Suncor received notices of enforcement in September 2007 from both Alberta Environment (AEnv) and the Alberta Energy Resources Conservation Board (ERCB) related to regulatory deficiencies in the design, construction and operation of the Firebag in situ facility.
In relation to the AEnv Enforcement Order (received on September 21, 2007) non-compliances were noted in the areas of vent emissions sources lacking required pollution abatement equipment and ambient air odour impacts. A formal regulatory investigation was subsequently initiated by AEnv.
In relation to the ERCB enforcement action (received on September 24, 2007) regulatory shortfalls were noted in the areas of flaring, venting and H2S emissions in contravention with ERCB regulatory requirements. This enforcement action resulted in the issuance of significant production, venting, flaring and emissions caps equivalent to May 2007 performance results.
ERCB production restrictions were eventually lifted in July 2008.
Several air emissions treatment projects have since been completed or are underway to address these shortfalls and a comprehensive air emission and ambient air monitoring program continues in and around the site.
After the regulatory investigation concluded, the Province of Alberta charged Suncor with two counts under the Environmental Protection and Enhancement Act. The charges related to the failure to construct facilities at Firebag as described in our original operating approval and failure to provide required follow-up information, subsequent to a 2005 inspection at the facility.
On April 2, 2009, Suncor pled guilty to the two counts and incurred a $675,000 fine. Creative sentencing submitted by the Crown and Suncor directed $315,000 of the total fine to the University of Calgary's Regulatory Compliance Project, which helps promote research and public education. Another $75,000 was directed to the Keyano College Endowment Fund to support the Environmental and Conservation and Sciences Program.
Firebag began operations in December 2003. Suncor's original design included vapour recovery units (VRUs) on all process water tanks at Firebag. The design plans were later amended to exclude VRUs on produced water tanks after experience at our Burnt Lake pilot project suggested they weren't necessary. This change was not reflected in the regulatory application, which is taken as a commitment of what the company will build.
The Crown has acknowledged that the issue arose out of a miscommunication within Suncor. We weren't aware of the discrepancy between the application and the design plan. When we became aware, we notified regulators.
Since the discovery of the contraventions, Suncor has spent about $175 million on equipment to bring the facility into compliance. Site-wide hydrogen sulphide emissions have been reduced by 98 percent. We expect to spend a total of $500 million on a variety of emissions control equipment for current and future Firebag stages.
This incident should have never happened. We fell short of the expectations of regulators—and ourselves. There was a failure in management oversight, for which we take full responsibility. We have strengthened our project controls to prevent it from occurring again.