March 25, 2016
Jock Finlayson BCBC
Re: Your Response to Open Letter to the Business Council of British Columbia
Thank you for your response to our letter of March 1, 2016. You stated in your reply that the mainstream business community is prepared to live with the outcomes of properly constituted and fact-focused regulatory processes. You also stated that the new federal government and a substantial fraction of the voting public share our view that the regulatory processes are inadequate. Regarding our specific concerns, you noted that others in the engineering community see the risks as smaller and presumably acceptable, and that these are issues best addressed by the regulatory review process.
We would like in this letter to specifically address this disconnect regarding the adequacy of the review process and attempt to chart a path forward that would see Canada’s energy industry develop in a manner that is acceptable to a majority of Canadians. We have provided below and in the attached appendix a more thorough explanation of our concerns and invite you and your contacts in the engineering community to review them and consider whether or not you believe the existing regulatory process is adequate. As an organization with a leadership role, we believe the Business Council of British Columbia (BCBC) can have a significant impact in motivating the development of the required regulatory regime.
Firstly, the risk analyses submitted for the Northern Gateway and Trans Mountain projects state an unacceptably high probability of a major spill in the 50 year projected lifetime of the projects – 9% for an at least 5,000 m3 spill for Northern Gateway and 10% for an at least 8,250 m3 spill for Trans Mountain. The analyses present these estimates in terms of ‘return periods’, an opaque concept which carries little meaning to the average person, and we explain in the attached appendix how these can be translated into more intuitive probabilities. As we experienced first-hand when we participated in the Northern Gateway review process, the risk analysis firm, DNV, does not comment on whether this is an acceptable level of risk, and suggests that this is for the public and the regulators to decide. Does the BCBC have an opinion on what is an acceptable level of risk for a major spill?
Secondly, these risk analyses are deeply flawed, and the above probabilities of a major spill are possibly significantly higher. One glaring example is the assumed ratio of the amount of time tankers have historically spent in confined channels. This parameter has a larger effect than any other on the overall risk, yet the authors of the original analysis, in the case of Northern Gateway, admit that it is an assumption. Similar unjustified assumptions are employed in stating the effectiveness of mitigations – the importance of which is highlighted in the attached appendix. Does the BCBC believe that the reviews conducted thus far, in leaving these assumptions unaddressed, constitute a fact-focused regulatory process?
We also want to point out that there has not been an analysis done of the potential for a collision of a fully loaded or an empty Aframax-type tanker with either the First or the Second Narrows bridges, particularly with the present Second Narrows railway and highway bridges.
Thirdly, the product that is being transported, diluted bitumen, is considerably different from crude oil, and the established body of knowledge regarding marine spills cannot be directly applied. For a recent comprehensive overview of this topic, please refer to the US National Academy of Sciences report referenced in the appendix. What is the BCBC’s position on the adequacy of the current cleanup capability for such an unconventional product? Does the BCBC believe that the regulators have adequately addressed this issue, despite the significant objections of many intervenors, including Environment Canada’s own scientists?
Lastly, the existing funding structure is inadequate to cover the costs of a large marine spill, especially when one considers the likely difficulties of recovering such an unconventional product. The liability of the pipeline companies ends at the terminals, and the tanker operators are typically structured as one-ship companies. What is the opinion of the BCBC regarding the current funding structure in light of the incomplete risk analyses and the uncertainty regarding cleanup? Is the business community prepared to sustain, through increased taxation, an extended cleanup effort that could cost several billion dollars?
In short, we ask, will the BCBC join us in seeking a truly fact-based, independent review process that addresses these legitimate concerns? Will you join us in seeking to make this process more transparent, by directly tackling difficult questions of what is an acceptable level of risk? Will you join us in requesting that every reasonable option be considered to lower the risks of these projects, particularly relocating the proposed terminals to Port Simpson and Roberts Bank?
We look forward to Canada maintaining its position as a world leader in the responsible development of its natural resources and welcome the input of the BCBC in guiding the federal government towards a regulatory regime that will satisfy the public’s concerns so that progress can be made.
Return periods vs. probabilities
The following is an explanation of how the risk estimates provided by the proponents, stated in terms of ‘return periods’, can be translated to more meaningful and appropriate spill probabilities. As we stated in the Letter of Comment we submitted to the Trans Mountain review process,
The return period is an estimation of the average time elapsed between spills of a given volume. As such, approximately 50% of the spills would occur before the return period and 50% would occur after that time. Therefore, the return period is not a good statistic to communicate probability of a spill. Of importance is the probability that at least one spill, of a given volume, would occur within the operating life of the project. The calculation of such a probability is straightforward given the return period and the operating life.
