Monday, 13 August 2012 18:01 Ross Marowits, The Canadian Press

MONTREAL – SNC-Lavalin’s choice of an experienced American executive to head the Quebec-based engineering giant will be well-received by the beleaguered company’s investors, despite some political concerns in the province that he doesn’t speak French, analysts said Monday.

Robert Card, a senior executive at CH2M Hill Companies and former undersecretary of energy in the U.S., will take the reins Oct. 1.

He was chosen after a global search for leaders outside the Montreal-based company, which has recently been mired in scandal.

Former CEO Pierre Duhaime stepped down in March amid controversy over millions in mysterious payments in North Africa.

Card and his family plan to move to Montreal and learn French, but the naming of an anglophone to head one of the province’s marquee businesses is sure to upset some Quebecers in the midst of a provincial election campaign.

Concerns have been raised about a hostile bid to acquire Quebec’s hardware giant Rona (TSX:RON) by U.S. retailer Lowe’s.

There were also some grumblings when bilingual Ontario-born Michael Sabia was chosen to head the Caisse de depot fund manager – despite his long-time Quebec residency – and when unilingual George Cope was picked to head Montreal-based BCE, while he lives in Toronto.

Parti Quebecois leader Pauline Marois said Monday that SNC should require Card to take French lessons so that at least he becomes bilingual.

SNC-Lavalin (TSX:SNC) spokeswoman Leslie Quinton said the ideal candidate to head “this great Quebec institution” would speak French.

“However, at a time when the company requires strong, decisive and insightful leadership, the most important criterion was to hire the best overall candidate with significant international experience,” she said in an email.

Quinton added that the company has a global reach and that attracting someone with such extensive experience demonstrates that Montreal is an attractive international location to which such people can be recruited.

Analyst Frederick Bastien of Raymond James said Card’s appointment may not be initially well-received by the average Quebecois who expected another francophone to head the firm.

“But we are of the view that SNC shareholders should be pleased that the firm has managed to attract someone with Mr. Card’s experience and reputation,” he wrote in a report.

In a report, the Vancouver-based analyst said the SNC-Lavalin board’s key focus was to identify an experienced senior leader with both an extensive background in the international engineering and construction sector and a deep understanding of the complexities of operating internationally.

“At first blush it would seem SNC accomplished just that.”

Card served as president of CH2M Hill’s energy, water and facilities division and earlier headed its government, environment and nuclear division.

Privately-held CH2M Hill is a Fortune 500 engineering firm with 30,000 employees in more than 80 countries and $6 billion of revenues. It has competed against SNC-Lavalin for many contracts.

Analyst Maxim Sytchev of Alta Corp Capital said investors will be pleased that SNC’s board selected an outsider to help instill a perception of a clean start to re-establish investor confidence in the company.

He said Card’s U.S. government pedigree will prove invaluable to help SNC expand its presence south of the border, where it is running two private-public partnership projects. Only 3.4 per cent of SNC’s total corporate revenues are derived from the U.S.

“Clearly having somebody who was the undersecretary of the department of energy, I’m sure that he’s got a pretty nice Rolodex to delve into,” Sytchev said in an interview.

He expects Card will eventually guide SNC to expand its U.S. footprint, especially in private-public partnerships. Card’s first focus is to ensure governance changes are appropriate before deciding if any changes are required in about six months, he said.

Sytchev dismissed any concerns about Card’s inability to speak French, saying SNC is a global firm.

“The company and the board of directors answer to the shareholders, not to anybody else.”

Pierre Lacroix of Desjardins Capital Markets said the appointment of an outsider will bring “fresh eyes” to the company’s management and governance practices.

“While we view the appointment of a new president and CEO as a positive catalyst for the shares, we believe the market reaction should be gradual until Mr. Card elaborates on his strategic vision for SNC,” he wrote in a report.

Card and board chairman Gwyn Morgan declined requests for interviews until the new CEO assumes his duties.

On the Toronto Stock Exchange, SNC’s shares closed at $37.28, down 22 cents in Monday trading.

Friday, 17 August 2012 19:10 Dene Moore and Vivian Luk, The Canadian Press

VANCOUVER – The National Energy Board has asked Calgary-based Enbridge (TSX:ENB) to provide documentation of improvements it has made since a massive oil spill in Marshall, Michigan two years ago.

