credibility problem ” when Protti, an industry insider, was appointed as boss.

“The new board members have a lot of work to do to overcome that bad start,” said Notley, adding that putting environmental enforcement under the regulator is heading in the wrong direction.

The board appointed five people, four from Calgary and one from Banff, as full-time officers to hear arguments about projects that go to public hearings.

Brad McManus, currently acting chair of the ERCB, becomes chief hearing commissioner.

The hearing officers are Alex Bolton and Rob McManus, both former ERCB members, Christine Macken, currently a member of the province’s Environment Appeals Board, and Barbara McNeil, chair of the Banff Development Appeal Board.

Unlike the ERCB, where board members also doubled as hearing officers, the board of the AER will not preside over public hearings.

© Copyright (c) The Edmonton Journal
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Pipeline in northern Alberta leaks 9.5 million litres of industrial waste water

By The Canadian Press June 12, 2013

ZAMA CITY, Alta. – A pipeline operated by a Texas-based oil company has leaked 9.5 million litres of industrial waste water in northern Alberta.

The Energy Resources Conservation Board said the spill was first reported by Apache Canada Ltd. on June 1.

The pipeline breach is about 20 kilometres northeast of Zama City, a remote community near the Northwest Territories boundary.

“The affected area is undergoing cleanup, environmental monitoring, wildlife protection and remediation efforts and is currently estimated at 42 hectares,” the company said in a release Wednesday.

Apache said the nearby Zama River has not been affected by the leak, which has been plugged.

An Apache official declined to answer questions about the Zama spill.

Waste water that is extracted during oil and natural gas operations contains oil, gas, salt and other minerals.

Bob Curren of the resources conservation board said Alberta regulators didn’t learn how big the spill was until Tuesday.

“At the outset we were unaware that it was of this extent or volume,” Curren said from Calgary. “If we had known that up-front we would have made the announcement at that time.

“Once it was determined that the volumes were at this level we immediately moved to issue a news release.”

Greenpeace Canada said the area of the spill is an important wetland and habitat for animals and birds.

The environmental group calls the leak one of the largest of its type in Canadian history.

Keith Stewart, a Greenpeace spokesman, said this kind of waste water is full of toxic compounds.

“This is a massive spill of toxics into one of the most important wetlands in Canada, if not the world,” he said from Toronto. “The government shouldn’t be trying to hide these kinds of things.”

Greenpeace called on the Alberta government to release the findings of a pipeline safety review that was completed last year.

The province commissioned the report following spills from oil pipelines owned by Plains Midstream Canada in central Alberta last June and in April 2011 in north-central Alberta.

The Apache website says the corporation has oil and natural gas operations around the world including the Gulf Coast, the Gulf of Mexico, Egypt, the North Sea, Australia and Argentina with assets in 2011 worth US$52 billion.

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SHOCKER: NEB Bails Out Pipeline Monopoly

“Social License” for Pipelines? Or more land theft through public relations?

By Pipeline Observer Editors

There has been a lot of talk about “social license” and pipelines lately.

As in pipeline companies need to get one in order to get their projects approved and under way.

New Democrat Adrian Dix, the apparent next premier of British Columbia, says Enbridge “mishandled its efforts to move the Northern Gateway pipeline project ahead, triggering a backlash that the company is now unlikely to overcome.”

In other words, Enbridge did what it usually does and tried to bluster and bully its way through pristine, “publicly” owned BC wilderness.  And basically blew the public relations (PR) battle in the process. Click here to read more.

SHOCKER: NEB Bails Out Pipeline Monopoly. Landowners not the only ones hurt by “public” regulator.

By Pipeline Observer Editors

For at least the second time this year the National Energy Board (NEB) has done what it does best:  protect pipeline companies.

In its wisdom, the NEB, self-proclaimed “partner” of the pipeline industry and protector of the Canadian public, has propped up profits for shareholders of the Kinder Morgan Trans Mountain pipeline.

Kinder Morgan’s Trans Mountain, like all pipelines in Canada, is a franchise monopoly. That means it is protected by government from competition. Which means it can do what monopolies always do: abuse customers by jacking prices and cutting service. Click here to read the whole article.

What Do Pipeline Monopolies Do When They Want More Money? Get the public regulator to rubberstamp their rate hike requests, of course.

By Pipeline Observer Editors

Why do pipeline companies raise tolls whenever business is down or they have maintenance or other costs come up?

Because they can. They are monopolies, after all. And they can almost always count on “public” regulators as co-conspirators in their schemes to soak consumers.

We told you about TransCanada getting a guaranteed toll rate on its natural gas Mainline for the next five years because business was down.

And we told you how the National Energy Board (NEB) rubber stamped a monopoly price hike for Kinder Morgan’s Trans Mountain pipeline, because demand to move oil from Alberta to the Pacific is up. Click here to read more.

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AHS chairman faces ouster over refusal to withdraw executive bonuses – Uproar pits health superboard against province

By Jamie Komarnicki and Don Braid, Calgary Herald June 12, 2013 7:05 AM

A high-stakes showdown erupted Tuesday between the Redford government and Alberta Health Services board after directors refused to spike executive bonuses — and the spat is expected to trigger the departure of the superboard’s chair just nine months into the job.

While no formal confirmation of the move came Tuesday, several sources confirmed board chairman Stephen Lockwood is expected to leave the position Wednesday.

It’s unclear whether he’s poised to resign or Health Minister Fred Horne will force him to leave. Horne has scheduled a news conference Wednesday to comment on the situation.

One source said the entire AHS board could be ousted and it’s likely a new chair will be named Wednesday.

Reached late Tuesday, Lockwood said he would comment after today’s developments, “if any” occur.

