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Muddied Waters

A Survey of Offshore Oilfield Drilling Wastes and Disposal Techniques to Reduce the Ecological Impact of Sea Dumping

by Jonathan Wills, M.A., Ph.D., M.Inst.Pet., for Ekologicheskaya Vahkta Sakhalina (Sakhalin Environment Watch); 25th May 2000

The Law on Offshore Wastes Discharges in Different Jurisdictions

Canada

Canada has similar rules to OSPAR's and, in general, only water-based drilling muds may be discharged to the sea, and then only in certain quantities and after treatment to remove as much crude oil as possible. However, the Canadian regulations appear to be much less prescriptive and detailed than in Norway or the UK, with less stringent enforcement and even more self-reporting and self-regulation than in the best-performing OSPAR countries.

Several Canadian laws govern what can and cannot be discharged into the sea on the Grand Banks of Newfoundland and the Scotia Shelf, the two main areas of offshore oil and gas production to date. This summary was compiled by the Canadian National Energy Board (NEB) and the local offshore petroleum boards in Newfoundland and Nova Scotia:

Offshore Petroleum Legislation

The regulatory frameworks applicable to oil and gas activities in each of Canada's offshore areas are broadly the same. In the Newfoundland offshore area, such activities are administered by the CNOPB under the Canada-Newfoundland Atlantic Accord Implementation Act, S.C. 1987, c. 3 and the Canada-Newfoundland Atlantic Accord Implementation (Newfoundland) Act, R.S.N. 1990, c. C-2. In the Nova Scotia offshore area, oil and gas activities are administered by the CNSOPB under the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act, S.C. 1988, c-2 and the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation (Nova Scotia) Act, S.N.S. 1987, c. 3. The NEB is responsible for the regulation of oil and gas operations in the rest of Canada's offshore areas under the Canada Oil and Gas Operations Act, R.S.C. 1987, c. O-7. This legislation collectively shall be referred to as the energy legislation.

Regulations governing drilling and production operations have been promulgated under each Act which contain requirements related to the protection of the environment. The three Boards have also issued the Offshore Waste Treatment Guidelines, 1996.

The selection of chemicals for Canadian offshore petroleum activities currently does not have specific regulatory requirements under the energy legislation or regulations. The Production and Conservation Regulations require that an operator include in its Environmental Protection Plan, a summary of chemical substances intended for use in the operation and maintenance of a production installation. There are no similar requirements for other petroleum related activities. [Note the contrast with OSPAR's very detailed and specific regulations. JWGW.]

There are other regulatory requirements of general application in Canada that provide some restrictions on the transportation, handling and use of chemicals, however, these provide limited direction on the discharge of chemicals into the marine environment. Some of the relevant requirements are as follows:

Fisheries Act

Section 36 (3) of the Fisheries Act states that ".... no person shall deposit or permit the deposit of a deleterious substance of any type in water frequented by fish....". Deleterious is broadly defined in Section 34 of the Act to mean "any substance" or "any water that contains a substance in such quantity or concentration, or that has been so treated, processed or changed, by heat or other means, from a natural state that it would", if added to any water, "degrade or alter or form part of a process of degradation or alteration of the quality of that water so that it is rendered or is likely to be rendered deleterious to fish or fish habitat or to the use by man of fish that frequent that water"...

Section 36 (3) of the Act is not contravened if the waste or pollutant is "in a quantity and under conditions authorized by regulations applicable to that water or place made by the Governor in Council..." [i.e. pollution is legal if officially sanctioned. JWGW.]

Canadian Environmental Protection Act (CEPA)

CEPA, amongst other things, provides for the notification and control of certain substances. Regulations have been made under sections 26 to 32 of CEPA for the notification of the manufacture or importation of new substances. Any substance that is not on the Domestic Substances List is required to go through this process. A new substance is assessed for toxicity and may have restrictions, controls or prohibitions imposed.

Under CEPA there is also a "Prohibited Substances List". This is a list of chemicals that are prohibited to be imported, exported or dumped into the ocean under an Ocean Dumping Permit.

Part VI of CEPA provides for the control of ocean disposal. This requires specific authorization prior to dumping or discharging material into the ocean. The definition of dumping, and subsequently the Act, does not include "any disposal that is incidental to or derived from the normal operations of a ship, aircraft or platform" or "any discharge that is incidental to or derived from the exploration for, exploitation of and associated off-shore processing of sea bed mineral resources"...

