Wednesday, March 23, 2016

When regulators don't believe in regulation

I thought this headline at the March 22 National Observer was an April Fools' Day joke published too soon:

It is not. Therefore, citizens of BC expecting a changed approach ought to know a little more about the province's new deputy climate minister. The following was published here about two years ago:
 * * * * * * *
The precautionary principle states that before taking risky actions, initiators must prove the proposed actions are benign. Stewardship is an ethic that requires people acting as surrogates of others to manage responsibly and protect assets of the commons.

For many citizens of Canada, the concepts are incontrovertible but the avaricious care little about consequences for others, particularly for others yet unborn. Sadly, BC Liberals like Christy Clark, Rich Coleman and Bill Bennett don't see themselves as stewards of public assets, they are facilitators of exploitation by anyone willing to pay to play.

The Clark government is negotiating agreements with multinational gas operators but is in trouble because there is not much left to give. In recent times, drilling credits almost completely offset natural gas royalties and the exploration rush ended so most gas related land tenure revenues vaporized too. We're told that known reserves are sufficient for the long term and prices are weak so industry sees little need to search for more gas.

The subsidies discussed by potential LNG exporters are for transport and shipping infrastructure and for capital and operating costs, particularly for powering liquefaction plants. Additionally, LNG operators want sales tax concessions and assurance that foreign workers can be imported for construction and operation of facilities.

Expansion of BC's gas industry depends on LNG but liquefaction plants are non-starters unless government agrees to subsidies and concessions. Of the latter, a significant issue is government willingness to let gas producers set rules for production. Hiring mossbacked Fazil Mihlar as Assistant Deputy Minister for oil and strategic initiatives signalled that government will not allow environmental standards to interfere with production. Mihlar is a self-proclaimed risk-taker and an opponent of state involvement in matters of business.

This is unfortunate because the weight of new science, at least that which is independent of the fossil fuel business, declares that increases in gas production involves previously unrecognized dangers. The latest, from the National Academy of Sciences, is discussed in the linked article below.

New Study Finds U.S. Has Greatly Underestimated Methane Emissions, New York Times, November 25, 2013
"A comprehensive new study of atmospheric levels of methane, an important greenhouse gas released by leaky oil and gas operations and livestock, has found much higher levels over the United States than those estimated by the Environmental Protection Agency and an international greenhouse gas monitoring effort. The paper, “Anthropogenic emissions of methane in the United States,” is being published in the Proceedings of the National Academy of Sciences..."
I published the following on Northern Insight two months ago. It is worth repeating.


Fracking in Wyoming
With Put the brakes on LNG until impact of fracking investigated, Laila Yuile draws attention to deficient science surrounding hydraulic fracturing in British Columbia.
"The rush to develop LNG resources is appalling, considering several countries, states and provinces have already banned or put a moratorium on fracking until the considerable environmental concerns can be addressed. Here in B.C., there are grave concerns about the massive amounts of fresh water being used for the process, and how an expansion will impact local water supplies, and the sustainability of rivers and streams..."
Many issues are at play in development of natural gas production in this province. Protection of water resources is but one. Undeniably, persons in positions of authority in the federal and provincial governments care little about water and other environmental elements or about fair economic returns to citizens: the putative owners of natural resources. As Noah Scape commented at Andrew Nikiforuk's report on the Encana contamination lawsuit,
"This case is evidence that Govt works for Corporations and not the citizens..."
Is hydrofracturing safe? I'm a layperson but I've done considerable study so I can respond to that question. The answer: yes and no. However, even that may be uncertain.