At a board meeting, Lockwood said he planned to “continue to lead until I don’t think I can be effective, or until I’m asked to depart.”

Observers say the public blow-up between AHS and the Tory government raises new questions about whether political “games” are interfering with the health superboard’s ability to run the medical system.

Opposition critics blasted the board’s decision to shell out pay at risk that could hit $3.2 million to the 99 senior leaders for the fiscal year 2012-13, when other areas such as home care and palliative care are being pinched.

The dramatic situation unfolded rapidly Tuesday when Horne issued a statement just before the AHS board was to hold a news conference on its financial statements, which contain bonus pay information. The minister said the government “cannot and will not accept” the health authority’s decision to award pay at risk.

Horne said the bonuses can’t be awarded at a time when front-line staff such as doctors and teachers are taking wage freezes and directed AHS to rethink the decision.

However, in a board meeting organized on the fly Tuesday afternoon, the AHS directors ignored the directive and approved the organization’s financial statements, including pay at risk.

“Today is not about pay at risk,” Lockwood said. “It’s about an arm’s length relationship between government and Alberta Health Services.”

He noted the payments were first approved by the board in February, and will be eliminated moving forward.

“We’re talking about autonomy and integrity,” Lockwood added.

“It’s about the ability of AHS to operate independently from government.”

Lockwood, president of trucking company Mullen Group, was appointed in September 2012 to a three-year term as AHS board chair. He had previously said the organization will cut executive bonuses in the 2013-14 fiscal year, but it would be unreasonable to eliminate performance pay promised under the terms of the last contract.

Lockwood has in the past called on elected politicians to not interfere with the running of the health system.

However, Horne also announced Tuesday the government would launch a sweeping review of how boards and commissions are run, starting with AHS, to ensure Albertans “can have trust and confidence in the decisions made by boards and commissions.”

The AHS review will be complete by Sept. 1, 2013.

Lockwood shot back that the government already concluded a review of AHS governance last year and called a second report a waste of taxpayer money.

The board chair also openly questioned why the Redford-government directed AHS to hold back on the release of its annual report and financials.

“In my view, good governance and best practice would include releasing documents like that as soon as they’ve been approved by the board.”

A former AHS chief executive ousted amid a political fracas over ER waits in 2010 said the Alberta government is once again trying to meddle where it doesn’t belong.

“It’s obviously political interference,” said Stephen Duckett, whose contract was terminated in November 2010 by the AHS board, under pressure from government.

Pay at risk, a portion of salary that executives must earn based on reaching year-end performance goals, is a clear example of why AHS must be allowed to operate free from politics, Duckett said from Australia.

AHS executives earn salaries based on the mid-range of the scale for similar positions, and the bonus structure ensures Alberta attracts good talent, he said.

“It’s a game isn’t it, that’s being played in the political arena,” Duckett added.

“What is the point of having a board if the minister wants to get involved in decisions at this level, just because of political pressure.”

Duane Bratt, a political science professor at Mount Royal University, said the situation is a no-win for the governing Tories, since it created AHS and appointed the board — and the health authority has been dogged by controversy surrounding executive compensation.

But the optics of allowing the board to give bonuses to its top brass while the medical system is being squeezed “just looks horrid,” he said.

“This is a significant challenge to the government because if they intervene, they did create an arm’s length agency to run health care. And if they don’t, it looks like they have no control over the health-care system,” said Bratt.

Wildrose Leader Danielle Smith said the situation showed Horne had lost control of the health system.

She said he now has two choices: Order the board to cancel the bonuses, or fire the AHS directors.

“Because what we’ve seen here is open defiance. We’ve seen an AHS board that don’t believe they have to answer to anyone,” she said.

With files from James Wood and Chris Varcoe, Calgary Herald.

[email protected]

© Copyright (c) The Calgary Herald
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Titles registry won’t be sold without ‘due diligence,’ PCs say

By Darcy Henton, Calgary Herald May 28, 2013 5:51 AM

Albertans shouldn’t get too excited about the possible sale of the province’s land titles registry because other provinces have done it successfully, says Premier Alison Redford.

While the Progressive Conservative government is contemplating privatizing the registry, it won’t proceed unless it is confident the security of the system will be maintained, the premier told party members on the weekend.

“Of course, the integrity of the system is fundamental, but it would be wrong for people … to suggest that simply because the system is operating outside of conventional government systems, there is any impact on land titles in terms of tenure and security of title,” Redford said.

“If anything is done here, it will only be after full consultation and due diligence, but there have been successful models that have been used.”

Ontario, B.C. and Manitoba have off-loaded their registries and Saskatchewan is also moving in that direction.

But some critics worry the move will result in fee hikes and put property ownership titles at risk. Others contend that if the system makes money, there is no reason to sell it.

Manitoba’s contract with a private company called Teranet paid the government $75 million upfront, plus another $11 million annually.

Chestermere-Rocky View PC delegate Tim Anderson, a real estate agent who raised the question about the sale of the registry at the Tory party’s policy conference, said Monday he was concerned about the effects of the move.

After meeting with Service Alberta Minister Manmeet Bhullar at the conference, Anderson said he felt better about the plan.

“I was reassured that if they privatize, the government oversight would be there and the fees would stay the same,” he said.

But both the Law Society of Alberta and the NDP oppose privatization of the registry.

“We think it is in the public interest that the land titles system be preserved,” said Law Society past president Steve Raby.

He said property rights are the cornerstone of democracy and selling the registry is mortgaging the future. If the province wants to offload the registry, it should hand it off to an independent not-for-profit authority rather than a corporation, he said.

NDP critic Deron Bilous said privatizing the registry would allow private companies to benefit from a system paid for by taxpayers.

