Syncrude charged in duck deaths

Claudia Cattaneo
Calgary Bureau Chief
Financial Post
Tuesday, February 10, 2009

500 birds died after landing in tailings pond

The federal and Alberta governments laid unprecedented charges yesterday against the Syncrude Canada Ltd. oil sands venture over last year's death of 500 ducks in a tailings pond.

Jim Prentice, the federal Environment Minister, called the incident "a serious issue with serious consequences."

"What this illustrates is that both the government of Alberta and the government of Canada are intent on ensuring that our environmental laws are respected -- whether it's in the oil sands or other industrial activities, or by all of us as individuals," he said in an interview.

The ducks died last spring after landing in a tailings pond at Syncrude's Aurora mine site, after the company failed to set up a noisemaker to scare away the migrating fowl because of a storm.

The April 28 incident captured global attention and reenforced critics' portrayal of oil sands operations as an environmental blight.

Industry players and both levels of governments are fighting that image, particularly in the United States, where they are presenting the oil sands as a source of secure oil that is taking steps to minimize its impact on the environment.

The federal government has charged Syncrude under the Migratory Birds Convention Act for allegedly "depositing or permitting the deposit of a substance harmful to migratory birds in waters or an area frequented by birds."

Environment Canada said the deaths represented the single largest reported incident of oiled birds in the oil sands region.

The charge carries a maximum penalty of a $300,000 fine or six months in jail, or both.

The Alberta government's charge, under the Alberta Environmental Protection and Enhancement Act, is for "failing to have appropriate deterrents in place at a tailings pond." It carries a maximum penalty of $500,000.

Ogho Ikhalo, a spokeswoman for Alberta Environment, said the province took the step after an investigation.

Hundreds of thousands of water birds travel through oil sands leases in the Fort Mc-Murray area and effective bird deterrence is an important part of the province's approval requirements for tailings ponds, the province said.

Syncrude spokesman Alain Moore said the consortium is reviewing the charges and has not decided whether to fight them.

"We have taken this very seriously, and we have cooperated with the government throughout the whole process and we will be appearing in court as requested," Mr. Moore said.

The first court appearance has been scheduled for March 25 in provincial court in Fort McMurray.

"All of our employees feel horrible this happened at our facility," Mr. Moore added. "Ever since this occurred there has been resolve in our organization to make the appropriate changes required to prevent it from happening again."

Syncrude is a joint venture of Canadian Oil Sands Trust, ConocoPhillips, Imperial Oil Ltd.,Murphy Oil Corp., Nexen Inc. and Petro-Canada.

Mr. Prentice said the federal government is in the process of updating environmental laws and significantly increasing penalties so they are in line with those in the United States and other countries.

The charges against Syncrude are unique under both long-standing federal and provincial laws.

ccattaneo@nationalpost.com

Syncrude execs may face time in jail

Ottawa to increase fines as charges laid in deaths of 500 ducks in tailings pond

Rob Renner, Minister of Environment and Alison Redford, Minister of Justice and Attorney General answer media questions at a news conference at the Alberta Legislature after the government announced laying charges against Syncrude Canada for failing to have appropriate deterrents in place at a tailings pond. The charges result from an incident on April 28/08 where waterfowl died after landing on a tailings pond at a facility north of Fort McMurray. Photograph by: Ed Kaiser, Edmonton Journal

Shortly after Syncrude was charged Monday for failing to prevent the deaths last spring of 500 ducks, the federal environment minister revealed the government is considering dramatically increasing fines for environmental crimes.

Syncrude was charged by both the Alberta and federal governments for failing to take precautions to prevent the deaths of 500 ducks on a northern tailings pond.

If convicted, the company faces a maximum of $800,000 in fines and its executives could be sent to jail for up to six months.

Federal Environment Minister Jim Prentice said Monday his government is committed to bringing in new legislation that deals with such environmental issues.

"We've spoken about significantly increasing the penalties. Penalties for companies of this size would range in the multimillion dollars and we will be proceeding with those legislative amendments in future."

Prentice said both he and Prime Minister Stephen Harper consider the incident unacceptable. "We have environmental laws in Canada. We expect them to be abided by, and there will be consequences for people who don't live up to the full extent of the Canadian conservation environmental laws."

