VelocityEHS acquires Industrial Hygiene Software company Spiramid

VelocityEHS, a Chicago-based environment, health, safety (EHS) software company, recently announced it has acquired Spiramid, developer of the a system for managing industrial hygiene (IH). The acquisition adds Spiramid’s occupational safety & health software to the VelocityEHS’s EHS platform. The software, now called VelocityEHS Industrial Hygiene, gives organizations the capabilities to efficiently run an industrial hygiene program.

VelocityEHS is launching its new Industrial Hygiene solution at a time when IH is at an important crossroads. The need for workplace programs that anticipate and prevent workplace hazards is growing, while the number of certified industrial hygienists and investments in traditional programs has been on the decline.

“We’re excited to launch our powerful new Industrial Hygiene product. It’s a perfect fit for people working on the frontlines and has great synergy with our market-leading Chemical Management capabilities. Its simple design cuts through the complexity of IH tasks,” said Glenn Trout, president and CEO of VelocityEHS. “While there’s no substitute for a well-trained, well-resourced team of industrial hygienists, the reality today is that a growing number of EHS generalists are being called upon to do sampling and run IH programs that fall outside the scope of their training and traditional responsibilities. Whether you’re a veteran hygienist or new to the role, we believe our new IH solution will provide significant value.”

The software gives companies with sophisticated programs the ability to see, in one place and in real time, what’s happening across their enterprise. It gives staff hygienists new reporting tools — like dynamic risk matrices — to help them determine where and why to deploy resources, as well as to demonstrate the value of IH when talking with leadership stakeholders. For companies without a Certified Industrial Hygienist, it provides a framework for managing exposure risks and meeting a wide range of IH tasks.

“The goal of any industrial hygiene program is to help as many people in the workplace as you can. I am proud to see our IH software, which we have spent years perfecting, added to the VelocityEHS platform, which serves the industry’s largest EHS software community,” said Dave Risi, co-founder of Spiramid.

Managing IH can require the collaboration of many stakeholders, including people sampling in the field, IH consultants, outside laboratories, and program managers. VelocityEHS’ Industrial Hygiene software is a central management hub, facilitating the workflow and hand-off of responsibilities from party to party. For instance, users can more easily plan and control all aspects of IH, from selection of chemicals and analytical methods, to selection of laboratories and access of sampling results, with options to share information with the right stakeholders. The solution lets users send chain of custody forms directly to labs and receive the analytical data electronically, inside the product, eliminating the need for manual input and helping to avoid errors by making the information readily accessible.

Other features include an in-product database of CAS Registry Numbers, OELs and laboratories, plus easy tools for tracking and managing of similar exposure groups (SEGs), qualitative assessments, sampling plans, medical surveillance, surveys, samples and equipment. It is the smartest and most efficient way to track a high-volume of complicated sample data and to manage risk assessments and mitigation programs.

The new IH software, together with VelocityEHS’ Chemical Management and Industrial Ergonomics solutions, provides industrial hygienists with the comprehensive resources they need to promote healthier workplaces.

Diving deep into Redwater – Supreme Court Says Trustee in Bankruptcy can’t cherry pick Environmentally Clean Assets

Written by John Stefaniuk and Scott Birse, Thompson Dorfman Sweatman LLP

The Supreme Court of Canada released its much anticipated decision in Orphan Well Association v. Grant Thornton Limited (a case more commonly known as Redwater) on January 31, 2019. You might recall our article on the Alberta Court of Appeal’s decision in the same case.

In Redwater, the courts had to decide whether bankruptcy law trumped provincial regulatory orders issued in Alberta. Redwater Energy Corporation (Redwater) was an oil and gas developer.  It held a number of development properties under the authority of the Alberta Energy Regulator (AER).  With the slump in oil prices, Alberta Treasury Branches (ATB), Redwater’s primary lender, called its loan. ATB appointed Grant Thornton Ltd. first as receiver and subsequently as trustee in bankruptcy of the estate of Redwater under the federal Bankruptcy and Insolvency Act (BIA).