“I honestly don’t see the logic behind outsourcing this when it can be done in-house … where the government brings in a modest profit and passes savings on to consumers.”

He said privatizing gives the purchaser of the registry a monopoly.

“That is absurd,” Bilous said. “Land titles is an essential service.”

Alberta Land Surveyors Association executive director Brian Munday said the association has concerns around fee rates, liability and maintenance of the system.

“Certainly we want to know what safeguards will be in place to make sure fees remain reasonable,” he said.

“If something does go wrong, is it the government or a private company that is responsible for it? What mechanisms will be put in place to ensure that adequate money is in fact spent on maintaining and upgrading the system into the future?”

The Redford government is reviewing the registry along with about 800 programs and services as part of its results-based budgeting process. No decision is expected until next year.

[email protected]

© Copyright (c) The Calgary Herald
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Presentation to the Senate Committee on Energy, the Environment and Natural Resources

February 28, 2013

Good morning Honourable Senators. It is my pleasure to be talking to you from Calgary this morning by video conference. Our National office is situated in Regina, Saskatchewan, but I am in Calgary on personal business right now.

The Canadian Association of Energy and Pipeline Landowner Associations (“CAEPLA”, formerly “CAPLA”), is an association made up of regional member landowner groups from New Brunswick, Ontario, Manitoba, Saskatchewan, Alberta, British Columbia and associate members from across Canada, coast to coast.

CAEPLA’s objective is to assist Canadian pipeline landowners to address more effectively the impacts of energy pipeline construction and operations which affect landowner interests, including soil preservation, environmental liability, land use restrictions, safety, repair and maintenance issues, abandonment and compensation. CAEPLA is a catalyst for the organization of pipeline landowner associations by providing organizational advice, advocacy and negotiation experience and services. It is also CAEPLA’s intention to address landowner concerns with respect to present pipeline regulation in Canada with appropriate government and regulatory authorities.

I would like to open with a couple of quotes, food for thought that might help contextualize the thoughts I am about to share with you.

The famous poet and playwright George Bernard Shaw said, “The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.”

And Albert Einstein said, “You can’t solve problems with the same level of consciousness that created them.”

Both sentiments are I believe very applicable to the issue we are addressing here this morning.

CAEPLA is a pro-development association, we support development that is responsible, sustainable, and respects the stewardship responsibilities of landowners to protect land and water for future generations. To date, our mandate has not been to oppose energy or pipeline projects. But if the industry and regulators continue to disrespect our property rights and stewardship responsibilities that will certainly change.

Landowners are the most interested party when it comes to safety, yet the system prevents us from insisting on iron clad business contracts that include oversight and the discipline of insurance.

CAEPLA has provided assistance to many landowner associations in negotiating pipeline agreements across Canada. Much of our time right now is spent on pipelines and power corridor projects in the West. We continue to attempt to get iron clad business contracts, but regulators and their legislation do nothing but get in the way and protect energy companies from the free market and free market oversight.

I have provided you ahead of time with a few documents that will help you to understand the perspective of the landowners CAEPLA represents. I have provided you our position papers in the National Energy Board’s Land Matters Consultation Initiative on Company Interactions with Landowners which includes discussion of Pipeline Crossing Issues and landowner positions on Abandonment of Pipelines and the collecting of funds for the same. I also include a 2009 letter from CEPA on the subject of Damage Prevention (pipeline crossings) to the NEB with a Saskatchewan landowner, Stephanie’s, candid views attached at the beginning. I have also provided the CAEPLA final argument in the recent NEB Enbridge Line 9 Reversal Hearing. I think this document provides some general history of CAEPLA, where we started and where we are today. Lastly, I attach a recent letter sent to the Board (NEB) by landowners and landowner associations concerning pipeline crossing issues.

My goal this morning is to bring perspective to the issues of landowners when confronted by pipeline companies. That is, the issues when private property owners, like yourselves, come up against government supported and subsidized corporations that are allowed to come packing with government regulations to take our lands, our rights and leave us with annual risks, liabilities, a duty of care that we do not want, costs and the pipeline junk which includes the resulting safety and liability issues of historical contamination and pipeline collapse when the companies pack up and leave.

Before I proceed I would like you to pretend you are sitting around a kitchen table with your family and a “land agent” has just left you with a brown envelope with a Section 87 Notice, an NEB Regulatory Notice stating that a pipeline company is going to put a pipeline in your backyard and the easement agreement and the compensation offer are included.

The stress has only just begun. Next come teams of land agents, the men trained in profiling and in telling every tale they can to get the deal signed while they sit at your kitchen table drinking your coffee. He/she might even be your neighbour’s son or daughter. It is like you have stepped into a spaghetti western with cowboys coming to your door, not packing a gun, but a big smile, lots of lies and packing government regulations that allow them to threaten you if you question them.

Pipeline company bullies – forgive me but there is often really no other word for it — packing regulations that allow government sponsored industries and their shareholders to “expropriate” our land while leaving our names on title and the discriminatory transfer of pipeline company responsibilities, duty of care to private landowners and the resulting decreased land values is legislated theft. And they keep harassing you until you give up and sign.

As can be seen in the transcripts of your previous guest’s presentations to date, pipeline companies have no real accountability to anyone and they haven’t since 1959. CEPA, NRCan, the CSA, Canadian Safety Standards Association, Alberta ERCB, Saskatchewan Government, and self-admitted “industry partner” Gaetan Caron, chairman of the NEB, said nothing to you but that everything is wonderful, safe and sustainable. Well, it is not, and it is time everyone understands what is really going on.