International Commitments

Canada has signed or ratified a number of international marine conventions, agreements and guidelines, collectively representing its goal of protecting and conserving the environment and living resources in the coastal and offshore marine regions under its jurisdiction. These include the United Nations Law of the Sea Convention (1994), MARPOL 73/78 (the international Convention for the Prevention of Pollution from Ships, 1973, as modified by the Protocol of 1978), Agenda 21 (United Nations Conference on Environment and Development 1992), the Convention on Biological Diversity (1992), and the Organization for Economic Cooperation and Development (OECD)'s Environment Directorate Guidelines on Harmonization of Classification and Labeling... The principles of sustainable development, precaution (i.e. the precautionary principle), and integrated management pervade these instruments. The present Offshore Chemical Selection Guidelines have been prepared within the context and with the recognition of the obligations set forth by this international framework. They also are harmonized to the maximum extent with the methodologies of international bodies as those mentioned above. (Canada - Newfoundland Offshore Petroleum Board, Canada - Nova Scotia Offshore Petroleum Board and National Energy Board. 1999. Guidelines Respecting The Selection of Chemicals Intended to be Used in Conjunction with Offshore Drilling & Production Activities on Frontier Lands. St Johns, NF)

The Canadian offshore petroleum industry is much smaller and more recently developed than the long-established, onshore oil, gas and tar-sands extraction business in the west of the country. The development of Hibernia, in particular, was delayed for many years because of financial and technical problems and eventually required large government subsidies to get it going. The exploitation of offshore oil and gas resources has been seen by Ottawa and the maritime provinces as an important tool for economic development in areas with chronic unemployment. In these political circumstances, it may not be so surprising that the environmental controls seem to be applied with a relatively light touch.

The emphasis offshore Canada is on partnership between government and industry, rather than confrontation between regulators and regulated. This voluntary approach can work, if both parties are sincere in their commitment to environmental responsibility, and there is some evidence that this is so in the Newfoundland sector of Canada's continental shelf. For example, no conventional OBM has been used there since the mid-1980s, when about 10 exploration wells were drilled with it. (For details of drilling wastes research in Canadian waters, see: 1. Yunker, M. B., Drinnan, W. R. and Smyth, T. A.. 1990[?] Dispersion and Fate of Oiled Drill Cuttings Discharged from Two Exploration Wells near Sable Island, Canada. Oil and Chemical Pollution; 2. Canadian Marine Drilling Ltd. 1990. SSDC/MAT Environmental Protection Manual. Canmar; 3. Mushenheim, D. K., and Milligan, T. G. 1996. Flocculation and Accumulation of Fine Drilling Waste Particulates on the Scotian Shelf (Canada). Marine Pollution Bulletin 32:740-751; 4. Thomas, D.J. et al. 1984. Offshore Oil and Gas Production Waste Characteristics, Treatment Methods, Biological Effects and their Application to the Canadian Regions... Environment Canada, Ottawa.)

By agreement, the drilling mud used offshore Newfoundland is mainly Petro-Canada's IPAR-3 fluid, based on low-toxicity, synthetic isoparaffin. Also, the first oilfield developed, Hibernia, is currently (May 2000) converting to cuttings re-injection after successful trials showed good receiving formations. (Canada-Newfoundland Offshore Petroleum Board representative, April 2000. pers. comm)

The Canadian system of regulation contrasts markedly with the situation over the border in the US, where confrontation between industry, regulators such as the Environmental Protection Agency, and pressure groups is more frequent and vociferous.


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"Muddied Waters":

Contents

Author

List of Abbreviations

Summary of Conclusions

Drilling Waste Streams from Offshore Oil and Gas Installations

The Law on Offshore Wastes Discharges in Different Jurisdictions:

The OSPAR Convention

United Kingdom

Norway

Canada

United States

Inviting Regulation

Environmental Effects of Drilling Waste Discharges

The SBM Controversy

"Non-Water Quality Environmental Impacts"

Additives

Drill Cuttings

Produced Water

Minimising Waste Discharges and Their Effects

Reinjection Offshore

Cleaning Produced Waters

List of Main Sources

Selected References





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