Under scrutiny, oil and gas commission cracks down on illegal dams

British Columbia's gas industry regulator launched a string of enforcement orders this fall against fracking dams in the province's gas-rich northeast.

The crackdown comes amidst questions being raised about the independence of the B.C. Oil and Gas Commission from the whims of industry, raised by a researcher with the Canadian Centre for Policy Alternatives who documented at least 50 illegally built dams.

One company, Malaysian government-owned Progress Energy, was hit with five such orders alone since September 13, while three other firms faced a dam-related enforcement order from the provincial body overseeing them over the same two months — ConocoPhillips, Saguaro and Nexen.

The last time the commission issued such an order prior to that was last March.

In a Nov. 14 statement, the commission said it issued 10 dams this fall with "compliance orders to ensure they are safe and pose no threat to the environment."

The commission's enforcement orders came as another regulator, B.C.'s Environmental Assessment Office, stepped in by demanding two Progress Energy dams be 90 per cent drained on Oct. 31 as "not compliant" with the Environmental Assessment Act "given that the dams exceed 15 metres in height" but had not applied for permits. The commission itself order one Nexen-operated dam completely drained this year.

They were just a few of more than 50 unlicensed dams the CCPA's Ben Parfitt documented across B.C. Some had operated for five years illegally, supplying large amounts of water needed for hydraulic gas fracturing, or fracking.

In September, the gas commission ordered five Progress dams half-drained because inspectors in July "observed features that create a concern about the integrity and stability of the structure," the various order letters all stated, plus with at least one dam "a potential for structure failure" due to overflowing water levels and "constant seepage."

Progress told the commission it had complied with its orders later that month. And in a statement, the firm told Metro it has 59 "freshwater earthen structures" in B.C.

A 2016 "change in regulatory process" led the company to "discover its oversights in the approvals process" — and that two of its structures "should have been assessed" as dams requiring review and different permits, for which it applied retroactively.

"The dams are in a remote location, the water contained in the dams is fresh water, the dams are structurally safe," the company stated. "Progress believes there are no significant adverse environmental, economic, social, heritage or health effects."

But Parfitt argued the dozens of unlicensed dams allowed to fill with water for years in B.C. are "part of a growing body of evidence (that) seems to suggest the energy industry in this province is being overseen by an Oil and Gas Commission that appears to be fairly sympathetic to the needs and wants of the industry." His organization is urging an independent inquiry into the B.C. fracking sector.

In a statement the B.C. Oil and Gas Commission countered allegations of collusion with the industry it regulates. A spokesman said in an email the agency "does not promote oil and gas or LNG," but that its "job is to strictly ensure the existing legal and regulatory framework here in the province is complied with by all" oil and gas operators, citing 4-5,000 inspections a year.

Asked about unlicensed dams, it had "authorized these water storage structures" on "short-term permit" for surface water diversion, and "immediately addressed" dams that didn't have proper licenses.

[Photo: BEN PARFITT/CCPA / METRO WEB UPLOAD, A photo of a dam used by Progress Energy in its operations in British Columbia.]