Safety and Security of Energy Pipelines in Canada: A Report to Ministers

Safety and Security of Energy Pipelines in Canada:  A Report to Ministers
Safety and Security of Energy Pipelines in Canada:
A Report to Ministers
Energy and Mines Ministers’ Conference
Sudbury, Ontario
August 2014
Safety and Security of Energy Pipelines in Canada:
A Report to Ministers
Energy and Mines Ministers’ Conference
Sudbury, Ontario
August 2014
Aussi disponible en français sous le titre: La sûreté et la sécurité des pipelines au Canada : rapport aux
ministres
ISBN 978-1-100-24528-7 (Online)
Cat No. M134-34/2014E-PDF
Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Table of Contents
Executive Summary.................................................................................................... 1
Context and Methodology ......................................................................................... 3
Introduction ............................................................................................................... 4
Survey Results and Analysis ....................................................................................... 6
I) Prevention .........................................................................................................................................................7
Safety Culture and Standards............................................................................................................................7
Maintenance, Testing, Inspections and Audits .................................................................................................9
Spill Data ...........................................................................................................................................................9
Compliance, Orders, Penalties, and Fines ...................................................................................................... 10
II) Preparedness & Response ............................................................................................................................. 11
Emergency Management Program ................................................................................................................ 11
Incident Reporting ......................................................................................................................................... 13
Response Standards ....................................................................................................................................... 13
Restoration of Environmental and Natural Resources Damages ................................................................... 14
Response Equipment ..................................................................................................................................... 16
Drills, Exercises, and Personnel Training ........................................................................................................ 17
III) Liability & Compensation ............................................................................................................................. 18
Comprehensive Liability Regime .................................................................................................................... 18
Financial Capacity Requirements ................................................................................................................... 19
Independent Financial Backstop .................................................................................................................... 19
Conclusion ............................................................................................................... 20
Next Steps .......................................................................................................................................................... 20
Annex 1: Survey Questions ...................................................................................... 21
Annex 2: Survey Responses ...................................................................................... 23
Annex 3: Pipeline Regulators in Canada ................................................................... 89
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Executive Summary
Canada’s oil production in 2012 was higher than it has ever been before, and is projected to continue
growing in coming years. Production from Canada’s oil sands is forecast to continue growing from 1.8
million barrels per day to more than 5 million barrels per day in 2035. New gas discoveries, particularly
from shale, are also rising, further driving forecasts of growing natural gas production. Moving this oil
and gas to markets requires infrastructure in the form of pipelines, rail or marine tankers. In Canada,
the vast majority of oil, and all natural gas, is moved to market in pipelines. Federally regulated
pipelines transport more than $100 billion worth of oil, gas, and petroleum products each year.
With several major pipelines being proposed or developed in recent years and in light of a number of
high-profile incidents across North America recently, the safety and security of Canada’s pipelines is
under intense scrutiny. With this in mind, the federal, provincial and territorial governments undertook
a detailed review of the safety regimes governing pipelines across Canada. The analysis involved a
survey of jurisdictions with pipeline systems.
This report consolidates the input received from across the country to provide a comprehensive
perspective on Canada’s overall pipeline regulatory regime. The approach to pipeline safety in Canada
can be divided among three pillars: (1) prevention; (2) preparedness and response; and (3) liability and
compensation. There are many similarities in the regulatory approach undertaken by different
jurisdictions under each of these pillars.
Prevention
Both Federal and Provincial pipeline regulators require pipeline operators to anticipate, prevent,
manage and mitigate potentially dangerous conditions associated with pipelines under their
jurisdiction. Companies must design safety management, environmental protection, emergency
management, security management, third party crossings, public awareness and integrity programs,
which are reviewed and audited by regulators. Pipeline management is always improving with regular
updates to standards and regulations that require operators to systematically inspect and evaluate
pipe condition and proactively ensure safe operation.
Preparedness and Response
Federal and provincial pipeline regulatory oversight is aimed at preventing incidents from happening.
However, if an incident occurs, regulators exercise their authority to protect the public, workers,
property, and the environment. A company’s emergency management program guides response and
containment of a spill with appropriate equipment and personnel. Pipeline companies must have
internal or contracted spill first-responders, and continually educate them on practices and procedures
to be followed in the event of an emergency.
Industry also has voluntary arrangements in place to collaborate on emergency preparedness and
response. For example, through oil spill co-operatives, companies within a specific geographic region
work together to achieve a state of spill response readiness. Additionally, member companies of the
Canadian Energy Pipeline Association (CEPA) recently formalized an agreement to collaborate on
emergency response, which allows for the sharing of resources, personnel, equipment and advice, in
the event of an emergency.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Liability and Compensation
Provincial liability regimes apply to both federally and provincially regulated pipelines as long as they
do not violate the inter-jurisdictional immunity and paramountcy. The provinces and territories have
used two general approaches, often simultaneously, to create statutory civil liability regimes. Some
provinces, as well as the Yukon Territory, have enacted legislation governing the operation of
intraprovincial pipelines; in many cases, such legislation imposes some degree of liability on pipeline
operators for government spill response costs. Second, every province and territory has enacted
legislation governing the release of environmental pollutants. These laws typically establish a cost
recovery mechanism that governments may use to hold pipeline operators liable for spill response
costs. In some cases, pipeline operators are also subject to codified liability where a spill causes
government and/or third party loss or damage.
Next Steps
Continuous improvement is an absolute requirement for achieving and maintaining a world-class
energy pipeline regulatory regime in Canada. Building on recent and ongoing pipeline regulatory
improvements across federal, provincial and territorial jurisdictions, areas of focus moving forward
include:
-
Continue implementing proposed legislative, regulatory, and related pipeline initiatives while
ensuring that Aboriginals and other key stakeholders are meaningfully engaged;
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Commit to further studying and improving the safety and security of broader energy transportation
systems including rail, marine and trucking;
-
Enhance communications to ensure fact-based dialogue surrounding energy transportation;
-
Explore options for improved cooperation and collaboration between jurisdictions either through
harmonization, sharing or leveraging information and expertise;
-
Explore opportunities for enhanced collaboration on pipeline innovation between governments,
regulators and industry – for example, “Best Available Technologies” recognized through the
Canadian Pipeline Technology Collaborative (CPTC);
-
Continue to cooperate in efforts to enhance the safety and security of hydrocarbon production and
transportation systems, including damage prevention and cyber security.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Context and Methodology
With 825 000 kilometres of transmission, gathering and distribution pipelines in Canada, most
provinces have significant pipeline infrastructure. This includes 105 000 kilometres of large-diameter
transmission pipelines. Oil and natural gas pipelines are generally buried underground and service most
major Canadian cities. The National Energy Board (NEB) regulates about 100 companies which operate
over 73 000 kilometres of pipelines in Canada.
Pipelines are necessary to deliver fuel to Canadians to heat their homes, drive their cars, or travel by
bus, ship, train, or air. The majority of homes in Canada are heated with natural gas, all of which is
delivered by pipeline. Petroleum products are also used as feedstock to make materials found in
everyday household items, such as toiletries, electronics and clothes. Pipelines are used to move these
petroleum products to refineries and to customers across the country. Canadians simply could not live
as they do today without pipelines.
Before any pipeline project can proceed, it must be reviewed by the appropriate federal or provincial
regulator to ensure that it is designed, constructed and operated in a manner that is safe and secure,
protects the environment and the public, and is economically feasible and in the public interest.
Pipelines are regulated throughout their entire life cycle (planning, design, construction, operation,
decommissioning and abandonment). An integral part of this process is the engagement of
stakeholders. This two-way communication keeps stakeholders informed about projects and keeps the
pipeline operator and government aware of community issues and concerns while informing
appropriate mitigation to minimize impacts
Canada has the resources to become a global supplier of oil and natural gas, but requires additional
infrastructure to access new or expanding markets. Markets are responding, by driving the pursuit of
various transportation options, including pipelines, marine, and rail. In light of this expanding energy
transportation infrastructure, when taken in conjunction with several recent high-profile incidents,
there is increasing scrutiny on the part of Canadians regarding the safety of Canada’s energy
infrastructure and transportation systems.
Within this context, federal, provincial and territorial officials sought to catalogue existing safety and
security measures and regimes covering pipelines across Canada, to take stock and assess the scope of
these activities.
A survey (ref. Annex 1) was circulated to federal, provincial and territorial officials through the Energy
and Mines Ministers’ Conference Markets and Trade Working Group. Annex 2 provides the
jurisdictions’ responses. The survey collected information on specific elements related to pipelines,
organized under three pillars: 1) Prevention; 2) Preparedness & Response1; and, 3) Liability &
Compensation.
Each jurisdiction was invited to use the survey as a means to frame their particular pipeline safety
regime. This report consolidates the input received from the provinces so as to provide an overview of
pipeline regulatory regimes across Canada. The report is not intended to provide comparisons between
jurisdictions or to serve as a gap analysis tool; instead, it is a simple compendium of pipeline regulatory
1
In some provinces, such as British Columbia, provincial environment ministries have legislated responsibilities for spills of
hazardous materials. Provincial environment ministries were not specifically surveyed in this exercise.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
regimes across Canada. This is an important point as the jurisdictions being compared differ
substantially in the amount of pipelines and types of products that flow through them, making
comparisons difficult.
Introduction
Canadian pipeline regulators provide safety-focused oversight and emergency management for energy
pipeline facilities and operations. The National Energy Board (NEB) is the independent federal agency
established to regulate international and inter-provincial pipelines, energy development and trade.
Pipelines contained entirely within a single jurisdiction are generally regulated by provincial or
territorial regulatory bodies. Annex 3 provides a list of pipeline regulators in Canada.
Pipeline regulatory regimes across Canada have much in common, including the adoption of the
Canadian Standards Association (CSA) standard Z662 – Oil and Gas Pipeline Systems, which sets out the
technical standards for the design, construction, operation, maintenance and decommissioning of
Canada’s oil and gas pipelines. However, there are still significant differences in regulatory regimes
across Canada. This report uses survey data to compare and contrast pipeline regulatory regimes
across Canada, focusing on three particular areas.
Prevention
Regulatory oversight is aimed at preventing incidents from happening. Pipeline regulators require
companies to anticipate, prevent, manage and mitigate potentially dangerous conditions associated
with their pipelines. Companies must design safety management, environmental protection,
emergency management, security management, third party crossings, public awareness and integrity
programs, which are reviewed and audited by regulatory bodies. Regulators have various enforcement
measures at their disposal to ensure compliance.
Preparedness & Response
In the event of a spill, pipeline regulators must be notified immediately. A company’s Emergency
Procedures Manual guides the response and containment of a spill. Pipeline companies must have
internal or contracted spill first-responders and continually educate all first responders – including
external agencies such as fire departments and police – on practices and procedures to be followed in
the event of an emergency.
Liability & Compensation
If the operator is at fault, the pipeline company is liable for costs to clean up a pipeline spill. Regulators
can order remediation. The Government of Canada intends to enshrine in legislation the ‘polluter pays’
principle and require pipeline companies to have sufficient financial capacity to respond to spills, leaks
and ruptures while ensuring companies remain responsible for their abandoned pipelines. In addition
to being financially responsible for clean-up, the company may also be fined or be subjected to other
enforcement actions such as Notices of Non-Compliance, Orders, Administrative Monetary Penalties,
revocation of authorization or prosecution. Violators may also be subject to prosecution and fines
under other federal and provincial legislation.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
The next chapter lists Government of Canada actions to improve the federal pipeline regime within the
context of safety and security. The balance of the report compares and contrasts highlights of pipeline
regulatory regimes across Canada.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Canada’s World-Class Pipeline Safety
The Government of Canada is taking action to improve Canada’s pipeline safety system on federally
regulated pipelines through the strongest measures in three areas — 1) Prevention; 2) Preparedness
& Response; and 3) Liability & Compensation. Examples of recent changes, initiatives and proposed
amendments include:
Prevention
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
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
Increase the number of annual oil and gas pipeline inspections conducted by the
National Energy Board (NEB) by 50 percent
Double the number of annual comprehensive audits by the NEB (from three to six)
Improve disclosure of publicly available pipeline safety documents
The government will seek guidance from NEB on the application of “best available
technology” in pipeline construction and operations
Apply Administrative Monetary Penalties for violations of the NEB Act
Strengthen and clarify the powers of NEB audit and inspection officers
Preparedness & Response





Require pipeline companies to have minimum financial resources to be prepared for an
incident (set at $1B for major oil pipelines)
Require companies to have a minimum amount of cash on hand to respond quickly to
incidents
Enable the NEB with the ability to take control of response and clean-up
Provide the NEB authority and resources to take control of incident response if a
company is unable or unwilling to do so
Develop a strategy for integrating Aboriginal communities in pipeline safety operations,
e.g., emergency response planning, pipeline monitoring, and related employment and
business opportunities
Liability & Compensation





Make companies operating pipelines liable on a “no-fault” basis for up to $1 billion, in
addition to unlimited liability when at fault or negligent
Hold pipeline companies responsible for pipelines for entire life cycle, including post
abandonment
Provide government funds for clean-up if a company is unable or unwilling
(incapacitated) and recover costs from industry
Provide the NEB with authority to order companies operating pipelines to reimburse
any cleanup costs incurred by governments or individuals
Improve pipeline arbitration for compensation disputes
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Survey Results and Analysis
I) Prevention
Both Federal and Provincial pipeline regulators require pipeline operators to anticipate, prevent,
manage and mitigate potentially dangerous conditions associated with pipelines under their
jurisdiction. Companies must design safety management, environmental protection, emergency
management, third party crossings, public awareness and integrity programs, which are reviewed and
audited by regulators. Pipeline management is always improving, with regular updates to standards
and regulations that require operators to systematically inspect and evaluate pipe condition and
proactively ensure safe operation.
Safety Culture and Standards
Safety culture is an assembly of characteristics and attitudes that ensure an overriding priority for
safety issues. Safety culture is implemented by organizations and reinforced and mandated through
the adoption of codes, standards and
regulations.
GOVERNMENT OF CANADA
CanmetMATERIALS Pipelines Program
The Canadian Standards Association (CSA)
provides the benchmark standards and
regulations for all pipelines in Canada. The CSA
Standard Z662 — Oil and Gas Pipeline Systems
sets out the technical standards for the design,
construction, operation, maintenance and
decommissioning of Canada’s oil and gas
pipelines. Standards are continually reviewed
using strict revision and approval protocols by a
knowledgeable and experienced group of
professionals representing industry
stakeholders, including provincial and federal
pipeline regulators. CSA Z662 is revised and
published on a four-year basis.
CanmetMATERIALS is a materials research laboratory in
Natural Resources Canada. Its Pipelines Program
develops and validates new materials and technologies
to:






extend the life of oil and gas pipelines;
increase pipeline capacity;
ensure pipeline integrity and reliability;
provide authoritative information on pipeline
materials issues;
improve or enable development of new
codes and standards; and,
facilitate innovation and competitiveness.
Regulations and legislation govern pipeline
activities within Canadian jurisdictions. Examples include New Brunswick’s Pipeline Act 2005 and
Manitoba’s Oil and Gas Act. All provincial and federal regulatory bodies adopt the latest version of CSA
Standard Z662 into their own regulatory frameworks through “incorporation by reference”. Some
provinces adapt CSA Z662 to reflect unique circumstances in their jurisdiction.
Other examples of recognized standards organizations that can be incorporated by reference include:
the American Petroleum Institute (API), the American Society of Mechanical Engineers (ASME), the
American Society for Testing and Materials (ASTM), Underwriters Laboratories of Canada (ULC) and the
National Research Council Canada (NRCC).
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
INDUSTRY-LED INITIATIVE
Canadian Pipeline Technology Collaborative
The recently established Canadian Pipeline Technology Collaborative (CPTC), led by industry, will address
key challenges in technology development for the pipeline industry. The key objectives of the CPTC
include: to develop, implement and commercialize new pipeline technologies; champion the expansion
of research infrastructure in government, academic and private research facilities across Canada to meet
the needs of industry-driven projects; and support a network for pipeline research in Canada and around
the world to focus collaboration on priority issues.
Supply chain partners, especially small and medium enterprises, will be engaged to validate new
technologies as well as to develop new technologies to fill technology gaps identified through the project
work. Priority topics, identified by industry, include:



Integrity Management: Reduce the number of pipeline leaks through effective design,
construction, inspection and maintenance;
Leak Detection: Improve the sensitivity and reliability of leak detection systems; and,
Spill Response: Mitigate the environmental impact of spills through faster response and
effective restoration techniques.
While most jurisdictions use CSA Z662 as the minimum performance standard for pipelines, some
provinces impose additional requirements. For example, CSA Z662 contains non-mandatory provisions
in its annexes such as “Guidelines for pipeline system integrity management programs”. Alberta and
British Columbia make these guidelines mandatory and enforce them through provincial regulatory
frameworks. The Alberta Energy Regulator (AER) and the British Columbia Oil and Gas Commission
(BCOGC) require pipeline operators to develop, implement, and document, for all of its pipelines, a
pipeline integrity management program that complies with the latest edition of CSA Z662, Annex N.
Similarly, Alberta and Saskatchewan require that the recommended leak detection requirements
contained in Annex E of CSA Z662 are mandatory for liquid hydrocarbon pipelines.
In British Columbia, pipeline companies are required to develop, implement and maintain Damage
Prevention Programs designed to anticipate and proactively prevent third party damage to pipelines
resulting from unsafe excavation practices. Nationally, a new CSA standard is under development to
establish minimum requirements for damage prevention programs (CSA Z247). This new standard is
multi-sectoral and is being drafted in a form suitable for adoption by reference by all regulators across
Canada.
Quebec has an overarching department of public security that is in charge of public safety. Its main
goal is to reduce the vulnerability of Quebecers to disaster risks by developing a safety culture. The
Department is responsible for administering the Quebec Civil Protection Policy 2014-2024 and the Civil
Protection Act, which both have the primary objective of making Quebec society safer and more
resilient to disasters. Similarly, as infrastructure is being proposed, Quebec’s BAPE (public
environmental hearings board) advises, surveys and consults the public on projects or matters
involving environmental quality issues referred to it by the Minister, including pipeline projects. It then
publishes reports on its inquiries. The BAPE is a government agency with advisory functions and no
decision-making authority. In matters related to pipeline construction projects, the BAPE is primarily
concerned with issues surrounding the safety of proposed infrastructure.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Maintenance, Testing,
Inspections and Audits
Ensuring pipeline safety and
integrity is primarily the
responsibility of pipeline operators.
In all instances, companies must
have robust management systems
in place to design, construct,
operate, maintain, test and inspect
pipelines.
Most pipeline regulators require
pipeline operators to develop,
implement and abide by pipeline
integrity programs. Integrity
Management Programs are
required under CSA Z662 and form
the basis for much of the required
maintenance, testing and
inspections on pipelines.
SPOTLIGHT - Alberta
The Alberta Energy Regulator (AER) performs proactive
pipeline inspections using a prioritization model called ‘OSI’.
‘The OSI’ helps determine the frequency of facility inspections.



