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Offshore drilling review discussed
National Energy Board visits Inuvik, residents feel same-season relief well turn around time too long

Katherine Hudson
Northern News Services
Published Thursday, March 22, 2012

INUVIK
Who decides what is the worst-case scenario when it comes to drilling offshore in the Arctic the people or industry?

NNSL photo/graphic

David Hamilton, member of the National Energy Board, foreground, and Gaetan Caron, board chair and chief executive officer, head an information session last Wednesday about the board's review of the safety and environmental requirements for offshore drilling in the Arctic, which was published in December. - Katherine Hudson/NNSL photo

It was one of many questions posed to the National Energy Board (NEB) during its information session in Inuvik last Wednesday at Ingamo Hall.

Three months have passed since the board published its review of the safety and environmental requirements for offshore drilling in the Canadian Arctic spurred by the world watching in horror as millions of barrels of oil spilled from BP's Deepwater Horizon in the Gulf of Mexico two years ago for about three months. It was one of the largest oil spills in history.

Inuvik resident Billy Turner said the board has reaffirmed the same-season relief well policy where an applicant must demonstrate the capability to drill a relief well to kill an out-of-control well during the same drilling season is based on the capacity of industry and a "little too long, given the fragile aspects of the environment of the Arctic."

"That's the best that you can come up with is the same-season relief well and that's up to 90 days of oil just pumping into the Arctic Ocean. I find that unacceptable and a nightmare and beyond a worst-case scenario," said Turner.

Gaetan Caron, board chair and chief executive officer, said if companies want to try something which is equivalent or better than a same-season relief well, the board will be open to hearing their application.

"We'll look at it on a well-by-well basis, try to persuade us," he said, adding that there is no "cookie cutter recipe" for Arctic offshore drilling applications.

Caron said through the review, the regulations have not changed, but been confirmed.

The filing requirements for the companies are much more extensive, more clear and explicit on the information needed for hazard assessment and recovery plans. The NEB will also inspect and audit future projects when they are underway.

In the event of a blow-out, the board has the legal authority to ask for any amount of financial responsibility that it sees fit so people who incur losses will be reimbursed.

"We recognize that we cannot let the process take 10 to 15 years in court. There is a financial responsibility requirement," said Caron.

There is no limit on the financial responsibility of the company, but there is a $40-million amount called absolute liability which is money that can be easily accessed for the initial intervention in a disaster.

One elder in the audience addressed the current crisis Inuvik is facing with the estimated reserve life of the Ikhil natural gas pool at about 1.2 years.

Caron said the NEB will do everything in its power to expedite reviews or applications to alleviate the pressure on Inuvik's energy sources.

"We're going to work as fast as we can without cutting corners on the analysis. Any action on a new well, a new pipeline, we're committed to working as fast as possible for a solution," said Caron.

Oil companies that plan on drilling in the Beaufort Sea must hold extensive consultations in the North before filing their offshore drilling applications, and make their safety and contingency plans public.

While the NEB will have its own set of standards, approval for projects drilled in the Beaufort Sea will also have to receive the approval of the Environmental Impact Screening Committee, part of the Inuvialuit Final Agreement.

There are currently no applications for offshore drilling before the board, with future activity of potential drilling a few years away yet. Currently, Chevron is planning a 3D/2D seismic survey off the coast of Tuktoyaktuk this summer, which Caron said is the type of work people of the Beaufort Delta will continue to see in the near future.

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