The National Science Foundation funded a study titled Impact of Shale Gas Development on Regional Water Quality. The environmental engineer who led the review stated,
"This is an industry that's in its infancy, so we don't really know a lot of things."
As in most situations where the science is evolving, interested parties turn to trusted sources who will deliver opinions or make presentations that suit their own needs. Vancouver saw an example in December 2012 when Charles Groat of the Energy Institute at the University of Texas delivered, as Mark Hume reported,
"a definitive statement that the widely held environmental concerns about fracking were simply unfounded."
It turned out that the only thing truly definitive was that Mr. Groat had ethical and independence issues that troubled the University of Texas, itself not a paragon of virtue when business and academic interests conflict. Mr. Groat was encouraged to move on from UT Austin.

Risks of producing hydrocarbons by hydraulic fracturing relate to more than water. One of the hazards comes from methane leakage during production and transport of gas. This audio clip is from an interview with Cornell University's Dr. Robert Howarth, taken from a program produced by scientists at Cambridge. (The full program, What is Fracking? is a podcast that can be found at The Naked Scientists. Here, I present only a four minute segment.

Dr. Howarth challenges the assumption that shale gas has a low GHG footprint and he cites work by Cornell colleague Dr. Anthony Ingraffea and scientists at Duke University. Of course, science that doesn't promote the oil and gas industry is quickly targeted by hired guns, most involved with lobbying and public relations rather than science and technology. (Follow the link to Ingraffea's story of Halliburton and the black olives.)

In all likelihood, in particular geologic situations, fracking can proceed with acceptable risks, provided that scrupulous attention is paid to the integrity of fracked wells.

Writing about the methodology in the northeastern U.S., Scientific American noted,
"There are many ways for things to go wrong with a natural gas well during the fracking process. A new well—or the 100,000 or so existing but forgotten wells—can allow natural gas from either the Marcellus or shallower deposits to migrate up and out of the rock and into water.

"...One reason there is no such irrefutable evidence [of ground contamination] is because of a lack of publicly available baseline data for the condition of groundwater prior to any drilling and fracking. That data is collected, often by the gas companies themselves, but not shared due to privacy issues...""
In Canada, with regulators dedicated to eliminating obstacles to expanded oil and gas production, oversight is minimal or non-existent. Industry has almost a free hand to do what suits their economic interests and, if dealing with wastewater and preventing or solving gas leaks is too costly, contaminated wastewater and slippery gas will be allowed to escape.

The preceding article at Northern Insights, They assume we're feckless idiots and they might be right, demonstrates that recently, contrary to public messaging, the natural gas industry has barely contributed to public coffers in BC. Liberals encourage expectations that tens of billions of dollars from natural gas production will pay down debt and provide public services. However, in the last fiscal year, royalties from gas producers added $8 million to the province's bottom line. That's only half the profits claimed by B.C. Ferries after it booked subsidies of $210 million and paid bonuses to management for the result.

The net amount of royalties that government receives from natural gas production surprises everyone I know who has not examined public accounts in detail. Certainly, the financial situation indicates the political influence wielded by extractive industries in British Columbia. Another indicator is the appointment of Fazil Mihlar as Assistant Deputy Minister, Oil & Strategic Initiatives, BC Ministry of Natural Gas Development.

Mihlar has moved from the Fraser Institute to the Vancouver Sun and now to a senior position in the BC government's ministry of gas promotion. This latest move will please industry immensely. A regulator who doesn't believe in regulation is akin to a banker who turns off the security systems, unlocks the cash vaults and leaves the doors open.

However, there is much more to Fazil Mihlar's idealogy than his belief that business should operate without restraints imposed by governments. I looked through newspaper archives and Tweeted a number of statements and assertions by or about Mihlar. Collectively, they paint an incomplete but useful portrait of the man. See if you agree.

Recommend this post


  1. "Fazil Mihlar wrote that Governments must reduce the tax burden on business. Now he's part of the burden."

    Good line Norm, bears repeating. Kind of ties in with the assumption we are feckless idiots. How are we permitting this to happen? I submit our local "journalists" like Baldrey, Palmer and Smyth aid and abet in the true legal sense of the term.