‘O’ stands for ‘operator history’ – operators with
poor compliance records will have their facilities
inspected more frequently.
‘S’ represents ‘site sensitivity’ – the AER assigns
inspection priority to higher risk areas including
densely populated areas or wetlands.
‘I’ refers to ‘inherent risk’ – the AER considers the
nature of the resource being transported. For
example, high vapor pressure fluids such as propane
or ethane would warrant more frequent inspections.
Besides prioritizing inspections by the OSI system, the AER
routinely conducts proactive random inspections.
Pipeline integrity programs must be approved by regulators. Typical integrity management programs
include: inline pipeline inspections, records of the pipeline’s history, operating manuals which include
testing requirements (type, frequency, location etc.), engineering assessments to address issues such
as corrosion, third-party damage and geotechnical hazards, mitigation plans and priorities.
Usually, Inline Inspection (ILI) testing is performed at a frequency determined by the age, material and
product characteristics being transported. Other tests used are based on the results of ILI. This usually
means inspection digs, visual inspection, and non-destructive testing. Companies must also periodically
test instruments and equipment at the pipeline stations to verify their proper and safe operation.
In addition to pipeline operators’ own efforts to maintain, test, and inspect their pipeline
infrastructure, regulators also inspect infrastructure and conduct independent audits. The types of
testing and the frequency and location of such tests depend largely on the products being transmitted,
the location, the line size, the age of the pipeline and issues identified during past integrity audits.
Taken together, this provides a risk-informed model for inspection and verification.
If issues arise that may threaten the protection of property and the environment and the safety of the
public and the company’s employees, pipeline regulators can direct the company to test, inspect or
assess a pipeline in accordance with CSA standards or any other comparable standards. Repairs are to
be carried out in accordance with CSA Z662, the company’s operation manuals and its Pipeline Integrity
Management Program as well as any relevant legislation and regulations.
Spill Data
Over the 2008–2013 period, 99.999 percent of the crude oil and petroleum products transported by
Canada’s federally-regulated pipelines arrived safely. Further, over the past 3 years (2011–2013),
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
100 percent of the liquids spilled by these pipelines were completely recovered. All Canadian
jurisdictions make spill data available to the public and many jurisdictions also make broader
compliance reports available to the public. For example, the National Energy Board (NEB) routinely
posts compliance and enforcement actions online.
Compliance, Orders, Penalties, and Fines
Jurisdictions have a variety of tools and powers at their disposal for enforcing compliance and
reprimanding non-compliance. Enforcement options are generally based on significance and severity of
the contravention and the ability to achieve compliance as quickly and effectively as possible.
Enforcement options include administrative penalties, tickets, warning letters, enforcement and
environmental protection orders and prosecution. In all instances, pipeline regulators have the power
to issue advisories, request corrective action, revoke authorizations, impose safety orders that restrict
operations, and issue stop-work orders.
In most instances, pipeline regulators have the authority to levy fines and monetary penalties to
pipeline operators as a result of non-compliance. For example, a company may be prosecuted under
the National Energy Board Act for contravening orders or regulations, ranging from $100,000 and one
year in prison to $1 million and five
SPOTLIGHT - Ontario
years in prison. The NEB can also issue
administrative monetary penalties to
A person may be charged, prosecuted and convicted of an
companies and individuals. The
offence under the Environmental Protection Act in addition to
maximum daily penalty to individuals is
an environmental penalty. Operating licenses and permits may
$25,000 (per violation) and $100,000 for
be suspended under the EPA until the environmental penalty is
companies (per violation).
paid.

In many jurisdictions, regulators have
developed prioritization models for the
application of compliance assessment
resources such as audits and
inspections. In British Columbia, the
BCOGC conducts periodic (maximum 5year interval) assessments of Damage
Prevention Programs and Integrity
Management Programs. Risk
prioritization is used, factoring inherent
risk and operator performance data to
assign the majority of inspection
activities.


