Pipeline Safety Act

An Act to amend the National Energy Board Act and the Canada Oil and Gas Operations Act

This bill was last introduced in the 41st Parliament, 2nd Session, which ended in August 2015.

Sponsor

Greg Rickford  Conservative

Status

This bill has received Royal Assent and is now law.

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment amends the National Energy Board Act and the Canada Oil and Gas Operations Act in order to strengthen the safety and security of pipelines regulated by those Acts.
More specifically, the enactment, among other things,
(a) reinforces the “polluter pays” principle;
(b) confirms that the liability of companies that operate pipelines is unlimited if an unintended or uncontrolled release of oil, gas or any other commodity from a pipeline that they operate is the result of their fault or negligence;
(c) establishes the limit of liability without proof of fault or negligence at no less than one billion dollars for companies that operate pipelines that have the capacity to transport at least 250,000 barrels of oil per day and at an amount prescribed by regulation for companies that operate any other pipelines;
(d) requires that companies that operate pipelines maintain the financial resources necessary to pay the amount of the limit of liability that applies to them;
(e) authorizes the National Energy Board to order any company that operates a pipeline from which an unintended or uncontrolled release of oil, gas or any other commodity occurs to reimburse any government institution the costs it incurred in taking any action or measure in relation to that release;
(f) requires that companies that operate pipelines remain responsible for their abandoned pipelines;
(g) authorizes the National Energy Board to order companies that operate pipelines to maintain funds to pay for the abandonment of their pipelines or for their abandoned pipelines;
(h) allows the Governor in Council to authorize the National Energy Board to take, in certain circumstances, any action or measure that the National Energy Board considers necessary in relation to an unintended or uncontrolled release of oil, gas or any other commodity from a pipeline;
(i) allows the Governor in Council to establish, in certain circumstances, a pipeline claims tribunal whose purpose is to examine and adjudicate the claims for compensation for compensable damage caused by an unintended or uncontrolled release of oil, gas or any other commodity from a pipeline;
(j) authorizes, in certain circumstances, that funds may be paid out of the Consolidated Revenue Fund to pay the costs of taking the actions or measures that the National Energy Board considers necessary in relation to an unintended or uncontrolled release of oil, gas or any other commodity from a pipeline, to pay the costs related to establishing a pipeline claims tribunal and to pay any amount of compensation that such a tribunal awards; and
(k) authorizes the National Energy Board to recover those funds from the company that operates the pipeline from which the release occurred and from companies that operate pipelines that transport a commodity of the same class as the one that was released.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, an excellent resource from the Library of Parliament. You can also read the full text of the bill.

Votes

March 9, 2015 Passed That the Bill be now read a second time and referred to the Standing Committee on Natural Resources.

Pipeline Safety ActGovernment Orders

February 26th, 2015 / 4 p.m.
See context

Etobicoke—Lakeshore Ontario

Conservative

Bernard Trottier ConservativeParliamentary Secretary to the Minister of Foreign Affairs and for La Francophonie

Mr. Speaker, I listened attentively to my colleague's speech. A wise person once said that we should never confuse a fence with a chair because we might get hurt. That is true.

My colleague talked about what a terrible piece of legislation this is, and yet he will support it. He has denounced pipelines, and yet he bemoans the fact that we have not built the northern gateway pipeline. I thought that maybe he should talk about a good news story, such as getting our energy products to market. The member should know that about half of our exports are energy products, and we cannot have exports without getting those products to market, and we all know that pipelines are the safest and most efficient way to get those products to market.

Also, the other piece of good news is that there are significant numbers when it comes to the employment of first nations. It is the largest private sector employer of first nations people in the country.

Perhaps the member could talk about some of the positive aspects with respect to getting these pipelines built but also ensuring that they are safe.

Incidentally, the liability amounts are very much in line with and are stronger than what the rest of the world has. This is a world-class pipeline safety regime that we are putting in place, but it also enables some positive aspects for the Canadian economy, for regular Canadians as well as for first nations.

Pipeline Safety ActGovernment Orders

February 26th, 2015 / 4 p.m.
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Liberal

John McKay Liberal Scarborough—Guildwood, ON

Mr. Speaker, I would say that when a Conservative offers us a chair we should ensure that all of the legs are in place.