    "There comes a time when silence is betrayal"

  2. When I read articles like this, it makes me so sad. Big corporations now-a-days don't seem to give a rat's ass about the environment, or the people that live in it. The quotes by Mihlar makes me wonder why he hates people so much...and this is a person with influence and power. Sometimes I despair for humanity.

  3. Really? This Mihlar character, sounds like someone from the U.S. Republican party from the deep south. He spouts the same nonsense as the "Right to Work" business movement in the U.S.. Economic subversive? One has to wonder...
    In truth the MSM in this province are dying by their own hand. truth in journalism used to be a hallmark of integrity in that business. Now, a number of "truths" are used, but only to follow the Corporate agenda. The MSM itself is part of that corporate elite and as such cannot be trusted, to report the "fundamental, unbiased truths" that the public really wants.
    Yes we have been betrayed, by both federal and provincial government's, whose corporate agenda, does not involve the common man at all. "Greed", seems to have become the "hidden operative word" in politics in this country.

  4. Actually I think Mary Robinson has resolved the issue. Leave the gas in the ground - just like all proposed expansions of fossil fuel extraction we cannot afford the damage to the atmosphere wrought by burning these fuels. Or, in the case of methane, the inevitable "leaks" caused by fracking. Methane being far worse as a greenhouse gas than CO2.

  5. With foxes lie this guarding the public henhouse we certainly won't have to worry about what kind of omelette to order.

  6. Are you aware of any commentary in the MSM regarding this outrage? Perhaps I've missed it. Yawn and Keef are definitely next.

  7. Fazil Mihlar and his ilk at the Fraser Institute practice Lysenkoism.

    Lysenkoism is used metaphorically to describe the manipulation or distortion of the scientific process as a way to reach a predetermined conclusion as dictated by an ideological bias, often related to social or political objectives.

    Much of what the F.I. prints is not worth the paper it is printed on, but they have their hateful base and they pander to it.

    The Liberal Government are Lysenkoists and will spend billions of taxpayer's dollars to create a fiction to support their activities.

    As Rees said, leave the gas in the ground.

  8. What a creep this Mihlar is! Why doesn't he just move to Yemen or Saudi Arabia, somewhere that is already a desert, rather than accepting TAX PAYER dollars to do everything he can to turn B.C. into a desert. Or at least he could move one province east to the soon to be depleted gravel pit known as Alberturda!

  9. The Canadian government allocated C$95 million ($90 million) on Thursday to help clean up contamination caused by the disastrous derailment in July of a train carrying crude oil through the small Quebec town of Lac-Megantic.

    It's time these damn companies paid for their messes. No insurance, not enough insurance, show the bank account balances to prove your worth. If not, NO GO.

    I'm tired of my tax dollars picking up and cleaning up after these greedy companies and corrupt governments.

  10. Anonymous @ 7:18 said:
    "I'm tired of my tax dollars picking up and cleaning up after these greedy companies and corrupt governments."

    Let's not forget the loss of life and disability...this disaster offers clear proof that the corporation has rights when it suits them and is de facto above the law when it doesn't.

  11. the federal cons are paying $95M now, yet refused to pay for inspectors to ensure the rails were safe. they wanted to get rid of federal workers. well they went and this is what happens. the public wanted fewer federal workers and now the auditor general points out the lack of border security.

    Some may feel we hve been betrayed by the provincial and federal government. No, we were not. We betrayed ourselves, our families, our friends, our enviornment. the "government" is voted into office by all of us. the majority of Canadians wanted these governments in office and now we have them. People knew quite well what harper would be up to. he said it clearly, we would not recognize this country when he was through.

    as to the provincial lieberals, "the dummy" got her majority. we had already seen what the b.c. lieberals had done. did anyone think anything would change? if they did, they were, in my humble opinion delusional. My Mother taught me a leopard does not change its spots.