Industry, regulators, government officials, all of these participants, are expert at seeming “reasonable” while promoting the privilege and protection of the pipeline industry. This industry has had the wild card of a regulator willing to grant Right of Entry and expropriate land from a landowner rather than be forced to negotiate a business deal for the acquisition of the land. This industry is not forced to function in the free market and resists negotiating cost effective binding contracts. It’s an industry that tells its regulator what to do, what to say and gets legislation passed that protects it from its responsibilities and the realities of the business world. The description is “regulatory capture” or when the regulatED become the regulatORS.

Mr. Corey from NRCan stated that pipeline companies are fully responsible for cleaning up spills. Then why are there spills and contaminated properties across Canada that have not been cleaned up. As I pointed out at the recent abandonment cost estimates hearing there is contamination in the Enbridge and TransNorthern pipeline corridor just east of Toronto that has been there for twenty years and more has recently been uncovered as Enbridge does integrity digs to repair the polyethylene coating disaster on line 9 in preparation for reversal. I also have a letter I read, at the hearing, from a Manitoba resident complaining of an Enbridge spill on her property that had never been cleaned up and I also know of other spills where landowners have signed confidentiality agreements and cannot talk about what was left behind. The NEB regulations and oversight protects companies from having to do due diligence to landowners.

The Expropriation process known as “Right of Entry” in the Canadian pipeline world and “Eminent Domain or “Condemnation” in the United States, is much different than expropriation as most of us know it. Under pipeline legislation and power corridor legislation these “private or shareholder” companies can take “use” of our land for their profit while leaving us with resulting annual risks, liabilities, costs and a duty of care because our name is still on title. Under most expropriation and government takings the land title is also transferred, transferring all the related risks. Pipeline easement agreements leave landowners with risks and liabilities that should be addressed in an ironclad free market contract or lease that would include oversight and the discipline of insurance.

The NEB, emphatically states, it has nothing to do with the easement agreement, it says it is a private contractual agreement negotiated between the landowner and the pipeline company. The NEB says the same about compensation. This is fully misleading and misrepresents the truth. Pipeline companies, packing the NEB regulations and regulatory documents that allow them the right to take your land rights do not negotiate a free market contract that will stand up in a court of law. The NEB Act trumps any easement. There is no real negotiation, it is take it or leave it when it comes to the easement. The land agent might increase the compensation a little if you raise your voice, but again it comes down to take it or leave it. The last thing they want is an iron clad business contract.

Under free market conditions there would be a willing buyer and a willing seller, hiring legal experts to protect both sides interests, negotiating an agreement that would be responsible, addressing safety, environment, liability and other legal issues in an annual lease agreement that also covers compensation representing a fair rental or share price; a business agreement that is beneficial to each side. What happens under the NEB Act is just legislated theft.

When I rent land from my neighbour for agricultural use, contract law and the courts protect me and my neighbour. I do not get to go in packing regulations and I certainly can’t force him to take it.

The NEB extends itself further into the murk of discrimination against landowners with its claim of having nothing to do with the contracts or compensation. They fail to explain further that its regulations, and any new regulations that its pipeline partners talk them into, supersede any covenants in those “private contractual easement agreements”. And yes, most of the regulatory change in the past 50 years has been at the behest of the pipeline industry.

The NEB and the industry have a revolving door when it comes to employees. Brenda Kenny, CEPA’s President was a long time employee at the NEB, as were a number of other CEPA people past and present. At the recent abandonment cost estimates hearing two of the regulatory people representing Enbridge had just recently worked at the NEB as regulatory officers. I think the term sometimes used for these situations is incestuous.

Landowners are not just stakeholders. Like you, Honorable Senators, we are property owners. We bought our property as a place to live, a lifestyle choice, an investment, to ranch our cattle, to crop farm or run any other business zoning allowed. We did not request pipelines. We live, raise families and work on these properties, yet we have had pipelines enforced on our backyards, that do not respect our stewardship or legal obligations. Our name is on title and the NEB legislation leaves our future to the whim of pipeline companies and their regulatory partners.

Even the Auditor General recognized landowner concerns and issues in her 1998 review of the NEB. The NEB hired a consultant to advise them on how to address the Auditor General’s concerns, in particular those related to landowners and stakeholders. The Purvin Gertz Report was very critical of the way the NEB addressed landowner concerns, but rather than address them the NEB provided the usual window dressing and then appointed the author of the report to the NEB Board itself.

Why the pipeline industry and its regulatory partners wish to make enemies of a pro-development group like landowners, the people minding the pipelines, is anybody’s guess. But it seems to be a very dangerous and ill begotten path to treat the people industry and regulators call the “first line of defence” in such a fashion.

I will now proceed to provide you with some history of our relationship with the NEB.

In 1988, Section 112 of the NEB Act was created and the legislation was then reworked in 1990 since it was not properly done in 1988. A Senator at that time stated that the legislation was questionable from a landowner rights perspective. It created new restrictions to the landowner’s right to farm over the pipelines and also restricted 200 more feet of our land along the pipeline. That is 100 feet on each side of the 60 foot easement. Our original easements gave us the right to farm over the pipelines and stated that the company was to compensate for any land taken for the operation of its pipelines. Those old 60 foot easements are now 260 feet, that is, 4X the width with no compensation.

Section 112 was created to allow pipeline companies the right to leave pipelines in the ground that are too shallow, corroded, too thin and designed with ineffective protective coatings that compromise safety. These regulations protect the companies and their shareholders from the cost of upgrading its infrastructure and addressing those safety issues. It is easier to restrict the activity of farmers over the pipelines than repair them. Imagine restricting traffic forever rather than upgrading a deteriorating overpass.

