Oil Sands Environmental Coalition

Transcription

1 Oil Sands Environmental Coalition Suite 300, 9804 Jasper Ave., Edmonton, AB, T5J 0C5 17 October 2016 Canadian Environmental Assessment Agency Attention: David Haddon Panel Manager 160 Elgin Street, 22nd Floor Ottawa ON K1A 0H3 Re: September 23 rd invitation for public comments on the sufficiency of information provided for the TECK RESOURCES LIMITED FRONTIER OIL SANDS MINE PROJECT, CEAA reference number: Dear Mr. Haddon, I am writing to you on behalf of the Oil Sands Environmental Coalition (OSEC) regarding the proposed Teck Resources Limited Frontier Oil Sands Mine Project (herein referred to as the Project). As stated in our Statement of Concern, 1 OSEC has ongoing concerns regarding the Project s impacts to wildlife, greenhouse gas emissions, air emissions, water quality, and terrestrial impacts. There are many outstanding deficiencies for considering the Project application at a time when policy and legislation applicable to the development is under review or under development, and are of particular concern given the 50-year lifespan and high environmental impact of the Project. There are four broad areas of concern where the information submitted by the proponent is inadequate: Tailings and land management, air pollution assessment, greenhouse gas emissions, and the socio-economic assessment. OSEC respectfully asks that the Project proponent address the questions provided below with supporting analysis and data as necessary, before this application proceeds to a hearing. Tailings and land management Volume 1, Sections and 6.7, The Project Update submitted by Teck in June 2015 included two major changes: (1) the project disturbance area (PDA) was modified as a result of an exchange in oilsands assets, and 1 OSEC Statement of Concern as filed June 4 th CEAA registry, Frontier Oil Sands Mine Project, document 33. Retrieved at: 1

2 (2) the tailings management plan was significantly changed. Teck has correspondingly overhauled its technology deployment strategy and has committed to enhanced beach capture and the deployment of commercially viable centrifuge equipment. The latter changes have been based on Teck's membership in the Canadian Oilsands Innovation Alliance (COSIA), improved understanding of site-specific conditions, and Alberta's Tailings Management Framework (TMF) as introduced in Spring In August 2016, the Alberta Energy Regulator (AER) formally released Directive 085: Fluid Tailings Management for Oil Sands Mining Projects (Directive 085). OSEC recognizes Teck's leadership in aligning its strategy with best-available technology, and supports the Project's more precautionary approach to tailings management. However, OSEC remains concerned about the extent to which the requirements of Directive 085 have been met by Teck's Amended Application and its associated Supplemental Information Request (SIR) response to the AER submitted in April The Panel must obtain the information required under Directive 085 to discharge its obligations under section 19 of the Canadian Environmental Assessment Act, 2012 and its Terms of Reference to assess the environmental effects of the Project. As identified in Section of the Terms of Reference for the Environmental Impact Assessment (EIA TOR), Teck is required to comply with the ERCB's Directive 074: Tailings Performance Criteria and Requirements for Oil Sands Mining Schemes, February 2009 (D074). Directive 074 has now been replaced with the equivalent Directive 085. Teck will therefore need to comply with Directive 085 to meet all the requirements, principles, objectives, and intent outlined by the TMF. Directive 085 states in Section that the proponents of new oil sands mining projects applications must include anything required by this directive. 2 As such, Teck must demonstrate that its Project Update is compliant with all components of Directive 085. Currently, OSEC has found Teck's Project Update and associated SIR5 to be incomplete in demonstrating compliance with Directive 085 and the TMF. OSEC understands that because D085 was not finalized until July 2016, Teck has not yet had the opportunity to submit a comprehensive application. However, it is OSEC's recommendation that Teck be required to submit a separate, comprehensive Directive 085 application in a similar format as required by existing oil sands mining projects. This would assist stakeholders in accessing all pertinent information and assessing the application's compliance with all aspects of the new regulatory framework. With the application in its current form it is difficult to clearly differentiate the necessary details required under Directive 085 from the rest of the Project Update. Table 1 highlights missing information from the Project Update that is required under Directive Alberta Energy Regulator, Directive 085: Fluid Tailings Management for Oil Sands Mining Projects (August 2016), 11. 2

