MOECC Releases Notice of Updated Excess Soil Management Proposal

By David Nguyen – Staff Writer

The Ontario Ministry of Environment and Climate Change (MOECC) recently posted notice on the Environmental Bill of Rights Environmental Registry of the regulatory changes to the management of excess soil (Excess Soil Management Regulatory Proposal, ERO# 013-2774). Excess soil is soil that has been dug up, such as during excavation activities, and cannot be reused at its original site and must be moved off site.  There is much controversy in the Province of Ontario and other provinces concerning the management of excess soil as there are claims and growing evidence that some companies mix clean soil with contaminated soil, some companies dispose of contaminated soil as clean soil, and other questionable practices.

The MOECC proposal clarifies where soils can be reused based on the soil characterization and aims to reduce greenhouse gasses from the transportation of soil by encouraging local reuse. The proposal also clarifies that the project leader is responsible for the management and relocation of the excess soil generated during a project to ensure proper characterization and relocation. Minor amendments to O.Reg. 153/04 and to O. Reg. 347 are also proposed.

The current proposal incorporates responses and comments from the previous proposal as well as from engagement with stakeholders and Indigenous communities. Changes from the previous proposal include:

  • A revised approach to waste designation
  • Reduced regulatory complexity and some details moved to guidance
  • A two to three years transition time for key regulations
  • Several O. Reg. 153/04 amendments to come into effect sooner
  • More flexibility for reuse through new reuse standards and a Beneficial Reuse Assessment Tool to develop site specific standards

This proposal is part of the MOECC’s response to the commitments outlined in Ontario’s Excess Soil Management Policy Framework. Other actions of the framework include developing priority education, outreach and training initiatives to support implementation.

The specific regulations and proposals provided for comments are summarized below:

  • A new proposed On-Site and Excess Soil Management Regulation
    • Excess soil would be designated as waste when it leaves the project area unless it is reused in accordance with the rules set out in this regulation.
    • If designated waste, the regulation would clarify when an ECA is not required.
    • Hauling of excess soil would generally not need an ECA, but is still subject to certain rules, such as maintaining records.
    • Project leaders may use temporary soil storage sites without an ECA as long as certain conditions are met.
    • Unless exempted, a project leader is responsible for preparing an Excess Soil Management Plan (ESMP), which involves determining contaminant concentrations on the soil, finding appropriate receiving sites, develop a tracking system and record keeping requirements.
    • Key information from the ESMP would be registered on a public registry. A qualified person (QP) would need to prepare or supervise the ESMP.
    • The regulation would be phased in over two to three years.
  • Amendments to O. Reg. 153/04
    • Align the requirements for soil being taken to Record of Site Condition (RSC) or phase two properties with the new rules for excess soil proposed in the On-Site and Excess Soil Management Regulation.
    • Resolve delineation challenges experienced at properties going through the Risk Assessment process.
    • Remove Record of Site Condition triggers for low risk projects.
    • Provide flexibility for meeting contamination standards where exceedances are cause by substances used for ice and snow safety, discharges of treated drinking water, and presence of fill that matches local background levels.
  • Amendments to O. Reg. 347
    • Clarify that excess soil is no longer part of the definition of “inert fill.”
    • Clarify operational requirements to support exemptions from ECA requirements for excess soil related activities.
  • Proposal of Rules for On-site and Excess Soil Management
    • A proposed document to be adopted by reference in the On-Site and Excess Soil Management Regulation
    • Specifies ESMP contents, including an assessment of past uses, sampling and analysis plan, excess soil characterization, requirements for excess soil tracking systems, a destination assessment and identification, and declarations required of the project leader and qualified person, and applicable soil quality standards and related rules.
  • The proposed “Beneficial Reuse Assessment Tool” (BRAT)
    • An alternative rules that aim to promote greater reuse of excess soil and the protection of human health and the environment
    • Allows a QP to generate site specific standards using a spreadsheet model

Comments can be made on the proposal up to June 15, 2018 on the Environmental Registry of Ontario proposal site or by mail.

Contaminated sites could pose issue for Saskatoon’s transit plan

As reported in the Phil Tank in the Saskatoon Star Phoenix, the city of Saskatoon has tested the soil at several locations where transit stations are planned for the bus rapid transit (BRT) system. The results of the tests will not be known until later this month, but Mayor Charlie Clark says contaminated sites, like former gas stations, pose a big issue for Canadian cities.

The testing took place along the proposed BRT red line, which is expected to run on 22nd Street on the west side of the river and on Eighth Street on the east side.

