B.C. regulator let an oil company delay pipeline cleanup. Spills followed

According to provincial data reviewed by  the Investigative Journalism Foundation and The Narwhal, Canadian  Natural Resources Ltd., or CNRL, reported 45 incidents since 2020, many  of them spills of unspecified amounts of natural gas and other toxic  cargo caused by metal corrosion at aging pipelines.

Those spills came after a 2020 decision from the BC Energy Regulator to exempt roughly 4,300 of the company’s pipelines  from the usual requirement that inactive pipelines be fully  decommissioned within 18 months. Decommissioning, or deactivating, a  pipeline includes removing any fluid and disconnecting it from the  system. The sealed-off pipeline will remain in the ground in  perpetuity.

A CNRL spokesperson did not directly  respond to a question about whether the spills occurred at pipelines  associated with the exemption. Neither did the BC Energy Regulator.

Most of the pipelines operated by CNRL are short, transporting fracked natural gas and other fuels from wells  scattered across northeastern B.C. to larger pipelines which carry the  products to consumers or exporters. But even after those wells have run  dry, the pipelines associated with them can still leak leftover  contaminants into the local environment.

“If it’s not properly [decommissioned]  after its end of life, you have a substantial risk of groundwater  contamination,” Philip Gass, a director of the energy program at the  Ottawa-based International Institute for Sustainable Development, said  in an interview.

Gass said such spills might go unnoticed.

“If it’s been sitting there for a long time, you have to be really careful about the monitoring because this isn’t an active pipeline where  you would notice a spill right away,” Gass said.

The BC Energy  Regulator reports for the CNRL incidents include leaks of natural gas,  liquid hydrocarbons and produced water — a byproduct of oil and gas  extraction that often contains heavy metals and hydrocarbons. Of the 45  reported instances, 23 were due to metal loss, often internal corrosion  that allowed toxic fluids to escape.

The regulator said incidents  don’t automatically mean spills, since they can also include “incidents  with the potential to affect pipeline integrity.” But many of the CNRL  incident reports explicitly indicate that they resulted in spills or  pipeline failure.

The regulator did not say how much of each fluid leaked into the surrounding environment or if there was any  ecological damage associated with those spills.

Critics argue the spills are further  evidence the regulator erred in giving CNRL such a broad exemption,  which they called a sign of the undue influence the oil and gas industry  has on provincial regulators.

“It doesn’t give us a lot of faith that  the regulatory system is operating as it should,” BC Green Party MLA  Jeremy Valeriote said.

‘No impact to the environment’: CNRL

For comparison, in the six years prior to 2020, CNRL reported 25 incidents at its pipelines, 17 of which were due  to metal loss.

A CNRL spokesperson said the company  operates 14,896 kilometres of pipelines in B.C. and that spills are  dealt with properly and promptly.

“Clean-up and remediation activities were  completed, resulting in no impact to the environment,” the spokesperson  said of the 45 incidents since 2020. “When events occur, such as  equipment malfunction that results in an incident, we have safety and  environmental management systems in place to quickly manage these  events. To mitigate any impacts, incidents are quickly and effectively  managed in accordance with our structured emergency management and spill  preparedness programs.”

Daryl Foley, president of Group 10 Engineering, said producers like CNRL work hard to minimize incidents.

“Their intention is to do the right thing  and to prevent spills because it costs them an enormous amount of money  when they have a substantial spill,” he said in an interview. Foley’s  Calgary-based company works with companies and producers on pipeline  integrity issues and advises the Alberta and B.C. regulators on best  practices. “I’m not claiming that everybody’s perfect — if perhaps  they’re ignoring it and there is a residual risk of environmental  impact, well, they need to pull up their socks and get after it and  prioritize based on where the highest risks are.”

Foley said corrosion affecting pipelines has been an issue for decades, but fracking can exacerbate the problem.

“The challenges are real,” he said.  “Northeast B.C. in particular, they’re fracking these wells to try to  enhance production. The challenge is after fracking, they’ve run into  issues where they can get some of these frac solids, and some of them  can be really aggressive sulphur compounds.”

Frac solids are a mixture of silica sand,  water and chemicals used in fracking to extract oil or gas trapped in  underground rock formations. Those mixtures, if not properly removed  from sections of pipeline that move material from wells to larger, safer  transportation pipelines, can damage the metal and cause leaks or  spills. Foley said any pipelines with potential or identified corrosion  issues associated with active wells should be prioritized.

“Are these wells known to have been  discontinued properly?” he wondered. “That’s really what they should be  checking in on and making sure of. Any that hasn’t been discontinued  properly, that needs to be dealt with immediately.”

CNRL pipelines exempt from clean-up timelines

The BC Energy Regulator said a 2020 audit identified thousands of CNRL pipelines that were either inactive or soon would be. The regulator said that’s  what prompted it to strike a deal with the company, one of the largest  oil and gas producers in the country.

Under that deal — which was  not publicly disclosed at the time — the regulator agreed to exempt  thousands of CNRL pipelines from normal clean-up timelines in exchange  for the company committing to deactivate all of them by 2028, with  targets to meet every year until then.

The regulator later found in 2023 that the company was not meeting those commitments, but reinstated the deal without penalizing CNRL.

A regulator spokesperson said the deal was  “the most effective way to bring CNRL into compliance” and claimed the  agreement “was not a removal of oversight.”

As of this month, the regulator said only 474 pipelines remain to be deactivated out of an original total of 4,312.

“As such, CNRL continues to meet and  exceed the required deactivation targets set out in the conditions of  the exemption,” the spokesperson said.

Drew Yewchuk, an environmental lawyer and PhD student at the University of British Columbia, said it’s not clear  what the regulator or the public gained from the deal with CNRL.

“The regulator is getting less than what  the legal requirements are, and the company only has to do less than  what was the legal requirement. So what is the regulator getting from  these deals?” Yewchuk said.

He said oil companies often argue meeting  regulatory requirements would endanger their operations, putting  pressure on politicians to intervene.

“They don’t want to cause job losses, and  that’s the threat that companies always have in the background,” Yewchuk  said. “They say, ‘Look, if you force us to invest too much here, we’re  going to move out of this jurisdiction.’ ”

But he said CNRL isn’t a struggling company. The Calgary-based company reported net earnings of $10.8 billion in 2025.

“CNRL is not out of money,” Yewchuk said.

Regulator ‘way too tied to industry’

Gass said oil and gas remediation can become a public responsibility if the operating company goes bankrupt.  Some provinces, including B.C. and Alberta, charge oil and gas companies  an annual levy to clean and shut down so-called “orphan wells” left by defunct firms.

But if the company is still active and profitable, the regulator’s role should be to enforce the rules, Gass said.

“In an ideal situation you have a  regulatory regime that assures the accountability and has the  enforceability to level penalties for actors that don’t do the  remediation as needed,” Gass said.

The BC Energy Regulator, like other regulators in Canada, is funded by an annual levy charged to oil and gas companies.

While proponents argue an industry-funded  regulator is sustainable, critics like the Green Party’s Valeriote argue  it creates a dependence that gives energy companies undue leverage in  negotiations.

Valeriote said granting exemptions like  the one given to CNRL is unfair to other companies following the rules  and is “erosive to the regulator’s reputation.”

“I think there’s probably a cultural and systemic issue there and that they’re way too tied to the industry,” Valeriote said.