The Canadian Senate adopted Bills C-69 and C-48 last night, along with a lower-profile measure enshrining a moratorium on Arctic oil drilling, clearing the way for the country’s new Impact Assessment Act and a federal ban on large tanker traffic off British Columbia’s environmentally sensitive north coast to become law.
“The assault from the oil and gas industry on this legislation was unprecedented,” wrote one observer, but Canada finally has “a new environmental assessment process, and the national energy board has been transformed to a new and improved institution.”
“Better rules will provide certainty to business and show investors that Canada is the best place in the world to invest,” said Environment and Climate Change Minister Catherine McKenna in a statement last night, reiterating that many of the contentious amendments to both bills had been handcrafted by the fossil lobby before being adopted by compliant but unelected senators.
In the end, “Bill C-48 was passed with only modest amendments, despite efforts by some senators to create a so-called ‘corridor’ that would allow oil tankers to dock in some designated areas,” the National Post reports.
Sen. David Tkachuk (C, SK), the transport committee chair whose conduct of hearings into Bill C-69 became a matter of public discussion among some senators earlier this month, was critical of the vote, the Globe and Mail writes. But Sen. Paula Simons (I, AB), who some said was “harassed” into casting the deciding vote to defeat C-48 in committee, supported the final version of C-69. She tweeted that the 99 amendments the government had adopted, mostly from Independent senators, had “improved it hugely”.
The Post notes as well that Senate adopted the less heavily-debated Bill C-88, amending the Canada Petroleum Resources Act to ban offshore oil drilling in the North.
In December 2016, Prime Minister Justin Trudeau “announced a moratorium on offshore oil drilling across all Arctic waters, which the federal government enforced not through legislation but by simply rejecting any new bids for licences or exploration permits, effectively shutting down any would-be resource extraction in the region,” the Post explains. “The updated legislation now provides the federal government the right to enforce the drilling moratorium based on ‘the Canadian interest,’ but does not explicitly define how the threshold will be met.” In June, Crown-Indigenous Relations Minister Carolyn Bennett told a Senate committee that Trudeau was concerned about the risk of an oil spill in ecologically sensitive waters.
Final decision on Tesoro’s Washington railport pushed to 2016
By Kristen Hays, June 26, 2015
HOUSTON – The latest delay in a detailed government review of Tesoro Corp’s proposed $210 million railport project in Washington state means a final decision will not happen until 2016, according to a state council’s published schedule.
The 360,000 barrels-per-day project would be the biggest in the United States, moving domestic and Canadian crude via rail to Washington’s Port of Vancouver, where it would be loaded onto vessels to supply West Coast refineries – mainly in California.
The company had hoped to start it up by late 2014, and then pushed it to this year as the project undergoes a lengthy state review.
Several other oil-by-rail projects, largely in California, are stalled amid opposition after multiple crude train crashes and derailments since mid-2013.
Tesoro said the company was disappointed in “yet another delay” and remains committed to the project.
Chief Executive Greg Goff told analysts last month that the delay to 2016 was likely as the project undergoes what he called a “painfully slow” review process.
The projected cost also has more than doubled to $210 million from its original $100 million as Tesoro upgraded the design, including seismic dock improvements.
Washington’s Energy Facility Site Evaluation Council (EFSEC)’s schedule, made public this week, says a draft environmental impact statement will be published in late November. The council had previously expected to release the draft report in late July.
State law then requires a month-long public comment period which can be lengthened.
EFSEC then will submit the final report to Gov. Jay Inslee, who has final say on whether it will be built. The new schedule, and the public comment session, pushes that submission to early 2016. Inslee will have up to two months to decide once he receives the report.
Most Washington refineries, including Tesoro’s 120,000 bpd plant in Anacortes, receive oil by rail. No major pipelines move oil west across the Rocky Mountains or the Cascades, so West Coast refineries turn to rail to tap North American crudes that cost less than imports.
(Reporting by Kristen Hays; Editing by Christian Plumb)
Washington state judge denies Shell appeal on rail project review
HOUSTON | By Kristen Hays, May 21, 2015 11:34pm BST
A judge on Thursday denied Royal Dutch Shell’s appeal of a ruling that a proposed oil-by-rail project at its Washington state refinery must undergo a full environmental review, just two weeks after a crude train derailment caused a fire in North Dakota.
Shell had appealed a February ruling from a Skagit County Office of Land Use Hearings examiner that the plan to move 70,000 barrels per day of inland crude to its 145,000 bpd Puget Sound refinery in Anacortes must be comprehensively reviewed.
In 2014, the county said the project did not need that much scrutiny to get a permit, prompting challenges from several environmental organizations.
On Thursday, a Skagit County Superior Court judge denied Shell’s appeal, according to court officials.
The denial came two weeks after an eastbound crude train derailed in North Dakota, the latest in a spate of fiery mishaps since 2013 that have stoked fears about moving oil by rail.
Shell had sought to limit the review’s scope to exclude railroad issues overseen solely by federal regulators, but said it remains committed to working with the county and other agencies to finish the permitting process.
