Canadian oil spills raise pipeline safety worries


CALGARY, Albert-- Three large Canadian oil spills over the last 30 days have increased concern over pipeline safety in the country, just as the government and the Canadian petroleum industry are trying to drum up support for a series of new pipeline projects.

Enbridge said late Tuesday that one of its pipelines, carrying heavy oil-sands crude oil, spilled some 1,450 bbl in eastern Alberta earlier in the week.

Earlier this month, Plains All American Pipeline spilled up to 3,000 bbl into a reservoir near the small resort town of Sundre, Alberta.

In addition, Pace Oil & Gas last month spilled some 5,000 bbl from a well in a remote corner of northwestern Alberta.

More pipelines cross the oil-rich province of Alberta than anywhere else in Canada, and the province's economy relies heavily on oil and natural-gas production. That has all helped to raise tolerance for minor spills among many residents.

But amid a spate of big spills this year and last year, environmental groups have stepped up calls for more regulation.

That has coincided with a push by Canadian officials and the industry to push a series of ambitious new projects - from a proposed Enbridge pipeline that will take oil from Alberta to the Canadian west coast to a series of plans aimed at reversing or expanding pipeline flows, including a controversial proposed expansion of TransCanada Corp.'s Keystone pipeline in Canada and the US.

The projects are being undertaken to redirect oil or natural gas to account for new production areas, particularly in the US.

Canada's federal government is speeding up the review of big energy-infrastructure projects, including for pipelines. On Monday, the Conservative government of Prime Minister Stephen Harper passed legislation that changes some environmental laws to help streamline the process.

This week's oil spill in Alberta has become a lightning rod for critics of those changes.

"It's ironic that the day that the House passed the budget bill that significantly rolls back environmental laws there was a major spill in Alberta," said Nathan Lemphers, senior policy analyst for Pembina Institute, an environmental think tank, referring to the Enbridge incident.

Mr. Lemphers and other critics said the government's ability to monitor pipelines and enforce regulations hasn't kept up with the growth of the industry.

The industry defends its record of pipeline safety. Canadian Energy Pipeline Association spokesman Philippe Reicher said there have been between zero and five spills a year of 50 bbl-plus of oil over the last 10 years.

In 2011, about 30,000 bbl were spilled out of 1.2 billion bbl transported, with most coming from a large Plains All American Pipeline spill.

"We have absolutely not seen an increased trend [in spills]," Mr. Reicher said. "When you think of the amount we transport compared to the amount that gets spilled, our reliability factor is 99.99%."

Alberta's provincial energy regulator, the Energy Resources Conservation Board, said pipeline-safety regulations are strong.

"We have a very strong safety record in this province," ERCB spokesman Darin Barter said. "Yes, there have been three major leaks in the past short while, but remember there are 400,000 kilometers (about 250,000 miles) of pipelines in this province, and we are shipping millions of barrels a day through those pipelines," he said.

Last year, Alberta suffered its largest pipeline spill in 36 years, when Plains' Rainbow pipeline spilled about 28,000 bbl of oil into boreal forest near the town of Little Buffalo, Alberta.

In the US, an Enbridge line spilled nearly 20,000 bbl into Michigan's Kalamazoo River in 2010, triggering a political firestorm in Washington.

Also last year, TransCanada's Keystone pipeline, which connects Alberta to refineries in Illinois and a storage depot in Cushing, Okla., also suffered 14 small leaks during its first year of operation.

TransCanada recently reapplied for a US permit to expand that line, after the White House rejected its original proposal, in part, to allow more time to review the environmental impact.

The Wall Street Journal (via Dow Jones Newswires)

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