    WE once again have the highest rate of child poverty in Canada at 18.6%. (and we have had for most of the time the lieberals have been in power.) That is 1 in 5 children live in poverty. I trust everyone who voted lieberal in the last provincial election is happy with the result.

    people are upset the electricity rates are going up. what did they expect? this province is out of money. the premier is in china selling B.C. bonds to China, in their currency. In other words we are so broke, we are borrowing from China. The province is not making any money except from extraction, not resource extraction, but extraction of money from all its citizen's wallets. It is being extracted at such a rate, people can not keep up with the cost of living, hence the 1 in 5 children living in poverty.

    Do not expect things to get better. They will get worse first . we have only to look south of the border where people continue to vote for 1%ers. the teabaggers are funded by people like the Koch brothers. Now what does the average american wage earner have in common with them? about as much as the average wage earner, in B.C. has in common with the lieberals and their friends.

  12. Bigger trains smaller crews (now even airlines )etc no caboose.
    .Privitize profit socialize debt.“charitable”-fraser-institute-accepted-500k-foreign-funding-oil-billionaires

  13. Just a casual observation — but it seems to me that the "CC for BC" government is happy to simply have activity.

    "If it moves, you can tax it." But not so fast: red tape slows down the activity, so get rid of the regulations and just tax the employees on their T4s. Businesses can squirm out of paying taxes through various legal (or shady) write-offs… but Jack and Jill Lunchbucket have few write-offs — and if they're doing really well and can afford to buy a new 4x4 or ski boat (or even used), they'll be paying taxes on those as well.

    1. Corporations operating in Canada now will accept zero risk associated with these Government Pipe dreams, the only way they will commit to anything is if Jack and Jill Lunch bucket carries ALL of that risk as in the LNG proposals for B.C. They will play as long is there is no chance of them losing a dime.
      All examples show proof of this, Enbridge being the most obvious but soon to be followed by others with Christy Clarke, Rich Coleman's antics..

    2. PavCo is another example of taxpayers paying billions to benefit insiders and a relative handful of business owners.

      Consider BC Place. Vancouver Whitecaps limit the seats available to a fraction of capacity because it suits the soccer club's business objectives to have a "shortage" of tickets in the market. However, I'm told the Whitecaps pay little in rent and Pavco's return is through concession sales. So, Whitecaps might benefit by limiting tickets for sale but Pavco loses, which means taxpayers lose. Pavco executives gain because bonuses depend on the number of "event days" not the profitability of the uses.

  14. Off topic Norm, but people need to see this. For everyone that has been wondering about AGT, check out this link please. Unbelievabl !.

  15. Why are regulators who "don't believe in regulation" not compelled to defend the breach of duty to a judge?

  16. This guy said, "Not all minimum wage workers are poor" and he's argued for reduced minimum wages, and, even better, removal of all labour standards protecting employed people.

    Now, he has a home in the highly paid top ranks of the BC Liberal administration, the one that raises grants to private schools while it manoeuvers to cripple or shut down public education. The same government that cedes the province’s natural resources to foreign owned companies with little payment to the public in return.

    It is about time all BC citizens woke up to this reality: the smiling face of Christy Clark is a diversion while here dark minded associates and unelected people skulk in the shadows as they carve up public assets.

  17. so if they aren't poor, what are they? could he explain, because they sure aren't rich or middle class.

    Well we do know how Christy feels about us citizens. Perhaps someone could just have Mihlar's comments reprinted in all the local papers so everyone could see how she really feels about us. Ah, I'll just write and ask my lieberal M.L.A. what he thinks about it.

  18. 6 billion usd pipeline for gas japan- Russia in talks?

  19. "Mr. Mihlar has been given a mandate to execute government’s vision around climate action…”

    Al Gore brought us the inconvenient truth.

    Milhar has been deputized with a mandate to continue this government’s convenient lie. He's a perfect fit.

  20. They made his WHAT????? O.K. I've re-read it and yes I do understand, but OMG. I got the date right, its not April Fools Day.

    Guess the queen of photo ops is going full HarperCon.



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