The maximum first-offence penalties for failure to
comply with the terms and conditions of an
environmental compliance approval, certificate of
property use, of a license or permit under EPA or
failure to comply with terms of a report is $4 million
for individuals and $6 million for corporations.:
The maximum first-offence penalties for failure to
comply with an order or pay fees as required is
$50,000 for individuals and $250,000 for
corporations.
For failure to do everything practicable to control
the spill of a pollutant or exceeding discharge limits,
including a limit of zero the environmental penalties
shall not exceed $100,000 for each day on which the
contravention occurred or continued.
Provincial environment ministries also
have powers to charge and prosecute pipeline operators for non-compliance. For example, under the
penal provisions of Quebec’s Environment Quality Act, a fine of $5,000 to $1,000,000 or a maximum
term of imprisonment of 18 months, or both, in the case of an individual, and a fine of $15,000 to
$6,000,000 for a legal entity, are provided for whoever contravenes the standards governing the
discharge of contaminants into the environment or the requirement to inform the Minister of the
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
MDDELCC2 without delay of the accidental presence in the environment of a contaminant. Reference
Ontario’s fact box, which provides additional insights into Ontario’s enforcement options under the
Environmental Protection Act.
II) Preparedness & Response
Federal and provincial pipeline regulatory oversight is aimed at preventing incidents from happening.
However, if an incident occurs, regulators exercise their authority to protect the public, workers,
property, and the environment.
A company’s emergency management program guides response and containment of a spill with
appropriate equipment and personnel. Pipeline companies must have internal or contracted spill firstresponders, and continually educate them on practices and procedures to be followed in the event of
an emergency.
Industry also has voluntary
Emergency Response Plans outline the action a company will
arrangements in place to
take should an emergency situation occur. They are developed
collaborate on emergency
and updated by pipeline operators and submitted to the
preparedness and response. For
appropriate regulator for review and audit.
example, through oil spill cooperatives, companies within a
Oil Spill Co-operatives operate within specific geographic areas.
The petroleum companies in each co-operative work together
specific geographic region work
to achieve a state of spill response readiness by maintaining
together to achieve a state of spill
spill contingency plans and strategically placing specialized
response readiness. Additionally,
equipment, infrastructure and personnel, available to all
member companies of the
member companies in the area, and undergo regional training.
Canadian Energy Pipeline
Association (CEPA) recently
formalized an agreement to collaborate on emergency response, which allows for the sharing of
resources, personnel, equipment and advice, in the event of an emergency.
Emergency Management Program
Emergency management includes all activities done prior to an emergency so that designated
personnel are ready and able to respond quickly and appropriately to an incident. Activities include
identifying hazards; preparing and maintaining an emergency management plan and specific response
procedures; identifying and securing sufficient resources and equipment; and designating response
personnel and ensuring they are suitably equipped to carry out their duties through training, drills and
exercises.
An emergency response plan outlines the necessary steps and decisions required to manage an
emergency situation. It contains specific steps that the operator must take to control the incident. It
also identifies the detailed roles and responsibilities for all responders, and specifies how a company
will work with the appropriate government agencies. Emergency response plans may or may not be
geographically specific. Often, such plans include manuals on how to proceed with the deployment of
emergency personnel, evacuation plans, communication procedures, and protocols.
2
MDDELCC : ministère du Développement durable, de l’Environnement et de la Lutte contre les changements climatiques
11
Safety and Security of Energy Pipelines in Canada: A Report to Ministers
In Canada, the National Energy Board requires companies with federally regulated pipelines to have an
emergency management program. This program must anticipate, prevent, manage and mitigate
conditions during an emergency that could adversely affect property, the environment or safety of the
workers or the public. Companies must design emergency response plans for any event that could
affect the pipeline, including accounting for geographically specific hazards. Similar requirements are
found within British Columbia’s Emergency Management Regulation under the BCOGC.
Operators of provincially regulated pipelines must have an approved emergency response plan
registered with the appropriate regulator or ministry, or, if located in Alberta, British Columbia or
Saskatchewan, must be a member in good standing of Western Canadian Spill Services Ltd. (WCSS) 3 oil
spill cooperatives. WCSS prepares and submits an emergency response plan to the appropriate
regulator on behalf of its members. Going forward, Saskatchewan is considering having all pipeline
companies adhere to an oil spill co-op in each geographic area through which their pipeline is routed,
and British Columbia is considering requiring all potential spillers (including liquid pipelines) to belong
to a province-wide spill response organization similar to Transport Canada’s requirements for marine
traffic.
Nationally, the CSA Group Strategic Steering Committee on Petroleum & Natural Gas Industry Systems
is overseeing the development of a new national standard for Emergency Management that will apply
across the entire petroleum and natural pipelines sector. CSA Z246.2 is scheduled for publication in the
spring of 2015 and will likely be adopted by reference across much of Canada similar to the current use
of CSA Z662.
To test emergency response plans, provinces may require operators to conduct regular emergency
response exercises and to regularly consult with those involved in emergency response procedures.
Outreach activities to inform nearby residents of what to do in case of a pipeline emergency are
considered a best practice.
Some provincial regulators require specific information and tools within or in addition to an operator’s
emergency response plan. For example, Nova Scotia and New Brunswick require operators to produce
an emergency procedures manual in addition to their emergency response plan. Ontario and
Saskatchewan require operators to include a procedure within their emergency response plan to notify
specific government departments or agencies, municipalities, public authorities or members of the
public who may be affected in case of a spill. In Ontario, companies are required to meet with local
police, firefighting and conservation authorities, the Ministry of Transportation, the Ministry of Natural
Resources, the Ministry of the Environment and the Technical Standards and Safety Authority (TSSA) at
set intervals to communicate capabilities and coordination required to respond to emergencies.
The required scope of emergency response plans varies. Most provinces do not require emergency
response plans to be site- or area-specific, and instead require plans that can address a spill onto land
or water from any well, pipeline or facility.
In Quebec, the Civil Protection Act requires regional authorities, in conjunction with their constituent
municipalities, to establish a civil protection plan determining objectives and actions to reduce disaster
vulnerability across their territory. Operators must take additional precautions when installing pipelines
3
Western Canadian Spill Services Ltd (WCSS) provides preparedness and response support services that meet regulatory
requirements for pipeline licensees that are members in good standing of WCSS oil spill cooperatives in Alberta, NE British
Columbia and Area 1 in Saskatchewan.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
through cultivated land to restore the soil to agricultural use, ensure soil productivity, and to monitor
soil health.
Emergency response plans in Ontario and Alberta must include hazard analysis, risk assessments, and
the identification of high-consequence areas. Emergency response planning must then be structured in
proportion to risks involved in operations. In Ontario, plans for oil pipeline segments located in highconsequence areas must be provided to the Ministry of Natural Resources and the Ministry of the
Environment for review and comment.
Incident Reporting
There is no standard definition for a “pipeline incident” in Canadian law. Definitions vary by jurisdiction,
which can influence the scale, scope, and pace of a response.
For example, federally, the Transportation Safety Board defines a “reportable pipeline incident” as an
incident resulting directly from the operation of a pipeline where any amount of uncontained and
uncontrolled release of a commodity occurs. The National Energy Board definition of a “pipeline
incident” differentiates between liquid and non-liquid spills. It includes any amount of unintended or
uncontrolled release of gas or high vapour pressure hydrocarbons, and of liquid hydrocarbons in excess
of 1.5m3. Pipeline (and associated facilities such as pumps, valves or compressors) incidents may also
include fires or explosions, death or serious injury to a person, a reduction in the structural integrity of
a pipeline, threats in the vicinity of the pipeline, or the operation of a pipeline beyond design limits.
Provincial regulators have different definitions for pipeline incidents. Incidents may be considered
“reportable” depending on their size, severity, location, type or frequency. For example, definitions
may differ in terms of the minimum volume of a spill constituting a “pipeline incident”, which must be
reported to the regulator.
In some provinces, such as Ontario, a spill of petroleum product of not more than 100 L in areas
restricted to the public, or not more than 25 L in areas with public access may be exempted from
reporting to the Ministry of the Environment and municipalities only if it is unlikely to enter a
watercourse or to cause adverse effects other than those readily and immediately remediated, and
only if records of the spill are maintained. Alberta is unique in that it requires all pipeline failures –
including tests failures, or any contact or damage to a pipeline – to be reported, regardless of the size
of the spill, area affected, status of the pipeline, or type of fluid released.
Response Standards
In the event of a pipeline incident, federal and provincial regulators must be notified immediately by
law. For example, in New Brunswick, the regulator must be immediately notified of any pipeline
incident, and a detailed report must be filed within 48 hours. The province also asks that companies
consider reporting any events having the potential to attract public or media attention or which have
or may have significant adverse effects on property, the environment, or the safety of persons,
regardless of whether or not they meet the strict definition of an “incident” in the Pipeline Act. In
Quebec, licensees must notify the provincial government without delay, or, in cases provided for by
regulation, within the time prescribed, of accidental occurrence in the environment of any
contaminant. In some provinces the pipeline operator must also notify any affected municipality (e.g.
Ontario) or landowner (e.g. Alberta) immediately following a pipeline incident.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Response standards (i.e. response time) vary within Canada, and are specified in each company’s
emergency response plan or emergency procedures manual. These standards may be specified to the
location or type of pipeline.
SPOTLIGHT – Transportation Safety Board
The Transportation Safety Board (TSB) is an independent agency that reports to Parliament through the
Leader of the Government in the House of Commons. The TSB advances transportation safety in marine,
pipeline, rail and air by conducting independent investigations into selected transportation occurrences in
order to make findings as to their causes and contributing factors by: conducting independent investigations;
identifying safety deficiencies; making recommendations designed to eliminate or reduce any such safety
deficiencies; and reporting publicly on its investigations and on the findings in relation thereto.
In making its findings as to the causes and contributing factors of a transportation occurrence, it is not the
function of the TSB to assign fault or determine civil or criminal liability. However, the TSB does not refrain
from fully reporting on the causes and contributing factors merely because fault or liability might be inferred
from the Board’s findings.
Federally, the National Energy Board oversees a company’s immediate response during a serious
incident and requires that appropriate repair methods be used, in accordance with regulation. British
Columbia takes a similar approach, ensuring that the company’s response is effective and that the
response is coordinated, employing the principles of unified command. In other provinces, serious
incidents are generally overseen by first responders, with regulators providing assistance.
Provincial regulators conduct inspections during and following pipeline incidents. Some regulators can
take control of the response if it is deemed insufficient or inadequate. For example, in New Brunswick
the regulator may enter a spill site to conduct operations as necessary to repair a leak or break, contain
the escaped substance, and prevent further escape. In Quebec, through Urgence-Environnement,
Quebec’s provincial government provides 24/7 response province-wide to minimize the impacts of
environmental emergencies. In major environmental emergencies, the government response is
coordinated by Organisation de la sécurité civile du Québec. In Manitoba, the regulator can take
control of a response if needed, but would only do so in rare exceptions. Instead, most provincial
regulators issue orders to pipeline operators to address insufficient or inadequate responses.
The National Energy Board coordinates follow-up for incidents involving federally regulated pipelines.
Provincial requirements for post-incident follow-up vary depending on the scale of the incident, but
usually involve, at a minimum, the submission of an incident report to the regulator. Additional followup may require monitoring, best practice sharing, communications, or further investigation.
Restoration of Environmental and Natural Resources Damages
In Canada, federal and provincial regulations indicate the extent to which the site of a spill must be
remediated, including damage to wildlife and the environment.
Remediation involves the improvement of a contaminated site to prevent, minimize or mitigate
damage to human health or the environment. It involves the development and application of a planned
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
approach that removes, destroys,
contains or otherwise reduces the
availability of contaminants to
receptors of concern.
In the case of a spill from a federally
regulated pipeline, the National
Energy Board appoints an
Environmental Specialist to act as a
liaison with the responsible party,
and verifies that an adequate and
appropriate clean-up and
remediation is completed, following
the National Energy Board
Remediation Process Guide.
SPOTLIGHT - Manitoba
Provincial regulation in Manitoba requires companies to fully
clean up contaminated sites to their original condition.
Contaminated sites are entered into the regulator
Rehabilitation Program, and progress of their clean-up is
tracked on a yearly basis.
The province uses Canadian Environmental Quality Guidelines,
even though not specifically referenced in the regulations, as
the baseline for clean-up.
Almost all provinces have laid out the requirement for remediation of a contaminated site in
regulation. For example, rehabilitation of a site is required under Nova Scotia’s Environment Act,
Ontario’s Environmental Protection Act, and Quebec’s Environment Quality Act. In New Brunswick,
although the need for remediation as a result of a pipeline incident is not laid out in regulation, the
Energy and Utilities Board can deal with smaller cases and issues orders as it determines necessary,
while extreme cases are dealt with within environmental legislation such as the Clean Environment Act.
Some provinces require pipeline operators to develop a remediation plan based on an assessment
identifying all potential risks of a spill and the estimated reclamation cost to reclaim a site. This plan is
then approved by the regulator. For example, in Alberta, the regulator requires all licensees to undergo
an assessment to identify and evaluate all remediation and surface reclamation issues. In British
Columbia, the regulator requires pipeline operators to conduct an assessment of wildlife or natural
resource impact, to develop a regulator-approved remediation plan. The British Columbia Ministry of
the Environment is currently
considering additional measures to
SPOTLIGHT - British Columbia
ensure a consistent process is in
place to assess the level of
The provincial government in British Columbia is proposing
environmental damage associated
policies to ensure both government and industry can respond
to heavy oil and other hazardous material spills on land in a
with a spill and require a restoration
timely and effective manner. One proposal is for a new
plan to ensure appropriate
provincial preparedness and response organization.
restoration of environmental and
natural resource damage is
The policy would create a provincially certified, industry-led
achieved.
Regulators verify that adequate and
appropriate clean-up and
remediation is completed by
pipeline operators. For example, in
Quebec, responsible parties may be
ordered to submit a rehabilitation
plan to the provincial government,
setting out the measures that will be
non-profit organization to conduct spill planning and
preparedness activities on behalf of its members and to
provide incident management and spill response when
activated by a spiller or the Province.
The organization would be funded by companies that would be
required to join based on the level of risk they present, as well
as by voluntary members.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
implemented to protect human beings, other living species, and the environment in general, including
property, together with an implementation schedule. In Ontario, the Ministry of the Environment
verifies that adequate and appropriate clean-up and remediation has been completed by the
responsible party in an acceptable manner. In Saskatchewan and Manitoba, regulators inspect spill
sites to verify acceptable clean-up and remediation, and contaminated sites are entered into
rehabilitation programs which require the company to complete a remediation plan, submit follow-up
reports to the regulator, and enable additional inspections by the regulator.
Response Equipment
The National Energy Board requires identification, maintenance, and regular checking and certification
of equipment for federally regulated pipelines. Equipment must be readily accessible and positioned as
specified in relevant standards. Companies must also, where practicable maintain materials,
equipment and spare parts in adequate quantities and at suitable locations for use in emergency
repairs. Finally, the NEB requires that employees be instructed in the proper operation of equipment
and emergency equipment.
Most provincial regulators require companies to include within their emergency response plan or
emergency procedures manual a description of the type and location of available emergency
equipment. Generally, companies are not required to report the location of their equipment to the
regulator; however, this information is provided to the regulator upon the submission of a new or
updated emergency response plan. In the event of an emergency, Alberta requires pipeline companies
to provide a list of emergency equipment (including location, number, and type), communications
equipment, equipment for roadblock kits, ignition equipment, and gas monitoring equipment to the
regulator.
Some require provisions in
emergency response plans
covering the accessibility of
equipment. Often, provincial
pipeline operators are also
required to maintain – for
emergency repair purposes –
materials, equipment and/or spare
parts in adequate quantities and at
suitable locations. Furthermore,
companies are required to
regularly check, certify, and/or
maintain their equipment.
In some provinces such as
Manitoba and Saskatchewan,
companies who belong to oil spill
co-ops are not required to
maintain their own stock of
emergency equipment, and may
instead rely on the immediate
emergency response capabilities
SPOTLIGHT - Quebec
Through Urgence-Environnement, the Quebec government
provides 24/7 response province-wide to minimize the impacts
of environmental emergencies.
Urgence-Environnement normally acts as a technical advisor,
with municipalities responsible for emergency measures within
their respective jurisdiction. It ensures that all possible measures
to protect the environment are promptly taken.
It has the necessary specialized equipment to respond to the
majority of emergency situations reported to it, and each of its
regional branches also has the most frequently used equipment.
Urgence-Environnement also has three mobile laboratories,
including a trace atmospheric gas analyzer, a leading-edge
analytical tool. This equipment can be immediately dispatched to
the site of a major disaster. It also has a mobile command post
that allows for timely and effective on-site response, in
particular for oil spills.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
of the co-op, which can provide specialized equipment, infrastructure and personnel, should a release
occur. In Quebec, the ministry responsible for environmental emergency response carries specialized
equipment for the majority of emergency situations, and each of its regional branches also carries the
most frequently used equipment.
Drills, Exercises, and Personnel Training
Even the best equipment is useless in untrained hands. That is why regulators require company
employees and their own personnel to be trained and instructed in the proper operation of equipment
and emergency response procedures.
Operators of both federally and provincially regulated pipelines are required to develop training
programs and conduct exercises to verify their capabilities to respond to incidents. Companies
regularly test their emergency response plans through major “live” exercises and tabletop simulations.
In some jurisdictions, like Ontario, companies are required to document drills. Regulators may
participate in these exercises to assess the knowledge and capability of a pipeline operator to respond
should an incident occur. Pipeline companies operating in Quebec regularly conduct emergency
response exercises in the field on a voluntary basis. These exercises normally involve the deployment of
emergency equipment and the participation of first-line responders. The government departments and
agencies likely to be called upon in the situation attend as observers. The provincial government also
regularly holds emergency preparedness exercises involving the participation of municipalities and
private sector partners. In jurisdictions with oil spill co-operatives, members are required to participate
in spill exercises organized by the co-operative, or to organize their own.
The National Energy Board requires processes to be in place to verify that those working on behalf of
the company are trained, competent and able to perform their duties safely and in a manner that
ensures the security of the pipeline and protection of the environment.
Provincial regulators also require training programs for personnel related to construction, operations,
maintenance, and emergency response. For example, in New Brunswick, the required Training Program
for Operators and Contractors ensures that those working on behalf of the company are trained and
competent in performing their duties. In Ontario, companies are required to have an Operator
Qualification Program stating the training, competency and scope of work of employees and
contractors. Emergency response training is included in both programs.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
III) Liability & Compensation
Provincial liability regimes apply to both
SPOTLIGHT - Canada
federally and provincially regulated
pipelines as long as they do not violate
Unlimited liability exists for companies found to be at fault or
the doctrines of inter-jurisdictional
negligent.
immunity and paramountcy. The
provinces and territories have used two
Regardless of fault or negligence, companies are required to
address and mitigate pipeline incidents and the National
general approaches, often
Energy Board can issue orders to this effect.
simultaneously, to create statutory civil
liability regimes. Some provinces, as well
Canada proposes to amend the NEB Act to provide
as the Yukon Territory, have enacted
governments with the ability to recover costs associated with
legislation governing the operation of
clean-up, to ensure that companies are responsible for
intraprovincial pipelines; in many cases,
abandoned pipelines, and to enshrine the ‘polluter pays’
such legislation imposes some degree of
principle in law to reinforce that polluters are financially
liability on pipeline operators for
responsible for costs and damages.
government spill response costs.
Second, every province and territory has
Measures to implement absolute liability are planned for
enacted legislation governing the
inclusion in the NEB Act.
release of environmental pollutants.
These laws typically establish a cost
recovery mechanism that governments may use to hold pipeline operators liable for spill response
costs. In some cases, pipeline operators are also subject to liability where a spill causes government
and/or third party loss or damage.
Comprehensive Liability Regime
All jurisdictions have enshrined ‘polluter pays’ principle in their pipeline management regimes. In all
instances, the operator is liable for any damages caused by the pipeline regardless of fault or
negligence. For example, in Nova Scotia, it is a term and condition of every permit and licence to
construct and operate a pipeline that each holder of the permit or license shall carry adequate
personal injury, property damage and third party liability insurance for losses suffered in the
construction and operation of the pipeline on such terms and in such amounts as determined by the
provincial regulator.
Operators can sometimes minimize their liability if they can prove to a court that all reasonable steps
were taken to prevent a spill. The court would then determine the degree to which a third party
contractor might be responsible.
The Civil Code of Quebec contains provisions regarding civil liability. These state, in particular, that
every person has a duty to abide by the rules of conduct incumbent upon them so as not to cause
injury to another. Where an entity is endowed with reason and fails in their duty, they are liable for any
injury they cause to another by such fault and are bound to make reparation for the injury. This liability
is unlimited. In addition, the Civil Code stipulates that every person has a duty to honour his
contractual undertakings. Where they fail in this duty, they are liable for any bodily, moral or material
injury caused and are bound to make reparation for the injury.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
For this reason, over-the-counter contracts for hydrocarbon transportation, storage or distribution
services in Quebec usually require valid and current general liability insurance covering personal injury
and damage to property and contractual liability, civil liability insurance (typically for at least $2 million)
as well as environmental liability insurance (typically for at least $10 million) issued by recognized
insurers.
Financial Capacity Requirements
Ensuring operators have sufficient financial capacity is key to a successful liability and compensation
regime. Most provinces have regulations requiring operators to prove that they have sufficient
resources either through insurance or other financial capacity to respond to a spill or other type of
damage. There is not a minimum level, as each province allows the regulator to assess the project and
determine the required financial capacity.
The Government of Canada is considering legislation that will require operators to have sufficient
financial capabilities to respond to an incident. This will include a minimum requirement of $1 billion
for major crude oil pipelines. British Columbia is currently considering a risk based approach, whereby
operators will be required to provide a security deposit to ensure financial capacity based on the level
of risk their project entails.
Independent Financial Backstop
Other than insurance, there are currently very few mechanisms in place in any jurisdiction that allow
for independent financial backstopping. Since March 31, 2007, the Quebec government's consolidated
financial statements have included an environmental liability associated with the costs of contaminated
site rehabilitation. As of March 31, 2013, this liability was estimated at $3.2 billion.
British Columbia has indicated that they are considering proposals but have not made details public.
The Government of Canada announced that it proposes to implement a government financial backstop
to ensure funds are available to the National Energy Board for spill clean-up, should it be required to
assume control of incident response, in exceptional circumstances.
The Alberta Orphan Well Fund acts as an independent financial backstop in the event that a pipeline
operator goes bankrupt in the process of cleaning a spill. The Orphan Well Fund is entirely industry
funded and is used as an alternative to an insurance-based system.
In British Columbia, the BCOGC has developed and implemented an Orphan Fund that can be utilized
for remediation and restoration of orphaned infrastructure. In addition, the Commission maintains
funds under a Liability Management Program under which permit holders are required to maintain a
specific level of financial solvency ensuring financial capacity to respond to major incidents.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Conclusion
Regulators continue to pursue the ultimate objective of zero incidents. Federal and provincial pipeline
regulators continue to work with stakeholders to improve pipeline regulatory regimes by focusing on
the three pillars encompassing: 1) prevention; 2) preparedness and response; and 3) liability and
compensation. Governments are taking steps to ensure that taxpayers are protected from clean-up
costs should an incident occur.
Ensuring a world-class pipeline regulatory regime is critical for Canada to pursue its natural resource
advantage. While most crude oil and natural gas in Canada moves via pipeline, increasing crude oil and
petroleum product volumes are moving via rail and marine. These alternative modes of transportation
are becoming increasingly important for delivering Canada’s resources to markets.
Next Steps
Continuous improvement is an absolute requirement for achieving and maintaining a world-class
energy pipeline regulatory regime in Canada. Building on recent and ongoing pipeline regulatory
improvements across federal, provincial and territorial jurisdictions, areas of focus moving forward
include:
-
Continue implementing proposed legislative, regulatory, and related initiatives while ensuring that
Aboriginals and other key stakeholders are meaningfully engaged;
-
Commit to further studying and improving the safety and security of broader energy transportation
systems including rail, marine and trucking;
-
Enhance communications to ensure fact-based dialogue surrounding energy transportation;
-
Explore options for improved cooperation and collaboration between jurisdictions either through
harmonization, sharing or leveraging information and expertise;
o For instance, the harmonization of performance measures such as spill reporting
remains an important impediment to measuring the progress of companies across
jurisdictions.
-
Explore opportunities for enhanced collaboration on pipeline innovation between governments,
regulators and industry – for example, “Best Available Technologies” recognized through the
Canadian Pipeline Technology Collaborative;
-
Continue to cooperate in efforts to enhance the safety and security of hydrocarbon production and
transportation systems, including damage prevention and cyber security.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Annex 1: Survey Questions
Element
Questions
1) Prevention
Safety culture
 Are (and if so, how) are companies:
(i.e. processes,
o held accountable for meeting safety objectives
accountabilities)
o held responsible for addressing or correcting deficiencies
o required, at a senior level, to sign off on safety reports
Standards (e.g.
CSA, technical)
 CSA standards required in regulations (e.g. Z662-11; Z246.1; Z246.2; Z662; Z1600)
o Whether standards are updated periodically
o Whether regulator participates in development of standards or serves on technical
committees
Maintenance
and testing





Inspections and
audits
 Whether inspections and audits are required
 How often inspections and/or audits are required, and basis for this frequency (e.g.
random, risk-based, based on prioritization model, etc.)
 What is inspected and/or audited (e.g. emergency manuals, exercise evaluations,
integrity management programs, facilities, etc.)?
 Who is responsible for inspections?
Compliance and
spill data
 Is compliance and enforcement data collected and posted publicly?
 How often is this data posted (e.g. monthly, quarterly)?
Orders,
penalties and
fines
 What enforcement powers does the regulator have to issue penalties or orders for
contraventions (monetary, jail time, etc.)?
 List available penalties for both individuals and companies
 Include available orders (e.g. pipeline shutdown, reduced pressure, etc.)
Do regulations require regular or periodic testing of instruments and/or equipment?
Types of testing required (integrity digs, etc.)
Locations of required testing (pipeline stations, pipelines)
Frequency of testing. Note if variables affect frequency of maintenance or testing
Standards for pipeline repairs
2) Preparedness, Response and Recovery
Emergency
management
program
 Are companies required to have an emergency management program, and what is the
high-level focus / objective of the program?
Response
standards
(e.g. response
time, level of
remediation)





