New pipeline regulations proposed by the National Energy Board (NEB) shift the burden of constructing, operating and maintaining safe pipelines to farmers, who will face near automatic Administrative Monetary Penalties (AMPs) or even Criminal Code prosecutions for failing to warn pipeline companies when pipelines cannot safely accommodate farming practices. Doesn't this sound backwards? On behalf of CAEPLA and landowners across Canada, the Manitoba Pipeline Landowners Association (MPLA) submitted the letter below to the NEB urging the regulator to shift the burden to make pipelines safe back to pipeline companies where it belongs, and to avoid making criminals out of landowners and farmers.
Proposed NEB Pipeline Damage Prevention Regulations
Sheri Young
Secretary of the Board
National Energy Board
517 Tenth Avenue S.W.
Calgary, AB T2R 0A8
Dear Madam Secretary:
RE: Manitoba Pipeline Landowners Association (MPLA)
Comments on
Proposed Amendments to Regulations for Pipeline Damage Prevention
We are the lawyers for
the Manitoba Pipeline Landowners Association (MPLA) and are writing in response
to the NEB’s letter of September 18, 2014 to provide MPLA’s comments concerning
the proposed amendments to pipeline damage prevention regulations. MPLA is a voluntary association of Enbridge
pipeline landowners in Manitoba, most of whom have between 6 and 8 pipelines
crossing one or more of their properties (with at least one additional pipeline
being proposed at present). MPLA
landowners and all NEB-regulated pipeline landowners across Canada are directly
affected by Section 112 of the NEB Act and its related regulations. MPLA is taking the lead on behalf of the
Canadian Association of Energy and Pipeline Landowner Associations (CAEPLA), of
which MPLA is a member association, in responding to the NEB’s proposed
regulatory amendments. MPLA’s comments
should be taken as those of pipeline landowners across Canada.
This marks the third
time that MPLA has written to the NEB concerning the most recent round of
proposed changes to Pipeline Crossing Regulations. CAEPLA also provided comments to the NEB on
previously proposed changes to the regulations dating back more than a
decade. Unfortunately, the currently
proposed amendments demonstrate that the NEB is still not listening to the
concerns of pipeline landowners. The
amendments do nothing to introduce fairness for agricultural landowners into
the regulatory scheme.
As set out in MPLA’s
comments to the NEB in February, 2013 on the NEB Discussion Paper, Section 112
of the NEB Act leaves landowners carrying an unfair burden in ensuring pipeline
safety in Canada. Restrictions on
agricultural operations over and near pipelines are only necessary where
companies have failed to ensure that the condition and location of their
pipelines are adequate to accommodate agricultural operations. Fairness dictates that pipeline companies,
which have obtained land rights by expropriation or by agreement made through
the threat of expropriation, should be required to accommodate farming. However, as is apparent in the latest
proposed amendments to the regulations, the NEB is continuing to move in the
opposite direction – creating regulations that absolve pipeline companies from
the duty to build, maintain and operate safe pipelines by restricting
agricultural operations and exposing pipeline landowners to regulatory and
penal liability.
Once again, MPLA urges
the NEB to reverse this course by making amendments to the regulations that
restore a landowner’s ability to carry out agricultural operations without the
constant fear of contravening the NEB Act and regulations and of incurring the
penalties that will result. The starting
point is to prescribe an exemption for all agricultural activities from the
requirements to obtain NEB and/or company permission in Sections 112(1) and
112(2). Then, similar to the proposed
Section 10.1 of the proposed Damage
Prevention Regulations, Part 2, the regulations would also provide that, if
a pipeline company determined that agricultural activities could jeopardize the
safe and secure operation of a pipeline, the pipeline company would be required
to identify affected locations and advise landowners and farmers in writing of
those locations and the reasons for the determination. The pipeline company would then have two
options for addressing its safety and security concerns:
1.
Remove, repair, modify, relocate or replace its
pipeline so as to ensure that agricultural activities will not jeopardize the
safe and secure operation of the pipeline; or,
2.
Provide affected landowners and farmers with
clear written direction on any restrictions to be applied to agricultural
operations in specified locations and pay the landowners and farmers
compensation for any resulting business losses or other related damages or
loss.
This proposal is
consistent with the principles that should apply to the interaction between
pipeline companies and landowners under the NEB Act – that pipeline companies
are responsible to build, operate and maintain their pipelines safely, and that
landowners are to be compensated for the imposition of pipelines on their
properties and on their businesses.
MPLA’s proposed amendments do not compromise pipeline safety. Instead, they shift the primary safety and
security decision-making burden off of the backs of landowners and farmers and
onto pipeline companies where it should be.
Landowners and farmers should not be placed in the position of having to
decide whether a pipeline is safe or not and of having to face regulatory and
penal liability if they are wrong.
As MPLA previously
stated in its February, 2013 comments, pipeline companies have the resources
and expertise to make this work. They
can obtain equipment specifications directly from farm equipment manufacturers;
they can determine the surface loading and other impacts generated by farming
activities; they already possess information (or should possess information)
about the location, depth and condition of their pipes. Where site specific locations are identified
that will not accommodate the impacts of all farming activities, pipeline companies
can determine what work is necessary to accommodate farming or what
restrictions may be necessary. And
pipeline companies can compensate landowners and farmers for restrictions that
are necessitated by the unsafe condition of their pipes.
Without
this shift of responsibility to pipeline companies, Section 112 of the NEB Act
and the related regulations will continue to work an injustice for landowners
and farmers across Canada. How else can
one describe a situation where a Canadian farmer faces at a minimum an
“administrative monetary penalty” of no less than $1,000.00 (or $4,000 for a
corporation) for failure to notify a pipeline company that its pipeline is
unsafe? And the farmer has been deprived
of any defence of due diligence, has no ability to appeal a decision of the NEB
on the matter, and faces public denunciation by the NEB? MPLA and its members are very concerned about
the opportunities for abuse by pipelines companies that have been created by
the administrative monetary penalty regime.
The answer is for the NEB to make the amendments proposed above by MPLA
so that pipeline landowners and farmers do not face punishment on account of
the failure of pipeline companies to build, operate and maintain safe
pipelines.
The NEB should stop
covering up for the inadequacies and deficiencies in pipelines on the backs of
Canadian landowners and farmers. Safety
is in everyone’s interest, but it is the pipeline companies that should be
responsible for safety. MPLA and
pipeline landowners across Canada hope that the NEB will take advantage of this
opportunity to enhance pipeline safety while making the pipeline regulatory
scheme fairer for landowners and farmers.
Yours truly,
John D. Goudy
c.c.: MPLA, Board of
Directors