3 Table 1: Information required under Directive 085 and absent from the Teck Frontier Project Update 4.3 General Requirements Requirement 7 The applicant must submit a concordance table that references where each requirement in this directive is addressed in the application. 4.4 Fluid Tailings Inventory Profiles Requirement 8 a) a fluid tailings volume profile for new fluid tailings in graphical and table format; Requirement 8 i) a graph of bitumen production and new fluid tailings generation over the life of the project; Requirement 8 k) tables that show the predicted annual volume of each fluid tailings pond and treated tailings deposit over the life of the mine and 10 years after and that indicate both legacy equivalent and new fluid tailings volumes, including i) the annual volume of fluid tailings, annual fluid tailings deemed RTR, and water including any assumptions of reduction in volume due to factors such as consolidation; and iii) a composition at the beginning, milestones, and end for each fluid tailings pond and treated tailings deposit; Requirement 8 l) a process flow diagram that indicates the current typical calendar-day volume and mass balance (around treatment process, fluid tailings ponds, and treated tailings deposits) including stream compositions that is, oil, water, and solids and the volume of water recovered from treatment of fluid tailings and treated tailings deposits 4.7 Ready to Reclaim General The application must include information to support the Requirement assessment of proposed performance criteria, which establishes when a deposit meets Ready-to-Reclaim status. The AER understands that for projects in the early stages of operations, certain details may not be available; however, before depositing treated tailings, conditions of approval will require that more detailed information be provided. 3

4 Requirement 13 d) For each deposit, the performance criteria must be identified and how it will meet the sub-objectives of Ready-to-Reclaim status, including ensuring that the deposit s physical properties (subobjective 1) are on a trajectory to support future stages of activity and that the effects the deposit have on the surrounding environment (sub-objective 2) are minimized and will not compromise the ability to reclaim to a diverse, locally common, and self-sustaining ecosystem. Note: the information missing identified in this table is not intended to be a comprehensive list of all deficiencies, but a sample of the information that is lacking from the Project application. 1. Teck must submit a separate, full Directive 085 application in a similar format to existing projects that are currently submitting before this application proceeds to a hearing; and 2. The full Directive 085 application forms part of this application and that Teck is required to set out how it meets the requirements as outlined in Directive 085. April 15, 2016 response to OSEC Question 32, 33, and 34 Section 19 of the Canadian Environmental Assessment Act (CEAA, 2012), requires that the Joint Review Panel shall include a consideration of mitigation measures that are technically and economically feasible and that would mitigate any significant adverse environmental effects of the designated project. Teck s assessment demonstrates that the Project contributes to unacceptable environmental impacts on a range of terrestrial, wildlife and wetland values. Teck notes that it is willing to reduce its contribution to cumulative effects by providing offsets for project-specific effects through the development of a Conservation Agreement as discussed in the response to ESRD/CEAA Round 1 SIR 221 and ERCB Round 2 SIR 29. In the response to ERCB Round 2 SIR 29 Teck states it believes that the development of detailed mitigation measures or offset plans that could form the basis of a Conservation Agreement or Conservation Allowance should not occur until the anticipated EPEA approval for the Project is received, and consultation with regulators and potentially affected Aboriginal communities and stakeholders is completed. Certain and feasible mitigation measures that would address otherwise significant effects must be proposed and assessed as part of the environmental assessment process. Predictions of significant environmental effects and the success of mitigation measures must be certain, on the basis of good and reliable information available at the time of the assessment in order for the Panel to discharge its duty under its Terms of Reference (Part II) and section 19 of CEAA As such, Teck is required to propose feasible mitigation measures that will 4