Board inspectors visited the company’s control centre in Edmonton a week ago as part of an increase in inspections the board announced following a damning report by U.S. authorities on the spill in the Kalamazoo River in July 2010.

In a letter sent Friday, the board asked for a copy of Enbridge’s internal investigation into the pipeline rupture and documentation of the corrective actions it has taken.

The board also wants to know what improvements have been made to the company’s in-line inspection program since the incident and it wants a copy of the control room management plan.

The investigation by the U.S. National Transportation Safety Board found a litany of errors in Enbridge’s control centre that led to a spill of more than 20,000 barrels of oil into the Kalamazoo River.

According to the report, a segment of Line 6B ruptured during the final stages of a scheduled pipeline shutdown on July 25, 2010.

Even though multiple alarms were set off at the control centre in Edmonton, staff believed it was because of a change in pressure due to the shutdown and not because of a rupture. After the 10-hour shutdown was finished, pipeline operations resumed.

“Leak-detection alarms were generated, but Enbridge staff continued to believe the alarms were the result of column separation, even though the Marshall area was relatively flat, without significant changes,” the report said.

More than 17 hours after the rupture, a gas utility worker finally notified the Enbridge control centre about oil on the ground.

The U.S. report concluded that, among other things, deficiencies in Enbridge’s pipeline integrity and inadequate training of control centre personnel were to blame for the spill that affected more than 50 kilometres of waterways and wetlands and cost $800 million to clean up.

Since the Michigan spill, Enbridge says it has made multiple improvements to its pipeline integrity management, leak detection and control centre operations.

In an email sent to The Canadian Press last month, Northern Gateway President John Carruthers said Enbridge has now doubled the number of employees and contractors to detect leaks, added more control centre staff, improved training and technical support, and opened up a new control centre in Edmonton.

The oil giant has “revised and enhanced all procedures pertaining to decision making, handling pipeline startups and shutdowns, leak detection system alarms, communication protocols, and suspected column separations,” the email says.

The company’s proposed Northern Gateway pipeline from the Alberta oil sands to a tanker port on the B.C. coast is currently under review by a federal environmental assessment panel.

By James Wood, Calgary Herald August 18, 2012

Opposition parties stepped up their attacks on the appointment of a defeated Tory cabinet minister to a senior civil service post while members of the Progressive Conservative government remained silent on the issue Friday.

The Wildrose Party said the hiring of former agriculture minister Evan Berger as senior policy adviser to the deputy minister of agriculture raised serious questions about the impartiality of the office of the ethics commissioner.

Berger’s appointment had to be scrutinized by ethics commissioner Neil Wilkinson because there is a one-year restriction on former cabinet ministers receiving a contract or benefit from a department with which they had “significant official dealings” during their final year in cabinet, according to conflict of interest legislation.

Wilkinson granted an exemption for Berger’s hiring, which is allowed under the act.

“It’s so troubling the ethics commissioner waived a blatant conflict. That’s why that rule is there, to stop that exact thing from happening,” said Wildrose MLA Rob Anderson.

“You can’t have a politician get kicked out of office and then be hired back by his department a couple months later. It’s just beyond belief, frankly.”

The Wildrose, Liberals and NDP all called Friday for an explanation of the ethics commissioner’s decision to grant an exemption.

Wilkinson, a former chairman of the Capital Health Region board, was not available for comment.

Glen Resler, chief administrative officer in the commissioner’s office, said the appointment was approved under a clause in the legislation that allows an exemption if it is demonstrated the activity “will not create a conflict between a private interest of the former minister and the public interest.”

“In this instance there is that direct employment relationship with the department, he is working directly with agriculture, a lot of the subject matter is the thing he was working on before … he definitely has the qualifications as the candidate,” he said.

The employment contract was also scrutinized and conditions were set by the ethics commissioner.

© Copyright (c) The Calgary Herald

By Dene Moore, The Canadian Press August 19, 2012

VANCOUVER – While Prime Minister Stephen Harper says the fate of Enbridge’s proposed pipeline from the Alberta oilsands to tankers on the British Columbia coast will be based on science and not politics, documents show some of that science isn’t forthcoming.