“Brownfields (contaminated sites) along some of these major streets are a real problem,” Clark told reporters Tuesday at city hall. “We have a lot of gas stations that have been abandoned, left there and the owners are just sitting on them and not allowing them to be sold and redeveloped.”

The CP railway crossing on 22nd Street, one of the main routes of the BRT system. (Google Maps)

Clark, who was promoting an event to gather residents’ input on the city’s various growth plans, said he would like to see clearer rules from the province and the federal government on contaminated sites.

The City of Saskatoon has limited tools to force sites to be sold or redeveloped or to compel owners to clean up contamination, he said.

“We frankly don’t think the taxpayers of Saskatoon should have to pay to clean up contaminated sites where somebody was operating a gas station or a fuel distribution site for many years, generating a profit off of it, and then leaving it as a barren and wasted piece of land,” Clark said.

The city’s brownfield renewal strategy is among a number of different planks in its overall growth strategy, which was featured at a community open house in early March.

Brownfield Renewal Strategy

Saskatoon’s Brownfield Renewal Srategy (“BRS”) states that abandoned, vacant, derelict, underutilized properties shouldn’t stop revitalization.  The strategy supports redevelopment of brownfield sites to maximize their potential and revitalize the main transportation corridors within the City.  The goal of the BRS is to create environmental guidance manuals, provide advisory services, and implement incentive programs to encourage brownfield redevelopment.

The City of Saskatoon sees the BRS as requirement for achieving the City’s target of achieving 50% growth through infill.

The BRS will create a suite of tools and programs designed to assist prospective developers and property owners with the environmental requirements associated with impacted and potentially impacted brownfields.

Mayor Clark noted Saskatoon and its surrounding region has been identified as the fastest growing metropolitan area in Canada, with 250,000 additional residents anticipated in the next few decades.

Lesley Anderson, the director of planning and development with the City of Saskatoon, talks renewal strategy

Ontario Announces Cleantech Strategy & Support for Cleantech Companies

Article by Richard CorleySophie Langlois and Catherine Lyons

Goodmans LLP

Recently, the Ontario Minister of Research, Innovation and Science, Reza Moridi, launched Ontario’s Cleantech Strategy (the “Cleantech Strategy“) which aims to catalyze the growth of Ontario’s clean technology sector to support sales into a global market which is expected to grow to $2.5 trillion by 2022. The Cleantech Strategy is aligned with Ontario’s five-year Climate Change Action Plan (CCAP) to fight climate change, reduce greenhouse gas (GHG) pollution, and drive the transition to a low-carbon economy.  It is also aligned with Ontario’s Business Growth Initiative (BGI), which is, among other things, assisting innovative companies to scale up.

Purpose of the Cleantech Strategy

The Cleantech Strategy bolsters Ontario’s commitment to support the development of new, globally competitive low-carbon technologies that will contribute to fighting climate change and to meeting Ontario’s GHG pollution reduction targets of 15% below 1990 levels by 2020, 37% by 2030 and 80% by 2050. As Minister Moridi explained:

By helping our cleantech companies get ready to scale – and helping them to connect to early customers here in Ontario – Ontario is supporting innovation and reducing emissions and environmental impact across industries. Over the longer term, we expect to see more scaled-up Ontario cleantech companies recognized as North American leaders.

Ontario has the largest share of cleantech companies in Canada and the Cleantech Strategy further supports the province’s leadership in GHG pollution reduction through the development and scaling of cleantech solutions.

Principal Elements of the Cleantech Strategy

Based on Ontario’s strengths in cleantech and global demand, the Cleantech Strategy prioritizes the following four cleantech sub-sectors: energy generation and storage, energy infrastructure, bio-products and bio-chemicals, and water and wastewater.

The Cleantech Strategy has four interrelated pillars through which the province intends to meet its objective of helping cleantech companies scale up and meet global demand:

  1. Venture and scale readiness – strengthening opportunities for in-house research and development, strengthening entrepreneur knowledge of key global markets, reducing regulatory uncertainty to facilitate access to capital, and attracting and developing a strong pool of sales, marketing and management talent
  2. Access to capital – increasing access to scaling capital, providing guidance on available provincial and federal cleantech funding, and simplifying access to such capital
  3. Regulatory modernization – streamlining the regulatory environment where possible to reduce barriers for cleantech market entry, supporting performance-based standards and approvals processes, and supporting the development of harmonized industry standards
  4. Adoption and procurement – increasing demonstration and pilot opportunities to de-risk and validate new technologies, and addressing prescriptive and risk-averse procurement practices

Initiatives funded through Ontario’s carbon market as part of the Cleantech Strategy include the Global Market Acceleration Fund (GMAF) and the Green Focus on Innovation and Technology (GreenFIT).