For 20 years we have been asking that regulations be changed to have pipelines buried 6 feet deep and provide thicker pipes in rural areas because we farm over the pipelines and are concerned with our safety and the safety of the pipeline. The CSA standards are only 24” of cover and thicker pipes in highly populated areas. We have pictures at our web site of pipelines with only 1 foot of cover. They should be dug up, replaced and buried deeper.

CSA standards are set by the industry itself, there are no landowner groups involved. NEB regulations state in many instances “to CSA standards”, but the CSA document is not readily available to landowners or the public, it costs about $750 to purchase it.

Interestingly, farmers can no longer have buried fuel tanks, they must be above ground and must be either double hulled or surrounded by a burm … no more buried tanks. Why the double standards; why are pipelines, that are under high pressure not double walled (hulled). Why the double standards; because they can.

Train cars are now constructed double hulled and can be heated to ship bitumen directly. It takes two pipelines to ship Dilbit, the diluted bitumen. (condensates)

In the Omnibus Bill C38 (May of 2012) NEB regulations were changed to put monetary and criminal penalties on farmers if they do not ask permission to cross pipelines; on summary conviction, a fine of up to $100,000 and/or imprisonment up to 1 year; on conviction on indictment, a fine of up to $1,000,000 and/or imprisonment up to 5 years. Too bad the presidents of the pipeline companies do not suffer the same consequences for polluting miles of private property. Instead they get multi-million dollar pensions.

The pipelines want prescriptive regulations for landowners and stakeholders and only NEB goal oriented regulations for themselves. Interestingly, NEB goal oriented regulations include guidance notes rather than prescriptive regulations. The Guidance notes cannot be used as standards or evidence in the NEB quasi judicial hearings since they are only guides as CAEPLA found out in a jurisdictional hearing.

Let me read a landowner’s perspective on goal oriented regulations:

Hi Dave,

The letter from CEPA to the board is most disturbing. They are so candid in their request to find ways to penalize third parties (looking to sec 51.4, and apparently stretching sec 48 to fit this plan). And, in the same letter looking for confirmation that audits will NOT be conducted to ensure compliance with guidance notes or NEB regulations. That they, very blatantly, want prescriptive regulation with “effective enforcement and consequence” for 3rd parties and goal oriented regulatory text for the pipeline companies is nonsense. Using that same logic…. In prisons, the guards would be there with clear and enforceable rules for visitors and goal oriented “suggestions” for the inmates? In hockey, the refs keep an eye on the audience while the game goes on, with the players putting themselves in the penalty box?!?!?

If I understand correctly, part of the reason that the crossing regulation sec 112 is so vague is because of discrepancy between the English and French versions? Really, nobody has figured out how to fix that?

Anyhow, before I ramble too much…. After reading a little more and having my short-lived experience with the NEB, it is clear that they are hopelessly captured. Maybe just hopeless. It seems that arguing with them over specifics within the act will always be time consuming and (often) for little gain. I really feel that the NEB needs to be dissolved completely. There is just so many loopholes for them as it is right now.

As Mark Twain said: “Do not argue with an idiot. They will drag you down to their level and beat you with experience.”

The NEB has a lot of experience.  🙂

Stephanie Fradette

Moving on… In 1985 there were 5 abandonment regulations that held the companies responsible for removal of pipelines upon abandonment. Mr. Vollman, Past Chair of the NEB, an engineer at the time, was responsible for creating a document called a Discussion Paper on Negative Salvage Value. It discussed the issue of abandonment, pipeline removal and the collection of funds to finance the process. A year later, in 1986, the NEB gave notice to the industry that it would do nothing with the issue.

In 2002, CAEPLA invited the NEB to come to Sombra, Ontario to view farming practices and we made a presentation on the abandonment and funding issue. The Chair of the Board, Mr. Vollman and an Engineer at the time Mr. Gaetan Caron were both present and Mr. Vollman stated that the issue had been looked at but could not be resolved. He never mentioned the 1985 document.

CAEPLA accidently came across the document in 2007 and upon research found that the five abandonment regulations that called for the removal of pipelines at abandonment in 1985 had been changed a number of times, and now the regulations state that abandonment can now be approved in place.

In the meantime, two abandonment hearings and hundreds of thousands of dollars of landowners money later, the NEB has ignored its judicial burden of proof at hearings and decided to collect money, 50 years late, for only 20% removal of pipelines. It has ignored the legal evidence provided by landowners that clearly shows pipelines must be fully removed to protect landowners from liability. At one point the Board even changed its 2008 judicial decision that protected landowners (20% removal and 80% maintained into perpetuity) to a scheme of just 20% removal at the behest again of CEPA without a hearing.

In 2008, TransCanada Pipelines applied to the NEB to have jurisdiction of the NOVA pipeline system in Alberta transferred to Federal Jurisdiction, the NEB. The NEB got to decide if it would take over 25,000 km more pipeline and a tremendous increase to its bureaucratic mandate and authority. Such a jurisdictional change took away many longstanding rights that landowners had under Alberta Law. The NEB and Nova (TransCanada Pipelines) pretended the transfer would make no difference. CAEPLA and the Alberta Pipeline Landowner Association provided the proof, at great financial cost, showing the imposition of the change on Alberta landowners. The Alberta government did nothing for its landowners and the ERCB never once stood up for Alberta landowners.

In the presentation recently made to you by the Alberta regulator, the ERCB, they stated that in Alberta pipeline companies are always responsible for abandoned pipelines until they are removed. That is now not the case for these landowners under the NEB Act and the ERCB did nothing.

Recently, in the very high profile Jessica Ernst Fracking trial the lawyers for the ERCB argued that it owed no duty of care for landowners or groundwater. We understand now why they did nothing at the jurisdictional hearing for landowners. By contrast, in Ontario, shortly after the NOVA jurisdictional shift, the Ontario Energy Board stated that the NEB would have to recognize the rights of Ontario pipeline landowners when it attempted to take over jurisdiction of a pipeline in that province.