In the course of examining Redwater’s realizable assets, Grant Thornton became aware of outstanding environmental reclamation obligations that were associated with some of Redwater’s non-producing properties.  Grant Thornton decided to put the valuable, producing wells and other “clean” assets up for sale, and to walk away from the remaining assets by renouncing them under the BIA. That resulted in putting the reclamation in the lap of the Orphan Well Association (OWA), an industry-funded organization set up in Alberta to administer a fund established for the purpose of reclamation of “orphan” properties.

The AER refused to allow the transfer of the productive licences. It issued abandonment orders requiring clean-up or posting of security for clean-up costs in relation to the renounced assets. The parties headed to court to see what would become of the value that could be realized for the retained assets. Both the trial court and the Alberta Court of Appeal would have allowed Grant Thornton to leave the liabilities behind.

In the majority decision written by Wagner C.J., the Court applied a three-part test found in another Supreme Court of Canada case decided in 2012, Newfoundland and Labrador v. AbitibiBowater Inc. The majority of the Court held that the reclamation claims were not  a debt, liability or claim owing to a creditor and that they were too remote to attach a monetary value. That meant that two of the three criteria in the Abitibi test were not met. The Court therefore held that the bankruptcy did not have the effect of undoing the orders and the trustee could not cherry-pick the valuable assets while renouncing the rest.

This was a bit of a surprise to many environmental law practitioners, including most of the ones I attended a conference with just a few weeks prior to the decision.

What then, is the upshot?

Ostensibly, this is good news for provincial regulators. It is more likely that their enforcement orders will be found to continue to be binding upon corporations in bankruptcy. While it does not make receivers or trustees in bankruptcy personally responsible for rehabilitation costs, it does mean that the proceeds of sale of the valuable assets may have to be put toward satisfying those orders before any of it is available to lenders and other creditors. That means less costs potentially borne by the provinces (and their taxpayers). Predictably, lenders do not seem to garner a lot of public sympathy.

On the other hand, (assuming no changes to the BIA) the decision means that lenders and other creditors will have to pay closer attention to the borrower’s unfunded clean-up and closure costs when extending and monitoring credit. If the lender no longer has the ability to deal with valuable assets and leave the “dirty” behind, it means that credit in environmentally sensitive sectors may become tighter, reporting requirements may become more onerous, and some lenders may become skittish.

The dissenting minority decision written by Côté J. said the majority decision was not based on “polluter pays”, but instead resulted in a regime of “lender pays”.  After all, it is always open to the provinces to require permittees and licensees to post better (and more) security to fund rehabilitation costs, and to carry out better monitoring and inspections to ensure that the security is really adequate to fund clean-up. On top of that, who is in a better position to monitor environmental compliance and reclamation costs, the regulator or the bank? Surely, the regulators have better expertise and, assuming proper funding from government, better resources to carry out the work. Indeed, the regulators also wield the bigger stick – fines and penalties – whereas the most that the lender can do is either refuse to lend, lend less, or call in a loan where potential trouble is spotted. By the time that issues are obvious, the lender may choose to let things ride, so long as payments are being made, rather than force a realization that could put its security at risk. It is difficult to see how that serves environmental protection.

In some respects, the decision can be seen as a bit of a “Get out of Jail Free” card for the provinces and their resource and environmental regulators. No doubt that is the way that ATB felt about it.

This article has been republished with the permission of the authors. It was first published on the TDL Law website.


About the Authors

John Stefaniuk engages in a broad practice with emphasis on environmental law, real estate and development law, natural resources and energy, commercial law and municipal law matters. He has particular experience in relation to contaminated sites, mining and mine rehabilitation, wind power development, natural resource development, environmental approvals and licensing, commercial real estate, leasing, financing and development, municipal approvals, taxation and assessment and business acquisitions. He appears regularly before government licensing bodies and administrative tribunals including the Manitoba Clean Environment Commission and Municipal Board, municipal councils, provincial legislative committees and in all levels of court in Manitoba and in the Federal Court in connection with environmental, resource, regulatory municipal, and property issues.