The Global Market Acceleration Fund

The GMAF will help companies lower the risk associated with expanding production of a proven clean technology.  The fund will also assist companies with the cost of scaling up inventory, distribution and sales to domestic and global markets.  The GMAF can provide between $2 million and$5 million of funding to Ontario-based companies with promising GHG reduction technologies and scale-up and export potential.  To receive funding, these companies must be able to demonstrate funding commitments for at least 50% of the eligible project costs. A total of $27 million has been allotted to the GMAF.

Green Focus on Innovation and Technology

Through the GreenFIT program, Ontario will commit $10 million towards demonstration projects of new technologies and services. Early adoption of these new technologies and services will benefit both the adopting public sector institutions with support for their emissions reductions and participating companies with opportunities for validation and credibility for their products.

The content of this article does not constitute legal advice and should not be relied on in that way. Specific advice should be sought about your specific circumstances.

_________________

About the Authors

Richard Corley is a partner at Goodmans LLP and leads the firm’s Cleantech Practice Group.

Sophie Langlois is an associate at Goodmans LLP.  She practices in the area of corporate and securities law and mergers and acquisitions.

Catherine Lyons is a partner at Goodmans LLP.  She dedicates her practice to representing both private and public sector clients at the intersection of municipal and environmental law.

 

This article was first published on the Goodmans LLP website.

City of Welland, Ontario and Brownfields Development

As reported in the Welland Tribune, Welland, Ontario is on top of the heap when it comes to incentivizing its brownfield community improvement programs and has success stories it can share and build off of, a consultant told city council this week.

Luciana Piccioni, president of RCI Consulting, was before council Tuesday night to talk about Welland’s draft brownfield community improvement program, an 11-year-old document in need of a review and update.

Piccioni went through four programs the city currently has in place — an environmental site assessment grant program (ESA), brownfields tax assistance program (TAP), brownfields rehabilitation grant program (TIG), and brownfields planning and building permit fees refund program — and what needed to be updated and changed with each.

“Overall, with the exception of the rehabilitation grant program, Welland’s brownfield incentive programs are still competitive. Welland is one of only a few municipalities in Ontario that offers both a development charge reduction and a TIG for brownfield redevelopment projects,” Piccioni said.

He said it’s one thing that sets the municipality apart from others in the province.

Former Atlas Steel Plant in Welland Ontario

As RCI began to update the brownfield community improvement programs, a half-dozen key stakeholders in the development industry and brownfield developers were invited to a workshop.

“That went very well … and we brought back revisions to them and they were very supportive.”

Piccioni said the stakeholders had positive responses about applying for incentive programs and said city staff were recognized as being responsive and good to work with.

The stakeholders also said the city has an open for business and co-operative mindset, but suggested increasing dedicated city staff resources to help speed up the application process.

Comments about Niagara Region with respect to the handling of brownfield and other CIP incentive programs applications were less than positive, Piccioni told council.

Stakeholders also suggested the city increase its flexibility when it comes to interpreting program requirements, allowing for unique situations to be looked at and evaluated for possible inclusion.

It was also suggested the city consider expanding and enhancing the marketing of off of the incentive programs, success stories and long-term benefits.

“You’re starting to have those success stories now,” Piccioni said, adding he expected to have a final draft ready for council to see in April.

Council heard some of the changes being made to the plans included making it harder for people just trying to get financing for a brownfield property with no intention of developing it.

Piccioni said developers would be asked to provide a letter of intent.

“It would prove to us that they intend to redevelop the property. There would be just enough hoops to discourage the pretenders and encourage the intenders.”

As of March 2017, there were 17 applications submitted for ESA grants, the TIG and rehabilitation grants, with 15 approved, two not approved and two abandoned. The total grant amount requested was roughly $560,000.

Innovative Technology to streamlines brownfield industry projects

As reported by Martin Menachery in Arabian Oil and Gas, Over 95% of projects in the process industry in the Middle East (and comparable percentages around the world) are retrofits or expansions of existing plants that seek to increase capacity, comply with regulations, or introduce new technology to improve performance.

Moreover, often the building of a new plant is done on the brownfield site of an existing facility. For all these projects, capturing and modelling the existing context is critical to decision making and both conceptual and detailed engineering design. 3-D Software reality modelling technology is increasingly being leveraged to support these critical workflows.