Landowners have had to spend hundreds of thousands of after tax dollars to defend their property. When CAEPLA was invited to participate in the LMCI process we were told that it would not cost landowners to take part. After CAEPLA provided professional expert evidence to support our positions the NEB backed out and would not pay. CAEPLA sends a monthly invoice and statement for our costly involvement in the LMCI process and hearings. The NEB refuses to pay the invoice even though the NEB told us our participation and evidence in that process was not to cost us anything. The NEB’s fundamental principle is that “Landowners should bear no cost for abandonment”.

50 years ago the Canadian Public and landowners were convinced by smooth talking politicians, bureaucrats and pipeline companies that it was in the public interest to move energy from the Canadian western producers to the Canadian eastern market. Politicians had survived a few years of bedlam in the House of Commons with a government falling as a result. They no longer wanted the accountability, responsibility or the risks to their future the debate of pipelines caused. The House of Commons quickly decided to unload their accountability on the subject and created the NEB. They created a buffer so that they could again convince the public that they were being looked after by an independent regulator.

The pipeline and power corridor issues are no longer about providing energy to Canadians or providing electricity to rural Canada. It is all about exporting natural resources and electricity for private company and shareholder profit. Expropriation or Right of Entry is no longer warranted, if it ever was, for private for profit companies.

I always understood that good pipeline engineering meant pipelines should be built as straight and as short as possible. Thus the justification for expropriation!

I have been made aware by both the industry and pipeline companies that good engineering practices have changed and these standards are no longer the case. In the recent Vantage Pipeline Project NEB application the company applied for the longest of three proposed routes and a pipeline with many 90 degree bends in it to avoid landowners that did not want the pipeline. This was also done to fall within exemptions in the NEB ACT that allow the pipeline company to avoid a Comprehensive Joint Environmental Assessment.

The NEB approved the project. These new engineering practices that would allow a pipeline company to go around the property of landowners who do not want a pipeline on their property proves that Expropriation, Right of Entry, Eminent Domain, Condemnation is no longer warranted and cannot be justified, if it ever could. Perhaps now pipeline companies will no longer be coddled by legislated theft that compromises safety and the environment. The NEB can be abandoned and the legislation repealed and pipeline companies will have to operate and be held accountable under contract law and the judicial courts because landowners can now say no. It may be difficult at first for the industry to adjust, to learn how to function in the free market economy and be accountable for their actions and their businesses. But we as landowners are confident it can be done.

In closing, I would like to say there is another way. I would argue that we already have a regulatory system available to rural landowners, one unfortunately not Constitutionally recognized, but one that is embodied in Common Law and common sense:

Property Rights. Our traditional system of property rights, a system when allowed to function has proven to be the fairest and most productive way to grow a prosperous economy.

I would like to make a few points about what property rights properly imply and what property rights are not.

Property Rights implies the right to choose.  The right to choose how to dispose of your property, the fruits of your labour.

This would include the right to say no in some cases, too.

Because the basis of any contract, any legitimate deal, is a willing buyer and a willing seller.

The pipeline industry is an industry, a business, like any other.  Or should be. As such, the norms of contract law and business agreements should govern it.  Willing buyers and willing sellers. If one party to a proposed transaction is not willing, or is subject to coercion, then there is not a legitimate contract. There is not a fair deal.  Not a fair trade.

What I am proposing is free trade for the energy transport and pipeline industry in Canada.  Free trade without intervention by government. Without government intervening on behalf of industry, via expropriation, the Right of Entry power landowners are subject to when dealing with pipeline companies.

Right of Entry is forced entry.  It is not voluntary. It is not free and is not fair. 

With the coercive power of expropriation, of forced entry behind them, pipeline companies have landowners over a barrel.  An oil barrel.

But it is an oil barrel that does not truly reflect the real economic costs of bringing it to market. Part of that cost is borne by farmers and ranchers and other rural landowners who are coerced into non-market transactions. Non market transactions that are effectively a transfer of wealth from one group of owners to another. From the owners of farms and ranches to the owners of shares in pipeline companies.

A transfer of wealth from rural to urban Canada.  A transfer from middle class and often less affluent, to the affluent.

Genuine property rights do not imply a right to hire a lawyer to attend a government hearing to receive a government decision as to the disposition of your property.  Property landowners or their parents and grandparents worked for, and pay taxes on.

Real property rights imply the right to choose. The right to say no if need be. The right to freely and voluntarily deal or not deal as you see fit. The right, and responsibility, to look after your property to the best of your ability, to put your property, your land, to its highest and best use for the benefit of the economy and community you live and work in.

Government should not be in the business of facilitating the transfer of wealth from farmers, ranchers, and taxpayers to the shareholders of pipeline companies. 

Rural landowners should be able to decline — to say “no thanks” — to any offer from a pipeline company.  The same way we can say no thank you to other rural landowners who may wish to buy or lease our land. The same way urban residents can say no to an offer to buy or lease their property without the government or a regulator intervening with a Right of Entry taking.

Government should support free trade in the energy transport sector.  It should support fair trade between rural landowners and pipeline companies.

Government should move this country closer to the Canadian tradition of property rights, not farther away.

Government should allow for self regulation – not just for pipeline companies, but for rural landowners too, when it comes to rental or real estate agreements for pipeline projects.

In closing, let me explain what this would all mean.

It would mean that the goals our society shares – a prosperous, growing economy and a protected and vibrant environment – can be accomplished.

It would mean the removal of the moral hazard that an inevitably captured regulatory regime results in, namely a reckless industry incapable of respecting neither the environment nor the property rights of citizens.