And critics say there is no time for the science to be completed before a federal deadline for the environmental assessment currently underway.

Documents filed with the National Energy Board show the environmental review panel studying the Northern Gateway project asked Fisheries and Oceans Canada for risk assessments for the bodies of water the proposed pipeline will cross. The pipeline is to traverse nearly 1,000 streams and rivers in the upper Fraser, Skeena and Kitimat watersheds.

The department didn’t have them.

“As DFO has not conducted a complete review of all proposed crossings, we are unable to submit a comprehensive list as requested; however, this work will continue and, should the project be approved, our review will continue into the regulatory permitting phase,” DFO wrote in a five-page letter dated June 6, 2012.

The response went on to say there “may be differences of opinion” between the company and the department on the risk posed by the pipeline at some crossings. It provided two examples of crossings of tributaries to the Kitimat River where Enbridge rated the risk as low but Fisheries rated it medium to high.

DFO said the federal ministry will continue to work with the company to determine the risk level and level of mitigation required.

“DFO is of the view that the risk posed by the project to fish and fish habitat can be managed through appropriate mitigation and compensation measures,” said the department’s response.

“Under the current regulatory regime, DFO will ensure that prior to any regulatory approvals, the appropriate mitigation measures to protect fish and fish habitat will be based on the final risk assessment rating that will be determined by DFO.”

Earlier this month, Harper told reporters in Vancouver that “decisions on these kinds of projects are made through an independent evaluation conducted by scientists into the economic costs and risks that are associated with the project, and that’s how we conduct our business.”

He went on to say “the only way that government can handle controversial projects of this manner is to ensure that things are evaluated on an independent basis, scientifically, and not simply on political criteria.”

But the federal government recently sent letters to 92 habitat staff members within Fisheries and Oceans in B.C., telling them that their positions will be cut. Thirty-two of them will be laid off outright.

The cuts will mean the department in B.C. has half the habitat staff it had a decade ago.

All but five of the province’s fisheries field offices will be cut as part of a $79 million — 5.8 per cent — cut to the department’s operational budget, including the offices in Prince George and Smithers that would have had the lead in monitoring pipeline effects.

The marine contaminant group that would have been involved in a spill in B.C. has been disbanded and the fisheries and environmental legislation gutted, said Otto Langer, a retired fisheries department scientist.

“He (Harper) says the science will make the decision. Well he’s basically disembowelled the science,” said Langer. “It’s a cruel hoax that they’re pulling over on the public.”

Former federal Liberal fisheries minister David Anderson agrees.

Given the Dec. 31, 2013, deadline set by the federal government, Anderson said scientists in the Fisheries Department simply don’t have time to complete any substantial scientific study of the project.

“You can’t do these studies on the spur of the moment. It takes time to do them,” Anderson said. “And the federal Fisheries have just been subjected to the most remarkable cuts, so you’re in the throes of reorganization and reassessment and re-assigning people, and on top of it you throw them a major, major request for resources and work.

“It can’t be done.”

The department has three major projects in B.C. currently undergoing federal environmental assessment: Northern Gateway, a massive hydroelectric project called the Site C dam, and a gold-copper mine near Williams Lake, B.C., that was previously rejected following a federal environmental review.

Dr. Steve Hrudey, who was chairman of the Royal Society of Canada’s expert panel on the environmental impact of the oil sands two years ago, said it is normal for the company asking for environmental approval — in this case Enbridge — to provide the information in question in the review process.

“They have to foot the bill,” said Hrudey, who was also involved in more than two dozen reviews over 17 years as a member and then chairman of the Alberta Environmental Appeals board.

The project proponent pays consultants to prepare studies and reports required by the review board, the relevent federal departments look at those reports, respond with questions and comments of their own, and the panel then goes back to the proponent with those questions and requests for further information.

There may be several cycles of this back-and-forth.

“In the end DFO will say ‘No, it’s what we think it is and therefore you have to take measures we feel are appropriate for that rating,'” Hrudey said.

But if the department’s ability to do the studies itself is questionable, some scientists fear the process will unfold without independent scientific study.