Scott Birse has a broad practice with a particular emphasis on environmental law, municipal law, real estate and development law, regulatory compliance, commercial law and related litigation. He has particular experience assisting clients in the areas of environmental liability in real estate transactions and business acquisitions, municipal planning and approvals, contaminated sites liability, environmental assessments, commercial real estate development and civil litigation. Scott has appeared before municipal tribunals, the Manitoba Court of Queen’s Bench and the Manitoba Court of Appeal. He has also advised clients with respect to municipal and environmental matters in Saskatchewan and British Columbia.

Canadian Consulting Firm acquired by UK Giant

Novus Environmental, a 25-person specialized consulting firm with offices in Guelph ON and Calgary AB, was recently acquired by SLR, an UK-headquartered global environmental and advisory firm.

Novus will bring additional capability to SLR’s North American business in air quality, noise and vibration, and wind and climate. The Novus team will join SLR’s Canada business, which will now be 280 strong with 18 offices.

SLR began as SECOR Ltd. in 1994. Starting as a UK business, the company now operates as a global company with more than 1,100 people delivering client solutions across five regions. SLR offers a wide range of advisory and environmental consulting services.

This is SLR’s third acquisition in four months, reflecting the confidence of the company and its new investor Charterhouse Capital Partners in the market, according to Neil Penhall, SLR’s chief executive.

U.S. Opportunity: U.S. ITRC Issues RFP for 2020 Technical Projects

The United States Interstate Technology and Regulatory Council (ITRC) recently issued a Request for Proposals (RFP) for projects that address urgent environmental issues and advance innovative technologies and processes. The proposals that are selected by the ITRC Board of Advisors will begin in January 2020.

All applicable environmental topics will be considered, but evaluation criteria will give greater weight to proposals that address the needs listed in the 2020 ITRC Priorities list, or proposals which update ITRC documents that are outdated. Existing ITRC documents can be found here.

More information about the Project Proposal Process is available here. Please follow the instructions found in the selection process and criteria document, and use the proposal template to submit your proposal.

The ITRC Board of Advisors will conduct a preliminary evaluation of all proposals received by the deadline and in the proper format. The purpose of this preliminary evaluation is to determine what needs to be clarified during the Board interview on May 23, or to determine if a proposal should not move onto the next step in the evaluation process.

The Board will use the following criteria:

  • Is the proposal consistent with ITRC’s mission, goals, and strategic planning objectives?
  • Does the proposal address regulatory or technical barriers (which includes lack of awareness or lack of educational resources) to environmental solutions?
  • Does the proposal address a need of a broad spectrum of groups/states? Is the proposed guidance and training likely to be used by a large number of people, even though the subject may not have a high level of current interest? (e.g. passive sampling, ISM, GW statistics)
  • Is the problem/subject to be addressed clearly defined?
  • Does the project have a defined and manageable scope?
  • Does the proposal have the support of at least five states to be implemented, with two state personnel (with accomplished project management skills and a working knowledge of the subject matter) as potential Team Leaders?
  • Does the proposal consider the requisite subject matter expertise within its team composition?
  • Does the project propose the development of tools which are functional, educational, and able to address the needs of a varied audience?

2020 ITRC Priorities (see the expanded list here) include water reuse, waste reduction, chemicals of emerging concern, cleanup technology, water quality, and air quality.

Proposals are due electronically to the ITRC Director (preyes@ecos.org) by Wednesday, May 10, 2019. Proposers are reminded to review the evaluation criteria and present a proposal that is technical in nature, not policy-oriented, nor a research or demonstration project. All questions should also be addressed to Patty at preyes@ecos.org.

Environmental Liability Risk Faced by Directors of Dissolved Companies – Getting around the Gehring Defence

Written by Una Rodaja, Harper Grey LLP

Once upon a time, you were a director of a company that owned a parcel of land in the Greater Vancouver area.  A dry-cleaner and an auto-repair shop operated on the property, but you were not too concerned about environmental liability.  This was the 80s after all and the rent was good!  Your tenants caused some environmental contamination, which you addressed when your company sold the site in 1990.  You dissolved your company a year later and forgot all about it.