The issue is that we would not be having this conversation or the opposition would not be expressing some skepticism had the government established its environmental credibility over the past nine years. However, it has not established its environmental credibility; rather, it has lost its social licence to do things.

I am forever puzzled by the pathetic way in which the Conservative members ask for affirmation, such as, “Tell us what good things we have done today.” Well, what did they have for breakfast? I am sure that was a good thing.

I like and respect my hon. colleague across the way. However, the regrettable fact is that each and every pipeline I have mentioned has a considerable pushback from people who are very concerned about the safety of pipelines.

Pipeline Safety ActGovernment Orders

February 26th, 2015 / 4 p.m.
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NDP

François Choquette NDP Drummond, QC

Mr. Speaker, I agree with my Liberal colleague.

Indeed, it is a step in the right direction to bring in absolute liability in situations where the company is at fault. That is a key part of the polluter pays principle. It is also an improvement that the bill would increase the liability to $1 billion when the company is not at fault.

However, my colleague mentioned something really important, which is social licence. Prevention is needed so that pipeline leaks do not happen. That is the problem with Canadian legislation.

The Conservatives have been gutting the Canadian Environmental Assessment Act since 2012, and people in Quebec are upset that they are not able to participate in the National Energy Board's consultations and cannot know the full route of the energy east pipeline, for example.

Would my colleague like to tell us more about the fact that environmental assessments are no longer adequate?

Pipeline Safety ActGovernment Orders

February 26th, 2015 / 4:05 p.m.
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Liberal

John McKay Liberal Scarborough—Guildwood, ON

Mr. Speaker, I do not think the offence is limited to Quebec. It is an operative fact that the purview and the ability of the NEB to consider various issues that are of relevance to the very people the member is talking about has been quite circumscribed, and so the hearings themselves are limited and the access to the hearings is limited. The problem with that is that the project has basically been destroyed before one can get to it. If that pattern continues, then regrettably, this industry will have some serious problems.

The current government wishes to act like a cheerleader. It is not a cheerleader; it is a regulator. When a regulator operates properly, it operates in the best interests of the Canadian public.

Pipeline Safety ActGovernment Orders

February 26th, 2015 / 4:05 p.m.
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Liberal

Kevin Lamoureux Liberal Winnipeg North, MB

Mr. Speaker, I wonder if my colleague could pick up on his comments in which he made reference to the length of time we are in session. There are another 11 weeks after tomorrow, keeping in mind that we have not had a debate on the budget—the budget has been put off—there are other pieces of legislation, and this is at the beginning stage of second reading.

Reflecting on that, maybe the member could speculate on why the government might have even considered introducing the legislation. Could it possibly be because we are going into an election a little bit later this year?

Pipeline Safety ActGovernment Orders

February 26th, 2015 / 4:05 p.m.
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Liberal

John McKay Liberal Scarborough—Guildwood, ON

Mr. Speaker, I have in my hand the 2015 calendar. We have two sitting weeks in March. We have three sitting weeks in April. I imagine that the three sitting weeks in April will pretty well be used up by the budget. We then have three sitting weeks in May, and one and a half sitting weeks scheduled for June.

If the government were committed to a lightning-like process, it could do this bill, but that is just getting it through the House. From there, we have to move it over to the Senate, which has its own process.

I respectfully suggest that the chances of this bill seeing royal assent are about the same as the chances of the Maple Leafs winning the Stanley Cup this year. I have hit a pretty sensitive point, but as a lifelong Leafs fan, I have had a tonne of realism hit me this year.

I do not think this will happen. My only speculation, and it is entirely speculative on my part, is that this bill was introduced for window dressing.

Pipeline Safety ActGovernment Orders

February 26th, 2015 / 4:05 p.m.
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Conservative

Peter Kent Conservative Thornhill, ON

Mr. Speaker, I would suggest that the member look more to the Toronto Raptors this year than the Maple Leafs, and so to a similar positive outcome for this legislation as it passes through the House.

I must say that I was left somewhat breathless by my colleague's wandering away from the topic at hand. It is quite clear that in the United States there is support in Congress. The labour movement in every state across which the Keystone XL pipeline would eventually cross is in favour of the pipeline. The problem is at the White House; it is the difference of opinion between a president and his state department and Congress.

When it comes to puffing out one's chest, this government is indeed proud that it is the first Canadian government in history to actually reduce greenhouse gases. I would remind the member of the commitment to Kyoto, which saw emissions rise to 35%.

