It’s always pathetic to watch otherwise intelligent people being played like a violin by the oil and gas industry. There’s no shame in it – we’ve all been played – but it’s pathetic nonetheless.
I’m referring to the United Association of Pipefitters, one of the 14 trade unions being featured in the new ad campaign from the Canadian Association of Petroleum Producers (CAPP) touting the tar sands as a great employer of skilled trade workers.
Clearly, the Pipefitters brethren are eyeing all that potential work stemming from proposed tar sands export pipelines that are tearing at the nation’s political fabric. But the Pipefitters Union apparently hasn’t bothered to read Harper’s 450-page omnibus budget Bill C-38, passed in June, which CAPP and other oil and gas industry lobbyists helped to shape during their reported 81 meetings with cabinet members.
Had the Pipefitters union read this Bill, they might have noticed that – along with decades of environmental regulation – it abolishes a 27-year-old law called the Fair Wages and Hours of Labour Act. As a result, pipefitters who work on pipelines that cross provincial or national boundaries will see their wages cut by about two-thirds.
Hidden in Bill C-38
As the Toronto Star’s Carol Goar explained (May 18), the Fair Wages and Hours of Labour Act previously ensured that federal contractors would have to pay workers the prevailing wage in a region, rather than being allowed to slash wages to lower costs. Now, “under [Finance Minister Jim] Flaherty’s legislation, contractors would no longer be obliged to pay the prevailing wage (roughly $20 to $30 an hour). They would merely have to pay the provincial minimum wage (which ranges from $9.27 an hour in Yukon to $10.25 an hour in Ontario). The provision would affect public works, telecommunications infrastructure, railroads, airports, First Nations projects, and pipelines that cross provincial or national boundaries.”
When it dawns on the United Association of Pipefitters that they, like many others, have been stealthily shafted, perhaps they will realize that the only thing Big Oil cares about is profits for its shareholders. And in terms of the tar sands, those shareholders are primarily foreigners.
According to a May 10 report from ForestEthics Advocacy, “71% of all tar sands production is owned by non-Canadian shareholders. Supposedly Canadian companies (with Canadian headquarters and accounting practices who trade on our stock exchanges) are largely owned by foreign interests, including Suncor (56.8%), Canadian Oil Sands (56.8%), Nexen (69.9%), and Husky Energy (90.9%).” As a result, “over half (51.1%) of all oil and gas operating revenue in Canada goes to foreign entities.” Equally eye-opening, ForestEthics Advocacy’s report states that the oil and gas industry in Canada accounts for a mere 0.8% of total Canadian employment.
Meanwhile, another major oil pipeline spill – the fourth in two months – has sparked renewed calls to shut down the tar sands.
Another Pipeline Spill
On July 27, Enbridge announced that 1,200 barrels of Canadian crude spilled from its Line 14 pipeline near Grand Marsh, Wisconsin. Line 14 was delivering Canadian crude to Chicago area refineries.
This latest spill drew the wrath of U.S. Representative Ed Markey (D-Mass.), a ranking member of the House Natural Resources Committee, who said: “Enbridge is fast becoming to the Midwest what BP was to the Gulf of Mexico.” The U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) has issued an order prohibiting Enbridge from reopening Line 14 until it submits a plan to improve the safety of the entire 1,900-mile Lakehead pipeline system.
Earlier in the month, on July 10, the U.S. National Transportation Safety Board (NTSB) delivered a scathing summary of Enbridge’s handling of the July 2010 rupture of its Line 6B near Marshall, Michigan, which spilled more than 20,000 barrels of diluted bitumen (dilbit) into the Kalamazoo River. NTSB Chair Debbie Hersman likened Enbridge’s inept handling of the spill to “the Keystone Cops.”
The NTSB released its 149-page final report on July 25, citing “systemic deficiency in the company’s approach to safety.”
Adding to the credibility problem of the industry, between May 19 and June 18 there were three major oil pipeline ruptures in Alberta: a May 19 spill of more than 5,000 barrels of oil by Pace Oil & Gas at Rainbow Lake; a June 7 spill of more than 3,000 barrels of oil into Red Deer River by Plains Midstream Canada; and a June 18 Enbridge spill of 1,500 barrels of oil at a pumping station at Elk Point, Alberta.
Harper advisor Gwyn Morgan, who made his millions in the oil and gas industry, recently railed in the Vancouver Sun (Aug. 2) against “the doom-laden exaggerations of environmental zealots” who oppose tar sands pipelines like Northern Gateway. Tell that to the folks in Sundre, Alberta, who in June watched dilbit foul Red Deer River and their popular recreational area of Gleniffer Lake. Tell it to the dozens of communities impacted by Enbridge pipeline spills over the past decade, during which company pipelines spilled more than 132,000 barrels of oil – more than half the Exxon Valdez spill of 257,000 barrels.
Tarsands dilbit causes unique problems for pipeline transport (see Watershed Sentinel, March 2012). One specific concern associated with piping dilbit is “column separation.” Some of the substances used to dilute the bitumen to get it to flow through a pipe are natural gas liquids. Pressure changes within the pipeline can cause these liquids in the dilbit to change from liquid to gas and form bubbles that impede the flow of oil in the pipeline.
