No permission needed for Husky Energy to restart oil production, CNLOPB says
The regulator for the province’s offshore oil industry says while it has the authority to tell oil companies to stop producing in bad weather, the companies don’t need permission to restart their operations.
Scott Tessier, CEO of the Canada-Newfoundland and Labrador Offshore Petroleum Board (CNLOPB), says safety and environmental protection is covered through agreements with companies such as Husky Energy, which the CNLOPB oversees.
While all the offshore operators shut down production in advance of last week’s storm, there’s no permission needed to restart production.
“There’s not a stop light system or a thumbs up, thumbs down from the board, where we say stop-go, stop-go. That’s the responsibility of operators to shut-in and to restart when it’s safe to do so,” Tessier said.
“Everybody shut in as the weather approached. It was during the preparation to restart production that Husky had the spill.”
Tessier was responding to concerns after the single largest oil spill in Newfoundland and Labrador’s history — an estimated 250,000 litres of oil was released from Husky’s SeaRose vessel between Thursday and Friday, during what some meteorologists have called the worst weather in the world at that time.
Initial monitoring of the situation is ongoing, with Husky calling in remote operated vehicles (ROV) to take an up-close look at the situation. Flyovers from aircraft are also ongoing to discover the full scale of the oil spill.
In a brief statement, Husky says the priority is determining the scale of the spill.
“Our aerial and on water surveillance supports the idea that it is a batch spill, but we need to confirm this by ROV survey,” Husky spokesperson Colleen O’Connell wrote in an email.
“There have been no further sightings of oil sheen at or near the White Rose field, or elsewhere in our survey area."
Tessier says the lack of a visible oil sheen on the surface is good and bad news all at once.
“On the bright side, it’s an indication that it’s not an uncontained release – it helps confirm that it is a batch release and not an ongoing spill,” said Tessier.
“The not-so-good news in that regard is that the oil has dissipated, so obviously that’s not a good thing in terms of recovery.”
The 250,000-litre estimate is believed to be a worst-case scenario, but confirmation of that number remains to be seen.
There is no timeline in place for when the investigation into the spill will conclude.
The spill is not the first time Husky has run into issues restarting oil production.
On May 29, 2017, workers on the SeaRose vessel were ordered to “brace for impact” after an iceberg came within 180 metres of the platform. Despite the close quarters, the vessel did not disconnect to attempt to evade the iceberg.
After an investigation found wrongdoing by some senior management, Husky says it re-examined its ice management plan, which the CNLOPB says satisfied its expectations.
“The CNLOPB is satisfied that all findings from the enquiry have been addressed and are confident that safety and environmental protection will remain at the forefront of Husky’s operations going forward,” read the board’s report after the investigation.
Natural Resources Minister Siobhan Coady says while she’s not going to prejudge the outcome of the investigation, the potential punishment for the spill could go as far as revoking Husky’s licence in the province’s offshore. She says it’s a situation the government is taking very seriously.
“It could range from penalties, sometimes there have been shutdowns for a period of time. You could go from that side of things to pulling the operating licence. There is a full range. The investigation … must occur. If they did everything according to protocol, then we need to change the protocol,” said Coady.
“The question is should they have restarted on Friday. If that was permissible under the plan, why should it be permissible?”
Tory natural resources critic Keith Hutchings says he’s not sure whether suspending Husky’s licence will be the end of the situation, but there are a lot of concerns for the company to address.
“I think if there’s agreed-to plans, a regulatory agency to oversee that and those plans are not met, there needs to be repercussions,” said Hutchings.
“For us, as stakeholders in the offshore, which is huge to our future, there’s a financial cost to us every time it shuts down, in terms of royalties. All of that ties back to us.”
New Democratic Party Leader Gerry Rogers noted in the House of Assembly a recommendation from the 2011 Offshore Helicopter Safety Inquiry final report, which called for an independent safety regulator to be established for the province’s offshore.
While Coady says the CNLOPB effectively operates as the independent body described by Justice Robert Wells’ report, Rogers says a new body is needed to ensure personal and environmental protection.
“The CNLOPB promotes the industry, it sells demand. It’s a conflict of interest at this point to also be the sole regulator,” said Rogers.
“We need an independent regulator for safety and the environment. It’s best practices in other part of the world.”
After sustaining damages during the storm, only the Hebron platform has resumed production. Each of the other platforms received some “cosmetic” damages that are being repaired. There are no concerns of leaks at the other platforms.