Polar Bear Blog – Saturday Morning Oil

Well, the sun is out and coffee is on the stove, so I thought I might finally explore the topic of oil shipping from the Port of Churchill. That and I really should be cleaning the cabin…

This August a news article/press release came out in the Winnipeg Free Press about the Port of Churchill planning a test shipment of 330,000 barrels of oil this October. Before that happens, however, they need to upgrade some infrastructure at the port. Omnitrax stated that the Port’s oil handling facilities were to be upgraded to handle 3,000 gallons per minute from the current 800 gallon capacity. Costs was projected at $2 million. Upgrades were expected to be completed by September 30th.

Omnitrax has actually been talking (publicly) about oil shipments for over a year now. Last bear season (Halloween), an article in the financial post did a pretty good job of outlining Omnitrax’s intentions.

It seems that a Calgary-based oil producer requested a study of the Hudson Bay oil route back in the spring of 2012. There are conflicting reports as to whether this is tar sands oil bitumen or light sweet crude being shipped, I have seen both reported.

According to the Financial Post article, ‘In addition to assessing whether there is market support, the feasibility study will look at public reaction, the cost associated with building any new infrastructure and the cost of using ice breakers.’

In late August 2013, Darcy Brede (the latest in an ever-changing host of Omnitrax middle managers) stated that they hoped to have a deal in place ‘within a month or two’. There is also talk of extending the shipping season by a month to accommodate oil shipments. Icebreakers are once again suggested as an option.

What That Actually Means:
Probably not much this year. After writing about Omnitrax for almost ten years now, I can honestly say that its just one big over-promise after another with very small return. What does concern me is that this project does not have a big fancy tagline like Arctic Bridge or One Million Tons! or whatever. The absence of a big marketing push actually makes me feel like this is closer to reality than we think. Hard to say.

The Port of Churchill states that it has been ‘shipping oil’ since the 1950s. However, everyone knows that this is another typical Omnitrax overstatement and I am surprised that both the Town of Churchill and Tundra Buggy seem to have bought into this statement. I mean the military dumped tons of fuel and oil into the bay in the 1950 and 60s (was it ‘touch and goes’ or something, where the planes would land, fuel up, jettison their fuel over the bay and do it all over again…?). Does anyone really think we were keeping track of fuel spills at the Port for the first, say 30 years of fuel shipments to NWT and Nunavut?

Regardless, the Port primarily ships diesel to communities in Nunavut and at much much smaller quantities and ships than is being proposed – this is akin to someone working at a zoo all their life and then portraying themselves as an expert on wild polar bears (ahem, cough, cough, hack…).  Besides, small scale spills have been noticed by locals over the years, these spills of course were never recorded or reported. It happens.  Not to mention the fact that I am not sure the fire suppression system at the Churchill Marine Tank Farm was ever actually installed… just a rumour though.

Right now, it is really only the community of Churchill that seems to be taking notice. Most newspaper outlets, politicians and NGOs are either in favour of this or very very slow off the mark. Northern Manitoba First Nations are just starting to mobilize. The best that MLA Eric Robinson and Polar Bears International can say is that they ‘need more information’.

Robinson suggested that public forums should be held in the north, except they already were and Churchill residents felt that Omnitrax simply dismissed their concerns. As usual, little information was provided, definitely no word on a clean-up or environmental analysis, other than, ‘trust us’. I would say its a bit too late for more talk, given that – at least publicly – this test shipment is scheduled to occur within 4-6 weeks.

I also wonder how much benefit oil shipping will actually provide to the Town of Churchill.   It would seem that shipping oil requires a lot less manpower than shipping grain – then again, I’m not an expert on this – but I doubt that the employment created (or possibly eliminated…) by oil shipments outweighs the risk.

Some Analysis:
Given that a study (including gaged public response) has already been compiled, one would expect that Omnitrax and its allies must have understood and expected the local outcry. So, maybe their seemingly off-handed public consultation is calculated… or maybe they are just that out of touch…

I also wonder if Churchill is just being used as a pawn for Keystone? If there is a strong protest in Churchill, maybe Harper uses ‘saving polar bears’ as part of their lobbying efforts in the US.  Interesting thought.  Maybe that’s why NGOs are sitting back on this one?  This is being portrayed as a ‘backup plan’ if Keystone doesn’t go through.  Still, I would say Keystone really is a forgone conclusion, now its just a matter of winning over the public, at least to some degree.