Notification standards in the event of an incident (polluter notifying regulator)
Scale of incidents requiring notification
Response standards in the event of an incident (e.g. response time)
Does regulator oversee incidents? To what extent (e.g. dependent on size)?
Can the regulator take control of the response if it is deemed to be insufficient or
inadequate?
 Can the regulator issue orders if response is deemed to be insufficient or inadequate?
 What post-incident follow-up takes place (e.g. reporting, best practice sharing,
communications, investigation, etc.)?
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Element
Questions
Restoration of
environmental
and natural
resources
damages (e.g.
remediation)
 Is the extent to which remediation is required laid out in regulation? What remediation is
required (e.g. site of spill including wildlife, environment)?
 Does regulator verify that adequate and appropriate clean-up and remediation is
complete? Does the regulator appoint a specialist to address incidents?
Geographically
specific plans
 Are companies required to design plans that account for geographically specific hazards?
 Are companies required to be part of spill geographically specific cooperatives?
Response
equipment
 Are companies required to have readily accessible equipment? Are there standards for
where equipment must be located (accessibility, positioning, etc.)?
 Are companies required to maintain – for emergency repair purposes – materials,
equipment and/or spare parts in adequate quantities and at suitable locations?
 Are companies required to identify the location of their equipment to the regulator?
 Are companies required to regularly check, certify, and/or maintain their equipment?
 Are company employees required to be trained and instructed in the proper operation of
equipment and emergency equipment?
Response drills
and exercises
 Are companies required to develop a training program and/or conduct exercises to verify
their capabilities to respond to incidents?
o Are these exercises conducted “live”? How often?
o Are these tabletop exercises? How often?
 Does the regulator participate in and/or oversee exercises?
Personnel
training
 Are companies required to ensure that those working on behalf of the company
(employees and/or contractors) are trained and competent in performing their duties?
 Does the regulator require companies to identify personnel to be deployed in the event
of an incident who are responsible for responding to incidents?
 Does the regulator have a training program for its own personnel (specialists, response
personnel, etc.)?
3) Liability and Compensation
Comprehensive
liability regime
 Please outline the liability regime for pipeline companies in the event of an incident
 Are companies responsible for costs associated with non-use value (environmental
damages)?
 Is the ‘polluter pays’ principle in force?
 Are companies responsible for the actions of third party contractors? Is this found in
legislation or regulation?
 Are companies liable for costs associated with abandoned pipelines?
Financial
capacity
requirements
 Are companies required to demonstrate a minimum financial capacity requirement to
the regulator? (e.g. security deposit, letter of credit, cash-on-hand, insurance, etc.)
Independent
financial
backstop/fund
 Does an independent financial backstop exist in the event a company is unable to pay for
the costs of an incident?
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Annex 2: Survey Responses
Government of Canada
National Energy Board:
independent federal agency
established to regulate
international and
interprovincial aspects of the
oil, gas, and electric utility
industries in Canada.
Transportation Safety
Board: independent federal
agency that advances
transportation safety by
investigating occurrences in the
marine, pipeline, rail, and air
modes of transportation.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Prevention
Safety culture
Under the Onshore Pipeline Regulations, companies must produce an annual
report signed by an accountable senior officer describing performance of
management systems; achievement of goals, objectives, and targets during
that year; and any actions taken to correct deficiencies.
CSA standards required in regulations: Z662-11 (Sections 3 and 10 relate to
loss management programs); Z246.1 (Security Management Systems); and CSA
Z662. The standards are updated periodically.
Standards
The NEB also serves on technical committees for standards under
development, e.g. Z1600 (emergency and continuity management) and Z246.2 (Emergency Preparedness and Response for Petroleum and Natural Gas
Industry).
The NEB will develop guidance on the application of “best available
technologies” to pipeline construction and operations.
Maintenance and
testing
Inspections and audits
The NEB Act requires periodic testing of instruments and equipment at
pipeline stations for proper and safe operation.
The NEB inspects pipelines and facilities, examines the integrity of the
pipelines and facilities, and requires that appropriate repair methods be used.
NEB specialists conduct reviews and critical information checks on emergency
procedures manuals, emergency response exercise evaluations, compliance
meetings, and audits of facilities.
The NEB follows a risk-informed model and annual Compliance Verification
Plan.
The NEB posts compliance and enforcement actions online regularly.
Compliance and spill
data
Orders, penalties and
fines
The Minister of NRCan announced in June 2013 that companies’ emergency
and environmental plans would be transparent and easily available to the
public. Implementation options are under consideration.
The NEB has broad authority to issue orders. Fines (as determined by the
Courts) for contravening orders range from $100,000 and one year in prison,
to $1 million and 5 years in prison.
The NEB can also issue administrative monetary penalties to companies or
individuals. The maximum daily penalty is $25,000 for individuals (per
violation) and $100,000 for companies (per violation).
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Preparedness Response and Recovery
Emergency
management program
The NEB requires companies to have an emergency management program
that anticipates, prevents, manages and mitigates conditions during an
emergency that could adversely affect property, the environment, or the
safety of workers or the public.
Operators must notify the NEB of an incident immediately.
The NEB will oversee the company’s immediate response during a serious
incident. Regulation requires that appropriate repair methods be used.
Response standards
The NEB coordinates post-incident follow-up (e.g. reporting, best practice
sharing, communications, investigation).
The NEB requires that pipeline companies hold a minimum level of accessible
financial resources to ensure they can respond quickly to pipeline incidents.
The NEB will have the authority to take control of incident response if a
company is unable or unwilling to shoulder its responsibilities.
Restoration of
environmental and
natural resources
damages
Regulations indicate the extent to which the site of a spill must be remediated,
including damage to wildlife and the environment. The NEB will appoint an
Environmental Specialist to act as a liaison with the responsible party.
The NEB verifies that an adequate and appropriate cleanup and remediation is
completed. Companies follow the NEB remediation process guide.
Geographically
specific plans
Companies must design plans for events that could affect the pipeline,
including accounting for geographically specific hazards.
Response equipment
The NEB requires identification, maintenance, and regular checking and
certification of equipment. Equipment must be readily accessible and
positioned as specified in relevant standards; employees must be instructed on
proper operation of equipment and emergency equipment. Companies must,
where practicable, maintain materials, equipment and spare parts in adequate
quantities and at suitable locations for use in emergency repairs.
Response drills and
exercises
Companies are required to develop a training program and conduct exercises
to verify their capabilities to respond to incidents.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Personnel training
The NEB requires processes to be in place to verify that those working on
behalf of the company are trained and competent and able to perform their
duties safely and in a manner that ensures the security of the pipeline and
protection of the environment. NEB specialists must be trained for response
and other program areas.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Liability and Compensation
Unlimited liability exists for companies found to be at fault or negligent.
Regardless of fault or negligence, companies are required to address and
mitigate pipeline incidents, and the NEB can issue orders to this effect.
Comprehensive
liability regime
The NEB Act is to be amended to provide government with the ability to
recover costs associated with non-use value environmental damages to ensure
that companies are responsible for abandoned pipelines and to enshrine the
”polluter pays” principle in law to reinforce that polluters are financially
responsible for costs and damages.
Measures announced May 14, 2014, will expand NEB authority to order
reimbursement of spill cleanup costs incurred by governments or individuals.
They will also subject companies operating pipelines to “no fault” or absolute
liability for all pipelines, up to $1 billion in the case of major oil pipelines.
Financial capacity
requirements
Legislation and regulations are in development to require all companies to
have sufficient financial capability to respond to incidents, including a
minimum requirement of $1 billion for major crude oil pipelines.
Independent financial
backstop/fund
Announced May 14, 2014, the NEB will have access to the funds needed for a
cleanup and will have the authority to ensure that tax payers are protected
from the costs of an incident (NEB authority to recover costs incurred for
incident response from industry, in exceptional circumstances).
27
Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Province of New Brunswick
New Brunswick Energy and
Utilities Board: independent
crown agency established by
the Legislature to regulate the
electricity, natural gas, pipeline,
and motor carrier industries
and set maximum gasoline
prices for the province.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Prevention
The Pipeline Act, 2005 and associated Pipeline Regulation, 2006-2 outline the
procedures and methods required during the design, construction, operation
and maintenance of pipelines and stipulate that the responsibility for these
requirements lie with the companies who own and operate the pipelines.
Safety culture
Also, Guidance Notes are provided to companies to assist in understanding the
requirements of the Pipeline Regulation, 2006-2 and how those requirements
could be met. The actual methods used to meet the specific requirements are
at the discretion of individual companies, but the onus is on each company to
maintain adequate records and demonstrate the adequacy and effectiveness
of the methods employed to the New Brunswick Energy and Utilities Board
(EUB), when requested.
Section 38 of the regulation requires that a corporation develop and
implement a pipeline integrity management program.
Further to the above, Section 4 of the Pipeline Regulation, 2006-2 states that
the CSA Z662 – Oil and Gas Pipeline Systems standard shall govern the design,
construction, operation and abandonment of a pipeline. The latest edition of
this standard requires that a pipeline company implement a Safety and Loss
Management system.
Applicable standards and specifications:
Standards

CSA Z276, if the pipeline transports liquefied natural gas;