In this year’s submissions for the ‘Be Inspired Awards’, there are five excellent examples using reality modelling technology in the process industry, demonstrating how this technology has now become an essential part of any brownfield or greenfield plant design project.

UCB, a global biopharmaceutical company, is using reality modelling for its iconic manufacturing plant in Belgium (which was established in 1928) to assess options and communicate ideas to help this complex and established site become carbon neutral by the year 2030.

ContextCapture was used to create an engineering-ready 3D model of the entire complex, including all the buildings, production facilities, roads, and parking areas, using both drone and terrestrial photography.

This context enabled the engineering team to quickly produce a 3D model to convey ideas and determine options. Point-cloud data from laser scans was then added to the model to enable accurate quantities to be calculated and precise measurements to be given to contractors for the priority work packages.

ABS Steel needed to modernise the fume extraction system for its large steel complex in Udine, Italy, to meet new regulations. It did not have a survey of the entire site since the complex was the result of a merger of two plants in 1988. ABS Steel awarded the contract to BM Engineering to survey the site.

It used laser scanning for inside the plant and photography for outside the plant, creating a combined engineering-ready model in MicroStation using ContextCapture and Bentley Pointools, which was read into AECOsim Building Designer and used to design the new fume extraction system. The model was then used to test the structural integrity of the aging parts of the factory.

By using a drone to capture photos of the roofs of the industrial buildings, and using ContextCapture to accurately create the 3D model, the project avoided the need to construct at least 70,000 temporary structures (guardrails, walkways, ladders, PPE, etc.) to conduct the survey work.

Flightline Geographics (FlightlineGeo) solved a problem for an owner of an ethanol plant in Kansas, United States, plant expansion of which was impeded by a lack of a drainage plan that would satisfy the local municipality. Traditional alternative methods, such as ground surveying and either ground or aerial LiDAR, were eliminated as possible solutions due to the short time frame and limited project budget involved.

A drone was able to survey this 200-acre ethanol plant site in one hour. (Image courtesy: FlightlineGeo)

It was decided to use a drone (UAV) and, once survey ground control was placed, the UAV capture of the 200-acre site was completed in a single one-hour flight. The team used ContextCapture to produce the 3D model that engineers needed to quickly calculate the results for the drainage and construction study, which was presented to municipal authorities a few days later.

Moreover, the team leveraged the same work to create a 3MX reality mesh that could then be used for visualisation within the Acute 3D viewer. It took just one week to conceive, capture, process, and deliver the project, and gain approval.

Technical Solutions International (RBI) is a world-class engineering inspection company headquartered in Durban, South Africa. RBI has deployed a solution that combines the use of unmanned autonomous vehicles (UAVs or drones), 3D reality modelling software (ContextCapture), a geographical information system (Bentley MAP), and engineering documentation management (ProjectWise) to manage the entire inspection process.

Its clients include petrochemical, pulp and paper, power generation, and telecommunications firms. The new process enables RBI to deliver more competitive services to its clients that speed survey time considerably and increase the value and visibility of its inspection survey data.

“UCB SA is driving a ‘smart factories’ initiative, leveraging Industry 4.0 and Bentley technology. Our objective is to reorganise production so that we are more adaptable and effective in the allocation of resources. We store our engineering data in ProjectWise for better collaboration among colleagues,” said Joseph Ciarmoli, Head of CAD engineering, UCB SA.

“Using ContextCapture for 3D modelling of our site provides geo-referencing and allocates geographical coordinates to our data. Analysing the 3D model together with the orthophoto drawings provides the official record of our land registry data, waterways, and buildings,” added Ciarmoli.

“We can also bring this 3D model into AECOsim Building Designer to support any building design changes. For proposed modifications to our production facilities, we use OpenPlant Modeler and OpenPlant Isometrics to provide precise 3D data for contractors and to automate the detection of clashes between pipes, structures, and equipment,” observed Ciarmoli.

“The interoperability of Bentley products has made it possible to optimise and significantly reduce the survey and reality modelling time, while also allowing a BIM model to be created that can easily be used by all stakeholders (structural and plant designers), who have decidedly and significantly improved the efficiency of their integrated design, allowing the implementation of the first revamping phase to be reached just three months after delivery of the BIM model,” said Marco Barberini of BM Engineering.