Finally, the point I would like to make to reassure my colleague is that in questioning and raising the spectre of the Kalamazoo spill, he wondered about the cost. The cost is on the record. Enbridge says that it is $1 billion and running. However, Enbridge has taken responsibility there, as it would here if there were a similar spill, heaven forbid. With this legislation, the liability provided for and the coverages, Canadian taxpayers would not cover those costs. The polluter would pay. There are measures for the NEB to enforce better safety precautions, and this is probably the best pipeline safety legislation and liability coverage in the world.

Pipeline Safety ActGovernment Orders

February 26th, 2015 / 4:10 p.m.
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Liberal

John McKay Liberal Scarborough—Guildwood, ON

Mr. Speaker, I wonder sometimes whether they eat the talking points or have them mainlined.

I am told that the cost of the Enbridge spill is at about $1.3 billion and growing. That is a huge hit on Enbridge's bottom line. I do not know what the insurance was for Enbridge's spill. Were that to happen here, I assume that the first $1 billion would be picked up by the no-fault insurance. That is good. That is a good point.

Having said that, not all companies are Enbridge. There are companies that are in free fall as far as the value of their assets is concerned. I have watched stock markets in the past. The stampede of the shareholders out the door when bad things are happening to a company is amazing. The poor old taxpayer gets stiffed with the bill. I would just point that out.

There is only person whom we had to make happy with the Keystone XL pipeline. That one person is the most powerful man in the world. The government blew it. It was a no-brainer.

Pipeline Safety ActGovernment Orders

February 26th, 2015 / 4:10 p.m.
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Conservative

The Acting Speaker Conservative Barry Devolin

It is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Beauport—Limoilou, Health; the hon. member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, Social Development.

The House resumed consideration of the motion that Bill C-46, An Act to amend the National Energy Board Act and the Canada Oil and Gas Operations Act, be read the second time and referred to a committee.

Pipeline Safety ActRoyal Assent

February 26th, 2015 / 4:15 p.m.
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NDP

Nathan Cullen NDP Skeena—Bulkley Valley, BC

Mr. Speaker, I want to inform you that I will share my time with my esteemed colleague from Drummond. This is a good idea, as always.

This may sound strange, but I have looked forward to some version of such a bill for many years. With Bill C-46, the government has finally come to acknowledge a principle that for more than 20 years the New Democrats thought was important for the energy sector and industry at large. This is the principle that we commonly now know as the polluter pays. It is a very simple concept. It is a concept that should be embedded in all of our economic thinking about resource development and the potential for pollution, which is the company that causes the pollution should pay for the pollution.

This is an important concept for us because we also believe in pricing pollution across the board. We have heard the Prime Minister recently muse about the idea of perhaps putting a price on carbon similar to the Alberta model. It has some faults, but the very concept that pricing carbon, a known pollutant in causing climate change, is now something to which the Conservative government may be open. However, we hear Conservatives day after day ridicule and rile the opposition for any hint of the very same policy, which the Conservatives rain on.

Juxtapose that with the strange crossing of ideologies where the Liberal leader now says that pricing carbon should not be up to the federal government at all. It is odd to watch those two leaders cross themselves. More important, in Bill C-46 and the liability around spills from pipelines, we recall that the Prime Minister in an economic forum declare that Canada would quickly become a world energy superpower. This vision was outlined by the Prime Minister in very forceful terms. What one would have expected to be behind such a declaration was a plan or a strategy to achieve that vision.

As we have seen in the last eight or nine years, that commitment has been nothing but an unmitigated failure for the government. We have not seen the approach taken by the Conservatives enhance Canada's standing in the world when it comes to energy in any measurable way, not with our largest trading partner in the United States.

As pointed out by my Liberal colleagues, not only has the relationship around one particular project, in this case Keystone, caused all sorts of tensions between the government and the White House, but it has caused tensions in our trading relations in general. I recently had meetings with some trade department officials and investors from the United States, They wondered about the Conservative government's obsession with one project to the detriment of so many other important trade relations with the United States.

In making the declaration, when the Conservatives said that we would be an energy superpower, one would have thought there would have been some foundational elements included. One of them would have been the polluter pays principle. It is an important and key strategy in bringing the public along to any development, like a pipeline development. If there is a spill, it should not be the public who is on the hook for cleaning up the costs.