The property is now owned by a developer who is seeking to build a residential tower on the property.  To do so, the developer is required to investigate and remediate contamination that remained on the property after your company sold it.  Standards have changed and the limited remediation your company did years ago no longer meets the applicable standards.  Your old tenants (both sole proprietorships) are long gone and the developer is seeking to hold you personally liable for the costs of remediation.  You did not personally operate on or own the property, so are you really at risk?  A recent BC Supreme Court case says you are.  Here we explain how and why.

Directors of existing corporations are “responsible persons”

Under BC’s Environmental Management Act[1], a director or officer of a company that owns or operates on, or has historically owned or operated on, a contaminated site is a “person responsible for remediation” of that site simply by virtue of their position with the company.[2]  Such directors and officers can be liable to pay reasonable costs of remediation incurred by anyone in respect of the site owned or operated on by their company, if they authorized, permitted or acquiesced to the activity that gave rise to the cost of remediation.[3]

Directors of dissolved corporations are not “responsible persons”

Although the language establishing the categories of “responsible persons” under BC law is very broad, it is not without limit.  For example, it does not include “persons” who have ceased to exist, such as dissolved corporations.  This was made clear by the BC Supreme Court in a seminal decision called Gehring[4].  The case has undoubtedly motivated many corporate dissolutions by directors and officers seeking to shield themselves from personal liability for contaminated sites owned or operated on by the companies they served.

Dissolved companies can be restored – then what?

However, in the recent decision of the BC Supreme Court in Foster v. Tundra Turbos Inc.[5], a director of a long-dissolved corporation that owned and operated on contaminated land faced exposure in an action to recover environmental remediation costs by virtue of an application to restore the company to the corporate registry.  The company in question, Tundra Turbos Inc., was incorporated in 1978, and was dissolved in 2000.  Prior to its dissolution, it had a single director, one Mr. Clarke. The Plaintiff sought to hold Mr. Clarke liable for the costs of remediation incurred in respect of the property, some 17 years after Tundra had dissolved.  The question before the court was whether it was appropriate to restore Tundra and reconstitute Mr. Clarke’s directorship to make it possible for Tundra and Mr. Clarke to be liable for the costs incurred by the Plaintiff in remediating the property owned by Tundra in the late 1980s and early 1990s.  Tundra and Mr. Clarke presented several arguments against the restoration, including that Mr. Clarke would lose the Gehring defence, a substantive right, and that Tundra’s records pertaining to its operations at the property were destroyed, given the length of time involved.  The court rejected these arguments and ordered the restoration.

In the court’s view, there was nothing inherently unfair in the fact that companies and directors may be exposed to liability under BC’s environmental legislation many years after their association with a contaminated property ended.  Further, the right of a company and its directors to avoid liabilities for which they would have been exposed but for the dissolution is not the kind of right protected by legislation.  In fact, a legitimate purpose of restoring a company is to facilitate the imposition of such liabilities.  While destruction of the dissolved company’s records may, in certain circumstances, result in the court rejecting an application to restore, in Tundra’s case there was no prejudice arising from the loss of records because it was clear, on the facts, that had Tundra not been dissolved, it would have been responsible for the costs of remediation.  If anything, the lost records caused more prejudice to the Plaintiff than Tundra’s director, Mr. Clarke, who had personal knowledge of Tundra’s activities on the site.

In addition, the fact that Mr. Clarke could potentially face personal liability even without Tundra being restored (on the basis that he personally had the right to control, was in control of or responsible for any operation on the site in question) did not have a bearing on the restoration application.  The court recognized that it was easier to hold Mr. Clarke liable if he was responsible solely by virtue of his status as director, which could only be done if the company was restored.

Implications of the Tundra Decision

The Tundra case is an important example of creative counsel work to get around the Gehringdefence.  However, notwithstanding the outcome in that case, there are arguments to be made in future cases to avoid the restoration and, ultimately, responsible persons status for the director in question.  Existence of a limitation defence and loss of evidence that would assist in the defence of the director in question, or unreasonable delay of the Plaintiff in bringing the restoration application, may well result in the application being denied.

For lawyers advancing cost recovery claims, the Tundra case is a good reminder of the need to look at dissolved corporations and their directors and officers, and the need to apply for restoration, in a timely fashion.  For those defending these claims, and restoration applications, finding prejudice, beyond the mere loss of the Gehring defence, will be key.