CSA Z341 for the underground storage of hydrocarbons; and

CSA Z662, if the pipeline transports liquid or gaseous hydrocarbons or
minerals as defined in the Act.
The regulation allows for alternate standards to be used, if approved by the
EUB and if they provide for a level of safety or protection at least equivalent to
the level of safety or protection generally provided for by a comparable CSA
standard or by another applicable standard; or, in the absence of a
comparable CSA or other applicable standard, it provides for a level of safety
or protection that is adequate in the circumstances.
Also, the required Emergency Procedures Manual under Section 31 of the
Pipeline Regulation must conform to the standard CSA Z731 Emergency
Preparedness and Response for industry.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Most standards are continually reviewed using strict revision and approval
protocols by a knowledgeable and experienced group of professionals
representing the industry stakeholders. Specifically, the Z662 is revised and
published on a 4-year basis. For the past 12 years, the EUB Director of Pipeline
Safety has been a member of the main Technical Committee of the Z662 as a
full voting committee member and on the Gas Distribution Technical SubCommittee of the Z662 as well as the Technical Sub-Committee of the B137.4
Polyethylene Piping Systems Fittings for Gas Services. This person also is a
member of the CSA Regulatory Authority Committee for the group of CSA
standards used in the oil and gas industry.
Any equipment used for integrity testing of pipelines must be tested and
calibrated within the manufacturer’s recommended timelines. The certificate
of testing must be available at the location of testing and be maintained on
file.
Maintenance and
testing
The types of testing and the frequency and location of such tests depend
largely on the products being transmitted, the age of the pipeline and issues
identified during past integrity audits. Usually Inline Inspection (ILI) testing is
performed at a frequency determined by the age, material and product
characteristics being transported. Other tests used are based on the results of
ILI. This usually means inspections digs, visual inspection, and non-destructive
testing. The companies must also periodically test instruments and equipment
at the pipeline stations to verify their proper and safe operation.
The company’s Pipeline Integrity Manual must clearly outline the types and
frequency of testing specific to each pipeline owned. Also, if issues arise that
may threaten the protection of property and the environment, and the safety
of the public and the company’s employees, the Board may direct the
company to test, inspect or assess a pipeline in accordance with CSA standards
or any other comparable standards.
Repairs shall be carried out in accordance with Section 10 in the Z662, the
company’s operation manuals and Pipeline Integrity Manual, and the Pipeline
Act and regulations.
Inspections and audits
The Pipeline Act, 2005 empowers the EUB to inspect and audit a company’s
records and any pipeline and associated facilities. Audits are carried out by the
EUB and are primarily aimed at determining compliance with the Pipeline
Regulation and the company’s Pipeline Integrity Management Plan. The
frequency of compliance audits is based on a number of factors such as past
compliance issues, the safety culture present, the company’s internal audits,
etc. All construction is inspected on a daily basis and the final construction
turnover package is audited for completeness. Also, the Pipeline Regulation
requires that the companies conduct their own internal inspections and audits.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Compliance and spill
data
Orders, penalties and
fines
Historically, public information has been available upon request. The EUB has
recently moved to electronic document filing and the goal is to provide access
to public information through the EUB website. This is an ongoing project and
all public information dealing with recent applications before the board is
currently available.
The Pipeline Act, 2005 gives the EUB broad supervisory powers over regulated
companies and it may inquire, hear and determine any matter where it
appears any person failed to comply with any Act administered by the EUB or
where the EUB feels it is in the public interest to do so. As a result of any
inquiry held, the EUB may order a person to comply or forbid a person from
continuing any act that is contrary to legislation, order or directive.
The EUB has no authority to issue an administrative penalty. Any penalties for
violation or failure to comply with a provision of select sections of the Pipeline
Regulation must be dealt through the Provincial Offences Procedure Act
(through the provincial courts).
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Preparedness Response and Recovery
Emergency
management program
Companies are required to have an emergency management program. Section
31 of the Pipeline Regulation deals with emergency procedures manuals. CSA
Z731 Emergency Preparedness and Response for industry is referenced. The
Guidance Notes also provide some direction for companies preparing such
plans. The plans must be comprehensive in nature, with the main focus being
the protection of life, property and the environment.
The EUB must be notified immediately of any incidents (regardless of scale) as
defined in the Pipeline Act and a detailed report must be filed with the Board
within 48 hours.
The Guidance Notes ask that companies consider reporting to the EUB events
having the potential to attract public and/or media attention or which have or
may have significant adverse effects on property, the environment or the
safety of persons, regardless of whether or not they meet the strict definition
of an "incident".
Response standards
Response standards vary and are specific to the location and type of pipeline.
The standards are stated in a company’s Emergency Procedures Manual.
First responders such as the fire or police department oversee more serious
incidents. The EUB’s role in these situations is to ensure that
pipeline-related evidence is secured, and to be available to first responders as
needed.
The EUB has the power to conduct their own investigations and also works
closely with the emergency and police agencies having jurisdiction. The EUB
reviews incidents with the pipeline operator and as a result of the investigation
may issue orders or directions to the pipeline operator. Most operators use
Root-Cause Analysis.
Restoration of
environmental and
natural resources
damages
Remediation needed as a result of an incident is not laid out in regulation, but
the EUB can deal with smaller cases and issue such orders as it determines
necessary. However, extreme cases are better dealt with within environment
legislation such as the Clean Environment Act administered by the Department
of the Environment and Local Government.
Geographically
specific plans
The Emergency Procedures Manual must include a list or map of areas
susceptible to potentially adverse environmental effects that may require
special attention during an emergency (refer to Pipeline Regulation – Section
31(3)(o)).
Companies are required to be part of geographically specific spill cooperatives,
where these cooperatives exist.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Companies are required to have an emergency procedures manual which
includes a description of the types and locations of available emergency
clothing and equipment: refer to Pipeline Regulation – Section 31(3)(l).
Response equipment
Companies are required, where practicable, to maintain materials, equipment,
and spare parts in adequate quantities and at suitable locations for use in
emergency repairs. In addition, companies must regularly check, certify,
and/or maintain their equipment: refer to Z662-11 – clause 10.5.2.5
The location of equipment is required to be included in the Emergency
Procedures Manual, and Section 31 of the Pipeline Regulation states that the
Emergency Procedures Manual (and any updates) must be submitted to the
Board.
Company employees are required to be trained in the proper operation of
equipment and emergency equipment, under Pipeline Regulation – Section
26(2)(q) and Section 44(2)(d).
Response drills and
exercises
Companies are required to develop a training program and to conduct
exercises to verify their capabilities to respond to incidents. This is an essential
element of the Emergency Procedures Manual. Refer to Pipeline Regulation –
Section 26(2)(q).
The EUB usually participates in these exercises and provides feedback as
required.
The required Training Program for Operators and contractors ensures that
those working on behalf of the company are trained and competent in
performing their duties. Refer to Pipeline Regulation Section 26(2)(q) and
Section 44.
Personnel training
Identification of personnel to be deployed in the event of an incident is
required to be included in the Emergency Procedures Manual.
EUB Pipeline Inspectors participate in most operations and emergency training
conducted by the regulated pipeline companies.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Liability and Compensation
Section 20 of the Pipeline Act, 2005 states that the Board shall not issue a
permit or license to any person unless the person is insured by an insurance
company licensed to do business in the Province, and in an amount approved
by the Board.
Comprehensive
liability regime
The company’s insurance policy must be approved by the EUB prior to the
issuance of a License to Operate and this is a condition for maintaining this
license. Comprehensive Pollution Legal Liability insurance is normally required.
The Pipeline Act, 2005 is silent on whether companies are liable for costs
associated with abandoned pipelines. A condition is added to any EUB
approval for pipeline abandonment, stating: The Board's consent to an
abandonment operation does not relieve (the applicant) from any liability with
respect to this pipeline or part or part thereof.
Financial capacity
requirements
The Pipeline Act requires that the EUB take into account the financial
responsibility of the applicant when considering the application for a permit to
construct. The company is required to demonstrate its abilities in this regard
including insurance provisions as noted above.
Independent financial
backstop/fund
N/A
34
Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Province of Nova Scotia
Nova Scotia Utility and
Review Board: independent
quasi-judicial body which has
both regulatory and
adjudicative jurisdiction for
pipelines in Nova Scotia.
35
Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Prevention
Safety culture
Pipeline regulations require companies to establish and implement a pipeline
integrity management program. Where defects are found in excess of that
allowed by the latest version of CSA Z662 the company shall document the
particulars of the defect, the cause of the defect and the corrective action
taken or planned. No requirement for senior level to sign off on safety reports.
Standards
The latest version of CSA standards are incorporated by reference, e.g. Z662-;
W178.2; Z731. Regulatory staff serves on the CSA Z662 technical committee.
Maintenance and
testing
Regulations require a company to develop and implement a monitoring and
surveillance program for the protection of the pipeline and the public.
Inspections and audits
The Board may direct any company, at that company's own cost and expense,
to test, inspect, or assess a pipeline in accordance with CSA standards or such
other standards as the Board directs. Depending on the circumstance, the
Board or the pipeline operator can be responsible for the inspection. In the
case of the pipeline operator, any inspection must be done independent of any
construction contractor. Inspections and/or audits include facilities,
emergency manuals, exercise evaluations, integrity management programs,
training manuals and emergency responses.
Compliance and spill
data
Reports can be semi-annual or annual. All reports are public.
Orders, penalties and
fines
The Board will exercise control over the manner in which all pipelines including
gas pipelines are constructed, tested, maintained and operated and, subject to
the regulations, may issue such orders and directives as it deems appropriate.
Penalties are not to exceed one hundred thousand dollars and imprisonment
term is not to exceed two years.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Preparedness Response and Recovery
Emergency
management program
Pipeline operators are required to develop and regularly update an emergency
plan and an emergency procedures manual. An emergency procedures manual
should set out the information and procedures referred to in CSA Z662 and in
CSA Z731, a statement of the scope of application of the emergency
procedures, and a detailed description of the facilities to which the emergency
procedures apply.
Response standards
Incident is a defined term and includes the death of or serious injury to a
person, a significant adverse effect on the environment and an unintended or
uncontained release of LVP hydrocarbons in excess of 1.5 m³. The Board is to
be notified immediately following the discovery of an incident relating to the
construction, operation, maintenance, deactivation, reactivation or
abandonment of pipeline. Notification of a release and rehabilitation of a site
is required under the Nova Scotia Environment Act. The Board can direct that
adequate steps are taken to repair a leak or break in a pipeline or to contain
any escaped substance and may enter a site where the leak or break occurred
or the substance has escaped and conduct such operations as it considers
necessary to repair the leak or break and contain the escaped substance and
to prevent further escape. Preliminary and detailed incident reports are to be
made with the Board as soon as practical.
Restoration of
environmental and
natural resources
damages
Rehabilitation of a site is required under the Nova Scotia Environment Act.
Geographically
specific plans
A bulk plant should be located in an area that is known to be free from
flooding, landslides, rockfalls and geological faults.
Response equipment
An emergency response plan includes provisions covering accessibility of
equipment, materials/ equipment for emergency repair and checking,
certifying, and/or maintaining equipment. Company employees are required to
be trained and instructed in the proper operation of equipment and
emergency equipment.
Response drills and
exercises
Companies are required to develop a training program and/or conduct
exercises to verify their capabilities to respond to incidents. Frequency varies
depending on facility. They are live and table top. Regulator participates
through a third party representative.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Personnel training
Companies are required to ensure that those working on behalf of the
company (employees and/or contractors) are trained and competent in
performing their duties related to construction, operations, maintenance and
emergency response.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Liability and Compensation
Comprehensive
liability regime
It is a term and condition of every permit and licence to construct or operate a
pipeline that each holder of the permit or licence shall carry adequate
personal injury, property damage and third party liability insurance for losses
suffered in the construction and operation of the pipeline on such terms and
in such amounts as is determined by the Board. The Environment Act
embodies the ‘polluter pays’ principle. Companies are responsible for the
actions of third party contractors. Third party liability insurance is required by
Regulation.
Financial capacity
requirements
Requirement to have insurance in an amount and form satisfactory to the
regulator.
Independent financial
backstop/fund
Other than insurance, an independent financial backstop does not exist in the
event a company is unable to pay for the costs of an incident.
39
Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Province of Quebec
The following institutions
regulate pipelines in
Quebec: Régie de l’énergie
(REQ), Régie du bâtiment
(RBQ), ministère de la Sécurité
publique (MSP), ministère du
Développement durable, de
l’Environnement et de la Lutte
contre les changements
climatiques (MDDELCC),
ministère de la Justice (MJQ),
ministère des Forêts, de la
Faune et des Parcs (MFFP),
Société de l'assurance
automobile du Québec (SAAQ),
Commission de la santé et de la
sécurité du travail (CSST),
Commission de protection du
territoire agricole du Québec
(CPTAQ), Sûreté du Québec
(SQ), Bureau d’audiences
publiques sur l’environnement
(BAPE), Info Excavation
40
Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Prevention
The MSP [Department of Public Security] is in charge of public safety in
Quebec. Its main goal is to reduce the vulnerability of Quebecers to disaster
risks by developing a culture of safety. The Department is responsible for
administering the Québec Civil Protection Policy 2014-2024 and the Civil
Protection Act, which both have the primary objective of making Quebec
society safer and more resilient to disasters.
In terms of public protection, the RBQ [Quebec building authority] is
responsible for the quality of construction and the safety of buildings and
facilities, as well as professional qualifications and the integrity of contractors
and owners-builders. The RBQ fulfills its mandate by enacting and
administering construction, safety and professional qualification standards. It
oversees compliance with these standards through investigations and audits,
applying legislative remedies in the event of non-compliance and establishing
financial guarantees to protect consumers. The RBQ is also a recognized
authority in the inspection and verification of quality control programs for
pressure vessels.
Safety culture
The BAPE [Public environmental hearings board] is a public and non-partisan
agency reporting to the Minister of the MDDELCC [Department of Sustainable
Development, Environment and the Fight Against Climate Change]. Its mission
is to inform government policy-making related to sustainable development,
encompassing ecological, social and economic factors. To fulfill this core
mission, the BAPE advises, surveys and consults the public on projects or
matters involving environmental quality issues referred to it by the Minister,
including pipeline projects. It then publishes reports on its inquiries for the
public. The BAPE is a government agency with advisory functions and no
decision-making authority. In matters related to pipeline construction projects,
the BAPE is primarily concerned with issues surrounding the safety of the
proposed infrastructures.
As regards the prevention of damage to underground or other infrastructures,
Info-Excavation offers a range of services to ensure public and worker safety,
protect the environment and maintain essential public services. InfoExcavation is a not-for-profit organization that operates a free one-call centre
to handle requests for locating underground facilities, particularly pipelines.
The organization is the authority in Quebec for the development and
promotion of best practices for preventing damage to underground
infrastructure and maintaining public services. Info-Excavation's members
include 125 companies and 70 municipalities. In Quebec, it is not mandatory to
request a locate before digging. However, Info-Excavation strongly
recommends always dialling before digging, given the economic, physical
and/or environmental impacts of a breach.
41
Safety and Security of Energy Pipelines in Canada: A Report to Ministers
As in other Canadian jurisdictions, companies operating pipelines in Quebec
must comply with the technical design, construction and operation standards
of various recognized standards organizations, including the Canadian
Standards Association (CSA), the American Petroleum Institute (API), the
American Society of Mechanical Engineers (ASME), the American Society for
Testing and Materials (ASTM), Underwriters Laboratories of Canada (ULC) and
the National Research Council Canada (NRCC).
In Quebec, the requirement to comply with these technical standards is usually
imposed by stipulations in Acts and regulations (e.g.: the Construction Code
and Safety Code, administered by the RBQ).
Standards
In addition, the following are subject to the environmental impact assessment
and review procedure provided for under the Environment Quality Act and
require a government-issued certificate of authorization (CA): the construction
of installations for natural gas gasification or liquefaction and the construction
of more than 2 km of oil pipeline in a new right-of-way, except conduits for
transporting petroleum products under a municipal street, and the
construction of a gas pipeline more than 2 km in length. Excluded are the
construction of such a gas pipeline in an existing right-of-way used for the
same purposes, and the installation of gas mains less than 30 cm in diameter
designed for a pressure of less than 4,000 kPa.
Certificates of authorization issued by government decree normally include
safety and environmental protection conditions. For example, decree 2072010, dated March 17, 2010, with respect to the Pipeline Saint-Laurent project
sponsored by Ultramar Ltd. (now Valero), includes the following conditions:
[TRANSLATION]
CONDITION 9: Emergency measures plan
Ultramar Ltd. must map the high pressure zone of 0.3 lb. per sq. in. for
all sectors with potential fuel vapour containment when evaluating the
risk of explosion as part of its emergency measures planning.
Ultramar Ltd. must develop its emergency measures plan in
consultation with the municipalities concerned, the Department of
Public Security, the Department of Health and Social Services,
Transports Québec, the Department of sustainable development,
environment and parks, and, as required, any adjacent industries. The
plan must be filed with the Minister of sustainable development,
environment and parks at the same time as the application for the
certificate of authorization to operate the pipeline, provided for in
Section 22 of the Environment Quality Act.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Condition 10: REPORTING ON MONITORING AND FOLLOW-UP
PROGRAMS
Ultramar Ltd. must file with the Minister of Sustainable Development,
Environment and the Fight against Climate Change, no later than three
months after their final production, five copies of the monitoring and
follow-up reports provided for under this certificate of authorization.
The mandatory follow-up period may be adjusted depending on the
findings of the follow-up studies and the environmental components
involved.
Maintenance and
testing
The Safety Code adopted under the Building Act administered by the RBQ
stipulates that every piped gas undertaking must submit to the RBQ, within 90
days following the start of each fiscal year, its yearly program for maintenance
of the transportation systems, gas distribution systems and storage facilities.
Inspections and audits
The Safety Code adopted under the Building Act administered by the RBQ
stipulates that every piped gas undertaking must submit to the RBQ, within 90
days following the start of each fiscal year, its gas leak detection program for
the current year, and at the end of the same year, a report on the findings of
the program and measures taken to remedy any problems.
The Regulation respecting hazardous materials adopted under the
Environment Quality Act administered by the MDDELCC stipulates that every
person who accidentally releases a hazardous material into the environment
shall immediately stop the spill, inform the Minister of the MDDELCC, recover
the hazardous material and remove all contaminated material that is not
cleaned or treated on site.
Compliance and spill
data
As provided in the Environment Quality Act, the MDDELCC publishes on its
website a register of environmental emergency interventions, summarizing the
incidents handled by Urgence-Environnement, the environmental emergency
service. The register lists all environmental incidents that have required on-site
response by Urgence-Environnement since April 1, 2008, with the exception of
fuel tank spillage from vehicles involved in road accidents. The information
given is as known at the time of publication of the register, which is published
by region. The information is updated only while the intervention is in
progress.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
As provided in the Environment Quality Act, the MDDELCC publishes on its
website a register of information relating to guilty pleas/convictions for
offences under the Act or its regulations. The MJQ [Department of Justice]
notifies the MDDELCC of guilty pleas received by the Bureau des infractions et
amendes [offences and fines division] and court rulings in matters involving
notices of violations issued by the Director of Criminal and Penal Prosecutions
of Quebec. The officials authorized to identify violations of the Act or its
regulations include inspectors or auditors from the Centre de contrôle
environnemental du Québec (CCEQ) [environmental control centre], wildlife
protection officers from the MFFP [Department of Forests, Wildlife and Parks],
highway controllers from the SAAQ [Quebec’s automobile insurance agency],
and provincial (SQ) police officers. The register has been kept since November
4, 2011 and is updated weekly.
Also as provided in the Environment Quality Act, the MDDELCC publishes on its
website a register of monetary administrative penalties relating to violations of
the Act or its regulations. These penalties are imposed by CCEQ regional
directors on any person or municipality failing to comply with the Act or its
regulations. The register has been kept since February 1, 2012 and is updated
at the beginning of each month.
Orders, penalties and
fines
Under the penal provisions of the Environment Quality Act, a fine of $5,000 to
$1,000,000 or a maximum term of imprisonment of 18 months, or both, in the
case of a natural person, and a fine of $15,000 to $6,000,000 for a legal entity,
are provided for whoever contravenes the standards governing the discharge
of contaminants into the environment or the requirement to inform the
Minister of the MDDELCC without delay of the accidental presence in the
environment of a contaminant and to take immediate measures to minimize
or eliminate the effects of the event or incident and to eliminate the causes
thereof.
Maximum penalties apply in cases where the harm or damage caused by the
offence to human health or the environment, including vegetation and
wildlife, is sufficiently serious to justify heavier penalties.
The stipulated fines are doubled for a second offence, and tripled for any
subsequent offence. The maximum term of imprisonment for a second offence
increases to five years less a day.
When an offence under the Act or its regulations is committed by an
administrator or director of a legal entity, a corporation or an association
without legal personality, the minimum and maximum fines are twice those
imposed on a natural person for the same offence.
When an offence under the Act or its regulations persists for more than one
day, it constitutes a separate offence for each day the event or incident
continues.
44
Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Preparedness Response and Recovery
The Civil Protection Act, administered by the Department of Public Security,
imposes mandatory reporting of any risk-generating activities to the local
municipality where the source of the risk is located. In unorganized territory as
well as in the case where reports must be made in more than one locality, the
person may report the risk either to each competent regional authority or to
the Minister of Public security. A monitoring procedure, a procedure for
warning authorities and any other safety measures deemed necessary must be
maintained.
Through Urgence-Environnement, the MDDELCC provides 24/7 response
province-wide to ensure that everything possible is done to minimize the
impacts of environmental emergencies.
Emergency
management program
Urgence-Environnement normally acts as technical advisor, because in Quebec
the municipalities are responsible for emergency measures within their
respective jurisdictions. Urgence-Environnement ensures that all possible
measures to protect the environment are promptly taken.
In the event of a major environmental emergency, government response is
coordinated by the Organisation de la sécurité civile du Québec (OSCQ) [civil
protection organization], which reports to the Department of Public Security.
The organization of the Quebec government's civil protection actions falls
within the framework of the National Civil Protection Plan, which provides for
responses to 15 needs likely to arise in a disaster situation. In the plan, these
needs are translated into the concept of "missions". Each mission is assigned
to the government department or agency whose regular tasks and activities
most closely resemble those entailed in the mission, or who have the expertise
required to take charge of the mission (e.g. the MDDELCC mission relating to
water and hazardous and residual materials).
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Response standards
Under the Environment Quality Act, the holder of a depollution attestation
must notify the Minister without delay or, in cases provided for by regulation,
within the time prescribed therein, of the accidental occurrence in the
environment of any contaminant, and take all the necessary measures to
minimize the effects and to eliminate and prevent the causes thereof. The
holder must keep up to date and preserve, in accordance with the regulations,
the records indicated therein, and must provide the Minister of the MDDELCC,
in accordance with the regulations, with the reports indicated therein. At the
Minister's request, he must also furnish any information necessary to ascertain
compliance of the contaminant discharge with the applicable standards.
Furthermore, he must inform the minister, in accordance with the regulations,
of any event or incident entailing a contravention of the provisions of his
attestation and of the measures he has taken to minimize or eliminate the
effects of the event or incident.
Furthermore, in accordance with the Civil Protection Act administered by the
Department of Public Security, every person required to report a risk must
inform the civil protection authorities without delay of any risk-related
incident that is likely to exceed the person's emergency response capabilities.
In addition, the person must, within three months of such an incident, inform
the civil protection authorities of the date, time, place, nature, probable cause
and circumstances of the incident and the response operations conducted.
Restoration of
environmental and
natural resources
damages
In accordance with the provisions of the Environment Quality Act regarding
land characterization and rehabilitation, when it appears to the Minister of the
MDDELCC that contaminants are present in the land in a concentration
exceeding the limit values prescribed by regulation, or that the contaminants,
even though they are not specified in the regulation, are likely to adversely
affect the life, health, safety, welfare or comfort of human beings, other living
species or the environment in general, or to be detrimental to property, the
Minister may order any person or municipality that has emitted, deposited,
released or discharged all or part of the contaminants or has allowed the
contaminants to be emitted, deposited, released or discharged, or has or has
had custody of the land as owner or lessee or in any other capacity, to submit
for the Minister's approval within the time specified a rehabilitation plan
setting out the measures that will be implemented to protect human beings,
the other living species and the environment in general, including property,
together with an implementation schedule.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
In accordance with its mission, which is to guarantee for future generations
land suitable for the practice and development of agricultural activities and, to
this end, to ensure the preservation of agricultural land and contribute to
stakeholder engagement in achieving this objective, the CPTAQ [commission
for the preservation of agricultural land] is responsible for deciding on
applications for authorization submitted to it pursuant to the Act respecting
the preservation of agricultural land and agricultural activities regarding the
use for purposes other than agriculture, subdivision or alienation of a lot and
applications for the inclusion of a lot in an agricultural zone, to issue the
operating permits required for the removal of topsoil and sod, to supervise the
administration of the Act by conducting appropriate investigations and audits
and applying sanctions for offences as required, to advise the government on
any matters relating to the preservation of agricultural land, and to issue a
notice regarding any matter referred to it pursuant to the Act. The Act applies
over all Quebec territory south of the 50th parallel.
When authorizing, for the purpose of installing a pipeline, the alienation and
non-agricultural use of land for the uses and lots in each municipality and the
entire area targeted by the project, the CPTAQ generally imposes the following
conditions for the protection and/or restoration of environmental and natural
resources:

The pipeline must be installed at a minimum depth of 1.6 metres
through cultivated land (including forested areas restored to
agricultural use following the work) and 1.2 metres in forested areas.
However, a depth of 1.2 metres may be required on cultivated land,
and 0.9 metre in forested areas, if the bedrock is reached at or above
this depth. Also, the depth to which agricultural and forestry works
may be carried out before the company needs to be notified is 60
centimetres on cultivated land and 45 centimetres in forested areas.
The company does not need to be notified of work using a subsoil
plough.