“It (the response from Fisheries to the panel) implies that the request to the joint review panel will not be answerable until after a decision has been made, until after the project has been approved,” said Jeffrey Hutchings, a marine biologist at Dalhousie University.

“This seems, from a science perspective, a rather indefensible position in so far as a key part of the environmental review process is to evaluate the degree to which the pipeline will affect fish habitat.”

A spokesperson for the panel said there has been no further request for information from DFO, and no further information is expected.

The federal department said a spokesperson was not available for an interview, but provided a statement via email saying Fisheries is providing advice to the assessment panel on the potential impacts of the project on fish and fish habitat.

“Fisheries and Oceans Canada has provided its assessment and is of the view that the risk posed by the project to fish and fish habitat in the freshwater and marine environments can be managed by the proponent through appropriate mitigation and compensation measures,” said the email, which echoed the response sent to the panel.

“The Department notes in its submission that the proponent has conducted a reasonable ecological risk assessment and provided useful information on the risks that an oil spill (in either marine or freshwater) would pose to fisheries resources.”

Hutchings found it odd that they’re so sure.

“Well, how can you make that judgment when you have not yet conducted a complete review of all proposed crossings?” he said. “Again, from a science perspective, I don’t see how it’s possible to be able to draw that conclusion.”

The proposed Northern Gateway is a $6-billion project expected to spur $270 billion in economic growth in Canada over 30 years.

By Sherri Zickefoose, Calgary Herald August 17, 2012 6:43 AM

Hundreds of rats infesting a Medicine Hat landfill have provincial officials scrambling to defend Alberta’s rat-free status.

More than 50 rats have been caught and killed at Medicine Hat’s garbage dump since the colony was discovered last week.

Single Norway rat sightings were first reported in the area last spring, officials say.

“We’re going to estimate that this infestation is small rather than large, and by small we mean several hundred rats as opposed to thousands,” said Vaughn Christensen, manager with Alberta Agriculture and Rural Development.

”And we do have it isolated and contained.”

The infestation is “one of our larger ones,” since the rat eradication program began in 1952, Christensen said.

“Occasionally, we get small investigations around the border.”

Agriculture Minister Verlyn Olson vowed to resolve the issue.

“We’re up to 52 now, and they’ve been destroyed,” Cypress County agricultural fieldman Jason Storch said Thursday.

Workers are monitoring the site around the clock with infrared digital cameras and bait traps loaded with poisoned food and water. Neighbouring homes and farms have also been outfitted with poisonous traps to prevent the spread of pests.

If needed, bull snakes may be let loose at the landfill.

A single pair of healthy rodents are capable of breeding 15,000 young in a year.

“It’s very hard to tell how many are in there. There’s no way of knowing. But we’re making headway at this point,” said Storch.

“We’re just monitoring it and that’s going to continue until they’re all gone,” he said.

Dozens of bait stations are set up about every three metres around the landfill.

“We’re doing more perimeter baiting to keep ahead on everything. The trick here is to get ahead of them.”

Alberta claims to be rat-free, and has only experienced isolated cases of the rodents since the 1950s.

The province, which spends $350,000 a year on its rat-control program, has 11 rat inspectors who patrol the border with Saskatchewan, aiming to prevent the vermin from destroying crops.

Six counties and municipal districts participate in the patrol of the rat-control zone, which is 30 kilometres wide and stretches 390 kilometres from the Montana border to Cold Lake.

Despite the efforts, rodents carried by shipping containers on airplanes, trucks and trains, and some bought by pet owners as snake food, show up in Alberta frequently, officials say.

The City of Calgary fields about 200 rat calls each year, but almost all turn out to be squirrels, muskrats or gophers.

In 2011, four pet rats were discovered in Calgary. Last year, the city located five Norway rats. One came dead in a truck, and the other four were categorized as pets, or fancy rats.

City officials issued a warning that it is illegal to keep rats as pets after three Norway rats were seized from two homes last February.

Possession of a rat can lead to a fine of up to $5,000.

Norway rats can measure up to 25 centimetres long and weigh around half a kilogram.

Provincial law requires that rats discovered in Alberta either be euthanized or removed from the province.

