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Offshore drilling requirements finalized
National Energy Board report gets seal of approval from conservation group, local leaders

Nathalie Heiberg-Harrison
Northern News Services
Published Thursday, December 22, 2011

The National Energy Board's (NEB) recently-released offshore drilling requirements address Northern concerns and issues in a positive and comprehensive way, according to some stakeholders.

NNSL photo/graphic

More than 175 delegates attended the National Energy Board roundtable in Inuvik this past September. The five-day event was held at the Midnight Sun Recreation Complex and attracted people from across the world. - Samantha Stokell/NNSL file photo

"We're quite pleased in lots of ways with the report," said Rob Powell, director of the Mackenzie River Basin for the World Wildlife Federation.

"We think that the NEB review has been an important step because they have listened to people in the North and opened up a conversation about the risk and benefits that may be involved in offshore oil and gas."

Oil companies that plan on drilling in the Beaufort Sea must hold extensive consultations in the North before filing their offshore drilling applications, make their safety and contingency plans public and be able to counter a blowout with a same-season relief well, according to the National Energy Board Filing Requirements for Offshore Drilling in the Canadian Arctic released on Dec. 15.

"Filing requirements set out the technical information we will need to see in future applications for offshore drilling in the Canadian Arctic," stated Gaetan Caron, NEB board chair and CEO, in a news release.

"These new requirements provide clarity to future applicants and to those who will provide input into the board's decision to approve or deny an application for a well in the Arctic."

Mayor Denny Rodgers said the report did a great job at reflecting the sentiments expressed at the Inuvik roundtable held Sept. 12 to 16.

"Nobody around that table said they didn't want drilling, but they did say they wanted it to be done safely," he said.

"It's to be done appropriately, respecting the environment, and if it can be done safely then we'll do it."

Rodgers was also happy the National Energy Board reaffirmed its same-season relief well policy, which he said left a window open for industry to develop something even better.

"I think that's all industry wanted," he said.

"They're recognizing that the Arctic is a unique environment. It's not the same as drilling oil off the Gulf of Mexico."

The Inuvialuit Regional Corporation (IRC) is also commending the board's Arctic offshore drilling review and subsequent filing requirements.

"The report recognizes the important role of the Inuvialuit as stewards of the Inuvialuit Settlement Region and is consistent with the principles of the Inuvialuit Final Agreement," stated Peggy Jay, IRCcommunications adviser, in a news release.

Nellie Cournoyea, chair and CEO of the corporation, said the NEB responded well to issues presented by the Inuvialuit.

"Now the big job is to ensure that implementation moves forward in a timely manner by all parties," she said.

"There is more to be done on the issues of risk and liability, and the Inuvialuit look forward to working with governments and industry to ensure adequate resources are put in place so that offshore Arctic drilling is done in a safe manner," she stated in a news release.

Powell said the major gaps of the Arctic review are with the issues of liability and blame.

"The NEB has a limited mandate to deal with this, but we would like to see an amendment to the liability cap," he said.

Currently, under the Canada Oil and Gas Operations Act, companies can be fined a maximum of $40 million.

"It's very low compared to some of the recent costs for disasters that have happened," Powell said, pointing out that federal prosecutors in Brazil recently filed a lawsuit against Chevron and Transocean Ltd. for $10.6 billion.

"It's really a thousandfold less than the cost of one (disaster)," he said.

The National Energy Board's filing requirements come after a 19-month Arctic drilling review that was prompted by the Gulf of Mexico disaster in 2010.

The board's roundtable in Inuvik this past September attracted more than 175 delegates from across the circumpolar region.

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