Alberta officials did nothing wrong when an oilsands leak went unreported for 9 months, report finds

A review commissioned by the board of directors at the Alberta Energy Regulator found the regulator followed all of its policies in responding to a leak at Imperial Oil’s Kearl oilsands mine in northern Alberta that went unreported for nine months. 

The incident and the regulator’s response sparked outrage, particularly among nearby Indigenous communities.

The report found “the [Alberta Energy Regulator] followed the existing policies, standards, procedures and/or processes” in its handling of the leak and spill. There were “no areas of non-compliance,” the report found, however it did note some policies and procedures, as well as “manuals for emergency response” were out of date and did not live up to the expectations of stakeholders, including Indigenous communities. 

The Athabasca Chipewyan First Nation is one of the Indigenous communities downstream of the Kearl mine in Fort Chipewyan, Alta. The nation rejects the findings of the review, which was conducted by consulting firm Deloitte. The report was dated Sept. 11, but released to the public on Sept. 27.

“[The Alberta Energy Regulator] is captured by industry and overseen by a political class that doesn’t care about the consequences to northern and Indigenous residents of Alberta and the Northwest Territories,” Chief Allan Adam of the Athabasca Chipewyan First Nation said in a statement. 

“I can assure you that the government would be acting in a very different way had this incident occurred on the Bow River west of Calgary.” 

A statement from the Mikisew Cree First Nation, also downstream from the Kearl oilsands mine, said the nation “has lost all confidence in the Alberta Energy Regulator’s ability to regulate the incidents and emergencies in the tar sands,” calling the regulator’s explanation of the incident “insulting to those of us who have to drink the water.”

“The seepage and spill are symptoms of a broken regulator,” Chief Billy-Joe Tuccaro said in a statement. “This is why, today, we repeat and maintain that we have lost all confidence in the [Alberta Energy Regulator]. They are not blameless.”

The Kearl leak went unreported for nine months. And then there was a 5-million-litre spill to boot

The leak began in May of last year and continued for nine months until Imperial Oil and the regulator notified nearby communities — a violation on the company’s part of impact benefit agreements it signed with local Indigenous communities. 

It wasn’t until after a storage pond failed and spilled another 5.3 million litres of industrial wastewater into the surrounding forests and wetlands some time between Jan. 30 and Jan. 31, 2023, that the regulator issued an environmental protection order against the company and notified the public and affected communities of the months-long seepage and the spill. 

Even then, there were delays.

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Imperial says the spill wasn’t detected until Feb. 4, when it was reported to the energy regulator. The regulator says Imperial initially estimated the spill to be 2,000 litres, but on Feb. 5, during a site visit, the company said its estimate had increased significantly to more than five million litres. 

The next day the regulator posted the order against Imperial on its website, nine months after the initial leak began.

A review of the regulator’s role in Kearl spill finds no wrongdoing

The review found the regulator could “clarify and mature processes and procedures as well as streamline [its] governance system for incident and emergency management.”

It also found the “process and timelines in place for communication with external stakeholder groups does not explicitly consider the expectations of Indigenous Peoples.”

The Athabasca Chipewyan First Nation is calling on the federal government to intervene, saying it has no faith in the regulator or the Alberta government. 

The nation said in an email it doesn’t believe the Kearl leak is an isolated incident and wants the federal government to conduct a full audit of tailings facilities in the region, as well as a health study on residents in the area to determine the long-term health impacts from the oilsands. 

The nation also wants action on cleaning up the oilsands, with the creation of a “federally mandated co-management body with effective oversight and enforcement powers to create an additional layer of accountability to remedy the failings of the industry, the [regulator] and the Government of Alberta to responsibly manage oilsands tailings.” 

Alberta Energy Regulator board chair David Goldie said in an interview with The Narwhal that he’s spent the last three days meeting with all of the communities interviewed as part of the report, including the Athabascan Chipewyan, and says he doesn’t believe Chief Adam’s perspective is universal among them. 