[email protected]

© Copyright (c) The Calgary Herald

By James Wood, Calgary Herald August 17, 2012 5:27 AM

Critics say video an attempt to mislead public

By Judith Lavoie, Times Colonist August 15, 2012

About 1,000 square kilometres of islands have disappeared from Douglas Channel in an animated depiction of Enbridge Inc.’s proposed Northern Gateway pipeline and tanker route.

The project would send bitumen by pipeline from Alberta’s oilsands to Kitimat, where it would be loaded onto tankers for export to Asia.

A video on the Enbridge website shows Douglas Channel as a wide open funnel leading from Kitimat to the Pacific, omitting the narrow channels, islands and rocky outcrops that make up the potential tanker access route.

The view of Douglas Channel sprang to public attention after Lori Waters, a Vancouver Island researcher and owner of a biomedical communications company, created overlays and maps showing the real Douglas Channel and posted the images on Facebook.

Reaction against Enbridge – which is fighting an image problem because of recent pipeline spills – was swift.

“I find the pictures shocking. It’s reprehensible behaviour,” said University of Victoria climate scientist Andrew Weaver.

“These images are disturbing enough to make me no longer trust anything coming from Enbridge. It’s utterly shameful,” he said.

However, Enbridge said the video is an obvious animation and contains a disclaimer that says it is “broadly representational.”

“That video is meant to be for illustrative purposes only. It’s not meant to be to scale. It’s meant to illustrate the pipeline route, not the marine aspects of the operation,” said Enbridge spokesman Todd Nogier.

“There’s a disclaimer at the end because it’s really clear this is meant to be illustrative,” he said.

The video is meant to be pleasing to the eye, but viewers would not mistake it for a detailed map, Nogier said.

A tanker safety video showing Douglas Channel in detail and to scale, together with technical reports on every aspect of the marine route, are on the Enbridge website, he said.

“If they are trying to conclude that we are trying to mislead people, nothing could be further from the truth. There’s lots of information there. It’s all there and it’s all for public viewing,” Nogier said.

However, groups opposed to the proposed pipeline and tanker project believe the video is an attempt to mislead.

The Enbridge view of Douglas Channel would make anyone who knows the area chuckle, said Eric Swanson of the Dogwood Initiative.

“In reality, it’s a twisting path through rocky islands and granite outcroppings, including 90 degree turns, but it’s shown as a sparkly, open channel,” he said.

“They are certainly painting a rosy picture of a very complicated and dangerous waterway.”

The video fits with recent Enbridge advertising campaigns, Swanson said.

“It’s more hyper-positive imagery because they know they have a problem because of the spills,” he said.

Josh Paterson, a staff lawyer with West Coast Environmental Law, said the promotional video skirts the line on fair advertising.

“That image really misrepresents the reality, which is that that channel is jam-packed with islands,” Paterson said.

“You are really not supposed to omit big pieces of information like that and

British Columbians should look at the images and decide how far they are willing to trust the company, regardless of what disclaimer they put on the video, Paterson said.

“A comparison of their images with the actual really raises questions about the trustworthiness of what they are telling people in B.C.,” he said.

[email protected]

© Copyright (c) The Victoria Times Colonist

Original source article: Enbridge stirs up controversy with depiction of West Coast waterway as containing no islands

By Sharon Kirkey, Postmedia News August 15, 2012

Critics outraged at rules that limit use of U.S. report likening Calgary company to Keystone Kops

 By Peter O’Neil, Calgary Herald August 13, 2012

The joint Canadian government panel studying Enbridge Inc.’s proposed $6 billion Northern Gateway pipeline won’t be able to fully assess a U.S. regulator’s findings that the company behaved like the “Keystone Kops” before, during and after the massive 2010 Kalamazoo River spill in Michigan.
The panel is refusing requests by intervenors to have the U.S. National Transportation Safety Board’s devastating criticism of Enbridge’s performance to be tabled with the panel and entered into the public registry as evidence.

The panel said the NTSB’s findings can be raised only during the “oral questioning” period for the Northern Gateway hearings that begin this autumn and conclude in December.

However, the NTSB report won’t be viewed as reliable evidence and won’t be considered in the panel’s final ruling, a spokeswoman said Monday.
Annie Roy, a spokeswoman for the Canadian Environmental Assessment Agency, said the NTSB reports can only be used as “an aid to cross-examination” during the oral questioning period.

