OTTAWA (Reuters) - Canada’s energy regulator is doing a poor job of monitoring pipeline firms, an official watchdog said on Tuesday in a report that could bolster support for government plans to reform how major oil and gas projects are approved.
Environment Commissioner Julie Gelfand said the National Energy Board (NEB) did not properly check whether companies were sticking to the approval conditions for projects and did not consistently check that problems had been cleared up.
The new Liberal government plans to revamp the NEB, which is responsible for approving federally regulated projects and then monitoring them. Critics complain the body is too focused on the needs of the energy industry and does not pay enough attention to environmental concerns.
The NEB oversees 45,300 miles (72,900 km) of oil and gas pipelines and around 100 companies.
“Our audit concluded that the board did not adequately track companies’ implementation of pipeline approval conditions, and that it was not consistently following up on company deficiencies,” Gelfand said.
An increasingly heated public debate over pipeline safety, the environment and the role of the NEB is threatening to derail major Canadian projects proposed by TransCanada Corp, Kinder Morgan Inc and Enbridge Inc.
The energy industry says new pipelines are needed to ship crude to the seacoast, where it can attract higher prices.
In a bid to alleviate safety and environmental concerns, the NEB sometimes attaches specific conditions to projects. Gelfand said the board did not do a thorough enough job of checking whether these conditions had been met, in part because it had an outdated information tracking system.
In a written response, the NEB said it would overhaul its systems by December to improve compliance monitoring.
The Environmental Defence group said the NEB’s failure to check that firms were respecting the conditions showed the body was completely broken.
“In the past, the NEB has relied on these safety conditions to justify its approval of highly controversial pipeline projects,” said Tim Gray, the group’s director.
Gelfand also said the board was having trouble recruiting and retaining specialists in pipeline integrity.
Given increasing public interest in pipelines and climate change, as well as projected doubling of pipeline capacity by 2020, “it is clear the board needs to do more to keep pace with the rapidly changing context in which it operates”, she concluded.
The Liberals say they will reform the NEB to put more stress on environmental concerns.
Reporting by David Ljunggren; Editing by W Simon and Jonathan Oatis