[1] S.B.C. 2003, c. 53 (“EMA”)

[2] EMA, ss. 39(1), 45

[3] EMA, ss. 47(5); Contaminated Sites Regulation, s. 35(4)

[4] Gehring v. Chevron Canada Ltd., 2006 BCSC 1639, para. 55

[5] Foster v. Tundra Turbos Inc., 2018 BCSC 563

About the Author

Una Rodaja is a partner in Harper Grey’s Commercial Litigation and Environmental Regulation & Disputes practice groups. Una frequently lectures on various aspects of contaminated sites law for the Pacific Business and Law Institute, BC Environmental Industry Association, the Environmental Managers Association, and the BC Continuing Legal Education Society.  She is the co-author of BC Environmental Management Legislation and Commentaryand the recipient of the 2017 Lexpert® Leading Lawyers Under 40 award. Una is recognized by the 2018 Canadian Legal Lexpert® Directory as a Leading Lawyer to Watch in the area of corporate commercial litigation and by Benchmark Canada® as a Future Litigation Star. She has also been recognized by Best Lawyers® in Canada 2019 as a “Leading Lawyer in the area of Environmental Law.

Investigation finds Contaminated Soil from Montreal is being dumped on Prime Farmland

As reported by Marie-Maude Denis and Jacques Taschereau of CBC News, contaminated soil generated from the development of properties in Montreal is ending up on prime agriculture land.

Radio-Canada’s investigative program Enquête recently tracked demolition waste from Montreal sites to farmland in Saint-Rémi. When the investigators confronted the farmer, he claimed the material dumped on his property would be used as a foundation for a greenhouse and that it was legal.

An environmental lawyer contacted by the Radio Canada investigators disagreed with the farmer as did Quebec’s Environment Ministry. The Environment Ministry confirmed it found contaminated soil at the site last year, but it’s offered no further details about its origin, saying the matter is still under investigation.

When The Radio Canada investigators questioned the general contractor working on the site that was the source of the contaminated soil, he claimed the a subcontractor properly trucked the soil away.

Properly managed soil treatment facility

The claim of the general contractor and farmer is that the material is construction debris consisting mainly of bricks and stones and not contaminated soil. The investigators noted that the material they saw dumped on the farm included metal and concrete. According to the Environment Ministry, the kind of debris that was tracked by the investigators can’t be legally be use for the intended farmland construction.

In a similar investigation conducted by Radio Canada in 2016, investigative reporters followed trucks and observed debris being dumped in the countryside. The investigators arranged for the sampling and analysis of the soil from several farms and that found some samples to be contaminated.

New Cleantech innovations reduce emissions from vehicles and suppress dust at industrial sites

dynaCERT Inc and H2 Tek have taken home the $5,000 top prize at the Mining Cleantech Challenge in Denver, the Colorado Cleantech Industries Association (CCIA) has reported.

The two companies’ technology were chosen by mining executives and investors in the industry as the best among a competitive field of 12 total companies representing the US, Canada and Israel, the CCIA said. An international team of judges reviewed and voted on the winners, the CCIA said.

dynaCERT’s HydraGEN™ turns distilled water into H2 and O2 gases on-demand and introduces these gases directly to diesel engines’ air intakes. H2 Tek Vice President of Sales and Marketing, David Van Klaveren, said: “Our technology, HydraGEN can actually improve significantly those carbon emissions, reduce them and, along the way, pay for the capital cost of all this through fuel efficiency savings.

“We can’t ignore the fact that clean technology is an important part of our responsibility as participants and members of this industry, the mining industry,” he said. “I think it’s remarkable that an association considers this a priority: bringing together companies that have innovation for an extremely important cause.”

Hydrocarbons and CO2 are reduced due to the absence of carbon in hydrogen fuel and also due to better combustion of diesel fuel with the aid of hydrogen which has a higher flame speed, dynaCERT said.

“Although CO values for neat diesel operation is relatively lower, by inducting H2 & O2 into diesel the CO amount is further reduced,” dynaCERT said. dynaCERT has created partnerships to perfect a technology that would deliver on the promising findings with H2 & O2 injection. Not only have we developed patent-pending technology, we have completed testing and have validated that our technology works.”