“I think our approach and our stance is going to be: let us show you, let us perform here, let’s engage, let’s get a protocol on communication — what you want to hear, when you want to hear it — and let us demonstrate to you that we can meet your expectations,” he said.

A complicated relationship with the oilsands industry

The Fort Chipewyan community, nestled on the shores of Lake Athabasca in northern Alberta on a large inland delta, has a complicated relationship with the oilsands upstream. Rare cancers cluster in Fort Chipewyan, where the Athabasca Chipewyan First Nation, Mikisew Cree First Nation and the Fort Chipewyan Métis Nation are all headquartered, and the environmental impacts on the land and water are always top of mind. But there is also wealth from jobs in the mines. 

The tepid social contract was shattered in February when community members learned Imperial Oil hadn’t notified them of its leak — which occurred in areas where community members hunt and trap.

Many of those who live in Fort Chipewyan were outraged over the Kearl incidents and the regulatory response. Chief Adam threatened to take the regulator to court and community members shouted down the head of Imperial oilsands operations at a heated community meeting in late March — the first time Imperial representatives travelled to the community to talk about what happened. 

Concerns centered on impacts to drinking water that flows from the oilsands and fed by tributaries near the Kearl site, but also impacts on fish and wildlife in a region where traditional hunting and trapping is threatened, but still practised. 

In response to the anger over the response, the Alberta Energy Regulator’s board of directors commissioned Deloitte to investigate.

The board’s response to the findings was included in the report. It says it is committed “to move swiftly to correct the deficiencies identified by Deloitte” and working with communities. 

“Consequently, we have instructed [Alberta Energy Regulator] management to prepare a detailed action plan to address these deficiencies and concerns,” reads the response. “We have also asked Deloitte to assess the outcomes of the action plan in the coming months, and the board will proactively report these results publicly.”

Laurie Pushor, the CEO of the Alberta Energy Regulator told The Narwhal in an interview he will move “quickly and diligently” on that action plan, changing how the regulator communicates and implementing the lessons from the Kearl saga and examining policies, processes and protocols. A new website is also in the works. 

“Lastly, we’ll be looking at our organization and how we’re resourcing the teams in this space, and see if we don’t need to bring more to bear over the longer term,” he said. 

Imperial Oil said a series of failures led to the leak and spill

In a separate root-cause investigation conducted by Imperial and submitted to the regulator in May, the company blamed the seepage on a porous sand layer that was piled into the area where the wastewater is stored during construction, and on natural features that it failed to properly account for when designing the system.  

The company also said its monitoring wells, which are designed to alert the company to seepage, were too deep and didn’t account for the shallow flow of pollutants that occurred. 

The subsequent multi-million-litre spill was attributed in another root-cause investigation to a host of failures: monitoring equipment that wasn’t functioning properly, buildup of sediment, the design and operation of the pond, a risk assessment that wasn’t appropriate and human error. 

At the time of the spill, the pump control for the pond, which would push water back into the tailings area of the mine, was in manual mode and so did not automatically activate as it should have. 

“In the few days prior to the level reaching the spillway, environmental factors such as the surface of the pond being covered with snow and ice, snow buildup around the spillway and low lighting at night made it difficult to verify [the] level,” reads the company’s internal investigation. 

First Nations remain disappointed in regulator

The release of the independent report does little to assuage the frustration and concern of First Nations downstream of the oilsands. 

The Athabasca Chipewyan is hoping for further discussions with Ottawa, having lost faith in Alberta’s leadership. 

For many, the Alberta Energy Regulator shoulders the blame for the months-long failure to notify communities of the leak — for them it was as much a regulatory failure as it was an industry error. 

“The [Alberta Energy Regulator] has robust enforcement powers,” Tuccaro of the Mikisew Cree First Nation said. “They just don’t use them.”

Updated Sept. 27, 2023, at 2:38 p.m. MT: This piece has been updated to include the Alberta Energy Regulator board’s response to the report’s findings, which were included in the document.

Updated Sept. 27, 2023, at 4:42 p.m. MT: This piece has been updated to include an interview with the Alberta Energy Regulator CEO and board chair.