It would mean an end to what economists call the Tragedy of Commons – a scenario where actors – in this case the NEB and pipeline companies – who have no real “skin in the game,” so to speak, have no real incentive to look after the resources they use.

It may well mean – and this is for the market to decide – that alternative means of transport, such as railways, and technological innovation could also participate and spark economic development.

It would certainly mean that those of us who live and work and raise our families on the land would be recognized as the legitimate stewards of the land. Which would enable us to enlist the services of the insurance industry to provide the discipline landowners and the public so desperately need from pipeline projects.

It would mean that ranchers, farmers, and other rural landowners are brought in from the cold to partner in a growing and prosperous economy, and to promote the public’s interest in protecting the environment, and by extension, their own civil and property rights.

Thank you.

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Alberta power prices poised for summer spike

By Matt McClure, Calgary Herald May 24, 2013 6:22 AM

Hit recently with higher prices at the pumps, Albertans will now need to dig deeper in their wallets to keep the lights on and the fridge running.

While a National Energy Board report released Thursday says gasoline rates should soon drop back to last year’s seasonal levels, the federal regulator predicts the province’s consumers will have to pay about 16 per cent more this summer for their electricity.

And an NEB analyst who prepared the outlook said power prices could surge even higher than forecast with the surprise announcement this week that a key TransAlta plant that was expected to be back in service by mid-June will now be out of commission until sometime in November.

“There is an expectation that those not on a fixed-rate plan are going to see their power bills rise this summer,” said Roger Creighton, a market analyst with the NEB.

“This analysis of tight supply doesn’t reflect any impact from the TransAlta announcement.”

The energy giant’s Keep­hills 1 plant would normally produce about 395 MW, or approximately four per cent of the province’s internal supply during the summer.

The coal-fired station near Wabamun has been off-line since March after a winding failure was found in its generator.

TransAlta had originally hoped to have the plant back running in April, but recent testing after initial repairs revealed the 1983-vintage device had greater wiring degradation and now requires a full rewind.

TransAlta spokeswoman Marcy McAuley said the impact of the outage on the province’s power supply will be lessened in August by the earlier-than-expected return to service of its 288 MW Sundance 1 station.

“We’re committed to being online and reliable,” McAuley said.

“This is as frustrating for TransAlta as it is for Albertans.”

While the Keephills 1 outage could magnify the hurt for Alberta consumers, a TransAlta media release reassured investors they shouldn’t suffer because of this unexpected event.

“(The company) is entitled to continue to receive its (power purchase agreement) capacity payment and is protected … from having to pay availability penalties,” the release said.

“As a result, TransAlta does not expect the outage to have a material financial impact on the corporation.”

Creighton said the recent spike in gasoline prices to more than a $1.30 a litre at some Alberta stations stemmed from a longer-than-expected outage of Petro-Canada’s refinery in Edmonton.

Now that the plant is back operating and as other facilities complete their reconfigurations to produce fuel suited for summer weather, supply should increase and price will ease.

“It won’t be necessary to incur and pass on the cost of trucking and railing gasoline into the province from the U.S. Midwest,” Creighton said.

Nationwide, the NEB is predicting the average price at the pump this summer will be between $1.20 to $1.30 per litre, similar to last summer’s average of $1.27 per litre. Creighton said prices in Alberta, as usual, are likely to be lower than elsewhere in the country.

The NEB report projects on-peak power prices during the months of May through September will rise from an average $86.26 per MW last year to $100 per MW this year because of a combination of hotter than normal temperatures and natural gas prices that are predicted to soar 50 per cent higher than last summer.

Coal is the primary source of energy used to generate Alberta’s electricity, but natural gas supplied 41 per cent of the province’s power last year.

While consumers on a fixed-rate plan won’t be immediately affected by the price rise, the 60 per cent of residential customers who have opted instead for a regulated rate will see their power bills jump.

“Consumers should consider the option of going to a contract that evens out these spikes,” said Richard Penn, senior adviser with the province’s Market Surveillance Administrator.

“The great thing about most retail contracts in Alberta is they allow people to get out of them with one month’s notice.”

While a tight power supply may cause price hikes this summer, the organization that manages Alberta’s power grid says it isn’t expecting a repeat of the rolling blackouts that plunged parts of the province into darkness for hours one afternoon last July.

Dawn Delaney, spokesman for the Alberta Electricity Supply Operator, said the not-for-profit entity is forecasting it can maintain a minimum surplus of 1000 MW plus a 500-MW reserve the entire summer unless there are unplanned outages.

“We have a contingency plan for when we have a lack of supply,” Delaney said.

“We’re in fairly good shape as far as reliability.”

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© Copyright (c) The Calgary Herald
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Power line project approved

By Bryan Passifiume, QMI Agency

Monday, May 20, 2013 7:43:29 MDT PM

The Fidler power line project will allow for greater wind generation capacity in Pincher Creek.

A project aimed at reenforcing power transmission systems north of Pincher Creek has finally received regulatory approval.

The Alberta Utilities Commission has given AltaLink the green light to start construction on its $79 million dollar transmission line project on its preferred route north of Highway 3 between Pincher Creek and Brocket.

According to Altalink’s Peter Brodsky, the project will involve building a new substation just north of the Oldman River, nine kilometres of 240 kilovolt power line, two kilometres of 138 kilovolt line and refurbishing five kilometres of existing power line.

“It’s an opportunity to bring some of the wind generated energy in the Pincher Creek area onto the grid,” he said. “We have about 2700 megawatts of wind power potential here.”

This 2700 megawatts of potential wind power is the cumulative amount of power across the whole of Southern Alberta.

Brodsky said that the projects around Pincher Creek currently produce about 1000 megawatts of electricity.

