AER denies one of two CNRL applications to resume high-pressure steam injection near Cold Lake; AER keeps approving Encana’s high pressure frac fluid injection around dangerously contaminated water wells and Rosebud municipal drinking water supply

Editorial: Energy watchdog showing some bite [or is it to appear the AER has teeth?] by Edmonton Journal, March 11, 2014
Canadian Natural Resources Ltd. suffered a one-two environmental punch last Friday. First, the Alberta Energy Regulator rejected the firm’s bid to resume operations near the site of a major leak near Cold Lake, where bitumen has been oozing uncontrolled since last May. Moments later, the province slapped the oil industry giant with 11 charges in connection with the release of hydrogen sulphide gas from a project near Fort McMurray in August 2012. A bad day for CNRL, perhaps, but a good day for those who fear Alberta’s economy will suffer because the province is perceived as too soft on an industry from which it derives most of its wealth. It was also a sign from the relatively new Alberta Energy Regulator that it is taking its environmental watchdog role seriously.

It hasn’t always been thus.

Some might have been shocked last month at CNRL’s application to AER to resume steaming in a place where investigators continue to ponder how some 12,000 barrels of oily water have bubbled to the surface. The operation was shut down last spring after four leaks were discovered, including one under a small lake in Primrose South. “We expect regulatory response shortly and are set to begin the steam flood as soon as these approvals are obtained,” CNRL president Steve Laut confidently told investors last Thursday. Why not? It worked before. After a 2009 leak prompted the first shutdown at Primrose,CNRL applied to the defunct Energy Resources Conservation Board and was allowed to resume steaming. With its firm “no” Friday, the AER sent a clear message that times have changed. [Or to impress the public and courts? February 3, 2014, Ernst’s Appeal Factum (Appeal Number 1301-0346AC) was filed in the Alberta Court of Appeal in Calgary. Hearing set for May 8, 2014.]

The current Primrose investigation continues, and the cleanup has cost CNRL millions. The company blames old well bores. The AER is questioning whether the very process — high-pressure, high-temperature steam pushed into the ground to pump bitumen to the surface — may be causing the area’s caprock to crack. … In fact, satellite imagery used by the federal government to review CNRL’s leak last summer concluded its steam-based extraction is causing “measurable levels of ground deformation in the area of the leak” at a rate 10 times faster than other oilsands operations.

AER’s restrictions require CNRL to now get pre-approval to steam anywhere in the Primrose field — not just the well pads near the seepages. As a result, the company currently has a number of applications for steaming before the regulator. CNRL may eventually be proved right. Wellbore failures can be fixed, and its proposed new steaming technique may be flawless. But until we know for sure what happened at Primrose — another smaller leak was reported in January — it should not be allowed to resume work there.

The world is watching Alberta these days, as we promise world-class regulatory oversight of the oilsands. … If we are to gain any credibility on this issue in Washington and Europe, any of that “social licence” the Alberta government so wishes to acquire, careful oversight is critical. [Emphasis added]

CNRL has second application to resume production at leak site by Sheila Pratt, March 10, 2014, Edmonton Journal
Oilsands giant Canadian Natural Resources Ltd. made a second application last month to resume oil production on its leaking Cold Lake site before completion of the investigation into why four sites are oozing bitumen to the surface. More than 11,000 barrels have come to the surface in the last 10 months, among the province’s largest spills, and there is no way to stop the leaking. Ten months after the leaks were discovered, the company is eager to resume production.

In its Feb. 4 application, CNRL proposes to resume pumping high-pressure steam into the ground near a small lake with a leaking fissure in the bottom. The lake was drained and a berm constructed around the fissure to contain the bitumen as part of cleanup ordered by Alberta Environment. The cleanup is not yet complete. CNRL says it will adjust its high-pressure steam process and increase monitoring, says Zoe Addington. Also, the steaming would be outside the one-kilometre restricted zone….

Late last week, the regulator turned down the company’s Dec. 17 application to re-start sending high-pressure steam into the ground inside the restricted zone at Primrose East, where bitumen continues to flow to the surface in three places. “The AER determined that it was premature to approve this application, in light of the ongoing investigation into the leaks at Primrose,” Bob Curran, AER spokesperson, said Monday. After the regulator signalled it would not give approval, CNRL withdrew the application, Curran added. Curran added it’s not known when the AER will reach a decision on the February application. The two sites, about 12 kilometres apart, are the same geological formation….

Carolyn Campbell of the Alberta Wilderness Association, said protecting groundwater should be a high priority, rather than “treating the area like a lab for groundwater contamination.” In 2009, similar bitumen leaks in the same area contaminated the groundwater and that could be happening now but “we don’t know yet the extent of groundwater contamination,” said Campbell. “There was harm to a water body, and to wildlife and we feel strongly the AER should refuse this application as well.”

It’s not known when the AER investigation will be complete. “The investigation continues, and the operating restrictions put in place last summer by the AER remain in effect,” Curran said. [Emphasis added]

CNRL loses bid to resume steam operations near spill site, Environmentalists applaud regulator’s decision by Sheila Pratt, March 7, 2014, Edmonton Journal
The Alberta Energy Regulator turned down an application by Canadian Natural Resources, Ltd (CNRL) to resume oil production next to a leaking site where bitumen has been oozing to the surface for more than 10 months near Cold Lake. The Journal learned of the decision late Friday from Bob Curran, AER regulator spokesperson, who added details will be on the website later. The decision, announced late Friday, was welcomed by environmentalists who said it was premature to allow the company to start sending steam into the ground again given there’s not yet a way to stop the four leaks on their Primrose field. … Mike Hudema of Greenpeace he was “glad” to hear the decision and stressed there should be no resumption of steaming “until we get some answers about what caused these leaks.”

Thousands of barrels of bitumen have come to the surface on the Primrose site, though the seepage has slowed during the winter. The company has spent millions on cleanup, removing contaminated soil and isolating the fissures where the bitumen comes to the surface, including emptying a small lake to contain a bitumen leak at the bottom. CNRL applied on Feb. 4 to resume its high-pressure cyclical steaming process on wells just outside the one-kilometre zone where operations were shut down last spring after bitumen was discovered leaking into the small lake in Primrose South. In the application, the company proposed to make some adjustments to its high-pressure cyclical steam operation. It remains confident the leaking is caused when bitumen seeps into racks in faulty old well bores.

But after a similar 2009 incident of bitumen leaks, CNRL was allowed to resume steaming at Primrose “and we got more leaking,” said Hudema. The regulator’s report on the 2009 leak raised questions about whether the high-pressure steam pushed into the ground is causing the caprock to crack and letting the bitumen move up, he noted. [Emphasis added]

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