The duration of work to install the pipeline and restore the soil to
agricultural use must not exceed two growing seasons. The project
must not adversely affect drainage or soil productivity. The project
sponsor has one year following completion of the soil restoration to
ensure that the cultivated soil disturbed is restored to the same level
of productivity as it had prior to the pipeline installation.

The project sponsor is required to monitor soil health for a period of
seven (7) years following completion of the restoration work. Within
three (3) months of completion of the soil restoration, the sponsor
must provide the CPTAQ with the name and contact information of
the person who will act as liaison to ensure compliance with this
condition, throughout the seven-year period.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Geographically
specific plans
The Civil Protection Act administered by the Department of Public Security
requires that regional authorities, in conjunction with their constituent
municipalities and in compliance with the policies determined by the
Department of Public Security, establish a civil protection plan determining
objectives to reduce major disaster vulnerability across their territory and the
actions required to achieve those objectives.
Under the Civil Protection Act administered by the Department of Public
Security, the government is authorized to make regulations prescribing
standards applicable to civil protection equipment, the use thereof and the
identification of rescue workers and equipment.
Response equipment
The MDDELCC has the necessary specialized equipment to respond in the
majority of emergency situations reported to it. Each of the Department's
regional branches also has the most frequently used equipment.
The MDDELCC has three mobile laboratories, including a trace atmospheric gas
analyzer (TAGA), a leading-edge analytical tool. This equipment can be
immediately dispatched to the site of a major disaster. The Department also
has a mobile command post that allows for timely and effective on-site
response, in particular for oil spills.
Response drills and
exercises
The Department of Public Security, through the OSCQ [civil protection
organization] and its regional counterparts, Organisations régionales de
sécurité civile (ORSC), regularly holds emergency preparedness exercises (e.g.
the SOS drill held on April 30, 2014). Along with the departments and agencies
assigned missions under the National Civil Protection Plan, these exercises
involve the participation of the municipalities and private sector partners
affected by the situation being tested.
For their part, pipeline companies operating in Quebec regularly conduct
emergency response exercises in the field on a voluntary basis. These exercises
normally involve the deployment of emergency equipment and the
participation of first-line responders (firefighters, police, etc.). The government
departments and agencies likely to be called upon in the situation attend as
observers.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
The CSST [occupational health and safety commission] is the organization
mandated by the Quebec government to administer the occupational health
and safety regime. As part of its mandate, the commission administers the Act
respecting Occupational Health and Safety, the object of which is the
elimination, at the source, of dangers to the health, safety and physical wellbeing of workers. The CSST's activities include prevention and inspection,
support for the efforts of workers and employers to eliminate dangers in their
workplace, workplace inspections and the promotion of occupational health
and safety.
Under the Act and its regulations, a worker is entitled to training, information
and counselling services in matters of occupational health and safety,
especially in relation to his work and his work environment, and to receive
appropriate instruction, training and supervision.
Also under the Act, every employer must take the necessary measures to
protect the health and ensure the safety and physical well-being of his worker.
In particular, he must:
Personnel training

see that the establishments under his authority are so equipped and
laid out as to ensure the protection of the worker;

designate members of his personnel to be responsible for health and
safety matters and post their names in a conspicuous place easily
accessible to the worker;

ensure that the organization of the work and the working procedures
and techniques do not adversely affect the safety or health of the
worker;

use methods and techniques intended for the identification, control
and elimination of risks to the safety or health of the worker;

take the fire prevention measures prescribed by regulation;

supply safety equipment and see that it is kept in good condition;

see that no contaminant emitted or dangerous substance used
adversely affects the health or safety of any person at a workplace;

give the worker adequate information as to the risks connected with
his work and provide him with the appropriate training, assistance or
supervision to ensure that he possesses the skill and knowledge
required to safely perform the work assigned to him;
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers

provide the worker, free of charge, with all the individual protective
health and safety devices or equipment selected by the health and
safety committee or, as the case may be, the individual or common
protective devices or equipment determined by regulation, and
require that the worker use these devices and equipment in the
course of work;

give to the workers, the health and safety committee, the certified
association, the public health director and the Commission, the list of
the dangerous substances used in the establishment and of the
contaminants that may be emitted.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Liability and Compensation
The Civil Code of Québec contains provisions regarding civil liability. These
state, in particular, that every person has a duty to abide by the rules of
conduct incumbent on him, according to the circumstances, usage or law, so
as not to cause injury to another. Where he is endowed with reason and fails
in this duty, he is liable for any injury he causes to another by such fault and is
bound to make reparation for the injury, whether it be bodily, moral or
material in nature. This liability is unlimited. He is also bound, in certain cases,
to make reparation for injury caused to another by the act or fault of another
person or by the act of things in his custody.
Comprehensive
liability regime
In addition, the Civil Code stipulates that every person has a duty to honour his
contractual undertakings. Where he fails in this duty, he is liable for any bodily,
moral or material injury he causes to the other contracting party and is bound
to make reparation for the injury; neither he nor the other party may in such a
case avoid the rules governing contractual liability by opting for rules that
would be more favourable to them.
In this respect, over-the-counter contracts for hydrocarbon transportation,
storage or distribution services usually require valid and current general
liability insurance covering personal injury and damage to property and
contractual liability, civil liability insurance (typically for at least $2 million) as
well as environmental liability insurance (typically for at least $10 million)
issued by recognized insurers.
The Civil Code provides for certain cases of exemption from this liability. It
states that a person may free himself from his liability for injury caused to
another by proving that the injury results from superior force, unless he has
undertaken to make reparation for it. Superior force is an unforeseeable and
irresistible event, including external causes with the same characteristics.
However, a person may not exclude or limit his liability for material injury
caused to another through an intentional or gross fault; a gross fault is a fault
which shows gross recklessness, gross carelessness or gross negligence. He
may not in any way exclude or limit his liability for bodily or moral injury
caused to another.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Pursuant to the Act respecting the Régie de l’énergie, every natural gas
distributor is required to submit to the Régie, each year, a report containing
the following information, in the case of a company carrying on an enterprise:
its capital stock, the various issues of securities made since the establishment
of the enterprise or since the last report, the names of its directors, its assets,
liabilities, revenues and expenditures for the year, the prices and rates charged
during the year and any other information required by the Régie.
Financial capacity
requirements
In addition, under the Regulation respecting the conditions and cases where
authorization is required from the Régie de l'énergie adopted pursuant to the
Act respecting the Régie de l’énergie, authorization from the Régie de l'énergie
is required to acquire, construct or dispose of immovables or assets for energy
transmission or distribution purposes as well as to extend, modify or change
the use of the transmission or distribution system as part of a project involving
the distribution of natural gas worth $1.5 million or more, where the
distributor's total annual delivery is 1 billion cubic metres or more; or the
distribution of natural gas worth $450,000 or more where the distributor's
total annual delivery is less than 1 billion cubic metres. Authorization is also
required for projects for which the cost is under the specified limits and which
have not yet been recognized as prudently acquired and useful for the
operation of the natural gas distribution system.
In Quebec, the National Assembly's Committee on Agriculture, Fisheries,
Energy and Natural Resources has recommended that any pipeline company
not subject to the Régie's rules and regulations be required to submit a
financial guarantee plan sufficient to cover any damages in the event of a
disaster, including damages that may arise following cessation of operations.
Independent financial
backstop/fund
Since March 31, 2007, the Quebec government's consolidated financial
statements have included an environmental liability associated with the costs
of contaminated site rehabilitation. As of March 31, 2013, this liability was
estimated at $3.2 billion.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Province of Ontario
Ontario Energy Board:
oversees the province’s
electricity and natural gas
sectors through regulation and
in accordance with the
objectives set out in the
governing statutory
framework.
Technical Standards &
Safety Authority: promotes
public safety and enforces
technical standards in the
province.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Prevention
Pipeline operating companies are required to establish a management system
with clearly defined roles and responsibilities. The management system must
be kept up to date and is audited by the Technical Standards & Safety
Authority (TSSA) every five years. Safety reports are to be provided upon
request by the TSSA and must be signed accordingly by the appropriate
authority as specified in the management system.
Safety culture
Under Section 90 of the Ontario Energy Board (OEB) Act, the OEB’s approval
for construction of new pipelines is conditional upon the applicant’s
compliance with all applicable regulatory requirements including the design
specifications, operation, maintenance, safety and integrity requirements
under the TSSA mandate.
The TSSA has forums to discuss issues regarding pipelines:
1) Natural Gas Council: A TSSA steering group typically chaired by a
representative from industry, which meets every six months.
2) Risk Reduction Group (RRG) on Pipelines: a group chaired by a TSSA
representative meeting as frequently as required to address technical
pipeline safety issues. Corrective actions, deadlines and the party
responsible for the actions are identified.
Prior to excavation, the location of utility lines must be requested through
Ontario One Call or the utility at or near the excavation to prevent
inadvertently damaging pipelines and other utility lines. Warning signs and
markers along the pipeline right-of-way must be maintained.
Standards
The Oil and Gas Pipeline Systems Code Adoption Document (CAD) contains the
adopted and modified national standards that are applicable to Ontario. The
national standards are issued by the Canadian Standards Association (CSA).
The TSSA serves on technical committees and typically adopts and modifies
national standards, which are updated periodically. The following standards
are adopted and modified in the CAD as part of the Ontario Regulation 210/01
on Oil and Gas Pipeline Systems under the Technical Standards and Safety Act:
CSA Z662-11 Oil & Gas Pipeline Systems, CSA Z276-11 Liquefied Natural Gas
Production, Storage and Handling, CSA Z246.1-09 Security Management for
Petroleum and Natural Gas Industry Systems. The TSSA recommends the TSSA
Guidelines for Natural Gas Utilities Locating New Pipeline Facilities PI-98-01
and CSA Plus 663, Land use planning for pipelines: A guideline for local
authorities, developers, and pipeline operators – to municipalities, developers,
pipeline operators or other parties involved in subdivision planning, approval,
design, etc.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Maintenance and
testing
Pipeline safety and integrity is primarily the responsibility of pipeline operating
companies. O.Reg. 210/01 on Oil and Gas Pipeline Systems requires that
operators of high-pressure pipelines must have a Pipeline Integrity
Management Program in place to ensure that pipeline companies have proper
controls to mitigate safety risks. A Pipeline Integrity Management Program
includes in-line pipeline inspections, records of the pipeline history, operation
manual and documentation required to develop and implement the integrity
management program. These documents must be available for inspection by
the TSSA. The program requires an engineering assessment of the pipeline to
address issues such as corrosion, 3rd party damage and geotechnical hazards.
Criteria for assigning pipeline repair priorities and procedures for mitigation
shall also be established. The short term (1 to 3 year) and long-term (4-10
year) mitigation program plans and priorities must also be outlined. The
Pipeline Integrity Management Program is audited approximately every five
years by the TSSA. Pipeline companies are required to have an Operation and
Maintenance Manual for the pipeline system specifying the testing
requirements (type, frequency, locations, pipeline size, etc.) of the pipeline
systems, including related instruments and/or equipment. The Operation and
Maintenance Manual must comply with standards in the CAD and must be
updated annually. Any changes to the manual must undergo a change
management process to ensure their compliance with standards.
Inspections and audits
The TSSA audits oil transmission pipelines and natural gas transmission and
distribution pipelines approximately every five years. Documentation is
typically audited by the TSSA to prove that the requirements under CSA Z662,
the CAD, and manuals are met.
Compliance and spill
data
The Ministry of the Environment tracks spills data, which are maintained at the
Ministry of the Environment’s Spills Action Centre and can be obtained upon
request.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
A person may be charged, prosecuted and convicted of an offence under the
Environmental Protection Act in addition to an environmental penalty.
Environmental compliance approval, license or permit may be suspended
under the EPA until the environmental penalty is paid. Available orders include
pipeline shutdown and reduced pressure.
There are a number of penalties available under the Environmental Protection
Act. For failure to comply with the terms and conditions of an environmental
compliance approval, certificate of property use, of a license or permit under
EPA or failure to comply with terms of a report:
Orders, penalties and
fines

Maximum penalties for individuals: $4,000,000 on a first offence,
$6,000,000 for a subsequent offence.

Maximum penalties for corporations: $6,000,000 on a first offence,
$10,000,000 for a subsequent offence.
For failure to comply with an order or pay fees as required (e.g. licence fees,
registration or record fees, services etc.):

Maximum penalties for individuals: $50,000 for a first offence, and
$100 000 for a subsequent offence.

Maximum penalties for corporations: $250,000 for a first offence, and
$500 000 for a subsequent offence.
For failure to do everything practicable to control the spill of a pollutant or for
exceeding discharge limits, including a limit of zero:

Environmental penalties shall not exceed $100,000 for each day on
which the contravention occurred or continued.
For failure to apply for an environmental compliance review, register an
activity in the Environmental Activity and Sector Registry, or carry out
measures set out in a notice from a provincial officer:

Administrative penalty shall not exceed $100,000 in total and shall not
exceed $5,000 for each contravention.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Preparedness Response and Recovery
Emergency
management program
Pipelines must have world-leading contingency planning and emergency
response programs. Under Part X of the EPA, companies must develop and
implement plans to prevent or reduce the risk of spills of pollutants and
remediate any adverse effects that may result from spills of pollutants. This
includes plans to notify the Ministry of the Environment (Spill Action Centre),
any municipalities within the boundaries of the spill, other public authorities
and members of the public who may be affected by a spill, and implement
plans to ensure that appropriate equipment and personnel are available to
respond to a spill. For oil pipeline segments located in high consequence areas,
the pipeline company shall provide the Ministry of Natural Resources and
Ministry of the Environment an opportunity to comment on the company’s
contingency plan for leaks or spills and address their comments. The pipeline
companies shall conduct meetings with local police, firefighting, and
conservation authorities, Ontario Ministry of Transportation, Ministry of
Natural Resources, Ministry of the Environment and the TSSA to communicate
the capabilities and coordination required to respond to pipeline emergencies.
These emergency communication meetings shall be conducted at intervals not
exceeding five years.
The Ministry of the Environment’s Spills Action Centre and any municipality
within the boundaries of the spill should be notified as soon as possible. A
Class VIII spill (the spill of petroleum product of not more than 100 L in areas
restricted to the public, or not more than 25 L in areas with public access) is
exempt from reporting to the Ministry of the Environment or municipality if it
meets the following conditions:

The product does not enter and is not likely to enter a watercourse;

The spill does not cause adverse effects other than those that are
readily remediated through clean-up and restoration of paved,
gravelled, or sodded surfaces;

