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Plains Midstream Settlement Shows Lack Of Pipeline Accountability

06/13/2014 04:00 EDT | Updated 08/13/2014 05:59 EDT

Last week, just days after regulators laid federal and provincial charges against pipeline operator Plains Midstream Canada, the company pleaded guilty and agreed to pay just over a million dollars in environmental fines for its role in two of the most notorious oil spills in Alberta's recent history.

While we're pleased that federal and provincial regulators finally took action and laid charges, the size and nature of the settlements is somewhat disconcerting. It raises a number of questions and once again sheds light on the major weaknesses in Canada's environmental law and enforcement framework.

In April 2011, 4.5 million litres of oil spilled from Plains' 46-year-old Rainbow pipeline near Zama, Alberta. Just over a year later, 475,000 litres of sour crude were leaked from Plains' Rangeland pipeline into the Red Deer River near Sundre. Following the spills, Alberta Energy Regulator (AER) investigators reviewed both incidents and found it was likely that Plains' failure to implement proper practices had either caused or contributed to the size of the release.

Alberta Environment announced in April 2013 that it was bringing three separate charges against Plains for the 2011 Rainbow spill. Similarly, in late May 2014, the AER brought two charges against Plains for the 2012 Rangeland spill.

Just days after the Rangeland charges were brought it was announced that both matters had been settled: Plains would avoid two potentially lengthy trials and pleaded guilty to three of the five charges.

In the aftermath of the Rangeland spill, then-Premier Alison Redford stated that the Regulators would take whatever steps necessary prevent similar events in the future. With Plains' regulatory liability from both matters now finalized, one has to wonder whether the Regulator's actions have ensured proper accountability and why further charges with more and stiffer penalties were not pursued.

It took provincial prosecutors just shy of two years to lay charges on both spills despite the fact that the Regulator had already concluded that Plains was at least partially responsible. On the basis of the conclusions in the Regulator's own reports, it would have been reasonable to bring a number of charges under various environmental statutes. However, only charges relating to Plains' actions after the spill -- particularly failing to inform regulators and mitigate damage -- were laid.

Because the matter was settled without a trial, details of the spills -- including the full extent of the environmental damage -- will likely never be made public.

In the settlement, Plains agreed to pay $850,000 for failing to report and mitigate or remedy the Rangeland spill under the Fisheries Act and Alberta's Environment Protection and Enhancement Act (EPEA). It was charged another $450,000 under the EPEA for failing to remedy or confine the effects of the Rainbow spill. The settlement will see Plains responsible for roughly 10 cents for every litre spilled from the Rainbow pipeline.

This lack of transparency is problematic and is another example of how weak regulatory oversight has the effect of shielding the oil and gas industry from public scrutiny. These actions don't occur in a vacuum and are a part of an alarming trend.

As we reported in "Getting Tough on Environment Crime?", Canada has a surprisingly weak record when it comes to enforcing its own environmental laws. Our research indicates that since 2005-06, the number of investigations, prosecutions, and convictions under federal environmental laws has been on a steady decline.

For example, each year there are only about 20 convictions under the Canadian Environmental Protection Act (CEPA), one of Canada's most important pollution laws. Put it this way: According to our research, it took Environment Canada more than 20 years to collect $2.4-million in fines under CEPA. The Toronto Public Library collected $2.6-million in fines for overdue books in 2009 alone.

While they are just one of the tools available to regulators, fines are crucially important as they are the ultimate deterrent to polluters. Weak enforcement, coupled with substantially weakened environmental laws, have created a climate in which financial regulatory repercussions for polluters are rare.

With major pipeline projects like Enbridge's Northern Gateway and Kinder Morgan's Trans Mountain expansion moving their way through the review process, the public is now more aware than ever of the dangers of these risky projects. If Plains can get away with a slap on the wrist for two large oil spills, does this mean Canadians should expect the same light treatment in the event of a Northern Gateway or Trans Mountain pipeline break?

Canadians deserve assurances that environmental offenders will be held to full account when they are responsible for causing harm to our air, water, and land. And those assurances need to be backed up by meaningful action.

This piece was written by Ecojustice staff lawyer Fraser Thomson. Ecojustice is one of Canada's leading charities using the law to protect and restore Canada's environment. Learn more at ecojustice.ca.