Alberta Environment Minister Rob Renner said the provincial charge was laid alongside a federal charge under the Migratory Birds Convention Act, and both will be dealt with during the same court hearing.

"This is the first of its kind for charges to be laid in this manner in Alberta," said Renner, who sees no need to tweak Alberta's environmental law or toughen penalties.

"We're constantly looking to improve the effectiveness of regulation, but the legislation is very robust and I don't think it is necessary to be doing that."

But Jodie Hierlmeier, staff counsel for the Environmental Law Centre, thinks the federal plan to increase fines is a good idea.

"I think that might be a good thing from the deterrent perspective, because the penalties for a large corporation, fines of half a million or a million dollars, are not that significant depending on the size of the corporation. And perhaps the federal government is looking to the U.S., where the fines are in the multi-million dollar range."

Alberta Justice Minister Alison Redford said the province will seek an alternative penalty that may require Syncrude to perform technical or environmental work.

Syncrude's first court appearance will be March 25 in Fort McMurray Provincial Court.

The company hasn't said how it will plead to the charges.

"We'll be looking at the charges, understanding the charges and how they apply. And our legal team, after the analysis, are hoping to decide the appropriate path forward and that will be taking place over the next few weeks," said Alain Moore, a company spokesman.

Meanwhile, the company is working to prevent a repeat incident.

"The system had worked well for decades, but obviously last spring showed it didn't work as well as intended, so changes had to be made. Since then, we've had a thorough investigation to help understand what barriers we encountered and how we can help incorporate steps to prevent it from happening again."

Moore said the company looked at many things from technology to the way it deploys deterrents. It plans to announce changes to the program before the start of the spring migration.

"We have spoken to both Alberta Environment and Alberta Sustainable Resource Development and they've provided input to the plan.

"This incident was horrible," Moore said. "There's a huge resolve in our organization to help prevent it from happening again."

The charges under the Alberta Environmental Protection and Enhancement Act accuse Syncrude of failing to have proper equipment in place to deter ducks and geese from landing on the tailings pond.

The maximum fine under Alberta law is $500,000, while federal regulations allow for a fine of $300,000 and six months imprisonment.

The federal charge accused Syncrude of depositing "a substance harmful to migratory birds in waters or an area frequented by birds."

The charges were laid after about 500 ducks landed on the Aurora mine tailings pond north of Fort McMurray last April 28. The birds became covered in oily residue floating on the surface and sank to the bottom of the pond.

Only five ducks were recovered and sent to the Wildlife Rehabilitation Society of Edmonton. Three survived and were released, said Cheryl Feldstein, the society's executive director.

The company blamed a late-spring snowstorm for delaying deployment of noise cannons at the pond to prevent the ducks from landing.

NDP MLA Rachel Notley called Alberta's $500,000 penalty "laughable," saying it will not deter similar incidents from occurring.

"It's just not good enough," she said. "Five hundred thousand is a slap on the wrist."

She called on the government to boost the fine by 10 to 100 times.

Liberal Leader David Swann questioned why it took the governments 10 months to lay charges and said Alberta must do a better job of enforcing its environmental regulations.

"We have a law that says polluters pay and contaminated sites have to be redressed," he said. "Unfortunately, it's a law that has been seldom enforced. Those who pollute should be prosecuted to the full extent of the law."

Notley also criticized the length of time it took the province to lay the charge.

"It's profit first; protecting people and the environment second," she said. "That's the way the government operates, and the kind of delays we see are indicative of that fact."

Oilsands companies use tailings ponds to settle the sand and clay and unrecovered bitumen out of water that has been used in the oil upgrading process. The Energy Resources Conservation Board announced new rules governing tailings ponds last week that require oilsands companies to reduce the fine particles in liquid tailings by 50 per cent within four years, on top of what is already being captured.

The directive requires tailings ponds be reclaimed within five years after they are no longer in use.

