BUSINESS

Red Deer River Oil Spill: Lawsuit Launched Against Plains Midstream Canada

06/22/2012 07:47 EDT | Updated 06/22/2012 07:49 EDT
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CALGARY -- A prominent Regina-based lawyer is pursuing a class-action lawsuit over a recent oil spill in central Alberta.

The claim being organized by Tony Merchant is seeking more than $75 million from Plains Midstream Canada, owners of the pipeline that leaked up to 475,000 litres of light sour crude into the Red Deer River earlier this month.

High river levels flushed most of the oil downstream into Gleniffer Lake, a man-made reservoir and popular recreational area.

The suit lists Airdrie, Alta., couple Suzanne and Darin Rieger as the plaintiffs. It says the Riegers were trying to sell their two lots at the Carefree RV resort on the reservoir. The couple was hoping to get between $119,000 and $169,000 before the leak happened.

``As a result of the incident, the value that the Riegers can hope to achieve for those properties has been diminished,'' claims the lawsuit, without mentioning a specific amount.

The claim alleges negligence on the part of Plains Midstream Canada for allowing the leak to happen. It says the company should have known pipelines in the area were vulnerable during periods of heavy rain.

It cites a report into a spill of 28,140 litres of crude from a Pembina pipeline in 2008. The report into that leak found the break occurred after heavy rains eroded the soil around the pipeline, the statement of claim says.

Plains Midstream has not disclosed what happened to its pipeline.

None of the allegations has been proven in court.

It's believed a section of the 46-year-old Plains Midstream pipeline that runs under the river near Sundre, Alta., leaked June 7.

The company says that, with the exception of the first day after the leak, all water samples from the river and reservoir have been well within Alberta guidelines for drinking water. Plains Midstream has also been monitoring air quality and there have been no reported samples above acceptable levels.

But fishing guides and residents have already said they fear the leak could do long-term damage

When it comes to compensating people affected by the spill, spokesman Stephen Bart has said the company will ``make it right.''

There was a second major pipeline leak in Alberta earlier this week.

On Monday, an Enbridge (TSX:ENB) pipeline leaked 230,000 litres of heavy crude oil at a pumping station site about 25 kilometres southeast of Elk Point.

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