“Reality modelling using ContextCapture from Bentley enabled FlightlineGeo to process a large amount of data into information for the client in near real time. The project was completed ahead of time and under budget, allowing the company to acquire its expansion permit and move on with production of renewable energy,” commented Devon Humphrey, CEO, FlightlineGeo.

“Bentley’s range of products and integration between their products and our automated UAV systems gives us and our clients an added advantage against an ever-improving competitive market. The future we live in today,” said Stanley du Toit, technical and solution director, RBI Technical Solutions International.

3D design and conceptual model of the city of Coatesville’s “The Flats” brownfield redevelopment, a rugged, 30-acre former steel-mill site located 40 miles west of Philadelphia.

Pond Technologies announces project at Markham District Energy

Pond Technologies Holdings Inc.  (TSX.V: POND) recently announced the shipment of its proprietary Matrix System to Markham District Energy Inc. (MDE).  The shipment marks the commencement of the first phase of a $16.8 Million project to convert CO2 emissions to valuable algae-based nutraceutical products.  Pond’s Matrix System optimizes algae strain selection through the analysis of its customer’s emissions.

Pond also announced the signing of an exclusive marketing agreement with MDE who will market and develop customer projects using Pond’s solution for the District Energy market worldwide. District Energy systems are a highly efficient way to provide power, heating and cooling to buildings in communities and campuses from central plants. Bruce Ander, MDE’s President & CEO, is a past Chair of the International District Energy Association that represents over 2,200 members in 26 countries.

“We are pleased and ready to move this project forward with Pond Technologies.  The technology represents a significant opportunity for Markham District Energy to lower our environmental footprint while repurposing greenhouse gas emissions to manufacture a valuable product.  As we gain operational experience with the Pond process, we are keen to share our story with our District Energy colleagues here and abroad.” Bruce Ander, President & CEO of Markham District Energy Inc.

Steve Martin, President & CEO of Pond Technologies Inc. commented, “We are very excited to be working with Markham District Energy on this landmark project and grateful for their help in propagating our solution to other District Energy utilities located around the world.”

About Markham District Energy (MDE)
MDE, an energy company owned by the City of Markham, is committed to continuing as a leading developer of municipally owned district energy systems providing strategic foundations for Markham’s Greenprint Sustainability Plan and economic development objectives. MDE owns and operates award-winning community energy systems serving buildings in the developing urban centres of Markham Centre and Cornell Centre.

Markham District Energy is a thermal energy utility owned by the City of Markham

About Pond Technologies:
Located in Markham, Ontario, Pond Technologies Holdings Inc. (Pond) has developed a proprietary growth platform that can transform carbon dioxide (CO2) from virtually any source into valuable bio-products.  Pond works with the cement, steel, oil and gas and power generation industries to reduce greenhouse gas emissions and generate new revenue streams.

Pond’s platform technology also includes the growth of algae superfoods for the nutraceutical and food additive markets.  Pond’s system is capable of growing many species of algae, including strains that produce anti-oxidants, omega-3 fatty acids, and protein for human and animal consumption.

Algae Carbon Capture system

Bitumen floats longer than expected, Natural Resources Canada research shows

As reported in the Vancouver Sun, researchers at Natural Resources Canada are discovering important characteristics of bitumen (the un-processed form of crude oil from the Alberta oil sands) and its interactions with the environment.  Information from the research will be useful in the development of strategies and technologies to clean-up bitumen in the event that is leaks into the environment as a result of a pipeline leak or tanker spill.

One important question with respect to bitumen is whether it sinks or floats when it hits the water. The short answer is it floats, most of the time, according to a growing body of research being compiled by Natural Resources Canada scientists.

Researcher Heather Dettman, a senior scientist with Natural Resources Canada in Devon, Alta., is leading a team looking into some of those questions in research under the federal government’s world-class tanker safety program and ocean protection program.

Postmedia caught up with her and a spokesman from Western Canada Marine Response Corp. to talk about answers.

Bitumen

Q: What is diluted bitumen?

A: Bitumen is the basic, tar-like petroleum product extracted from the Athabasca oilsands, which are oil deposits that were first formed deep underground, but were moved closer to the surface by geological movements of the earth. That allowed microbes to degrade the components that make up gasoline and diesel leaving only its asphalt components. Producers inject those lighter components back into bitumen to make it thin enough to flow through pipelines.

Q: How would rough seas change the behaviour of diluted bitumen?

A: “From a density perspective, it will be floating unless it’s really stormy, then it can go anywhere, the same as any other petroleum product,” Dettman said.  If a storm pushed bitumen ashore, it would pose the problem of having to clean it up on land.