5 address any significant adverse effects during the environmental assessment process. Further, the hearing participants should have a fair opportunity to review and comment on whether any offsets proposed by Teck will mitigate adverse effects to inform the Joint Review Panel s consideration of whether the proposed offset mitigation is technical and economic feasible, as well as their relevance and potential effectiveness in reducing adverse effects. In sum, mitigation measures should be presented and assessed as part of the assessment process, not negotiated afterwards. This mitigation measure is a key tool for managing the Project s land impact, and has been considered by Teck as identified through supplemental information requests. However, Teck has provided no information to determine whether this mitigation option is feasible, and if so, whether it would effectively reduce adverse impacts due to the Project. Teck has also not indicated whether it has committed to implementing such mitigation measures in the event they are feasible and effective. OSEC expects that prior to the Project hearing Teck will submit a full suite of planned biodiversity offsets that demonstrates that there will be no net adverse impacts on species at risk, wetlands and other wildlife species. 3. Teck must provide a complete description of potential additional lands will be conserved or restored; 4. Describe, quantitatively, how these actions will mitigate the Project s impacts; and 5. Provide a technical analysis of potential offsets to quantitatively demonstrate the mitigation of impacts on species at risk, wetlands, old growth forests and other valued ecosystem components. Air pollution assessment Volume 3, Section and April 15, 2016 response to OSEC Question 9 While it is understood that the dispersion modelling provided incorporates five years of hourly meteorological data, and that modelling captures a wide range of meteorological conditions, no statistics for these conditions are provided as were requested and required by the EIA TOR. The frequency of meteorological conditions that may result in poor air quality is identified in Section [A] a) of the EIA TOR, and this information is necessary to understand and evaluate the ongoing risk of poor air quality to the public. Without this information, the Panel cannot discharge its obligations under the Canadian Environmental Assessment Act, 2012, or it s Terms of Reference, so the application cannot be considered complete. 5

6 6. Teck provide the historic frequency of the following specific meteorological events that are associated with poor air quality: a. Frequency of inversions within the region b. Frequency of low wind speed/stable meteorological events in the region c. Frequency of high wind speed events d. How each of the above are likely to change based on climate change influences in the future. Volume 3, Section and April 15, 2016 response to OSEC Question 11 Teck s response, and the discussion of the health implication of the predicted exceedances of PM 2.5 within the application mischaracterizes the current health research and misapplies the CCME standard for this pollutant as an exposure limit to prevent adverse effects on human health. As per the EIA Terms of Reference (Section 6[A] a) ), Teck is required to assess the potential health implications of PM 2.5 in relation to exposure limits established to prevent acute and chronic adverse effects on human health. The exposure limit Teck chose to infer acute and chronic adverse effects was the CCME standard (equivalent to the new Canadian Ambient Air Quality Standards). However, this standard does not represent the exposure limits for this pollutant and is inappropriate to use for the purpose of discussing the health implications of the predicted PM 2.5 exceedances. CCME and other government air quality standards are not solely based on health research, although it is a major consideration in their establishment. Environment Canada corroborates this by indicating that even where outdoor air quality meets current standards, medical research shows that there is potential for air pollution related health effects. 3 These standards therefore embed a certain level of risk to human health at the specified levels and are not reflective of safe levels of pollution. It is therefore inappropriate to use these standards to infer the health implications of exposure to both the current and future level of air pollution. Teck further illustrates its inappropriate use of this standard by admitting that the scientific basis of the CCME (2012) standard is not clear, while it still chose to use it as the exposure limit in the adverse effects on human health evaluation. This issue is compounded by Teck s claim within the application that air concentrations above the 24-hour CCME standard do not necessarily indicate that adverse effects will occur. This is contrary to the supporting research Teck cited for the establishment of the US EPA standard for PM 2.5. The research identified is very clear that there is no safe acute or chronic exposure concentration threshold for this pollutant. 4 3 Environment and Climate Change Canada, Backgrounder: Canadian Ambient Air Quality Standards, October 5, &news=A4B2C28A-2DFB-4BF ADF29B4360BD 4 United States Environmental Protection Agency, Integrated Science Assessment for Particulate 6