Some of the features delivered through the technology, dynaCERT said:

  • “Our patent-pending electrolysis system and Smart ECM provides a reliable and adjustable delivery of H2 & O2 concentrations. Not all engines are the same and having the optimal ratio of gases provides increased benefits;
  • “Our technology is scalable allowing use with Class 6-8 on-road vehicles and transition to applications with rail, marine, off-road and power generation;
  • “Our technology is leading edge and provides solutions without drawing excessive power to perform the task;
  • “It is designed to work with OEM manufacturer’s and compliment technological improvements.”

Earth Alive Clean Technologies

Second place in the cleantech competition went to Earth Alive Clean Technologies, a microbial dust control technology that is non-hazmat, 100% organic and has biodegradable properties.

Earth Alive offers EA1TM dust suppressant and RapidAll cleaner to remove dust, dirt and any other contaminant in a natural way. EA1 eliminates 90% of dust on work sites.

EA1TM reduces dust through the use of microbial technology to keep dust particles in the soil. EA1TM reintroduces natural microbial strains compounds already found in nature into the ground to create conditions that prevent dust from becoming airborne, while helping to retain soil moisture. Microbial spores are activated after application and thrive in the soil binding soil particles and creating a firm and resistant layer preventing dust emission.

Global Remediation Market Forecast

According to the recently updated “Global Environment Clean up & Remediation Market By Medium, By Type, By Application, By Region, Competition Forecast & Opportunities, 2013-2023” issued by Research and Markets, the environment clean up & remediation market is projected to grow to nearly $130 billion by 2023, owing to growing demand for oil & gas, rising industrial pollution, and increasing number of pipeline leakages and incidents affecting the environment.

A similar market study published in 2017 by Zion Market Research estimated the environmental remediation market to reach $122.8 billion (USD) by 2022. According to the Zion Market Research report, entitled “Environmental Remediation Market for Banking and Financial Services, Telecom and IT, Healthcare, Government, Automotive, Government, Manufacturing and Retails and Other application: Global Industry Perspective, Comprehensive Analysis and Forecast, 2016-2022“, the global environmental remediation market was valued at around $79.57 billion in 2016 and was predicted to reach approximately $122.80 billion in 2022, growing at a compound annual growth rate (CAGR) of slightly above 7.5% between 2017 and 2022. 

Environmental remediation technology deals with the removal of contaminants from environmental media such as soil, groundwater, or surface water. Remediation technologies are generally categorized into ex-situ and in-situ methods. Ex-situ methods offer excavation of affected soils and subsequent treatment at the surface and extraction of contaminated groundwater. In-situ methods offer to treat the contamination without removing the soils or groundwater.

Growing investments in the field of remediation services, stringent and transparent regulatory frameworks, and rapid industrialization in developing countries are drivers for the demand for environmental cleanup & remediation. Other drivers fueling the growth of environmental remediation market are rising demand from different industries such as oil and gas, mining and forestry, mining, automotive, chemicals, and others. 

North America and Europe are the major demand generating regions for environmental cleanup & remediation services, globally, on account of growing industrial and manufacturing activities in both regions. Some of the major players operating in global environment clean up & remediation market are Bechtel, Veolia Group, Clean Harbors, Suez S.A., Golder Associates Corporation, BRISEA Group, Inc., Dredging, Environmental & Marine Engineering NV, Terra Systems, Inc., ENTACT LLC, Weber Ambiental, etc.

The Researd and Markets remediation study discusses the following aspects of Environment Clean up & Remediation market globally:

  • Environment Clean up & Remediation Market Size, Share & Forecast
  • Segmental Analysis – Market By Medium (Surface Water, Ground Water & Soil), By Type (Bioremediation, Pump & Treat, In Situ Vitrification & Others), By Application, By Region
  • Competitive Analysis
  • Changing Market Trends & Emerging Opportunities

The Zion Market Research study provides a view on the environmental remediation by segmenting the market based on environmental medium, application, and region. All the of environmental remediation market have been analyzed based on present and future trends and the market is estimated from 2016 to 2022.In term of the environmental medium, environmental remediation market classified into soil and ground water. Based on application, global environmental remediation market is bifurcated into mining and forestry, oil and gas, agriculture, automotive, industrial, chemical, construction and land development and other application. The regional segmentation comprises of present and forecast demand in Asia-Pacific, Middle East & Africa, North America, Europe, and Latin America for environmental remediation market.