You also have to think that Omnitrax (and the Fed/Provincial Govts) are in a bit of a bind about the Port. Harper had to eliminate the CWB because it was a Liberal project – you can see almost everything he has torched was at one point created by the Liberals… (sorry, Parks Canada… you’re next). But, Port of Churchill also represents a great opportunity for his Arctic Sovereignty legacy. He will not want it closed on his watch… maybe under Justin Trudeau, sure… hence the five year subsidy (which I actually think will be extended another five years…).

I would say Omnitrax also needs the Port to obfuscate the fact that the Bayline is actually a major cash cow. There is no way that just the revenue from HudBay, Tolko, Vale, Gardewine and Stittco doesn’t cover operating costs and more. Even with scaled down mining in Thompson, there’s a lot of cash flowing back to Colorado.

The Real Threat:
Right now, the focus is firmly placed on the rail line and the danger of a spill in the Hudson Bay Lowlands. The tricky thing is that, at least from what I can tell, an oil spill cleanup along the HBR is likely easier to handle (given the permafrost, general containment and ‘relative’ ease of access) than something along the Keystone heading to Kitimat.

Either way, everyone must grasp the fact that an oil spill really is inevitable carrying large quanitities of crude along this line.  The quantities suggested are substantial and the HBR can only handle so much weight at one time – as Omnitrax surely has found out with grain spills of the recent past.

Still, what I feel that is being lost is the very real threat of an large-scale oil spill in Hudson Bay or Hudson Strait. The main timeline for these shipments is expected to be October and possibly November (as soon as the icebreaker gets here, right…?). IF there is a spill or a problem with a ship leaving the port, look at the window of opportunity for clean-up.

Landfast ice is locked into Churchill by mid-November in most years. So while there is a ‘Coast Guard’ depot in Churchill, it seems highly unlikely that much cleanup effort could be mobilized from the community aside from very localized spills. Canadian Coast Guard icebreakers are usually stationed on the east coast during this time of year and given our lack of resources are highly unlikely to be on ‘stand-by’ for the Port of Churchill.

In terms of clean-up, Churchill is once again struck by the Manitoba curse. It looks like the Port would still fall under the ‘Eastern Region’ and under Transport Canada’s weak regulations, the Ottawa-based Eastern Canada Response Corporation (ECRC) would likely be responsible for clean-up. They claim a two-day activation, but c’mon… its Churchill. Briefly reading Transport Canada’s regulations, it also seems quite plausible that Omnitrax could almost hire themselves as the clean-up and environmental monitoring team. At least, that’s how it seems to me.

So, the chances of a major oil spill being cleaned up before winter is, honestly, minimal – regardless of whether Omnitrax actually presents a ‘clean-up plan’ or not.  Combine the counter-clockwise current in Hudson Bay and all that oil gets carried back towards Churchill, maybe even circulated within the bay’s essentially closed system. Now, include the fact that one of the main polar bear feeding areas extends north from Churchill and these leads, areas of open water, would be directly in the slick’s path.

Even if a spill does not reach these leads, it would likely be frozen underneath the ice pack, the very place where most of Hudson Bay’s marine ecosystem feeds. Plankton, seals and beluga whales would absolutely be adversely affected by an oil spill.

Of course, once the bay thaws eight months later, we could begin the clean-up – assuming, of course, the Hudson Strait is open or the landfast ice clears from Churchill early. Otherwise, there could literally be a month of open water and oil floating around Hudson Bay before any actions are undertaken.  Transport Canada and Omnitrax would then have a three-month window to identify and clean-up the oil.  Looking at the ‘speed’ of the BP clean-up in the Gulf, it is conceivable that a slick could hang around Hudson Bay for two years or more.

Probable Outcome:
Well, like I said, I don’t put a lot of stock into Omnitrax’s efforts to diversify – every year, they seem to be in final negotiations with a new supplier/destination; always talking about a grand plan. From my view, the Port is just a distraction for them, a means to access government funding for the parent company.

Whether the shipment happens or not, I expect most governments, businesses and NGOs involved to sit back and issue soft stances on oil shipping through Churchill.  Manitoba is renowned for issuing Polar Bear Protection press releases while sitting back and completely avoiding the effects of hydroelectric development on Hudson Bay… I see no reason for them to do anything meaningful about oil shipments.

If it does indeed take place this October, be assured that there is no real clean-up plan in place – this simply does not exist for any arctic oil shipments. Producers in Alaska have stepped back in a major way since Shell’s disastrous year last year. There are a bunch of options that work on paper but the physical limitations of a frozen ocean just cannot be handled by our current technologies and definitely not by Harper Canada’s coast guard.

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