Shell’s refining competitors in Washington have been bringing in U.S. crudes by rail since 2012 to displace more expensive imports and declining Alaskan oil output. Shell was the last to seek oil-by-rail permits in late 2013, but by then opponents had taken notice of train crashes and safety concerns.
The rail issue is not Shell’s only concern in the state. The company also faces opponents to its plan to use the port city of Seattle to ready rigs before they travel to the Chukchi Sea off the north coast of Alaska.
(Reporting By Kristen Hays. Editing by Andre Grenon)
Repost from Crosscut, News of the Great Nearby [Editor: This is an excellent broad analysis of the intermingled risks of increasing rail, marine and pipeline delivery of North American crude to ports in the Pacific Northwest. Recommended reading. (Note that comments on increasing export of crude appear in the bulleted section, 9 paragraphs into the article.) Be sure to view the Friends of the Earth infographic showing regional impacts of multiple proposed fuel transport projects. – RS]
Guest Opinion: Dirty fuel exports darken NW’s Earth Day
By Fred Felleman, March 31, 2015
A refinery on Fidalgo Island near Anacortes (2008). Credit: 24hourmoon/Flickr
Some hailed President Barack Obama’s recent veto of the Keystone pipeline authorization legislation as an early Earth Day gift, spelling the project’s death knell. However, his decision was actually based on process, not policy. While Obama has articulated the science behind climate change better than any predecessor, his all-of-the-above energy strategy has opened the floodgates to unprecedented levels of domestic fossil fuel extraction with lax oversight.
These policies resulted in disasters such as BP’s indelible mark on the Gulf of Mexico five Earth Days ago. In typical fashion, regulators responded with some of the long-needed oversight, but offshore production soon came roaring back.
Recent oil train derailments, exposing communities to elevated risks, also reflect the administration’s policies in the face of the gusher of under-regulated fracked oil as it became cost-effective to bring to market by rail. While Bakken oil is the primary source of this incendiary risk, there are still only proposed national regulations on fracking without consideration of climate impacts. Despite the growing number of oil-train accidents, only weak requirements for safer tanker cars are being developed though Sen. Maria Cantwell just introduced legislation beginning to address this deficiency.
Leases are also being let on public lands at bargain-basement rates for coal extraction and risky Arctic oil exploration. Even after Shell Oil’s calamitous attempts to drill in the Chukchi Sea three years ago, resulting in eight felony convictions and $12.2 million in fines, the company is pursuing Arctic development this year.
Closer to home, Shell has secured the ability to use Terminal 5 from the Port of Seattle to maintain their oil rigs. This is yet another reflection of how the Northwest is being broadly targeted as the gateway for oil, coal and liquefied natural gas to Asian markets – all of which contribute unacceptable climate impacts.
Not since the late 1970s, when NW refineries switched from receiving crude oil from Alberta by pipeline to tankers from Alaska and elsewhere, have Washington’s waters and communities been exposed to such a growth in vessel casualties and oil spill risk. Despite the abandonment of four coal terminal proposals, there are still nearly 20 proposals for oil, coal, propane and LNG terminals either under review or recently permitted.
There is a major difference between the proactive safety planning that preceded the arrival of Alaskan oil tankers in the 1970s with the ad hoc gold-rush mentality that pervades today’s permit decisions.
The last time there was such a growing threat of catastrophic spills, the late Sen. Warren Magnuson took the lead in protecting the Sound from spills. He restricted the size and number of tankers transiting east of Port Angeles and worked on other national and local safety measures, like the 1978 Port and Tanker Safety Act and the creation of an international vessel traffic system in North America, enabling the Coast Guard to serve as ship traffic controllers in the Pacific Northwest. These measures lasted the test of time and continue to contribute to our admirable oil spill record – a legacy to endure. However, it is critical not to rest on our laurels especially since frequency of incidents and accidents are a far better indication of risk exposure than rare spills.
In contrast, today, while new risks accumulate, we see reductions being made in rail and marine safety measures, despite efforts by Sen. Cantwell and others. Such reductions include:
Rail companies are trying to negotiate with unions to reduce the number of crew from two to one required for the operation of 100-plus-car oil trains. The Federal Railroad Administration has not even defined the minimum crew size required for safe operations despite years of requests by the NTSB.
The Obama administration recently published clarification as to the seven ways in which domestically produced crude can be exported from the U.S. Despite this liberalization of exports, oil companies are pushing Congress for complete elimination of the longstanding ban on exports of U.S. oil.
The U.S. Army Corps asserted in the draft environmental impact statement, 10 years in the making, for the construction of BP’s second tanker dock at Cherry Point that the agency’s permit did not violate a Magnuson amendment to the Marine Mammal Protection Act. But the amendment seems to explicitly prohibit such actions. They have also yet to respond to the Lummi’s tribe call to abandon the Gateway coal project due to impacts to their treaty-protected rights.
The Washington State Pilotage Commission recently reduced the training required of pilots allowed to guide oil tankers in and out of Grays Harbor — despite growth in vessel traffic and three newly proposed oil terminals there.
Gov. Jay Inslee and local governments failed to require full environmental impact statements evaluating the chronic train and cumulative vessel impacts of the numerous oil terminal proposals prior to issuing permits. The only time such analysis has been required is in response to lawsuits. (An infographic was produced by Friends of the Earth and Protect Whatcom to visualize this increase associated with new terminals.)
