Chip Cummins, Wall Street Journal, July 11 2012
It was another tough day for Canada’s pipeline industry, as U.S. regulators on Tuesday lambasted Calgary-based Enbridge Inc. for its handling of a 2010 oil spill in Michigan’s Kalamazoo River.
The public whipping came on the heels of a series of spills further north, in Alberta. An Enbridge line spilled some 1,450 barrels in eastern Alberta in June. Earlier that month, Plains All American Pipeline LP spilled up to 3,000 barrels into a reservoir near the small resort town of Sundre, Alberta. And in May, Pace Oil & Gas Ltd. spilled some 5,000 barrels from a well in a remote corner of northwestern Alberta.
As we’ve written here before, the spills coincide with an effort by Canadian officials and the industry to push a series of ambitious 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 U.S.
The ramifications of the recent spills and regulatory scrutiny couldn’t have been more clear Tuesday when the U.S. National Transportation Safety Board’s Chairwoman Deborah Hersman compared Enbridge’s response to the Michigan spill to the “Keystone Kops,” the bungling police force of the silent-movie era.
As The Wall Street Journal’s Matthew Dolan and Edward Welsch write in today’s Journal: “The other Keystone in the picture is Keystone XL,” TransCanada’s expansion project.
Whether Ms. Hersman’s choice of words was deliberate or not, the scathing Enbridge review will likely have repercussions on the Keystone saga playing out in Washington. The Obama administration, citing environmental concerns, has refused to grant permits for the Keystone project. Republicans say President Barack Obama’s policy is costing thousands of jobs and undermines U.S. energy security.
The industry defends its record of safety. Last month, when we asked about the spate of June spills, Canadian Energy Pipeline Association spokesman Philippe Reicher said there have only been between zero and five spills a year of 50 barrels-plus of oil over the past 10 years. Alberta’s provincial energy regulator, the Energy Resources Conservation Board, said safety regulations are strong.
Regarding the Kalamazoo spill, Enbridge has said it’s learned lessons, but defended its response as well intentioned.