Spill probabilities for Northern Gateway
The table below shows the results of this calculation when applied to the return periods provided by Northern Gateway, using the 50 year projected operating life of the project. Original data is taken from Table 8.8 of the Marine Shipping Quantitative Risk Analysis, DNV, 2010, p. 137.
|Return period, years, with no mitigations||Return period, years, with mitigations|
|Spill volume (m3)||Return period, years||Probability of at least one spill of this size in 50 year operating life||Return period, years||Probability of at least one spill of this size in 50 year operating life|
|All sizes, oil or condensate||78||47%||250||18%|
|Greater than 5,000 m3||220||22%||550||9%|
|Greater than 20,000 m3||1750||3%||2800||2%|
|Greater than 40,000 m3||12000||0.4%||15000||0.3%|
Spill probabilities for Trans Mountain
The same analysis for the Trans Mountain project is given in the following table. Original data is taken Table 34 of their TERMPOL report 3.15.
|No project||Project with no mitigations||Project with all mitigations|
|Spill volume (m3)||Return Periods (in years)||Probability of at least one spill in 50 years||Return Periods (in years)||Probability of at least one spill in 50 years||Return Periods (in years)||Probability of at least one spill in 50 years|
|Greater than 0 m3 (any)||309||15%||46||66%||237||19%|
|Greater than 8,250 m3||619||8%||91||42%||473||10%|
|Greater than 16,500 m3||3,093||1.6%||456||10%||2,366||2%|
The above table permits the following conclusions:
- With no mitigations the probabilities of at least one spill in 50 years are too high. Thus, mitigations are essential and must be enforced.
- Even with mitigations, probability of at least one oil spill in 50 years, greater than 8,250 cubic meters, is deemed to be too high (10%). This is comparable to the probability for a spill greater than 5,000 m3 calculated for Northern Gateway (9%). The probability for a large spill of 16,500 m3 is more tolerable (2%), but even a more moderate spill would cause very substantial damage.
- Even with mitigations, there is a 19% probability of an oil spill, regardless of volume. This is also too high.
Comparative study of diluted bitumen and conventional crude oil spills
For a recent and comprehensive review of the differences between spills of diluted bitumen and conventional crude oil, please refer to:
Committee on the Effects of Diluted Bitumen on the Environment; Board on Chemical Sciences and Technology; Division on Earth and Life Studies; National Academies of Sciences, Engineering, and Medicine Spills of Diluted Bitumen from Pipelines: A Comparative Study of Environmental Fate, Effects, and Response. Washington: The National Academies Press, 2016. Print.
This report is available for free on the web at:
The focus of this report and its recommendations is on the current concerns related to the transport of diluted bitumen in pipelines. We are confident that, by updating the planning process and taking greater advantage of available information about diluted bitumen when it is spilled, the effectiveness of spill response can be enhanced. However, given the nature of pipeline operations, response planning, and the oil industry, it is likely that our recommendations will be applicable to spill response, preparedness, and cleanup for many types of crude oil.
Diane McKnight, Chair
Douglas Friedman, Study Director
The current system for response planning, preparedness, and mitigation is geared to the properties, behavior in the environment, and response challenges of commonly transported light and medium crude oils. Thus, the focus is on preparing for spills of oil that float on the surface. Spills of diluted bitumen raise different issues because of the greater density that the product acquires as the diluent evaporates. This leads to the potential, depending on environmental conditions, for the diluted bitumen residues to aggregate with particles in the water column and submerge or sink to the bottom of the water body. Different strategies, expertise, and response capabilities are needed to effectively address this spill scenario. However, the current relevant U.S. regulations and agency practices do not capture the unique properties of diluted bitumen or encourage effective planning for spills of that product.
Spills of diluted bitumen products where the crude oil submerges in the water column or sinks to the bottom are particularly difficult for responders. Most of the effective response methods are based on the premise that the spilled oil floats. Proven methods are needed so that responders have effective means by which to determine where the crude oil is, track its movement over time, and effectively recover it. Detection of diluted bitumen spills on the bottom may pose different challenges than for conventional nonfloating crude oils because the diluted bitumen can occur as oil-particle aggregates that require different detection methods than those used to detect bulk crude oil on the bottom. In situations where water is moving, there are no proven techniques for containment of suspended or sunken crude oil to prevent remobilization and spreading prior to recovery. Various techniques have been proposed but few have been shown to be effective. Once the crude oil has sunk to the bottom, recovery methods are selected based on the environmental setting, amount and distribution of the crude oil, and cleanup endpoints. Better technologies are needed to minimize water and sediment removal and improve the separation and treatment of oil, water, and sediment.
Techniques to intercept and recover submerged oil on the move.Submerged oil moving downstream in rivers or following wind- or tidally driven currents could be intercepted in theory, but in reality no techniques are known to be efficacious to capture oil beneath the water surface. Research should strive to develop options for the diversity of environmental settings in which oil can be spilled.
Alternatives to dredging to recover sunken oil. Dredging is costly and environmentally destructive, producing voluminous waste that often must be landfilled, and therefore alternatives should be sought. Agitation and collection of resultant floating oil was conducted in the Kalamazoo River, but its efficacy in a particular spill needs investigation before being deployed again. Other alternatives should be studied as well.