7 7. Teck provide an assessment of the potential health implications of the current and incremental PM 2.5 exposure in the region in relation to valid exposure limits that reflect the current state of health research that indicates no safe level of exposure to this pollutant; and 8. Identify all air pollutants evaluated within the application where air quality standards or objectives have been used to evaluate health risk instead of the appropriate human health exposure limits. Greenhouse gas emissions Volume 1, Section and April 15, 2016 response to OSEC Questions 17 The EIA TOR (Section 2.7 [A] c)) require a discussion of how the Project s intensity of greenhouse gas emissions compares to other similar Projects. Although the Integrated Applications discusses three projects compared against the Project, two of these projects (Joslyn North Mine and Jackpine Mine Expansion) have not been developed and are not reflective of similar projects. In addition, the emission intensity s range presented for the Kearl Oil Sands project originated from the project s application. There is no comparison provided of the Project s GHG emission intensity to any operating oilsands mining project, nor a comparison with the forecasted trend of emissions intensity to the actual trend from an operating mining project. The comparison with actual operating projects and the trend of operating project intensity is important in the evaluation of the GHG management plan as well as the socio-economic impacts of the project. While the GHG emissions intensity outlook published by the CERI suggests mining emissions intensity plateaus after 2020, results from actual operating projects demonstrate a reverse trend. Pembina s assessment of operating mines has identified that mining intensity has steadily increased by 22 per cent between 2004 and While there are many technical reasons why this intensity has increased, none of those factors appear to have been considered in the predicted emissions intensity of the Project. The Project s intensity is shown to remain static for all years of operations through Phase 2, without any explanation of how the Project intends on addressing the challenge of worsening emissions intensity faced by current mining projects. This is a critical assumption for both the evaluation of the GHG management plan suggested for the Project, but also for the socio-economic impacts induced by the Project. Our estimate indicated that an increase in emissions intensity of only 15 per cent per decade would generate over 71 kg of carbon dioxide (CO 2 ) by the end of the project life. This equates to increasing annual emissions to 7.1 Mt per year, a 43 per Matter (December 2009), Benjamin Israel, Measuring Oilsands Carbon Emissions Intensity (August 2016). 7

8 cent increase compared to the assessment provided. 9. Teck provide a comparison of the Project s emission intensity to currently operating projects, using operational data from these facilities; 10. Explain why the Project s deemed emission intensity does not follow the increasing trend that has been observed at existing mining projects, and what actions will be taken to maintain the emissions intensity of the project over time; 11. Describe whether, and if so, how the Project s deemed emission intensity qualify it for top-quartile performance, as recommended by the Alberta Climate Leadership Panel; 6 and 12. If the Project is able to meet top-quartile of the performance standard, explain how that will alter the project s economics. Volume 1, Section and April 15, 2016 response to OSEC Questions 17, 18, 19, 20, 21, and 22 The EIA TOR requires that emission profiles for the project be provided and specifies these profiles consider both normal and upset conditions (Section 2.7 [A]). The Joint Review Panel s Terms of Reference also require the consideration of malfunctions or accidents that have the potential to adversely affect the natural environment, and must consider the likelihood of the occurrence as per Section 19(1) of CEAA Performing this evaluation will require considering of a variety of scenarios and result in a range of emissions projections. The evaluation provided does not provide any range for this estimate, nor a detailed explanation as to what upset conditions (i.e. specific malfunctions or accidents) were considered or any indication of the likelihood of the condition. This assessment does not provide the necessary information to reasonably determine the potential variability of GHG emissions throughout the Project life. 13. Teck develop multiple emission profiles for the project under a variety of reasonable scenarios that would consider both normal and upset conditions. This requires a detailed explanation of the variety of upsets conditions that were considered. Volume 1, Section and April 15, 2016 response to OSEC Questions 19, and 20 The EIA TOR requires identifying any plans for CO 2 capture and storage/use technology 6 Andrew Leach, Angela Adams, Stephanie Cairns, Linda Coady and Gordon Lambert, Climate Leadership: Report to the Minister (Climate Leadership Panel, November 20, 2015),

9 (CCS) and the impacts on GHG emissions for the Project (Section 2.7 [A] g)). Teck has not made reference to the use or consideration of CCS for this project. It is required to identify whether this technology was considered for the Project and the results of any such evaluation. Alternatively, Teck is required to indicate why the technology was not considered and supporting feasibility assessments. This is necessary for the Joint Review Panel to be able to discharge its obligations under CEAA (2012) to consider alternative means of carrying out the project that are technically and economically feasible. 14. Teck provide a discussion of any evaluation of CCS for the Project and the results of that evaluation. Alternatively discuss why the technology was not considered as a potential mitigation option as part of the Project s GHG management plan. Volume 1, Section and April 15, 2016 response to OSEC Questions 19, and 20 The EIA TOR requires including a GHG management plan as part of the application (Section 2.7 [A] e)). Response 39 to the Alberta Energy Regulator in SIR #5 indicates no projectspecific GHG management plan has been developed. In place of a GHG management plan, Teck lists the many existing and future projects that could reduce GHG emissions and develop clean energy projects but which are not included as a formal GHG management plan. A GHG management plan is a key tool to evaluate how the Project fits within the global, national, and provincial climate plans over the lifespan of the project. Teck is obligated to submit a detailed and comprehensive GHG management plan that demonstrates feasible measures that will be implemented to mitigate the significant adverse effects caused to the environment due to its GHG emissions. As discussed with respect to land management above, technical and economically feasible mitigation measures must be provided and assessed by the Panel during the environmental assessment process in order for it to discharge its obligations under section 19 of the Canadian Environmental Assessment Act and its Terms of Reference. This is a critical requirement to assess the Projects environmental impact, especially in light of renewed and updated GHG management policies in Alberta and Canada. 15. Teck provide a detailed and comprehensive GHG emissions management plan that includes quantification of all sources of GHGs and how measures identified in the plan will mitigate the GHG emissions associated with the Project; and 16. Referencing the required GHG emissions management plan identified above, discuss the compatibility of the Project s GHG contribution to the Canadian commitment to the Paris agreement and the necessary reduction in overall Canadian emissions by