As has been pointed out in this debate already, Enbridge, which has proposed the northern gateway pipeline that will go through my region, had that exact experience just south of the border, when 3.5 million litres of diluted bitumen was spilled in the Kalamazoo River. It has spent north of one billion dollars cleaning that up.

In Canada, we had this perverse incentive in that the companies were never on the hook for that money for the cleanup. The companies receive the profit; the public gets the pain when there is an accident. There are spills. There have been several hundred spills across Canada over the last couple of years, some small and some quite a bit larger. The idea that the public would foot the bill for a company's mistake and damage to our environment is indeed perverse.

Several things in the bill remain lacking in a true energy policy from the government. If becoming an energy superpower were so important, one would have thought the government would have sincerely, and with great dedication, sought what would be a very important principle for any company operating, and that is the social licence to operate.

This is a commonly used term by industry today, particularly by extractive industries, heavy industries, that in order to be profitable and to remain viable, having a social contract with the public, an agreement on how companies conduct themselves, supported in the communities in which they operate would be foundational of any investment.

When I talk to the investment banks, the major banks in Canada, and some of the other investors who invest heavily in our country, the social licence of any particular project is paramount to the investor's rational to invest or not invest. If a company is facing protracted legal battles, if a company is in the face of strong public discontent, that affects the investor's decision.

Even with the Conservatives government, which is particularly fixated, having put so many of their eggs in one particular resource extraction basket, on oil, we would have thought that bringing forward legislation, working policies that would increase the level of public support would have been job number one. The efforts by the government to treat and negotiate with first nations in Canada would be job number one. The Prime Minister hired a special investigator, Doug Eyford, to go British Columbia to consult with first nations and find out what was lacking. In his report, Mr. Eyford stated that there was a lack of federal leadership in treating and negotiating with the first nations of British Columbia in particular .

Having lost almost 180 consecutive Supreme Court decisions that deal with first nations rights and title, we would think the federal government would have woke up to the idea that rights and title maybe matters, particularly to a resource like this one.

The bill is missing the ability of the government to understand, to respect and to negotiate with the first nations people of Canada. In provinces like British Columbia, rights and title have been confirmed again and again in the federal courts and at the Supreme Court level, and the government considers it an option to ignore those rulings, as if anything will get built, as if anything will get done by ignoring our Constitution and first nations rights and title.

We have also seen the government utterly ignore another foundational question that Canadians have with respect to any resource development, which is risk versus benefit. The benefits are generally seen in two areas: one through taxation and the other through job creation. What have we seen from the Conservatives? We saw the whole temporary foreign worker fiasco where they drove loopholes so big through the program that companies were firing Canadians working in the banking and energy sector and then hiring temporary foreign workers to the point where the Conservatives had to swing the pendulum back so hard that they essentially shut down virtually all of the temporary foreign worker program.

We have also seen a government absolutely ambiguous about the notion of value-added. Particularly when we deal with a one-time, non-renewable resource, we would think the government of the day would have some interest one way or the other as to whether companies are adding value or shipping the product out in its raw form. We know the true job components in any oil and gas project is when we add value to it.

The proposed projects, which heavily supported by the government, all purport to export raw bitumen in its most raw form. That leaves the risks with Canada and exports the lion's share of the benefits elsewhere.

The economy of the people I represent in northern British Columbia is primarily based on resource extraction. We understand the resource industry, we are support of it and are particularly supportive when it works with the values in the communities in which it seeks to operate.

Conservatives have ignored this time and time again and have lost public support, not just in their wild enthusiasm for projects that do not help the Canadian economy and certainly risk the Canadian environment, but they have run roughshod over first nations rights and title. The record shows they are not getting anything done. All they are doing is increasing conflict and uncertainty, which drives away investment and the ability of the Canadian economy to be more than just a raw export economy.

Time and time again we see the government make the same mistake. The Conservatives suggest that doing the same thing again will get them somehow a different result. We know the definition of someone who believes that doing the same thing repeatedly will get a different result: insanity. Increasing uncertainty, increasing conflict has done so little to even advance the agenda the Conservatives had.

What else do we miss from the Conservative government? It is not just a diversification of our trading partners, but also the diversification of our energy resources. The support for oil has been so outweighed by no support whatsoever for the clean energy sector.