“An aid to cross-examination is generally not considered evidence and cannot be relied on for the truth of its content,” Roy said in an email.
“It will not typically be included on the public registry and will not be considered by the panel when making its recommendations. The panel will however consider the answers provided to questions using the aid.”

The statement stunned one of the project’s top opponents, Haisla First Nation Chief Councillor Ellis Ross.

“The Panel is supposed to be looking at potential adverse impacts from the project, including an accident,” Ross, whose lawyer recently sent a letter to the panel calling on Enbridge to fully disclose Kalamazoo River spill information, said in an interview.

“Ignoring a significant analysis of a major pipeline accident involving the same proponent as Northern Gateway does not make any sense.”
A prominent critic of the oilsands pipeline proposal called on the panel and Enbridge to find a way to ensure the Kalamazoo River report is fully considered.

“If the NTSB Kalamazoo material is intentionally excluded from the panel’s considerations it is likely there will be no public acceptance of the fairness of the upcoming hearings,” said independent economist Robyn Allan, former chief executive officer of the Insurance Corporation of B.C.

The panel, operated by the National Energy Board and the Canadian Environmental Assessment Agency, revealed its position in separate letters to two B.C. intervenors who asked if they could submit as evidence the NTSB reports made public in July.

The panel responded that a witness cannot submit documents that weren’t prepared “under their direction and control,” since they couldn’t credibly answer questions about the documents “or otherwise confirm their accuracy.”

The Haisla nation’s Ross said Enbridge would “go a long way” in showing good faith to first nations and British Columbians by voluntarily submitting all its information on the Kalamazoo spill, including its evidence provided to the U.S. regulator.

Ross said Enbridge’s spill of an estimated 840,000 gallons of diluted bitumen crude into Michigan wetlands, a creek and the Kalamazoo River – “enough to fill 120 tanker trucks,” according to the NTSB – is directly relevant to B.C. concerns about Northern Gateway.

Enbridge spokesman Todd Nogier said rules prevent the company from submitting the NTSB findings.

“As we are not the authors of the NTSB report, we cannot file it for evidence into the Joint Review Panel process,” he said in an email.

“We would expect to answer questions on the NTSB’s findings during the formal hearings that are taking place this fall. We are also open to including any information requested of us by the JRP through the regulatory review process.”

Allan said official assessments of the environmental impact of the Kalamazoo spill weren’t included in Enbridge’s earlier risk analysis filed with the Canadian review panel.

She said the NTSB’s findings about the role of human error in the Kalamazoo spill, and systemic problems with safety at Enbridge, also need to be considered.

Josh Paterson, a lawyer with the group West Coast Environmental Law, said Roy is underestimating the panel’s authority.

The NEB “has the power to order any party to provide it with any information that it thinks may be necessary to obtain a full and satisfactory understanding of the issues,” he said in an email.

“The board also has the power to dispense with the normal rules of evidence where the public interest and fairness require it. The NTSB report is a document that should definitely be part of the consideration of Enbridge’s proposal, and the Board has the power to make sure that happens, if it wants to.
“Whether or not the Board orders the report be produced, the NTSB report is likely to be used as a basis to question Enbridge in cross-examination, and it’s clear that Enbridge will have a great deal to answer for.”

In early July NTSB Chairman Deborah Hersman compared Enbridge employees to the blundering Keystone Kops of the silent movie era. The board’s final report, submitted in late July, was equally harsh in its assessment of Enbridge’s handing of the spill.

“During the investigation, major deficiencies of the company emerged, as discussed in previous sections of this report. These deficiencies led to the rupture, exacerbated its results, and then failed to mitigate its effects,” the NTSB concluded.

“Although these deficiencies involved different elements of Enbridge’s operations, and may appear unrelated, taken together they suggest a systemic deficiency in the company’s approach to safety.”

While the panel has been constrained in its response to the NTSB reports, the NEB sent a letter to Enbridge chief executive Pat Daniel saying it would inspect the company’s Edmonton control room and planned to “carefully review” the NTSB’s findings.

[email protected]

© Copyright (c) The Calgary Herald

By Karen Kleiss, Edmonton Journal August 13, 2012