ST. ALBERT, Alta. - A firm linked to a Chinese state-owned company was ordered Thursday to pay $1.5 million in penalties in the deaths of two foreign workers at an Alberta oilsands project.
SSEC Canada Ltd. pleaded guilty last September to three workplace safety charges in the deaths of the Chinese temporary foreign workers.
The men died in 2007 at Canadian Natural Resources' (TSX:CNQ) Horizon project near Fort McMurray when an oil storage tank they were building collapsed.
Alberta Justice spokeswoman Michelle Davio said the penalty is the largest ever imposed by a judge in the province on workplace safety charges.
"The penalty is made up of a $200,000 fine and $1.3 million payment to the Alberta Law Foundation that will be used to support outreach and education programs for temporary foreign workers and for workers who are new to Alberta," she said.
SSEC Canada is the Canadian subsidiary of Sinopec Shanghai Engineering Company Ltd.
The case involved a total of 53 charges involving three different companies, including Calgary-based Canadian Natural Resources and Sinopec.
Charges against Sinopec were withdrawn. All 29 charges against CNRL were stayed, meaning the government can reactivate them at any time over one year.
According to an agreed statement of facts filed in court, problems at the Horizon project began in 2006 when 132 Mandarin-speaking Chinese workers recruited by SSEC Canada were late in getting to the worksite.
Work on the large metal storage tanks fell behind schedule.
SSEC Canada proposed revised construction in which the tanks' walls and roofs would be built at the same time.
CNRL agreed to the revisions, but said the work should be done under its own construction management team which would supervise quality control and safety.
SSEC Canada began work using the new method before CNRL's team arrived on site, even though the procedures hadn't been certified by a professional engineer.
On April 24, 2007, about three weeks after SSEC Canada began using the new approach, a roof collapsed when the wire cables holding it up snapped after being kinked and torqued in high winds.
The two workers were crushed by falling steel. Five other Chinese workers were injured.
Gil McGowan, president of the Alberta Federation of Labour, called the penalty "less than a drop in the bucket."
"This was an opportunity for the Alberta government to send a clear message to companies like Sinopec that if they want to do business in Canada, then they have to observe and follow our rules when it comes to workplace rights and health and safety," McGowan said.
The case was delayed for years by uncertainty over which company was responsible and whether they would be responsible as an employer, contractor or prime contractor.
Sinopec Shanghai Engineering Co. went to the Alberta Court of Appeal in a losing effort to argue that it hadn't been properly served with legal documents, since it had no presence in Canada.
The Supreme Court of Canada refused to hear a challenge.
Also on HuffPost:
10. Oil And Gas Accounts For 4.8 Per Cent Of GDP
The oil and gas industries accounted for around $65 billion of economic activity in Canada annually in recent years, or slightly less than 5 per cent of GDP. Source: <a href="http://www.ceri.ca/docs/2010-10-05CERIOilandGasReport.pdf" target="_hplink">Canada Energy Research Institute</a>
9. Oil Exports Have Grown Tenfold Since 1980
Canada exported some 12,000 cubic metres of oil per day in 1980. By 2010, that number had grown to 112,000 cubic metres daily. Source: <a href="http://membernet.capp.ca/SHB/Sheet.asp?SectionID=9&SheetID=224" target="_hplink">Canadian Association of Petroleum Producers</a>
8. Refining Didn't Grow At All As Exports Boomed
Canada refined 300,000 cubic metres daily in 1980; in 2010, that number was slightly down, to 291,000, even though exports of oil had grown tenfold in that time. Source: <a href="http://membernet.capp.ca/SHB/Sheet.asp?SectionID=7&SheetID=104" target="_hplink">Canadian Association of Petroleum Producers</a>
7. 97 Per Cent Of Oil Exports Go To The U.S.
Despite talk by the federal government that it wants to open Asian markets to Canadian oil, the vast majority of exports still go to the United States -- 97 per cent as of 2009. Source: <a href="http://www.nrcan.gc.ca/statistics-facts/energy/895" target="_hplink">Natural Resources Canada</a>
6. Canada Has World's 2nd-Largest Proven Oil Reserves
Canada's proven reserves of 175 billion barrels of oil -- the vast majority of it trapped in the oil sands -- is the second-largest oil stash in the world, after Saudi Arabia's 267 billion. Source: <a href="http://www.ogj.com/index.html" target="_hplink">Oil & Gas Journal</a>
5. Two-Thirds Of Oil Sands Bitumen Goes To U.S.
One-third of Canada's oil sands bitumen stays in the country, and is refined into gasoline, heating oil and diesel. Source: <a href="http://www.nrcan.gc.ca/statistics-facts/energy/895" target="_hplink">Natural Resources Canada</a>
4. Alberta Is Two-Thirds Of The Industry
Despite its reputation as the undisputed centre of Canada's oil industry, Alberta accounts for only two-thirds of energy production. British Columbia and Saskatchewan are the second and third-largest producers. Source: <a href="http://www.nrcan.gc.ca/statistics-facts/energy/895" target="_hplink">Natural Resources Canada</a>
3. Alberta Will Reap $1.2 Trillion From Oil Sands
Alberta' government <a href="http://www.huffingtonpost.ca/2012/03/27/alberta-oil-sands-royalties-ceri_n_1382640.html" target="_hplink">will reap $1.2 trillion in royalties from the oil sands over the next 35 years</a>, according to the Canadian Energy Research Institute.
2. Canadian Oil Consumption Has Stayed Flat
Thanks to improvements in energy efficiency, and a weakening of the country's manufacturing base, oil consumption in Canada has had virtually no net change in 30 years. Consumption went from 287,000 cubic metres daily in 1980 to 260,000 cubic metres daily in 2010. Source: Source: <a href="http://membernet.capp.ca/SHB/Sheet.asp?SectionID=6&SheetID=99" target="_hplink">Canadian Association of Petroleum Producers</a>
1. 250,000 Jobs.. Plus Many More?
The National Energy Board says oil and gas employs 257,000 people in Canada, not including gas station employees. And the Canadian Association of Petroleum Producers says the oil sands alone <a href="http://www.capp.ca/aboutUs/mediaCentre/NewsReleases/Pages/OilsandsaCanadianjobcreator.aspx" target="_hplink">will grow from 75,000 jobs to 905,000 jobs by 2035</a> -- assuming, of course, the price of oil holds up.