10 Socio-economic assessment Volume 1, Section 16 and April 15, 2016 response to OSEC Questions 2, 3, 4, 5, and 6 We continue to be unsatisfied with Teck s narrow assessment of the Project s economics and socio-economic impact. The assessment provided uses a limited number of assumptions (oil price, CAD/USD exchange rate, royalty regime) based primarily on pre-2014 data that are not reflective of the current market conditions or variability. Ultimately, the assessment only provides a single outcome with no perspective of how variable the Project economics and socio-economic benefits could be under different possible scenarios. The EIA TOR requires discussing key factors controlling the schedule, restrictions for conducting certain development activities, and uncertainties (Section 2.2[C]) and require description of the socio-economic effects of construction and operation of the Project, including impacts related to regional and provincial economic benefits (Section 7.2[A] a) iii)). The growing global carbon constraint is a key factor not adequately assessed within the application. Following the Paris agreement in December 2015, ratified by a majority of countries, the imperative of keeping our climate under 2 o C of warming shall have major impact on the long-term demand for petroleum products at the global, national, and provincial levels. This will affect the development of new market demand and access for the Project, and directly affect many of the assumptions the economic analysis is built on. We require further assessment of the economic and socio-economic outlook of the Project, and sensitivity analysis reflecting the following key factors: The Alberta Climate Leadership Plan included an overall limit to the growth of oilsands emissions to 100 Mt limit. We estimate that if the currently approved projects proceed to construction, this limit would be exceeded by Mt. Given the status of oilsands approvals, it is likely there will be additional costs associated with adhering to this policy if the Project is permitted to proceed. This potential cost is not evaluated sufficiently within the application. The 2015 Canadian Energy Research Institute (CERI) study referenced for comparison of mining intensity forecasts the average emission intensity of mining operations to be around 38 kg per barrel after This is approximately equivalent to the project s predicted emission intensity. It is unrealistic to expect the Project at this intensity to meet top-quartile performance as recommended by the Climate Leadership Panel. 7 This represents a cost to the project that has not been adequately evaluated, or even included within the economic or socioeconomic assessment. 7 Andrew Leach, Angela Adams, Stephanie Cairns, Linda Coady and Gordon Lambert, Climate Leadership: Report to the Minister (Climate Leadership Panel, November 20, 2015),

11 The federal Government of Canada has set a floor for carbon pricing at $50 per tonne of CO 2 -equivalent by While it is expected to be economy-wide, this carbon pricing will affect the economics of the project, as well as alter the demand for petroleum products domestically. The growing carbon constraint in foreign jurisdictions following the ratification of the Paris agreement by the largest emitters is expected to drastically impact the demand for oil. Some countries, such as Germany, are already discussing a ban on petroleum-fueled cars by There is no evaluation of the risk from declining demand for the products produced from this Project. There are still uncertainties tied to the capacity to transport products to new markets. While the Project s application mentions there is potential to serve a large and growing Asian demand for petroleum products, new pipeline capacity is uncertain. The impact of a lack of transportation infrastructure has not been sufficiently evaluated. 17. Teck provide a series of scenarios evaluating the economics and socio-economic benefits of the Project under oil demand forecasts consistent with the Paris agreement. Consider the impact of significant carbon pricing along the value chain of products made from deasphalted bitumen (specifically if the Project is unable to attain topquartile performance, see Submission #12), scenarios where demand for petroleum products globally decreases, and the impact of not being able to reach markets targeted for the sale of the products from this Project. Volume 1, Section and April 15, 2016 response to OSEC Questions 23, 24, and 28 In July 2015, the Auditor General determined Alberta s Mine Financial Security Program (MFSP) does not adequately mitigate taxpayer liability for reclamation work in the hypothetical event of an oilsands operator s non-compliance with reclamation legislation. According to the Auditor General s July report: For the design and operation of the MFSP to fully reflect the intended objectives of the program, we concluded that improvements are needed to both how security is calculated and how security amounts are monitored. Without these improvements, if a mine operator cannot fulfill its reclamation obligations and no other private operator assumes the liability, the province is at risk of having to pay substantial amounts of public money. 8 8 Auditor General of Alberta, Auditor General s Message (July 2015),