Q: Has there ever been a spill of diluted bitumen on the coast?

A: The biggest spill that the Western Canada Marine Response Corp. has dealt with involved a mix of bitumen and synthetic oil, said spokesman Michael Lowry.  That was the 2007 puncture of Kinder Morgan’s Trans Mountain pipeline in Burnaby that led to about 100 tonnes of oil flowing down storm drains into Burrard Inlet.  In nice weather and close to the industry-funded spill responders’ facilities, Lowry said they were able to recover 90 per cent of the oil.

“Those are ideal conditions; I can’t extrapolate those to other spills for sure,” Lowry said.

Kalamazoo River diluted bitumen spill clean-up

Q: How do you clean up a bitumen spill?

A: Lowry said methods haven’t changed much over the years. Chemical dispersants, in situ burning and mechanical recovery are the techniques that responders use, but since the first two require government permission, the corporation focuses on mechanical recovery — booming and skimming. From its 2007 experience, Lowry said responders learned that its brush skimmers — conveyors that rotate heavy plastic brushes over the surface to collect oil — were particularly effective.

“Conditions play a huge role in recovery,” Lowry said. “High winds are going to impact your ability to respond and rough seas definitely impede your ability to respond.”

Q: What research is being done to improve spill response?

A: Lowry said new tools are being developed, such as advanced booming systems that perform better under tougher conditions, which the corporation deploys.  In the meantime, Lowry said Environment Canada and Natural Resources Canada are putting resources into studying the topic.

TRC enters Canadian Oil & Gas Market and expands existing Infrastructure Practice

TRC Companies Inc. (a U.S. based engineering, environmental consulting and construction-management services) recently announced that it will expand its footprint in Canada in 2018 to take advantage of a rebounding oil and gas market and the country’s increased infrastructure spending.

“The time is right for us to grow our business in Canada and bring more of our unique services and solutions to clients there,” said CEO Chris Vincze.  “We already have a strong infrastructure practice in Canada, and we plan to build upon our existing relationships with a number of Canadian clients for whom we’ve done work in the United States.”

Photo Credit: Transcanada

TRC has hired Michael Koski to spearhead its expansion in Canada.  He will serve as senior vice president of Canadian operations.

“Mike brings a unique blend of engineering, construction, environmental and regulatory skills to the table and will quickly help us scale up operations,” said Ed Wiegele, president of TRC’s oil and gas sector. “Plus he has extensive experience in the Canadian oil and gas market and excellent command of Canada’s regulatory environment.”

Koski, who grew up in Thunder Bay, Ontario, has spent three decades working in the oil and gas sector and has considerable experience with project management, engineering and environmental issues. He is an expert in pipeline routing and has provided expert testimony on the subject, served on technical panels and presented at industry conferences. He has also authored several manuals on the topic for government and industry.

“I look forward to expanding TRC’s services into Canada across all business sectors,” said Koski.  “Companies in Canada are clamoring for the integrated approach, advanced technologies and laser-like focus on client needs that TRC’s is known throughout the industry for.”

TRC already has strong relationships with a number of large Canadian firms, including TransCanada, Enbridge, Kinder Morgan and Canadian National Railway. It has also done a number of infrastructure projects across the country, including locomotive fueling facilities, power distribution system upgrades, capital improvement planning projects and wastewater treatment plants.

About TRC

TRC is a global engineering, environmental consulting and construction management firm that provides integrated services to the energy, environmental, infrastructure and pipeline services markets. TRC serves a broad range of commercial, industrial and government clients, implementing complex projects from initial concept to delivery and operation.

Avoiding Common Phase Two ESA Errors – Part 1

By: Bill Leedham, P.Geo, QP, CESA.

Previously I have written about common errors I have encountered in reviewing Phase One Environmental Site Assessment reports, now it’s time to focus on some of the commonplace mistakes I have seen in planning and conducting Phase Two ESAs.

A properly scoped Phase Two needs to be based on accurate site data, which should entail completing a thorough Phase One ESA to identify actual and potential environmental concerns. An incomplete or deficient Phase One ESA (or absence of any prior site assessment) can lead to un-investigated areas, unidentified contaminants, missed contamination, and costly oversights when it comes to completion of the Phase Two work. With the high costs of drilling, sampling and lab analyses – and the even higher costs of remediation; it is vital that the consultant knows where to look and what to look for, in any intrusive site investigation; which requires a diligent and comprehensive Phase One ESA to get it right.

