Husky Oil Operations Limited - conviction information for 2019-06-12
| Corporation name: | Husky Oil Operations Limited |
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| Address: | 707 8 Avenue SW |
| City: | Calgary |
| Province/territory: | Alberta |
| Postal code: | T2P 1H5 |
| Country: | Canada |
| Sector or industry: | 211 - Oil and gas extraction |
| Location of offense: | N 53° 24.7570, W 109° 31.0620, North of Maidstone, Saskatchewan |
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| Case summary: |
Husky Oil Operations Ltd (Husky) is a registered corporation in Saskatchewan located in Lloydminster, SK and operates as a subsidiary of Husky Energy Inc., which is a Canadian-based energy company in Calgary, Alberta. At 15:15 on 20 July 2016 the Leak Detection System (LDS) on the Saskatchewan Gathering System (SGS), which includes the 16TAN pipeline carrying blended crude oil, began showing frequent dual alarms. Operators discussed possible causes and contacted a field operator. These alarms were attributed to temperature fluctuations at a location in the SGS unrelated to the failure. The alarms were not immediately reported to supervisory staff, recorded by the operator at the time, nor was SCADA contacted for assistance. There was an incomplete briefing of the alarms given to incoming staff at shift change at 17:45. On 20 July 2016, between 17:30 and 18:00, the evening shift took over monitoring duties in the control room. At 18:30 the operator noted that the LDS was in dual alarm. At 19:10, a request was sent to SCADA for assistance in dealing with the alarms. At 19:30 the operator began filling out a pipeline imbalance checklist documenting the existence of the alarms. SCADA called the control room in response to the help request and advised the operator to contact his supervisor. The designers of the LDS were also contacted to help with troubleshooting. At approximately 21:30, the operator advised his supervisor of the existence of the alarms. At 21:35, field operators were called to physically check some of the new connections for possible leaks, but none were found. SCADA continued their investigation and analysis of the alarms until 23:30 but were unable to determine the cause of the alarms. Although both the operator and the supervisor had the authority to shut down 16TAN due to the alarms, the supervisor advised the operator to continue running and monitoring the pipeline. The alarms continued throughout the shift, which ended at 05:30 on 21 July. Although the cause of the alarms was not conclusively determined, no-one investigating concluded that there was a leak. On 21 July 2016 at 08:25, the Saskatchewan Ministry of Environment (MOE) received a report of a sheen on the River at the Toby Nollet Bridge (the Bridge) on Highway 21, 16km downstream from where it was determined the oil entered the River. At 08:30, MOE reported the sheen to the Saskatchewan Ministry of the Economy (ECON). At approximately 08:40 two field staff from ECON's office in Lloydminster were dispatched to the Bridge to investigate the source of the sheen. They arrived on site around 09:35 and confirmed there was a significant amount of oil on the River. On 21 July 2016 at 08:45, Husky was informed by a third party of a possible sheen on the River and began to investigate. At 09:45, a Husky field operator was told by a third party operator that oil was observed in the River near the Bridge. At 10:00, Husky contacted ECON to advise of the location of the leak being a pipeline crossing under the River, but it was unclear whether the source was a Husky pipeline or an adjacent pipeline owned and operated by another company. Despite not knowing the source of the leak, Husky established an emergency operations centre to respond to the release as if it was theirs, or to assist other operators whose operations may have been the source. At 10:05, operators were informed of a pipeline leak and at 10:07, they closed the River crossing valves on 16TAN and initiated Husky's emergency response plan. Post-incident studies determined that on 20 July 2016 at around 15:00, 16TAN cracked at the failure location, about 160m south of the River crossing, resulting in the spill of blended crude oil. An estimated 225,000L (+/-10%) of product leaked into the environment until 16TAN was shut down at 08:15 on 21 July for previously scheduled maintenance. It is estimated that about 40% of the leaked product entered the waters of the River. |
| Charges: |
Count 1: That on or between 20 July 2016 and 21 July 2016, did deposit or permit the deposit of a deleterious substance, namely blended heavy crude oil, in water frequented by fish or in a place where the deleterious substance may enter water frequented by fish, namely the North Saskatchewan River near Maidstone, Saskatchewan, contrary to subsection 36(3) of the Fisheries Act, RSC 1985 c F-14¸ thereby committing an offense contrary to subsection 40(2) of the Fisheries Act, RSC 1985 c F-14.
Count 9: That on or between 20 July 2019 and 21 July 2019, did deposit or permit the deposit of a substance that is harmful to migratory birds, namely blended heavy crude oil, in waters or in an area frequented by migratory birds or in a place from which the substance may enter such water or such are, near Maidstone, Saskatchewan, contrary to subsections 5.1.(1) of the Migratory Birds Convention Act, 1994, SC 1992, c. 22 thereby committing an offense contrary to subsection 13(1) of the Migratory Birds Convention Act, 1994, SC 1992, c. 22. |
| Enforcement notification: | Husky Oil Operations Limited fined $2.7 million for federal offences related to the pipeline release of oil into the North Saskatchewan River |
| Result: | Guilty Plea |
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| Date of conviction: | 2019-06-12 |
| Court level: | Provincial and Territorial Court |
| Nature of offense(s): |
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| Additional details about the nature of the offense: | Allowed the deposit of a substance harmful to migratory birds |
| Act | Regulations | Section(s) |
|---|---|---|
| Pollution Prevention provisions (subsection 36(3)) of the Fisheries Act | ||
| Migratory Birds Convention Act, 1994 | 5.1.(1) |
| Date of sentencing: |
2019-06-12 |
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| Location of sentencing: | Lloydminster, Saskatchewan |
| Sentence(s): |
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| Amount of fine(s): | $2,700,000 |
| Sentencing details: |
On 12 June 2019, before the Provincial Court of Saskatchewan in Lloydminster, Saskatchewan, Husky Oil Operations Limited pleaded guilty to one count under subsection 36(3) of the Fisheries Act, RSC 1985 c F-14 and one count under subsection 5.1(1) of Migratory Birds Convention Act, 1994, SC 1992, c. 22.
On the same day, Husky Oil Operations Limited was ordered by the Provincial Court to pay a total of $2,700,000.00 in federal fines to the Environmental Damages Fund (“EDF”). A breakdown of the penalty is as follows: A fine of $2,500,000.00 for count 1, will be directed to the EDF for purposes related to conservation and protection of fish or fish habitat and the restoration of fish habitat in the North Saskatchewan River and/or Saskatchewan River and their associated watersheds within the Province of Saskatchewan. A fine of $200,000.00 for count 2 will be directed to the EDF for purposes related to the conservation or restoration of the environment in relation to migratory birds in the North Saskatchewan River and/or Saskatchewan River and their associated watersheds within the Province of Saskatchewan. |