One recent exercise of state authority was the Utilities and Trade Commission’s (UTC) fines against BNSF’s series of oil spills from oil trains calling on Washington. While such leadership is encouraging, in reality we don’t need their money as much as we need to be freed from their leaky oil trains. Similarly, on the marine front there is state legislation calling for tugs to escort the growing number of oil barges moving through Washington waters.
The combined vessel traffic currently bound to and from ports in Washington and British Columbia make the Strait of Juan de Fuca the second busiest waterway in North America.
While Washington’s regulatory agencies are overwhelmed by the onslaught of new terminal proposals and the fate of the Keystone pipeline nationally remains uncertain, there is a major threat coming from Canada to Washington and British Columbia’s Salish Sea. Former Enron executives acquired the Kinder Morgan pipeline that currently connects the vast Alberta tar sand reserves with a port near Vancouver, British Columbia. They are now seeking permits from Canada’s National Energy Board to triple its capacity, making it comparable in volume to the far better known Keystone proposal.
A spur in the Trans Mountain pipeline has also directly connected Washington’s four largest refineries in Whatcom and Skagit counties to Albertan oil since the 1950s. This helps explain why the refineries were constructed in the navigationally challenging waters through the San Juan Islands, rather than along the much broader Juan de Fuca Strait.
This expansion would result in a sevenfold increase in tanker traffic transiting through the San Juan Islands and the core area of the endangered Southern Resident killer whale community. The tankers would go from about one per week to one per day. Researchers at the George Washington University and Virginia Commonwealth University calculated this would result in a 51 percent increase in the amount of oil transported through the Salish Sea and increases in the risks of oil spills from collisions and groundings.
Tar Sands pose unique challenges to the response community. In order to get the heavy bitumen produced in Alberta to flow into pipelines, rail cars and tankers, it needs to be mixed with highly volatile diluents. This mixture, known as dilbit, has been shown to be explosive during accidents. And, during spills, the evaporation of volatile vapors poses health risks to responders, while the heavy remainders sink in water, complicating clean-up efforts.
Despite risks of Trans Mountain’s proposed expansion to the Salish Sea, the U.S. Coast Guard has been reluctant to release incident data in these boundary waters, claiming that is up to Canada – including when incidents occurred in U.S. waters. The lack of this data has underrepresented the vessel casualty risk in the analysis conducted for several terminal proposals.
Building a cross-Cascades pipeline to bring Alaskan oil to the Rocky Mountain states was part of the original plan to construct the state’s largest refinery (ARCO, now BP Cherry Point) north of Bellingham in the 1970s. This would have significantly increased the number of tankers calling on our waters that Magnuson’s efforts successfully thwarted. Now there is state legislation introduced to study sending oil over the cascades in the other direction, thereby connecting Washington refineries to Midwest oil. A recent series of major pipeline leaks has demonstrated how regulations have also lagged behind this oft-touted safest form of oil transportation. Since 2012, according the AP, 50 pipelines have been constructed – adding 3.3 million barrels of daily pipeline capacity, dwarfing Keystone’s 800,000. Between 2004 and 2012, U.S. pipelines spilled three times as much crude as oil trains.
As restrictions on the export of domestic oil are lifted, any purported benefits of pipelines will be quickly eclipsed by the risks associated with the increased volumes of oil being shipped overseas.
Based on statements in the President’s State of the Union address calling on Congress to send him something more than just a pipeline bill, it appears that he is willing to horse trade the completion of the Keystone pipeline for Republican support of his other priority infrastructure projects. Regardless, the uncertainty about Keystone has only emboldened Kinder Morgan to influence Canadian government decision-makers to get one of the world’s largest, most destructive and energy inefficient oil sources to international markets, risking the Salish Sea waters Washington shares with Canada.
As we look toward Earth Day, it’s sobering to remember the failures of oil shipment policies the country has seen. It was 26 years ago last week (March 24) that the Exxon Valdez spilled 11 million gallons of North Slope crude into the biological oasis of Prince William Sound. After that, Congress finally required tankers to be double hulled. It took until this year to complete the phase out of all single-hulled tankers, each carrying up to 33 million gallons of crude through Washington waters. One of Magnuson’s last actions was to write to Congress on his deathbed following Exxon’s abject failure to prevent or respond to their despoiling of Prince William Sound, calling on that body to require double hulls for oil tankers.
Obama’s priority trade deal, the Transpacific Partnership (TPP), will require compensating fossil fuel extractors for potential lost revenues if they are required to “keep it in the ground.” This subsidy undermines an essential step for combating catastrophic climate impacts.
The great legacy, from Magnuson and others, of protecting of Puget Sound is under threat. We need stronger local, state and congressional leadership on energy and the environment. And we need our next president to redefine an “all of the above” energy policy into one that transfers subsidies from peddlers of fossil fuel to peddlers of bicycles and for energy truly coming from above, such as wind and solar power. Otherwise, our children will lose the benefits of the natural capital we are jeopardizing by our lack of long-term vision.