This phenomenon – column separation – makes it difficult for computerized pipeline monitors to differentiate between a bubble and an actual leak in the line. For pipeline monitors, the proper response to column separation is to pump more oil through the pipeline, but if a leak is actually the cause of the pressure differentials, then pumping more oil would be disastrous. That is what happened in Michigan.
As the July NTSB report indicates, Enbridge’s Line 6B in Michigan spilled dilbit for 17 hours while controllers in Edmonton – thinking they were dealing with column separation -- restarted the line twice after the first alarm, thereby pumping out more than 80% of the total oil spilled from the ruptured pipeline.
The NTSB also said that the pipeline failure in Michigan was due to multiple small “corrosion-fatigue cracks” that grew over time into a two metres-long breach in the line, and that Enbridge had known for years about the corrosion.
Dilbit is more corrosive than conventional oil. In November 2011, a coalition of 12 Canadian and U.S. environmental groups released a report called Pipeline and Tanker Trouble, which says that tar sands dilbit is 15-20 times more acidic, 40-70 times thicker, and 5-10 times more sulphuric than conventional crude. Moreover, dilbit is transported at “significantly higher temperature and pressures” than pipelines carrying conventional oil.
The report also says: “Although conventional oil pipelines contain virtually no abrasive materials, pipelines carrying tar sands contain significant quantities of quartz and silicates,” which hasten corrosion.
Even TransCanada Corp.’s brand new 1,070-mile Keystone pipeline – the first leg of the proposed Keystone XL – has had more than 30 leaks since it began transporting dilbit in June 2010.
Susan Casey-Lefkowitz, with the U.S.-based Natural Resources Defense Council, says that piping dilbit is “like sandblasting the inside of the pipe.”
A November 2011 study by Alberta Innovates, a government-owned research company, reviewed available data and stated that tar sands crude is not more corrosive than conventional oil, but pointed out that there is no definitive peer-reviewed research on the issue. The study urged Alberta’s Energy Conservation Resources Board to start collecting data specifically on tar sands pipelines’ safety and operating statistics.
The U.S. Midwest has especially suffered the brunt of the dangers of transporting dilbit. A May 2012 report from Toronto-based Environmental Defence says: “In the U.S., the pipelines that have the longest history of transporting tar sands in North Dakota, Minnesota, Wisconsin and Michigan spilled almost three times as much crude oil per mile of pipeline between 2007 and 2010, compared to the U.S. national average.”
In May, Enbridge announced plans to spend $1.3 billion doubling the capacity of Line 6B in Michigan and Indiana in order to bring tar sands crude to refiners. The company is replacing the pipeline that ruptured two years ago with larger pipe that will increase Line 6B’s capacity to 500,000 barrels per day.
Saying Enbridge is “exploiting disaster,” a recent report from the U.S. National Wildlife Federation states: “Before the  Kalamazoo disaster had even been untangled, Enbridge began a series of moves to expand their Lakehead system [that] includes the ruptured line 6B, which runs from Chicago to Sarnia, Ont. While Enbridge moved ahead to replace the ruined pipeline, they took the opportunity to replace and enlarge a particular section of the pipe that crosses the U.S./Canada border. With this new, bigger line in place, Enbridge dodged a key step in the federal regulatory process: the need for a ‘Presidential permit’ issued by the U.S. State Department, which would have entailed a thorough environmental review of the project as a whole.” Like TransCanada Corp.’s proposed Keystone XL pipeline, any Canadian pipeline that crosses an international border into the U.S. must undergo U.S. federal review.
“In fact, Enbridge has continued to put forth, piece by piece, projects labeled as ‘maintenance and rehabilitation,’ when in fact each piece is replacing a majority of the existing Line 6B with larger pipe. Once completed, this new line will almost triple the capacity of the old one to create a system capable of shipping 33.6 million gallons per day... Instead of a comprehensive federal review, Enbridge has only been required to obtain approval by the Michigan Public Service Commission.”
The goal of this strategy is “a tar sands pipeline through eastern Canada to New England” for export.
Ironically, the July 27 Enbridge spill in Wisconsin occurred on the same day that Canada’s National Energy Board gave approval to Enbridge’s plan to reverse the flow of a 194-kilometer portion (9A) of its Line 9 oil pipeline between Sarnia, Ont. and Montreal. Line 9 is central to the oil industry’s plan to get tar sands crude to Atlantic tidewater.
Next month, I will explore this issue further.
Meanwhile, the recent spate of pipeline disasters, the passage of Bill C-38, the increased greenhouse gas emissions from tar sands production, the billions in Canadian government subsidies to the oil and gas industry – all call into question just how “beneficial” the (two-thirds foreign-owned) tar sands production is for Canadians.
As David Suzuki recently told a Quebec audience, tar sands crude “should be left in the ground, period.”
(Joyce Nelson is an award-winning freelance writer/researcher, and the author of five books.)