National Energy Board needs to fix pipeline oversight, watchdog says

The National Energy Board is not doing enough to track whether pipeline companies are complying with conditions set out when projects are approved, Canada's environment watchdog says.

Regulator's assurances 'meaningless' when less than half of conditions met, NDP critic says

Federal environment commissioner Julie Gelfand's latest audit finds that the National Energy Board is failing to follow through and adequately track the compliance of pipeline companies with the conditions set for their projects. (Adrian Wyld/Canadian Press)

The National Energy Board is not doing enough to track whether pipeline companies are complying with conditions set out when projects are approved, according to a new report by the federal commissioner of the environment and sustainable development.

The report, tabled in the House of Commons on Tuesday, warns that the national regulator needs to do more to keep track of pipeline projects, especially given the increased number of projects it is required to handle.

Commissioner Julie Gelfand found the systems set up by the NEB to check whether companies are keeping their promises when building and operating pipelines are "outdated or inaccurate."

"The NEB was not able to assure us that they followed up on the regulations or the approval conditions," Gelfand told reporters Tuesday. "We made a recommendation that they become much more systematic."

The compliance conditions are set by the NEB when a project is approved. They are often imposed on a project as a result of concerns raised during public hearings.

Conditions can range from employment requirements for aboriginal people to protection of the environment or safety testing of a pipeline.

Missing files, information

The report says that in the 49 cases it audited, there were 24 cases between 2000 and 2014 for which the tracking of the company's compliance was either out of date or files were missing.

The report says that in some cases, NEB had to go through a considerable manual search for files requested by the auditors.

In another file, the audit found that board had not tracked company compliance with a condition to study the environmental effects of a pipeline break near caribou habitat, despite the fact the condition was set a decade ago.

The report notes that despite an increase in funding, the NEB is having trouble hiring and keeping staff, and is facing an increased workload because of the number and complexity of new pipeline activities.

 "They have a variety of ... information management systems that don't all talk to each other. They're outdated. We could have one engineer tracking something on their computer, which is not talking to the main database that they use," the commissioner explained. "Because they have this computer database problem, it becomes much more likely that a mistake could be made.

"It's not all well-organized and they're not talking to each other," Gelfand told reporters. 

Commissioner of the Environment and Sustainable Development Julie Gelfand discusses her report into the National Energy Board's oversight of Canada's pipelines and the problems with pesticide regulation 7:37

Conditions 'meaningless' without tracking

The report also says the NEB has managed to increase public access to information on pipeline incidents, but still needs to give Canadians more information about whether companies are complying with their pipeline approval conditions.

The NEB says it has an action plan in place to address all of the commissioner's findings by the end of 2016. In a press release, the regulator said it had already identified the same ares for improvement as the audit and had completed work on many of the recommendations.

"The NEB absolutely enforces and monitors all companies' compliance with pipeline approval conditions and has complete confidence that compliance with pipeline approval conditions is appropriately and comprehensively evaluated by NEB staff and board members," said Paul Watson, the NEB's chair and CEO.

NDP environment critic Nathan Cullen said the report's findings won't help the public's confidence in pipeline safety.

"The response we've had from the previous government — and this government, to be fair — is that 'we have very strict systems in place' and 'we will put upon these oil companies a number of very strict conditions,'" he told reporters Tuesday. "That's the assurance that's been offered to a skeptical and concerned public.

"That's meaningless if less than half of the conditions that have been applied are actually even followed," he said. "At the very least, follow the conditions that you've set down rather than what we see right here, which is after years of warning the NEB continuing to be unable or unwilling to follow through on their own requirements for a pipeline to be built."

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