Hibernia oil rig operators plead not guilty to 2019 spill

Operators of a Canadian offshore oil rig have pleaded not guilty to a 2019 spill that saw 12,000 litres of oil leach into the Atlantic Ocean.

The Hibernia oil rig is about 300 kilometres off the coast of Newfoundland and Labrador, and has been producing oil since the late 1990s. On Thursday at provincial court, a lawyer appearing on behalf of the operating companies pleaded not guilty to a number of pollution and liability-related charges. A spokesperson for Hibernia Management and Development Company Ltd. (HMDC) confirmed the plea but would not comment further while the case is before the courts.

The charges were initially brought forward by the Canada-Newfoundland and Labrador Offshore Petroleum Board (C-NLOPB) in July 2022. The offshore regulator alleges Hibernia’s operators went against regulations by not stopping work that was “likely to cause pollution” quickly enough. The company also failed to follow company processes for managing risks, C-NLOPB alleges. The third charge relates to the spill in general, which C-NLOPB says violates its rule that “no person shall cause or permit a spill on or from any portion of the Offshore Area.” The regulator did not return a request for comment. The trial between the regulator and the company is set to begin in July.

Hibernia is jointly owned by seven companies, with the majority holders being ExxonMobil Canada at around 33 per cent and Chevron Canada at around 27 per cent. Suncor Energy also holds a significant portion at 20 per cent.

Following the July 2019 incident, HMDC told the CBC the spill came from a storage cell, which holds a mix of oil and water on the platform. A faulty sensor in the cell likely caused the event, the company said.

The July spill was followed by another at the platform the next month when there was a spill of 2,200 litres due to a power loss. The regulator initially fined the company $40,000 but later reduced it to $28,000. The company also had to pay a $250,000 fine in 2013 for failing to prevent an offshore oil spill at the same platform.

Gretchen Fitzgerald of the Atlantic chapter of the Sierra Club said there needs to be more responsibility placed on offshore oil companies and more incentives to prevent spills. Cutting back fines will not work, she stressed.

Also alarming is Hibernia’s worker safety record. In 2022, there were four near-misses — meaning there was potential for injury — on the Hibernia platform, with the third and fourth triggering an investigation. A near-miss from March, which saw a piece of a crane fall 10 metres to the rig deck, had “the potential for fatality,” said the regulator.

“This is a systemic problem we have with regulating safety... This is part of the reason why we're so concerned about approvals for new drilling,” Fitzgerald said, pointing at the uptick in exploratory activity off the coast of Newfoundland and Labrador and the 2022 approval of the Bay du Nord deepwater oil project.

The province was already dealing with the aftermath of the largest oil spill in Newfoundland and Labrador’s history when the Hibernia incident occurred in 2019. In 2018, there was a 250,000-litre spill from Husky’s SeaRose FPSO, a floating production operation. The company also faces charges from the regulator as well as the federal government and is awaiting a decision.

Oil spills can harm ecosystems, and at the same time, Canada’s offshore oil and gas regulations are weak, said Fitzgerald. Currently, liability for operators is capped at $1 billion unless the operator is proven to be at fault, leaving the outcome of spills from things like storms or iceberg collisions unclear, she said.

“We know a large spill could cost fisheries and communities much more than that,” she said, noting the largest offshore oil spill in U.S. history, the Deepwater Horizon spill, cost US$62 billion in damages.