Photo by Azad K. (Geo Forward Inc.)

A Phase Two ESA can be required for a variety of reasons; including transactional due diligence, litigation, remedial planning, and obtaining regulatory approvals. The consultant must know and understand all client and stakeholder objectives, as well as the local regulatory requirements.  Conducting a CSA-compliant Phase Two ESA when the Client is expecting ASTM protocols and the regulator requires a different legislation-specific format to support regulatory approval will lead to problems, delays, possible costs over-runs – and a very dissatisfied client.  Two-way communication and full understanding of the project before, during and after the Phase Two plays an important role in successful and timely project completion.

Once the project requirements are defined, a Sampling Plan must be developed to meet these requirements.  Too often, mistakes are made when the number and location of sampling points is underestimated, or improperly selected. The consultant must consider all the potentially impacted media to be sampled. This could include not just soil; but often groundwater, sediment, and surface water; and sometimes soil vapour, indoor air quality, and building materials.  Consideration of the frequency and extent of sampling is necessary to investigate all relevant media and to fully characterize the environmental condition of the Site.  Utilizing a Conceptual Site Model to consider the contaminant sources, migration pathways and potential receptors unique to the Phase Two property is a useful and too often under-used method of developing a suitable Sampling Plan.

Site specific conditions, access, logistics, safety and (unavoidable) budgetary considerations also play a huge part in properly scoping and conducting any successful Phase Two ESA, but these are all wide ranging topics to cover another day.  Next month I will discuss other methods to recognize and avoid common errors in field sampling.

 

About the Author

Bill is the Head Instructor and Course Developer for the Associated Environmental Site Assessors of Canada (AESAC); and the founder and President of Down 2 Earth Environmental Services Inc. You can contact Bill at info@down2earthenvironmental.ca

Canada: Courts Struggle to Mix Bankruptcy and Environmental Law – SCC To Hear Redwater Appeal

Article by John GeorgakopoulosGiselle Davidian and Serin Remedios

Willms & Shier Environmental Lawyers LLP

The Supreme Court of Canada (SCC) granted leave to hear the appeal of Orphan Well Association v Grant Thornton Limited.1 The SCC will reconsider whether trustees and receivers in bankruptcy must remediate wells in priority to the claims of secured creditors.

In April 2017, the Alberta Court of Appeal released its decision in Redwater.2 The Court found that the Government of Alberta’s environmental orders for oil well remediation did not have priority over secured creditors in bankruptcy proceedings.

In upholding the lower court’s decision, set out in our previous update, the Court of Appeal added to the “untidy intersection” between bankruptcy proceedings and provincial environmental law. Both Courts concluded that receivers and trustees were permitted to renounce an insolvent debtor’s interest in its licensed assets while selling valuable licensed assets to maximize recovery for secured creditors.

The decision, as it stands, allows receivers and trustees in bankruptcy to disclaim unprofitable assets and not be required to fulfill certain environmental obligations associated with those disclaimed assets.

Recap

The case revolves around the assets of a junior, insolvent oil and gas producer, Redwater Energy Corporation (Redwater).

Orphan Oil Well

When Redwater’s primary secured creditor began enforcement proceedings under the Bankruptcy and Insolvency Act (BIA), Grant Thornton Limited (GTL) was appointed as receiver and trustee.3 Several of Redwater’s oil wells had costs of remediation exceeding the value of the wells. GTL took control of only 20 of 127 Redwater’s assets and disclaimed the oil wells that had onerous environmental abandonment costs.

Alberta oil and gas legislation requires licensees, including trustees, to comply with “end-of-life” rules for oil wells. Where no one is financially capable of remediating and abandoning a well, the well is designated an “orphan well” under Alberta’s Oil and Gas Conservation Act (OGCA).4/em>

The Alberta Energy Regulator (AER) ordered GTL to remediate the disclaimed oil wells before distributing funds to creditors. When GTL indicated that it did not intend to remediate the wells, AER and the Orphan Well Association (OWA) brought applications asking the court to void GTL’s disclaimer of the non-producing wells and order GTL to comply with AER’s orders. AER argued that Redwater’s insolvency and bankruptcy did not affect Redwater’s environmental obligations and that GTL was legally required to discharge those obligations before paying Redwater’s creditors.

GTL brought a cross-application challenging the constitutionality of AER’s stance on GTL’s environmental obligations and seeking approval of the sale of Redwater’s valuable wells.