12 Based on this third-party assessment identifying issues about the efficacy of Alberta s current approach to mine liability management, it is very likely that the MFSP will be altered in the future to address these problems. These changes may impact the economics of the Project while improving public risk management, and must be understood in the evaluation of the project. The additional information provided by Teck in response to our questions does not provide adequate detail to understand how Teck intends to participate in the MFSP and how the cost of that participation impacts Project economics. 18. Teck describe management actions pursued by the Project to ensure Albertans are not responsible for subsidizing the economic and environmental liabilities associated with the operation of the Project throughout its life. This must include quantifying Project liabilities over the Project s lifespan in relation to securities Teck provides to offset the risk to the public; 19. Provide the economic analysis and justification supporting the Project s approach to liability management through the MFSP. This must include a comparison of the value of Project liabilities to the securities provided by the Project through the MFSP over the course of the Project life. This should contain an economic evaluation for the option to provide full security payment based on the MFSP calculation; and 20. Given the high likelihood of changes to the MFSP program, describe the financial viability of the Project under a range of plausible increases to security requirements from a change of this policy. Volume 1, Section 16 The Social Cost of Carbon is a monetary measure of the damage expected from climate change from the emissions of an additional tonne of CO 2 in the atmosphere in a given year. 9 This includes impacts to human health, property, and ecosystem services. 10 Environment and Climate Change Canada has recommended the adoption of Social Cost of Carbon values based on research and analysis conducted by the U.S. Interagency Working Group on Social Cost of Carbon. 11 Canada currently uses this approach in its Regulatory Impact Analysis 9 Environment and Climate Change Canada, Technical Update to Environment and Climate Change Canada's Social Cost of Greenhouse Gas Estimates (March, 2016), i Ibid., United States Government, Technical Update Document: Social Cost of Carbon for Regulatory Impact Analysis under Executive Order (November 2013). 12

13 Statements. There have also been multiple Environmental Assessments undertaken in the United States that have included consideration of the Social Cost of Carbon Evaluation and consideration of the Social Cost of Carbon is a key socio-economic factor for long-life, high emitting projects such as the Project. Teck has not included any evaluation of the Social Cost of Carbon, as is required for the Panel to evaluate Project impacts. 21. Teck provide an assessment of the Social Cost of Carbon associated with the Project as part of its socio-economic analysis. Conclusion OSEC submits that the information provided by Teck is inadequate such that the Panel cannot conduct a valid assessment and discharge its legal obligations under the Canadian Environmental Assessment Act, 2012, and its terms of reference. In particular, Teck has not submitted sufficient evidence to stakeholders regarding the Project s adverse environmental impacts, and the ability to mitigate those impacts. We request that the Panel determine that the assessment provided by Teck is deficient and that there is insufficient information for this application to proceed to a hearing. Sincerely, <Original signed by> Andrew Read Senior Analyst, Responsible Fossil Fuel Development Pembina Institute On behalf of the Oil Sands Environmental Coalition 12 United States Department of Agriculture, Rulemaking for Colorado Roadless Areas: Supplemental Draft Environmental Impact Statement (November 2015), Department of the Interior, Draft Environmental Impact Statement: Navajo Generating Station- Kayenta Mine Complex Project (September 2016), II/public/action/eis/details?eisId= Federal Energy Regulatory Commissions, Final Environmental Impact Assessment: Construction Pipeline and Wright Interconnect Projects (October 2014),