Hazardous industry leaders give insight on the keys to operational excellence

A global survey of hazardous industries and Operational Index was recently published by Sphera. The annual Operational Excellence Index (OEI) survey report which highlights trends in digital transformation and OE strategies across the hazardous industries.

Previously conducted by Petrotechnics, now a Sphera company, the index is in its third year of surveying oil and gas, chemical, energy and industry manufacturing professionals to gauge attitudes around OE and the measures taken towards its adoption. Year after year respondents agree, OE programs help reduce risk, cut costs, and improve productivity. The 2018/2019 survey reveals senior leaders are relying on technologies to support their OE initiatives and identifies where they are coming up short and what they could do to improve.

Ninety percent of respondents agree digital transformation will accelerate their ability to achieve OE – not just as a one-off target but as an ongoing business objective. This is a significant increase from last year’s report where 73% of leaders agreed that going digital was key to achieving OE. Implementing digital technologies is now aligned with overall business goals with 55% leveraging technology to reduce operational risk and 55% to improve asset availability and uptime.

Paul Marushka, President and CEO at Sphera, commented, “As the third-annual Operational Excellence Index shows, digital transformation is upon us. As companies look for new ways to keep their people safe, their operations productive and their products sustainable, being able to tap into and monitor data from Industry 4.0 solutions will be a major differentiator for organizations looking to separate themselves from the competition. It’s not surprising that 90% of respondents agree that digital technology will accelerate operational excellence. We couldn’t agree more. Sphera believes digital is the wave of the future for operational risk mitigation.”

But while industry leaders agree digital is essential to OE, more than half are still trying to figure out what ‘digital transformation’ means for them, and 69% are just beginning their digital journey. The approach to digital matters, according to 83% of survey respondents, who admit they have relied on legacy systems to improve their business agility but had not embedded operational best practices cross-functionally.

The good news is the industry is on the brink of a major step forward when it comes to achieving OE through digitalization. Seventy-five percent of leaders recognize the need to create new, insight-driven business processes across enterprise functions. Advanced analytics and digital twins were highlighted as key solutions to help operators understand how to make better, safer planning and operational decisions. 

Scott Lehmann, VP, Product Management, ORM for Operations at Sphera, said, “This year’s survey clearly illustrates the challenges digital leaders face within their own organizations to understand what digital transformation means or could mean practically and tangibly to their company. While the pace of digital transformation and ROI is still in its early days, the survey points strongly to a rapid acceleration on the horizon. Digital leaders understand digital integration and the adoption of new technologies must focus on creating actionable insights to help underpin new cross-functional business processes that enhance decision-making and the way people work together.”

One survey respondent suggested: “The best approach to digital is not to use technologies to close gaps that you know already exist. Rather, start with a blank sheet of paper and define what you need – and then assess the available technologies.”

Petrotechnics, now a Sphera company, conducted the survey between October and November 2018, collecting 116 responses from a broad representation of functions, demographics and industries across the hazardous industries, including: oil, gas, chemicals, manufacturing, utilities, mining, engineering and other sectors. The survey included respondents from each major region – specifically Middle East (29%), Europe (28%), North America (28%), Asia Pacific (11%), Africa (3%) and South America (1%).

View the full report and results from the 2018/2019 Operational Excellence Index.

Are New United States Regulations Coming for Accidental Releases into Air?

By Louis A. Ferreira, Willa B. Perlmutter, and Guy J. Thompson, Stoel Rives LLP

On February 4, 2019, a federal court ruled that the U.S. Chemical and Safety Hazard Board must issue regulations within one year that set forth reporting requirements for accidental releases of hazardous substances into the ambient air. This requirement has been part of the Board’s statutory mandate since its inception in 1990 pursuant to Section 112(r)(6)(C)(iii) of the Clean Air Act (“CAA”). Nevertheless, the Board has never issued any such regulations.