At issue was whether AER’s orders were provable claims in bankruptcy and therefore subject to bankruptcy proceedings. If AER’s orders were subject to bankruptcy proceedings, other creditor’s claims would take priority. The practical outcome being that the corporation would likely have no means of satisfying its environmental obligations after settling its obligations to other creditors. The cost of remediating the orphan wells would then fall on the Government of Alberta.

As we previously reported, Alberta Court of Queen’s Bench concluded that the applicable sections of the OGCA and Pipeline Act (PA) frustrate the federal purpose of the BIA of managing the winding up of insolvent corporations and settling the priority of claims against them. Based on the doctrine of paramountcy, the OGCA and PA were inoperable to the extent that they conflicted with section 14.06 of the BIA. This section of the BIA exempts a receiver or trustee from personal liability, allowing a trustee and receiver to disclaim assets, and prescribes the priority of environmental remediation costs.

OWRA and AER appealed the decision.

Court of Appeal Decision

The Court of Appeal upheld the lower court decision. The key issue on appeal was the priority and treatment of environmental claims in bankruptcy, and whether environmental claims were provable claims under section 14.06 of the BIA.

Priority and Treatment of Environmental Claims in Bankruptcy

The Court found that the BIA was amended in 1997 to specifically address environmental claims. The BIA now incorporates environmental claims into the general bankruptcy process, rather than exempting them. Following the test set out in Newfoundland and Labrador v AbitibiBowater Inc., the Alberta Court of Appeal found that AER’s orders were subject to bankruptcy proceedings.5 By refusing to permit the transfer of Redwater’s valuable assets unless funds were set aside for remediation, AER reduced the environmental obligations to “sufficiently certain” monetary claims. Accordingly, AER cannot indirectly interfere with the value of assets in a bankruptcy by placing financial preconditions on the transfer of AER licences.

Constitutional Law Issue

The Court of Appeal held that there was an operational conflict between federal and provincial regimes. The Court found that the provincial regulatory scheme frustrated the purposes of the BIA, which include determining the priority of claims against insolvent corporations. The practical outcome being that GTL did not have to comply with AER’s remediation obligations prior to settling claims of secured creditors.

Nortel and Northstar

The dissenting opinion briefly considered the two leading cases in Ontario on environmental claims in bankruptcy and insolvency: Nortel Networks Corporation (Re) and Northstar Aerospace Inc. (Re).6 In Nortel, the Court found that some of the Ministry of the Environment’s (MOE, as it then was) orders had priority over creditor claims, but in Northstar, the Court found that the MOE’s orders did not have priority.

Implications

The practical implications of Redwater may be far reaching not only for the worlds of bankruptcy & insolvency and oil & gas, but also for the world of director and officer liability.

Will we see more Alberta provincial environmental orders aimed at former directors and officers? In Northstar, after the Court found the MOE’s orders did not have super priority in insolvency proceedings, the MOE issued a remediation order personally against the former directors and officers.7

We will look to the SCC to provide clarity on this important, albeit untidy, area of law.

Footnotes

1 2017 ABCA 124 [Redwater].

2 Ibid.

3 RSC 1985, c B-3 [BIA].

4 Redwater at para 21; Oil and Gas Conservation Act RSA 2000, c O-6, s 70 [OGCA].

5 2012 SCC 67.

6 Nortel Networks Corporation (Re), 2013 ONCA 599 [Nortel]; Northstar Aerospace Inc. (Re), 2013 ONCA 600 [Northstar].

7 Northstar Aerospace, Inc. (Re), 2012 ONSC 4423. Subsequently, on November 14, 2012, the MOE issued a Director’s Order against the former directors and officers personally.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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About the authors

John Georgakopoulos resolves complex environmental legal issues for clients, uniquely drawing on his technical knowledge as a former senior environmental scientist with the Ontario Ministry of the Environment and Climate Change. John is called to the bars of Ontario and Alberta.

Giselle Davidian is an associate lawyer practicing in the areas of environmental law, environmental litigation, energy and natural resource law and Aboriginal law.  Giselle draws upon her technical knowledge as a former environmental scientist at a consulting engineering firm to help clients meet their goals.  Giselle is fluent in French and Armenian and has a working knowledge of Italian.  Giselle is called to the bar of Ontario.

Serin Remedios is an associate lawyer practicing environmental litigation as well as environmental, Aboriginal, northern and energy law.  Serin’s past experience in environmental science helps her understand clients’ problems and assist them in meeting their goals.  Serin is called to the bar in Ontario.

This article was first published in the Willms & Shier Environmental Lawyers LLP website.