December 1, 2011 By Brett Bundale, Business Reporter Chronicle Herald
Pressure comes after fatal N.L. chopper crash
The Nova Scotia government is coming under intense pressure to overhaul offshore petroleum safety more than a year after an inquiry into a deadly helicopter crash in Newfoundland called for an independent safety body.
Leading the charge is Liberal energy critic Andrew Younger who introduced a bill on the issue in the provincial legislature this week.
Bill 119 urges the NDP government to push Ottawa to create a national offshore petroleum regulator to replace the joint federal-provincial boards.
“Most other major offshore jurisdictions have moved in this direction because it’s very difficult for an offshore regulator to be both the economic and safety regulator,” Younger said Thursday.
Nova Scotia’s offshore industry is regulated by the Canada-Nova Scotia Offshore Petroleum Board, which is tasked with developing offshore oil and gas as well as enforcing safety and environmental regulations.
Critics say the board grapples with a conflict of interest given its dual capacity of promoter and regulator.
Energy Minister Charlie Parker dismissed the suggestion that a national independent agency is needed to ensure the safety of the offshore industry.
“I would say there is really no need for that bill,” he said. “We have a joint federal-provincial board that oversees offshore safety, environmental protection and industry promotion and we have complete confidence they are doing the job they have been assigned to do.”
Parker said the board works closely with the Newfoundland board to ensure consistency between the two provinces.
But senior Energy Department officials are reviewing the recommendations that stemmed from the inquiry of the fatal crash of Cougar Flight 491 off Newfoundland and Labrador in 2009, he said.
ExxonMobil Canada’s Sable Offshore Energy Project has roughly 50 people working on its natural gas rig for two weeks at a time. Encana Corp. has about 35 people at its Deep Panuke platform, also for two week stretches, set to begin producing natural gas in the first quarter of 2012.
Both offshore rigs use a Sikorsky S-92 helicopter operated by Cougar Helicopters, the same company and helicopter involved in the Newfoundland crash.
Retired Judge Robert Wells led the inquiry and concluded in his report that “safety regulation should be separate from production aspects of the oil industry in order to avoid the conflicts which could arise when both activities are presided over by a single regulator.”
He pointed to countries like Norway, the United Kingdom and Australia that created independent safety boards on the heels of serious offshore accidents as a potential model for Canada to follow.
Parker said the potential need to further separate the board’s safety and development duties is under consideration.
Richard Grant, president of Grantec Engineering Consultants Inc., said Australia moved to a national agency several years ago after concluding the state-based regulatory regime wasn’t working.
“They realized there were deficiencies, they didn’t have the staff, expertise or competency to deal with all aspects of offshore safety so there were huge gaps,” he said.
Grant said moving to a national agency ensured the board had the critical mass of technical expertise needed to deal with complex problems.
He said Canada’s offshore regulations, which were “cobbled together in the 1980s,” could use updating.
Saint Mary’s University psychology professor Mark Fleming, an expert is safety culture, said the critical issue is allocating the safety board adequate resources to do its job properly.
“Whether a national agency would be better or worse than a federal-provincial board comes down to the resources allotted to them,” he said. “What’s most important is having the best quality staffs that have the resources to get external to help needed.
“There will be benefits and weaknesses in whatever scenario we choose.”
Paul Barnes of the Canadian Association of Petroleum Producers said the current structure is working well.
“We as an industry wouldn’t advocate breaking up the board because we think they are currently functioning in a manner similar to other regulatory bodies that regulate the offshore around the world,” he said. “Industry is satisfied that regulations are consistently applied in different jurisdictions.”