Four non-profit groups and one individual filed a one-count complaint against the Board, seeking declaratory relief and an injunction to compel the Board to promulgate reporting requirements as required by the CAA. Plaintiffs claimed that the Board had violated the Administrative Procedure Act by not issuing any regulations. Plaintiffs further asserted the lack of reporting requirements have impaired their respective abilities to collect information that would help prevent future releases and the harm caused from such releases.

The United States District Court for the District of Columbia agreed with the plaintiffs and ruled that the Board must issue regulations within one year. In reaching its decision, the Court rejected the Board’s defenses that the delay in promulgating regulations was reasonable given the Board’s limited resources, small staff size, and other required functions. “[I]f that is the case,” the Court said, “the solution to its resource constraints is not to ignore a congressional directive[,] [i]t is to return to Congress and ask for relief from the statutory requirement.” The case is Air Alliance Houston, et al. v. U.S. Chem. & Safety Hazard Investigation Bd., D.D.C., No. 17-cv-02608, February 4, 2019.

The Court’s decision appears to follow a similar one issued in August 2018 in which some of the same plaintiffs brought a complaint against the U.S. Environmental Protection Agency. In that case, the plaintiffs petitioned the D.C. Court of Appeals for review of the EPA’s decision to delay for 20 months the effective date of a rule designed to promote accident safety and enhance the emergency response requirements for chemical releases. The Court rejected all of EPA’s defenses justifying the delay in a strongly-worded opinion that held the agency strictly to the letter of the CAA. That case is Air Alliance Houston, et al. v. EPA, 906 F.3d 1049 (D.C. Cir. 2018).

The same directness is evident in this recent decision.

Ultimately, the practical effect of the ruling is not clear. There are already laws in place that require companies to report accidental releases to state and federal authorities. It is possible the Board will promulgate regulations that align with its current practice of deferring reporting requirements to other agencies. If the Board took that approach, there likely would not be a noticeable difference in reporting requirements from the current practice.

On the other hand, the two recent decisions discussed above suggest that a trend may be forming in which the courts are pushing back when the government steps off its clear statutory path.


This article has been republished with the permission of the authors. The original post of this article can be found on the Stoel Rivers LLP website.

About the Authors

Lou Ferreira is a senior partner with more than 27 years of complex trial experience.  His practice focuses on commercial litigation, insurance coverage and environmental, safety & health issues.  A seasoned litigator, Lou has significant experience in high-stakes litigation including successfully defending a class action filed against a utility by residents of a town in Washington asserting that the utility was liable for flooding as a result of the operations of its upstream dams.  Lou  successfully defended a port in Washington from a $20 million lawsuit brought by developers alleging breach of contract to develop a large mixed-use waterfront project on the Columbia River. 

Willa Perlmutter has more than 30 years of experience as a litigator, focusing for the last 20 on defending mine operators across all sectors of the industry in administrative enforcement proceedings brought by the Mine Safety and Health Administration (MSHA) for alleged violations of the Mine Act.  In addition, she regularly counsels clients on a broad range of issues that affect their mining operations, from personnel policies and actions to compliance with a broad range of federal statutes. Willa regularly defends companies and individuals facing investigations and formal legal proceedings for alleged safety and health violations under both the Federal Mine Safety and Health Act of 1977 and the Occupational Safety and Health Act of 1970, whether those arise out of a catastrophic event, such as an accident, or in the course of a regular inspection by MSHA or Occupational Safety and Health Administration (OSHA). She has successfully defended a number of mining companies in whistleblower cases brought under the Mine Act.

Guy Thompson is a litigator and advisor on a wide-range of insurance matters. His practice focuses on insurance coverage litigation, including natural resources/environmental insurance coverage, and a wide variety of risk management issues. Guy helps policyholders obtain the recovery they deserve from their insurers and has helped recover millions of dollars from insurance companies for his clients. Guy is skilled at getting insurance carriers to cooperate in paying claims and often secures settlements with insurers without the need for litigation. Recently, he helped recover over $1.65 million from multiple insurance carriers for a Portland company that was required to perform environmental cleanup by the Oregon Department of Environmental Quality.