AER looks to courts, government for clarity by Stephen Ewart, June 28, 2014, Calgary Herald
Jim Ellis remains a plain-spoken military man. A year into his tenure as chief executive of the Alberta Energy Regulator, and after several years working in the provincial government bureaucracy, he retains the direct manner and frank demeanour that would’ve served him well as a colonel in combat with the Canadian military.
When Ellis and AER chairman Gerry Protti met with the Herald’s editorial board this week to mark the first anniversary of the amalgamation of three provincial regulators into a single body he was remarkably forthright on any number of highly contentious issues in Alberta’s booming oil and gas industry. For example: On fracking: “Everybody saw the shale revolution coming and nobody did anything about it. The regulators certainly didn’t,” he said.
On aboriginal issues: “It’s a big challenge and not just for the regulator but the whole system.”
On oilsands development: “You don’t hear a lot about tailings ponds right now, but it’s coming back.”
On participation in AER hearings: “Some of this stuff is going to have to go to court.”
On cumulative effects management: “I need a regional plan (from government) in the northwest.” [What about the rest of us being impacted and harmed in Alberta?]
The province’s appointment of Protti – a former industry lobbyist and government bureaucrat [Why not tell inform the public that Protti was Encana VP for many years, Chair of CAPP, also for many years, and advisor to Cenovus?] – gained most of the media attention when the new regulatory body was announced, but under its governance structure neither the chairman nor board members are involved in the AER’s day-today operations or decisions. The combined regulator oversees more than 415,000 kilometres of pipelines, 180,000 operating oil and gas wells, 780 gas processing plants, close to 300 oilsands projects and 11 coal mines.
Ellis is absolutely clear on his role and the mandate of a regulator with 1,200 employees that expects to process more than 60,000 applications a year from oil, natural gas and coal producers. An issue such as pace of development in the oilsands – where production is forecast to more than double to 4.8 million barrels a day by 2030 – isn’t something the AER decides on.
The question is often raised over environmental impacts and cost inflation, he said. “We don’t have the authority to stop issuing authorizations,” [The regulator continued approving more and more Encana frac’d gas wells even during community wide drinking water contamination investigations after Encana frac’d the community’s drinking water aquifers. The regulator keeps on approving more and more Encana wells, after slamming the door shut on the community, leaving families to live and cope with dangerous gas water. The regulator even approved a non-compliant application for another Encana gas well in that community, in one day. Is the AER anything but a legal protector, contamination cover-up agency and PR firm for the energy industry?] Ellis noted. “That’s a government call … the regulator has no role to play. Those are pure public interest calls that the government was elected to make on behalf of Albertans. Our role is to implement government policy.”
The parameters for development in the oilsands are determined by the province’s Lower Athabasca Regional Plan and the AER issues approvals based on it. There are subordinate plans to address water quality and air emissions. The plans for biodiversity, water quantity and GHGs are still in development.
The government’s South Saskatchewan Regional Plan for often-parched southern Alberta is reportedly close to completion but Ellis cited the increase in fracking in liquids-rich gas plays as the driver for a provincial cumulative effects management plan for northwestern Alberta. “I need a regional plan in the northwest. That’s where the shale opportunities are,” he said.
The AER is about to launch a pilot project for its risk-based, play-focused regulation of development regionally, rather than a traditional well-by-well approach, in the Duvernay formation in the northwest. Without the regional plan, Ellis said playbased regulation will address the cumulative impacts of development. [More honestly, play-based regulation is deregulation to allow fracing free-for-all, cumulative impacts be damned]
The AER’s recent experience dealing with noxious odours from oil production in the northwest around Grande Prairie has reinforced the need to address the surge in oil transported by rail to ensure there are no gaps in oversight with federal authorities as new trans-shipment rail terminals are built.
Ellis acknowledged the AER is playing catch-up on rail and fracking. He said it’s one reason the AER has established a Foresight Group to see “what’s coming over the horizon.” [Doesn’t Ellis mean Hindsight Group?] A crucial element of the far-sighted focus will be to ensure new rules don’t inhibit innovation to resolve challenges.
One issue the AER is well aware of is the debate over Aboriginal rights and resource development. The landmark ruling by the Supreme Court of Canada this week that extended land title to a First Nations’ traditional hunting and fishing grounds has reinforced the complexity of a long-standing issue. “It’s a big challenge. And not just for the regulator, but the whole system in the province. There is a lot of work being done right now. It’s complicated, it’s emotional,” said Ellis. “It’s got to get it sorted out … but it’s not done right now. They are still working through the process.”
The issue has arisen for the AER over whether First Nations – and other stakeholders – have been “directly and adversely affected” by oilsands development under its rules for to get standing at a hearing.
Ellis acknowledges it ultimately won’t be a decision for the regulator. “It’s my perspective as the chief regulator that some of this stuff is going to have to go to court,” he said. “We’re not afraid of that. We’re using precedent and we’re making good decisions [Is covering-up Encana frac’ing a community’s drinking water aquifer a good decision?] , but if it has to go to court for clarity then it has to go to court for clarity.” [Precedent has been set that the AER owes harmed Albertans “no duty of care” and has complete legal immunity, even for gross negligence and violating Canada’s supreme law – the Charter of Rights and Freedoms. And when stakeholders and First Nations go to court to appeal rulings made by the AER, and win, the AER has ignored the court rulings or changes regulations to spit on them]
For all the effort to improve the efficiency of the regulatory process [aka “deregulate” so that the harmed have no recourse, not even in the courts], Ellis was clear on one thing – if a company doesn’t get its First Nations consultation right, it won’t get project approval. [Two-tiered Alberta? Encana got regulator approval without consulting with non First Nations to frac hundreds of wells above the Base of Groundwater Protection, and got approval in one day, without consultation, to drill under privately owned Non First Nations land.]
Like the AER boss, it’s pretty straightforward. [Emphasis added]
Mr. Jim Ellis, photo from AER website: Mr. Ellis is a graduate of Carleton University, with a Bachelor of Arts degree in law and political science.
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