Arrangements for remediation are made immediately; and

Records of the spill are maintained.
Response standards
Response standards in the event of an incident should be outlined in the
pipeline company’s Emergency Procedures Manual. The TSSA investigates
incidents as required in the regulation (i.e. involving death, injuries, fire,
explosion, media attention, substantial damage). The TSSA cannot take control
of the response if it is deemed insufficient or inadequate but can issue orders
as required. Inspectors release a report as a follow-up after an incident.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Restoration of
environmental and
natural resources
damages
Part X of the EPA requires the owner of the spilled material to do everything
practicable to restore the natural environment. “Restore the natural
environment,” when used with reference to a spill of a pollutant, means that
all forms of life, physical conditions, the natural environment and things
existing immediately before the spill of the pollutant that are affected or that
may reasonably be expected to be affected by the pollutant must be
remediated. The Ministry of the Environment verifies that adequate and
appropriate clean-up and remediation has been completed in an acceptable
manner.
Depending on the scale of the project, a company may be required to apply to
the OEB for a leave to construct.
Geographically
specific plans
The CAD also requires for new construction to address high consequence
areas. Operating companies are required to identify segments of their oil and
gas pipeline system that are in high consequence areas and must determine if
additional preventative or mitigation measured are needed. For oil pipeline
segments located in high consequence areas, the operating company shall
provide the Ministry of Resources (MNR) and Ministry of the Environment
(MOE) an opportunity to comment on the company's contingency plan for
leaks or spills and shall address any comments provided by the MNR or MOE.
In the Sarnia area, pipeline companies are part of the Chemical Valley
Emergency Coordination Organization (CVECO), which brings municipal and
industrial emergency responders together to identify potential risks associated
with industrial operations and to develop emergency plans around them.
Response equipment
Equipment required must be listed in a company Emergency Procedures
Manual and must be readily available. In the event that equipment is not
available, contact information must be available to locate equipment. Certain
spare equipment and parts are required to be available on hand for
emergency repair purposes. Companies are required to regularly check,
certify, and/or maintain their equipment (i.e. firefighting equipment, water
pump, hoses etc.). Company employees are required to be trained and
instructed in the proper operation of equipment and emergency equipment.
Response drills and
exercises
Pipeline companies are required to develop a training program for responding
to incidents, and drills shall be documented and performed periodically.
Tabletop exercises are performed as per company manuals. Pipeline
companies typically invite the TSSA to participate in response drills and
exercises.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Personnel training
Companies are required to have an Operator Qualification Program stating the
training, competency and scope of work of employees and/or contractors.
Emergency response training must also be included in the qualification
program. The roles and responsibilities of personnel in the event of an incident
must be established in the company Emergency Procedures Manual. Any
employee and/or contractor handling oil or gas must be a holder of a
certificate or license. The TSSA administers the certification of occupations
regulated under the Technical Standards and Safety Act. Programs include
Gas/Oil Technician Certification and Gas Pipeline Inspector Training.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Liability and Compensation
Comprehensive
liability regime
Economic and environmental risks and responsibilities, including remediation,
should be borne exclusively by the pipeline companies. Any person has the
right to compensation for loss or damage from the owner of the pollutant.
However, a polluter is not liable if they establish that they took all reasonable
steps to prevent the spill of the pollutant. The court would determine the
degree, if any, in which a 3rd party contractor contributed to the loss, damage,
cost or expense by fault or negligence.
Financial capacity
requirements
Pipeline companies must provide financial assurance demonstrating their
capability to respond to leaks and spills under EPA Part XII.
Independent financial
backstop/fund
There is no independent financial backstop in the event a company is unable
to pay for the costs of an incident.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Province of Manitoba
Manitoba Public Utilities
Board: regulates the
construction and operation of
natural gas and propane
pipelines within the province of
Manitoba.
Manitoba Petroleum
Branch: supervises the
construction of oil and gas
pipelines for the upstream and
midstream oil and gas industry
where the lines do not cross
provincial boundaries.
Manitoba Environmental
Approvals Branch: regulates
developments in a manner that
protects the environment and
public health, and sustains a
high quality of life for present
and future Manitobans.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Prevention
Safety culture
Companies must comply with The Oil and Gas Act and associated regulations.
Pressure tests for pipelines are witnessed by an inspection team and facilities
are inspected yearly, at a minimum. Company safety manuals must contain
updated sections pertaining to ERPs, Spill Containment and Fire Prevention.
Standards
Manitoba’s regulations reference CSA Z662, and the regulations can be
updated as needed.
Maintenance and
testing
Provincial regulations require periodic testing of pipeline instruments and
equipment, and companies must prove the meters in those tests.
Inspections and audits
Pipeline terminals in Manitoba must be inspected annually by provincial
Petroleum Inspectors. A pipeline spill could instigate an additional audit or
inspection. Companies are also required to participate in the Manitoba Spill
Co-op.
Compliance and spill
data
Spill data is posted on a website on a yearly basis.
Orders, penalties and
fines
The Minister has the authority to order a shutdown of a pipeline facility if it is
deemed necessary due to environmental concerns of as a result of noncompliance with regulations. Monetary penalties can be administered when
warranted.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Preparedness Response and Recovery
Emergency
management program
Pipeline operation permits granted by the province require companies to have
and maintain a Safety and Emergency Response Plan (ERP) program. The goal
is to prevent events before they occur and to have effective plans in place in
case of an emergency.
All companies are required to report any serious accident or incident to the
Branch within 12 hours of the event. This can include, but is not limited to, a
liquid spill greater than 0.5 m3, any spill on land outside of the company’s
lease, a fire, or a blow-out.
Response standards
An inspection team will inspect the site of the incident and direct the company
to an appropriate response. A spill report is required in all cases, and
additional action may be required depending on the scale of the incident.
The regulator can issue orders if the response by the company is deemed to be
insufficient. In exceptional circumstances, the regulator can take control of the
response.
Restoration of
environmental and
natural resources
damages
Manitoba regulation requires companies to fully clean up the site to its original
condition. Companies must report to the province on the progress of their
clean-up activities annually, based on a pre-approved plan. Inspectors can
inspect any time and provide input or feedback to the company regarding their
progress.
The Branch uses Guidelines developed by the Canadian Council of Ministers of
the Environment as the baseline required for clean-up, even though these
Guidelines are not specifically referenced in the current version of regulations.
Geographically
specific plans
There are provisions within the regulation for the Branch to require an
Environmental Protection Plan for certain types of locations, and all companies
must belong to the Manitoba Spill Co-operative.
Response equipment
Companies have access to equipment through the Manitoba Spill Co-op.
Companies are not required to identify the location of their equipment, but it
is often referenced within the ERP. Companies are required to regularly check,
certify, and/or maintain their equipment. Company employees are required to
be trained and instructed in the proper operation of equipment and
emergency equipment per CSA Z662.
Response drills and
exercises
All members of the Manitoba Spill Co-op are required to participate or send
company representation to the spill exercises put on by the co-op. These field
exercises are conducted once or twice a year. If a company does not attend
they are required to organize their own spill exercise. Regulators sit on the
Manitoba Spill Co-op and often coordinate and oversee the exercises.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Personnel training
Companies are required to ensure that those working on their behalf are
trained and competent in performing their duties. The roles of company
personnel to be deployed in the event of an incident should be within a
company ERP. The Manitoba regulator has a dedicated training program for its
own personnel.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Liability and Compensation
Comprehensive
liability regime
The licenced operator for a pipeline is legally liable for the line throughout its
lifetime use and after abandonment. Companies are responsible for costs
associated with environmental damages, and owners are compensated during
pipeline installation and in the event of an unintentional release.
The ‘polluter pays’ principle is in force.
Companies are responsible for the actions of third party contractors, although
this is not specifically referenced within Manitoba regulation.
Financial capacity
requirements
The Oil and Gas Act specifies the requirement of a performance deposit for
pipeline (although the amounts are not spelled out at this time…)
Independent financial
backstop/fund
The Branch maintains an Abandonment Fund that could be made available for
use as an independent financial backstop in the event a company is unable to
pay for the costs of an incident.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Province of Saskatchewan
Saskatchewan Ministry of
the Economy: advances and
regulates responsible resource
development in Saskatchewan.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Prevention
The Ministry of the Economy (ECON) recommends to all operators to be a
member of Sask 1st Call. Most large pipeline companies are subscribers.
Safety culture
ECON requires a licensee to develop, implement, and document – for all of its
pipelines – a pipeline integrity management and safety management program
as well as an emergency response plan in accordance with the latest edition of
the CSA Z662 standards.
ECON licenses transmission pipelines. However, flowlines, pipelines between a
well and a gathering facility, are exempt from licensing.
Standards
The minimum requirements for the design, construction, testing, operation,
maintenance and repair of pipelines shall be in accordance with the most
recent version of CSA Z662 – Oil and Gas Pipeline Systems, unless otherwise
approved by the minister.
ECON actively participates in the development of CSA Z662 standards as a
member of two technical subcommittees.
A licensee must submit a Leave to Open application with the proper
documentation, including charts and logs for strength and leak tests, before
commencing operation of the pipeline.
Pipeline integrity is the primary responsibility of a pipeline company.
Maintenance and
testing
ECON requires companies to develop and implement integrity management
programs to identify, manage, monitor, and address any potential hazard
associated with each individual pipeline.
ECON requires that the leak detection requirements contained in Annex E of
CSA Z662 are mandatory for liquid hydrocarbon pipelines.
ECON also requires, for the purpose of leak detection, that every operator of a
pipeline shall accurately measure all the substances transported by that
pipeline.
ECON conducts proactive and random pipeline construction, pressure test and
operation inspections and audits.
Inspections and audits
Compliance and spill
data
ECON is considering implementing a risk-based model for inspections and/or
audits, including reviews of emergency response plans as well as integrity and
safety management programs.
ECON is considering publishing compliance reports on its website.
ECON files and posts all incidents and spills in a spill database available to the
public. This data is updated monthly.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Orders, penalties and
fines
ECON has enforcement authority ranging from administrative penalties to
monetary penalties, including notices of contravention, suspension or
cancellation of a licence and fines based on the gravity of the contravention
not exceeding $50,000, and in the case of a continuing offence to a further
fine not exceeding $50,000 for each day or part of a day during which the
offence continues.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Preparedness Response and Recovery
Emergency
management program
ECON requires every pipeline operator to prepare and maintain up to date an
emergency response plan, which must be accessible to operating and
maintenance personnel, that sets out the action to be taken and the agencies
and persons to be contacted in the event of a rupture, break, leak or fire.
ECON is considering requiring all pipeline companies to adhere to an oil spill
co-op in each geographic area through which their pipeline is routed. There
are six oil spill co-ops capable of providing immediate emergency response in
all areas of the province through the provision of specialized equipment,
infrastructure and personnel, should a release occur.
Every operator shall immediately notify ECON of spills, fires, etc., except where
the volume of oil, salt water, condensate or other product that escapes or is
released is less than 1.6 cubic metres and is contained on property that the
operator owns or leases.
Response standards
ECON field personnel respond with field inspections and clean-up follow-ups.
Emergency response plans detail the process and timelines for responding to
incidents and follow-up investigations.
ECON requires written reports and closely monitors post-incident remediation.
Restoration of
environmental and
natural resources
damages
ECON requires pipeline operators to clean up and remediate the site of any
spill, including reclaiming the soil.
ECON inspects a spill site to verify acceptable cleanup and remediation
(SPIGEC).
ECON requires design plans in accordance with the latest version of CSA Z662
standards.
Geographically
specific plans
Response equipment
ECON is considering requiring all pipeline companies to adhere to an oil spill
co-op in each geographic area through which their pipeline is routed. There
are six oil spill co-ops capable of providing immediate emergency response in
all areas of Saskatchewan through the provision of specialized equipment,
infrastructure, and personnel, should a release occur.
In accordance with CSA Z662 standards, ECON requires pipeline companies to
have the capability to respond to an emergency, and where practicable,
operating companies must maintain materials, equipment, and spare parts in
adequate quantities and at suitable locations for use in emergency repairs.
Oil spill co-ops provide immediate emergency response capabilities in all areas
of Saskatchewan through the provision of specialized equipment,
infrastructure, and personnel should a release occur.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Response drills and
exercises
Personnel training
ECON requires operators to train emergency response personnel and regularly
test their emergency response plans through major ‘live’ exercises and
tabletop simulations.
ECON participates in these annual exercises to assess the knowledge and
capability of a pipeline operator to respond should an incident occur.
ECON requires every pipeline operator to have an emergency response plan
that sets out the action to be taken and the agencies and persons to be
contacted in the event of a rupture, break, leak or fire.
ECON does not monitor training of personnel.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Liability and Compensation
Where an incident occurs, the operator shall take immediate action in
accordance with the emergency response plan.
Comprehensive
liability regime
Regardless of fault or negligence, Saskatchewan holds all licensees/operators
responsible for spill clean-up and remediation.
An orphan well, facility or associated flowline are subject to the provisions of
“The Oil and Gas Orphan Fund”.
Companies are responsible for abandoned pipelines.
Financial capacity
requirements
Independent financial
backstop/fund
ECON may contemplate developing the necessary legislation to have
companies contribute to a common financial fund associated with the cost of
abandoning orphan licensed pipelines.
An orphan well, facility or associated flowline are subject to the provisions of
“The Oil and Gas Orphan Fund”.
An orphan well, facility or associated flowline are subject to the provisions of
“The Oil and Gas Orphan Fund”. Funding is provided by companies based on
an orphan fund levy.
No financial funds are available for licensed pipelines.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Province of Alberta
Alberta Energy Regulator:
regulatory body with a mandate
to provide for the efficient,
safe, orderly, and
environmentally responsible
development of Alberta’s
energy resources.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Prevention
Safety culture
The Alberta Energy Regulator (AER) has a long history of regulating pipeline
companies and is unique in North America in that it requires all pipeline
failures to be reported regardless of the size of the spill, area affected or type
of fluid released. This process has created an industrial culture characterized
by a safety first attitude.
Inspections are based on a three-tiered model: baseline inspections; random
inspections; and a prioritized system that takes into account a company’s
history, location of the facility, and the type of resource being developed. This
system ensures that all licensees make safety and compliance their most
important priority.
The AER ensures that the design, construction, operation, and maintenance –
including discontinuation and abandonment of regulated pipelines (the full
pipeline life cycle) complies with Alberta’s Pipeline Act, Pipeline Rules, and
applicable Canadian Standards Association (CSA) standards.
The AER incorporates several standards of the CSA for the regulation of
pipelines, as stated in the Pipeline Rules Section 9. The primary standard is CSA
Z662 – Oil and Gas Pipeline Systems, which sets out the technical standards for
the design, construction, operation, and maintenance of Canada’s oil and gas
pipelines, and is the mandatory starting point for pipelines in Alberta.
Standards
CSA Z662 contains provisions for addressing system integrity, with the 2003
S1-05 edition introducing Annex N: “Guidelines for pipeline system integrity
management programs”. This non-mandatory annex is enforced as mandatory
in Energy Resources Conservation Board (ERCB) Directive 077 in Alberta.
Therefore, the AER requires pipeline licensees to develop, implement, and
document for all of their pipelines a pipeline integrity management program
that complies with the latest edition of CSA Z662, Annex N.
The AER requires that the leak detection requirements contained in Annex E of
CSA Z662 be mandatory for liquid hydrocarbon pipelines.
If a failure occurs on any portion of a licensed pipeline, that failure is
reportable and made mandatory through the Pipeline Act (Part 6, Section 35).
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
The AER requires companies to develop and implement integrity management
programs to identify, manage, monitor, and address any potential hazard
associated with each individual pipeline.
Maintenance and
testing
Companies must have management systems to design, construct, operate and
maintain pipelines.
Pipeline integrity is the primary responsibility of a pipeline licensee. The AER
requires companies to take a system-wide integrated approach to keeping
their pipeline in sound operating condition.
As part of the risk assessment process, the pipeline licensee determines the
type and frequency of the physical condition (integrity) assessments of the
pipeline.
The AER's pipeline-inspection program considers pipeline fluid characteristics,
location, line size, failure history, and the company’s compliance history.
Pipelines with greater potential risks are given a higher inspection priority.
The AER conducts comprehensive incident investigations after serious
incidents occur to determine the cause of a pipeline failure and what can be
done to prevent a similar situation in the future.
The AER performs proactive random inspections and uses a system of
inspections based on a prioritization model called “OSI”.
The “OSI” system takes into account a variety of factors that help determine
the necessary frequently to inspect a particular facility.
Inspections and audits

“O” stands for “operator history” – this is the company’s history of
complying with AER regulations. If an operator has a poor track record,
the AER will inspect its facilities with greater frequency.

“S” represents “site sensitivity” – this is where the AER takes into
account the location of the facility. If it is located near a heavily
populated area or a wetland, it becomes an inspection priority.