The good news for Canadians is that globally last year, and we look forward to 2015 being similar, the advancements and the investments in clean energy technology, with the costs of production dropping and the acceptance and encouragement by the public writ large across the world for clean technology, solar, wind, geothermal and rest, has only grown and investments are outpacing investments in carbon energy.

Canada should be embracing this enthusiastically, with a government that understands we need to have a balance between these things. However, to put all of the attention on one energy source alone, we see what happens. The Conservatives have had to delay their budget. They have no plan B. All they have is this, and it is not working.

The bill is a small and important step in advancing a more balanced approach to the energy sector in Canada. We look forward to its passage. We will see if the calendar allows for its passage and how much enthusiasm the Conservatives have for it to become law.

Pipeline Safety ActRoyal Assent

February 26th, 2015 / 4:25 p.m.
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Liberal

Kevin Lamoureux Liberal Winnipeg North, MB

Mr. Speaker, my question for the member is related to motivation more than anything else.

One of the benefits of enshrining in legislation the polluter pays principle is that it can be an incentive for companies building future pipelines, or even current ones, to ensure the final product that will carry our oil or natural gas is of a high standard. We would have limits, potential fines or mechanisms to recover the cost of damage that might be caused to the environment and so forth, Thereby, hopefully, we would have a better system going forward.

Pipeline Safety ActRoyal Assent

February 26th, 2015 / 4:25 p.m.
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NDP

Nathan Cullen NDP Skeena—Bulkley Valley, BC

Mr. Speaker, I apologize, and it is not from lack of paying attention, but I am not sure I totally understood my friend's question.

I will add that the act would enhance the National Energy Board, the regulator in this case, or the police judging whether it should go ahead or not.

However, the government has retroactively, in the midst of an NEB process dealing with gateway, politicized the decision of the National Energy Board. The decision as to whether pipelines should be approved or not has been given to the Prime Minister and the cabinet. The Conservatives did this and then said that they would rely on evidence and science and not politics. However, they changed the NEB Act to allow only the cabinet and Prime Minister to have the final say.

The NEB now no longer requires a company like Kinder Morgan to release its full safety plan and cleanup operations in Canada. However, the same company is operating a very similar pipeline 50 miles south of where it plans to operate in Vancouver and the American regulator is happy to disclose that information. Our regulator, the NEB, seems to think the public does not have the right to know what cleanup the company is sponsoring.

We can see how the public loses faith in the referee. The government has consistently tried to bias the results and skew and torque what should be an apolitical process. Instead, it has become something that has lost the support of those in the broad sector of the Canadian public. When they lose that faith, they lose faith in the government's broader agenda.

Pipeline Safety ActRoyal Assent

February 26th, 2015 / 4:25 p.m.
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Conservative

Blake Richards Conservative Wild Rose, AB

Mr. Speaker, when our government has made changes in the past regarding pipeline safety systems, members in the opposition have always voted against them.

Would the member be able to explain to the House why those members voted against increasing the number of inspections by 15%, doubling the number of comprehensive audits and bringing in new fines for companies that break our strict environmental regulations? It seems quite inconsistent.

Pipeline Safety ActRoyal Assent

February 26th, 2015 / 4:25 p.m.
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NDP

Nathan Cullen NDP Skeena—Bulkley Valley, BC

Mr. Speaker, what is inconsistent is that the same government gutted the environmental assessment process through much of those same acts. It is a government that took fishery habitat protection out of the Fisheries Act.

Many of my friend's constituents from Wild Rose Country love to come up to B.C. and fish its rivers. One would think that habitat protection would be important. However, under the government, the Conservatives thought it was not so important.

As well, the Navigable Waters Protection Act existed for over a century in our country to protect the navigation of our rivers and waterways. It is something one would think the public had interest in and thought was important. It balanced out the conversation about what damage could and could not be done.

After gutting the Environmental Assessment Act, after getting rid of the Navigable Waters Protection Act, except for Muskoka and cottage country for the minister's sake, and after gutting the Fisheries Act, to stand and say that somehow the Conservatives are the proponents of strong and tough regulation, no one believes them. This is a problem for the Conservatives. When they say they want to protect the environment and are not completely in the pockets of the big oil companies, the facts deny it all.

The reality is that their plan is not working. The Conservatives cannot bulldoze their way through the country. Some people demand and insist on having a voice in the conversation, that is Canada, and we will continue to do so.