Companies that don't meet requirements face shutdown orders and delays in upgrade approvals.

dhenton@thejournal.canwest.com

hbrooymans@thejournal.canwest.com

© Copyright (c) The Edmonton Journal

Syncrude charged over Alberta duck deaths

CALGARY — Alberta and Ottawa moved Monday to charge an energy heavyweight with breaking environmental laws after the industry – and the country – were humiliated last spring by the image of hundreds of oil-soaked ducks dying in a toxic byproduct of the oil sands.

Syncrude Canada Ltd. could face fines of up to $800,000 if convicted under provincial and federal environmental legislation in connection with the deaths of 500 waterfowl at one of its tailing ponds north of Fort McMurray, Alta.

The charges are the first of their kind against an oil sands company. They come as Alberta and Canada attempt to promote the resource as a safe, secure supply of energy at the same time as environmentalists are waging a “dirty oil” campaign against the so-called tar sands.

“I think we have an obligation not only to the environment, but to the public and to the credibility of our system if we don't lay charges,” Alberta Environment Minister Rob Renner told reporters Monday.

A Mallard duck gets cleaned by Focus Wildlife Canada personell Bruce Adkins and Hilary Pittel at the Wildlife Rehabilitation Society of Edmonton on Sunday May 4, 2008. The duck was transported to the center after being rescued from a Syncrude tailings pond a week earlier near Fort McMurray. (Jordan Verlage/Edmonton Sun/The Canadian Press)

On April 28, 2008, the birds were found dead or dying in a toxic soup located along a migratory route for hundreds of thousands of waterfowl. Alberta requires effective bird deterrence by energy producers, but at the time, Syncrude explained that a spring snowstorm prevented the company from erecting noisemakers around the massive pond to scare away flocks.

Under the Alberta Environmental Protection and Enhancement Act, Syncrude could be fined up to $500,000 for failing to ensure that “a person who keeps, stores or transports a hazardous substance or pesticide shall do so in a manner that ensures that the hazardous substance does not directly or indirectly come into contact with or contaminate any animals, plants, food or drink.”

Syncrude also has been charged federally under the Migratory Birds Convention Act for “allegedly depositing or permitting the deposit of a substance harmful to migratory birds in waters or an area frequented by birds.” The maximum penalty is $300,000.

“We expect all Canadians and certainly Canadian companies operating in Canada to respect our environmental legislation and we will demand full accountability in law, in terms of any type of environmental problems,” federal Environment Minister Jim Prentice told reporters in Ottawa.

Syncrude spokesman Alain Moore said this was the first time anything like this has occurred in the decades the company has been operating in the region.

“We feel horrible it happened. There's a huge resolve in our organization to make appropriate changes to prevent it from happening again,” he said.

The company is scheduled to appear in Provincial Court in Fort McMurray on March 25.

Frustrated with how long it was taking governments to act, a member of the Sierra Club of Canada launched a private prosecution against the company last month. The joint prosecution by Ottawa and Alberta will now likely take precedence.

“It's nice to see that they've finally actually laid charges,” said Mike Hudema, a spokesman for Greenpeace Canada. “It's unfortunate they are doing so by being spurred on by a private prosecution, and at the same time the fines under the legislation are ridiculously low.”

Syncrude does not issue overall financial results, but, based on a rough calculation, an $800,000 fine represents less than an hour of production revenue from the mine.

Mr. Prentice said the Conservative government plans to introduce legislation to deal with environmental crimes, including “significantly increasing the penalties” for large companies that could reach the multimillion-dollar range.

Alberta Justice Minister Alison Redford said the province would push for “creative sentencing” options that focus on such things as technology and the environment.

Despite the charges against Syncrude and last week's announcement by Alberta's energy regulator to set new rules for the cleanup and management of tailings ponds, observers say it's too early to know whether this amounts to a crackdown that should worry the oil patch or improve Canada's reputation around the globe.

“Everybody is concerned about the environmental issues associated with the oil sands,” said Duff Harper, an environmental lawyer with Blake, Cassels & Graydon LLP in Calgary. “It seems to have become almost a rallying cry for a lot of people.”

Mr. Hudema suggested the timing could be linked to U.S. President Barack Obama's visit to Ottawa this month.

“I think that they're trying to do minor things to try to improve that image,” he said, “especially leading into a presidential visit that could have major implications for the tar sands for sure.”