The project, when complete, will quadruple the wind energy potential in the area — not only accommodating projects already under construction, but those that are still on the drawing board.

“There’s a lot of potential wind projects coming up for the Pincher Creek area,” he said. “Right now, we just don’t have the capacity to bring that on to the network.”

The project was initiated in 2009, with public consultations taking place shortly thereafter. Work on the project was suspended in late 2011 as AltaLink waited for further direction from the Alberta Electric System Operators, which gave their approval last year.

With the AUC approval in hand, AltaLink can now move forward with construction.

Construction will begin on the project this summer, with an anticipated completion date of April of 2014.

As with any powerline project, approval from regulators is always the biggest step. Brodsky is confident that the project will move forward smoothly now that the necessary steps have been taken.

“The process for these major transmission projects is the up front time, in terms of getting the facility applications prepared and approved,” he said. “Until you get the sign-off from the AUC, you don’t begin construction.”

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Wind turbines set to rise near Medicine Hat

By Amanda Stephenson, Calgary Herald May 22, 2013

CALGARY – A subsidiary of a Spanish renewable energy company has received the go-ahead from the Alberta Utilities Commission for its proposed 120 MW wind farm near Medicine Hat.

Pteragen Canada Inc. — a subsidiary of Spain’s Renovalia Energy — announced Tuesday it has received final regulatory approval for the $200 million project, which could become one of the largest wind farms in Alberta. (Right now, Capital Power’s newly operational 150 MW Halkirk project near Stettler is the largest in the province. There is a 300 MW project — owned by Enbridge Inc. and EDF EN Canada — in the works for the Vulcan area.)

In a telephone interview from Madrid, director of business development Fernando Schwartz said Renovalia owns and operates wind power projects in Spain, the U.S., Hungary, Romania, Italy, Mexico, Chile, and Peru. He said the Peace Butte project — to be located 22 km south of Medicine Hat near the village of Seven Persons — will be the company’s first entry into Canada. Pteragen acquired the early-stage project from original developers, Calgary-based Wind River Power Corporation, in 2010.

“We spent some time hunting around for projects in the Ontario region, but in the end we decided we liked the project in Alberta,” Schwartz said. “It has a very good wind resource, which obviously for us is one of the most important aspects. But the second aspect we like about Canada generally is that it gives us a lot of confidence, financially and legally … Canada is an investment-attractive country.”

The company still must finalize financing for the project, and obtain an agreement for the sale of the energy produced. Under Alberta’s deregulated system, wind producers sell their electricity into the grid for market price. Schwartz said the Peace Butte project should generate enough electricity to power 50,000 households annually.

Construction on the 60 wind turbines is expected to begin in early 2014 and should create significant employment in the Medicine Hat area, Schwartz said.

“Right now in Mexico, on our 137 MW project that is actually just starting, we have in the order of 270 people working on site. And that’s the initial phase — once we go to full construction, we’ll have around 600 people working on site for at least a year,” he said.

That’s great news, said Nichola Kondra, associate director with the Economic Development Alliance of Southeast Alberta. Right now, the Lethbridge-Pincher Creek region is home to the majority of southern Alberta’s wind power capacity, but Kondra said Medicine Hat is also well-positioned to be a centre for alternative energy.

“We have a real advantage with our consistent wind source and our expected sunshine hours,” she said. “We’re excited to have it in this part of the province and to get this kind of recognition for renewable energy.”

AltaLink has filed an application with the AUC to construct approximately 250 metres of transmission line to connect the Peace Butte wind project to an existing transmission line in the area.

Alberta currently ranks third in Canada for wind power production, after Ontario and Quebec. In 2012, the province’s wind power generation capacity hit 1,116 MW broke the 1,000 MW mark for the first time. According to the Canadian Wind Energy Association, there are 752 wind turbines in Alberta divided between 34 different projects.

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© Copyright (c) The Calgary Herald

Alberta Premier Alison Redford give B.C. preem congratulations on stunning election win

Still concerns about Gateway pipeline in Northern B.C.: Clark

By ,Edmonton SunFirst posted: | Updated: Premier Alison Redford congratulated the B.C. Liberals and its leader on their re-election Tuesday night as talks surrounding the Gateway pipeline continue to heat up. “I look forward to renewing discussions with British Columbia about the issues that affect our provinces,” said Redford about Christy Clark’s win.On Wednesday, Redford said she had a long phone conversation with Clark about her win.”We talked about our shared interests — we both want to ensure our economies are growing, that we’re creating jobs and that western Canada will thrive for generations to come,” said Redford.

The two premiers haven’t been on the best of terms since Redford told Clark to take a hike over her demand for royalties from the Northern Gateway pipeline last year.

When asked about the Northern Gateway pipeline a press conference Wednesday, Clark reiterated her belief that people in northern B.C. are concerned about the project and that support for the pipeline is “mixed across the province.”

Congratulating Clark directly on her party’s victory, Wildrose Opposition Leader Danielle Smith suggested that now is the time for Redford to pick up the phone and start working out their differences.

“This is a project that is of mutual benefit for both Alberta and B.C.,” said Smith.

“B.C. voters clearly want a government that is focused on growing the economy and creating jobs. Most importantly, they have rejected the anti-growth, anti-pipeline agenda of the B.C. NDP.”

“I am hopeful that Premier Clark and the BC Liberals will champion these types of projects and see them through to completion.”

Alberta Liberal Leader Raj Sherman said Clark and her team “deserve credit for a hard-fought campaign, which ultimately resulted in Liberals regaining the confidence of British Columbians with a strong mandate to lead the province forward into the future.”

Alberta NDP Leader Brian Mason did not offer any form of congratulations.

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@SunMattDykstra