“I” refers to “inherent risk” – this is where the AER considers the
nature of the resource being extracted or transported. For example,
high vapor pressure fluids such as propane or ethane would warrant
more frequent inspections.
Besides prioritizing inspections by the OSI system, the AER inspectors routinely
conduct proactive random inspections.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Regulated companies routinely report to the AER. The policy and processes
under the AER’s Compliance Assurance Program subject licensees to a series of
internal audits, reporting, and accountability processes. This Program uses a
risk matrix and compliance categories for administering and tracking
enforcement and identifying licensees that are persistently noncompliant in
their asset integrity processes and emergency management programs. The
predetermined risk of each AER requirement then determines the response
process as detailed in Directive 019: Compliance Assurance.
Compliance and spill
data
The AER publishes a comprehensive annual compliance report for all AER
compliance categories. Incident reports, which may contain specific
noncompliance and related enforcement action information, are also
published.
Stakeholders may also contact licensees regarding specific compliance
information.
If a licensee does not release the information, stakeholders may use the
Freedom of Information and Protection of Privacy Act process to request the
information.
The AER has a range of enforcement options to ensure compliance, including
administrative penalties, tickets and warning letters, enforcement and
environmental protection orders, and prosecution.
Orders, penalties and
fines
The AER has the power to order an individual or company to pay an
administrative penalty if it does not comply with energy resource legislation or
approvals, including regional plans under the Alberta Land Stewardship Act.
Penalties need to be issued within two years after the date on which the
incident occurred or the date on which the incident first came to the notice of
the AER – whichever is later.
The maximum penalties for a person who is guilty of offence under the
Pipeline Act are $500,000 for corporations and $50,000 for individuals. Parties
are not considered guilty of an offence under the Act if they took all
reasonable steps, on a balance of probabilities, to prevent the offence.
If a company is incapable of implementing its emergency response plan, the
AER can deny a licence application, shut-in facilities, or suspend licences until
the company demonstrates otherwise.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Preparedness Response and Recovery
Emergency preparedness and response includes all activities done prior to an
emergency so that designated personnel are ready and able to respond quickly
and appropriately, as well as those activities that take place during the
incident. This includes activities such as identifying hazards, preparing and
maintaining emergency response plans and response procedures, ensuring
that the emergency response plans identify sufficient resources and
equipment for use by response personnel during an emergency, and
designating response personnel and ensuring that they are suitably equipped
to carry out their duties through training, drills, and exercises.
The AER requires all license holders to have an emergency management
program. These programs are to include hazard analyses, risk assessments,
mitigation and prevention planning, training, and emergency response
planning in proportion to the risks involved in their operations. Reviews and
updates of these programs are to be conducted at least annually.
Emergency
management program
The AER’s Directive 71 Emergency Preparedness and Response Requirements
for the Upstream Petroleum Industry requires companies to have in place
comprehensive emergency response plans.
Emergency response plans define the actions a company will take should a
failure occur. This includes identifying the detailed roles and responsibilities of
all responders and how the company will work with appropriate local and
provincial government agencies.
These plans do not need to be site specific. Instead, the emergency response
plans must address a liquid spill onto land or water from any well, pipeline or
facility. The plan must include purchasing spill clean-up equipment and
conducting annual exercises.
Site-specific emergency response plans are not required for every drilling,
production, or pipeline operation in the province. When a site-specific
emergency response plan is not required, a corporate-level emergency
response plan is used by the licensee to handle emergency events.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
The AER requires the licensee to take immediate steps to stop the source of
release and contain and clean up the spill (Pipeline Rules Section 77). The AER
does have a series of requirements that must be followed upon a spill being
detected: the licensee must verbally report to the AER immediately, and the
industry operator must notify the landowner of any release that occurs offlease, migrates off-lease or occurs on an easement or right-of-way.
Response standards
The Field Operations branch deals with response to leaks and breaks, the
internal emergency response plan describes the process and timelines for
responding to incidents and performing follow-up investigation.
Additionally, Oil Spill Cooperatives maintain spill contingency plans and
strategically place OSCARS (Oil Spill Containment and Recovery units) that are
enacted immediately after the detection of a spill.
Alberta Environment and Sustainable Resource Development requires pipeline
operators to clean up and remediate the site of any spill. This includes
repairing the soil and any wildlife impacted by the spill.
Restoration of
environmental and
natural resources
damages
Directive 006 requires all licensees to undergo an assessment identifying all
potential risks of a spill and the total estimated reclamation cost to reclaim a
site. As part of this process, all remediation and surface reclamation issues
must be identified and initially evaluated through a phase 1 environmental site
assessment.
This estimate must be conducted in a manner that meets or exceeds the
standards provided in Alberta Environment and Sustainable Resource
Development (ESRD) publication T/573: Phase 1 Environmental Site
Assessment Guideline for Upstream Oil and Gas Sites.
Geographically
specific plans
When pipelines pass through or near populated areas, roads, railways or water
bodies, AER regulatory requirements intensify. When pipelines pass through
sensitive areas, operators must adhere to additional requirements, including:
reducing operating pressure, using thicker-walled pipeline, pipe being buried
at greater depths, and increased inspections and surveillance.
In some instances, the AER requires the identification of an emergency
planning zone (EPZ). An EPZ is a geographical area surrounding a well, pipeline,
or facility containing hazardous product that requires specific emergency
response planning by the licensee. The development of an EPZ is based on a
project-by-project assessment.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
AER regulations require all pipeline companies to belong to an oil spill co-op in
each geographic area through which their pipeline is routed, or submit their
own spill response plan for their specific local operations to the AER for
approval.
Oil spill co-ops provide immediate emergency response capabilities in all areas
of Alberta through the provision of specialized equipment, infrastructure, and
personnel, should a release occur. Funding for spill co-ops comes entirely from
industry and is administered through Western Canadian Spill Services.
The AER requires Pipeline companies to have extensive maintenance and
repair programs and operate “leak detection systems” to monitor pipeline
integrity. The AER requires that the leak detection requirements contained in
Annex E of CSA Z662 be mandatory for liquid hydrocarbon pipelines.
Response equipment
Response drills and
exercises
In the event of an emergency, AER Directive 071 requires pipeline companies
to provide a list of emergency equipment (including location, number, and
type) of the following:

communications equipment for the public safety coordinator, rovers,
roadblock and air monitoring personnel, and any others that require it
(the licensee is responsible for ensuring that communications
equipment is made available to key response personnel);

equipment for roadblock kits (including contents);

ignition equipment that is maintained on site; and

gas monitoring equipment.
The AER requires operators to train emergency response personnel and
regularly test their emergency response plans through major “live” exercises
and tabletop simulations. The AER’s participation in and awareness of these
exercises allows it to assess the knowledge and capability of a pipeline
operator to respond should an incident occur.
In situations where an operator is unable or unwilling to take the necessary
actions during an incident, the AER has the authority and expertise to do so.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
The AER requires companies to provide training sessions to ensure that
response personnel are competent in emergency response procedures. The
licensee is expected to provide ERP training on: the overall plan, roles and
responsibilities during an incident, public protection measures used during an
emergency, and available communication methods.
Personnel training
Licensees are required to belong to oil spill co-ops that provide training and
guidance for pipeline operators.
If a licensee is unable to implement an emergency response plan the AER has
trained staff capable of immediately undertaking this work.
Additionally, Cooperatives maintain spill contingency plans and strategically
place OSCARS (Oil Spill Containment and Recovery units) that are available to
all member companies in the area. They hold annual training exercises and
provide educational funding for their membership.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Liability and Compensation
Alberta holds all licensees responsible for spill clean-up and remediation
regardless of fault. The AER has an absolute no-fault liability which requires
the licensee pay for all costs associated with emergency response, clean-up
and restoration.
The AER holds all licensees liable for the cost of spill clean-up and remediation
regardless of whether the licensee is responsible for a spill or not. Alberta has
a system of absolute at fault and no fault liability whereby the licensee mast
pay all costs required to clean a spill and restore the area.
Comprehensive
liability regime
Unlimited liability for clean-up and remediation is addressed under the
Pipeline Act Section 36 and Pipeline Rules Section 77. In addition, the Pipeline
Act Section 25 deals with liabilities for pipeline abandonments.
In the upstream oil and gas industry, an orphan is a well, pipeline, facility or
associated site which has been investigated and confirmed as not having any
legally responsible or financially able party to deal with its abandonment and
reclamation.
The Orphan Well Association (OWA) is a not for profit organization unique to
the province of Alberta which was created from the work of many genuinely
concerned individuals from the oil and gas industry and from the provincial
government. It operates under the delegated authority of the AER. The
purpose of the OWA is to manage the abandonment and reclamation of
upstream oil and gas orphan wells, pipelines, facilities and their associated
sites.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
The AER uses a Licensee Liability Rating (LLR) Program to prevent the costs to
suspend, abandon, remediate, and reclaim a well, facility, or pipeline from
being borne by the public of Alberta should a licensee become defunct.
The LLR system assesses a licensee’s ability to address its suspension,
abandonment, remediation, and reclamation liabilities. Under the program,
each operator must pay a security deposit if its deemed liabilities exceed its
deemed assets.
Financial capacity
requirements
Under Directive 19, if a licensee fails to comply with the requirements of the
LLR Program, it could be subject to various AER enforcement provisions,
including:

non-compliance fees;

partial or full suspension of operations;

suspension and/or cancellation of permit, licence or approval; or

issuance of an Order, which is a legal document that formally orders a
specific action or prohibition, including facility closures or
abandonments.
Alberta’s Orphan Fund pays the costs to suspend, abandon, remediate, and
reclaim a well, facility, or pipeline included in the LLR Program if a licensee or
working interest participant becomes defunct.
Independent financial
backstop/fund
The Orphan Fund is fully funded by licensees in the AER’s LLR Program. A
licensee's annual levy is based on its proportionate share of sector liability as
determined by the LLR.
The Orphan Fund is administered by the Alberta Oil and Gas Orphan
Abandonment and Reclamation Association, a non-profit society incorporated
under the Societies Act on March 20, 2001.
Note the orphan fund does not apply to some transmission pipelines.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Province of British Columbia
BC Oil and Gas
Commission: independent,
single-window regulatory
agency with responsibilities for
overseeing oil and gas
operation in British Columbia,
including pipeline
transportation.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Prevention
Safety culture
Standards
Maintenance and
testing
Inspections and audits
Compliance and spill
data
Orders, penalties and
fines
Under consideration.
CSA standards applied to BCOGC-regulated pipelines include Z662-11, Z662,
and Z246.1 (Security Management Systems). The standards are updated
periodically.
The BCOGC serves on the technical committees for these and other standards
still under development. For example, Z246.2 (Emergency Preparedness and
Response) and Z247 (Damage Prevention).
Based on pipeline standards, product location, size, etc., the BCOGC currently
requires companies to periodically test pipelines relative to CSA Z662
standards.
The BCOGC conducts pipeline construction inspections and employs a riskbased model for inspecting operational pipelines. The BCOGC conducts
periodic audits of Integrity Management Programs (IMP).
BC is considering increasing capacity for inspections and audits via funding
from industry, and mandatory participation in a Preparedness and Response
Organization.
The BCOGC provides quarterly compliance reports on their website, and is
considering monthly compliance and enforcement reporting.
The BCOGC and MOE have enforcement authorities, which include a host of
enforcement options based on significance and severity of the contravention
(e.g. orders, tickets, warnings).
Penalties of up to $1.5 million, and/or imprisonment.
BC is developing policy on administrative monetary penalties.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Preparedness Response and Recovery
Emergency
management program
The BCOGC requires companies to have an emergency management program
that anticipates, prevents, manages and mitigates conditions during an
emergency that could adversely affect property, the environment, or safety of
workers or the public.
Operators must notify the BCOGC of an incident immediately.
The BCOGC is actively involved in the management of incidents. The BCOGC
will issue orders if company response is deemed inadequate.
Response standards
BC is exploring options to implement a variety of response standards, e.g.
response times.
The BCOGC coordinates post-incident follow-up (e.g. reporting, best practice
sharing, communications, investigation).
Restoration of
environmental and
natural resources
damages
Geographically
specific plans
The BCOGC requires assessment of wildlife or natural resource impact and
development of an BCOGC-approved remediation plan.
BC MOE is considering additional measures to ensure a consistent process is in
place to assess the level of environmental damage associated with a spill and
require a restoration plan to ensure appropriate restoration of environmental
and natural resource damage is achieved.
BC is considering requiring area-based planning and geographic response plans
that would spell out actions to be taken in the first 24-48 hours, and would be
shared across all sectors.
The BCOGC requires equipment and other resources to be developed
specifically for the activity in question.
Response equipment
Response drills and
exercises
BC is considering looking to Preparedness and Response Organizations to
maintain an inventory of equipment and ensure equipment is maintained and
operational.
The BCOGC requires tabletop exercises and “live” exercises, and participates in
and monitors these exercises. The BCOGC conducts its own annual exercises to
evaluate incident response and emergency management systems.
BC is considering requirements for drills and exercises, including mandatory
certification by a “preparedness and response organization.”
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Personnel training
The BCOGC requires permit holders to identify resources to be deployed in the
event of an incident or spill including staff or other trained personnel (with
required knowledge, training and background) who will be responsible for
responding to incidents and spills.
BC is considering requirements to ensure responders have the appropriate
level of training commensurate with their duties.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Liability and Compensation
Comprehensive
liability regime
Unlimited liability exists for companies found to be at fault or negligent.
BC MOE is examining options for defining and implementing liability for the
loss of non-use value.
Financial capacity
requirements
Under consideration, e.g. implementation of a security deposit style system
where financial vehicles are put in place, based on risk factors to ensure
financial capacity is available to deal with the possible outcomes of pipeline
incidents or spills.
Independent financial
backstop/fund
Under consideration
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Northwest Territories
As of April 1, 2014, the Government of the Northwest
Territories became responsible for management of onshore
oil and gas development and regulation in the Northwest
Territories.
National Energy Board:
The National Energy Board will remain the regulator for
onshore/offshore oil and gas developments, and regulation
in the Inuvialuit Settlement Region (ISR) for the next 20
years.
87
independent federal agency
established to regulate
international and
interprovincial aspects of the
oil, gas, and electric utility
industries in Canada.
Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Northwest Territories Recommendations
Safety and security
measures for pipelines

Promote and provide safety training, education, and employment and
business opportunities in First Nations communities in the North.

Partner with Aboriginal governments for ensuring safety and security
of the pipeline, and the energy transportation system in the North.

Regulators/owners/ operators are accountable for safety management
and adopting a safe work culture from the initial application through
the life cycle of the project.

Safe production facilities and protection of oil/ gas resources.

Develop CSA standards required in regulations for construction,
operation and maintenance for pipelines and energy transmission in
permafrost locations and frozen terrain in the North.

Ensure a suitable mechanism and standard for periodic system
integrity checks, testing, and provision of a supervisory control and
data acquisition (SCADA) system for all pipeline and energy
transmission/ transportation projects in the North.

Adopt and comply with superior standards in pipeline operation and
maintenance procedures, from the initial application through the life
cycle of the project.

Develop and implement audit management, adopting critical safety
standards, practices and regulations,

Develop guidelines with regards to compliance and enforcement.

Facilitate safety training, education, employment, and business
opportunity planning with Aboriginal governments and communities
related to ensuring pipeline safety and security.

Develop a pipeline disaster management framework and emergency
management program in the provinces and territories.

Allocate adequate funds for pipeline disaster management (pipeline
burst/leak/ spill etc.).

Ensure restoration of the environment and loss recovery (personal,
property damage etc.).

Develop emergency procedures and a communications strategy.

Provide facts and figures and update information/material regarding
pipeline system safety and security in Northern communities.
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Annex 3: Pipeline Regulators in Canada
Federal
National Energy Board - www.neb-one.gc.ca
Transportation Safety Board - www.tsb-bst.gc.ca
Provincial / Territorial
British Columbia Oil and Gas Commission - www.bcogc.ca
Yukon Environment of Energy, Mines and Resources, Oil and Gas Branch - www.emr.gov.yk.ca/oilandgas/
Northwest Territories: Office of the Regulator of Oil and Gas Operations www.iti.gov.nt.ca/infopage/oil-gas-regulator
Alberta Energy Regulator - www.aer.ca
Saskatchewan Energy and Resources - www.economy.gov.sk.ca
Nunavut Impact Review Board - www.aadnc-aandc.gc.ca/eng/1100100011174/1100100011175
Manitoba Public Utilities Board (natural gas and propane pipelines) - www.pub.gov.mb.ca
Manitoba Petroleum Branch (upstream and midstream oil and gas pipelines) – gov.mb.ca/petroleum
Ontario Energy Board - www.ontarioenergyboard.ca
Régie de l’énergie du Québec - www.regie-energie.qc.ca
Régie du bâtiment du Québec - www.rbq.gouv.qc.ca
Ministère de la Sécurité publique - www.securitepublique.gouv.qc.ca
Ministère du Développement durable, de l’Environnement et de la Lutte contre les changements
climatiques - www.mddefp.gouv.qc.ca
Ministère de la Justice - www.justice.gouv.qc.ca
Ministère des Forêts, de la Faune et des Parcs - www.mffp.gouv.qc.ca
Société de l'assurance automobile du Québec - www.saaq.gouv.qc.ca
Commission de la santé et de la sécurité du travail - www.csst.qc.ca
Commission de protection du territoire agricole du Québec - www.cptaq.gouv.qc.ca
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Safety and Security of Energy Pipelines in Canada: A Report to Ministers
Sûreté du Québec - www.suretequebec.gouv.qc.ca
Bureau d’audiences publiques sur l’environnement - www.bape.gouv.qc.ca
Info Excavation - www.info-ex.com
Newfoundland and Labrador Board of Commissioners of Public Utilities - www.pub.nf.ca
New Brunswick Energy & Utilities Board - www.nbeub.ca
Nova Scotia Utility & Review Board - www.nsuarb.novascotia.ca
Standards
Canadian Standards Association - www.csagroup.org/ca/en/services/codes-and-standards
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