NGI The Weekly Gas Market Report
One of the most prolific natural gas regions of Canada hasbecome a combat zone for alleged industrial terrorists andaggressive federal police – and the country’s sixth-largestproducer is in the thick of the fray.
As two reputed ringleaders of gas field attacks cooled theirheels in a northwestern Alberta jail, awaiting trial without bail,Alberta Energy Co.’s president stepped forward to explain its rolein the conflict to startled stockholders and anxious employees.
Gwyn Morgan said five trusted AEC staff collaborated, with fullsupport from the company and out of a strong sense of corporatecitizenship, in a spectacular sting operation by the Royal CanadianMounted Police that has drawn national attention across Canada.
Titled Operation Kabriole, the sting consisted of an RCMPinformant or undercover agent staging a bombing that destroyed ashed at an AEC wellhead. The company helped set up the site, takingprecautions to ensure the blast would be remote from any populationcenters and not harm real gas-field operations.
The idea was to collect evidence on real cases by winning thetrust of the two alleged eco-terrorists: Wiebo Ludwig and RichardBoonstra, who are leaders of a small religious commune near Hythe,a gas field and agricultural community in the Grande Prairie areaabout 600 miles northwest of the industry capital of Calgary.
The bombing attracted national attention last fall as one of themost spectacular events in a wave of about 160 increasingly violentincidents of vandalism and alleged terrorism that had gone on forabout two years. At the height of the campaign late last fall,senior officials from Ottawa flew to Calgary to reassure workers inthe Harry Hays federal office complex that there was no threat of aCanadian version of the Oklahoma City bombing.
The northern wellhead explosion was only disclosed to be apolice sting by some evidence at a bail hearing earlier this year.The revelation drew wildly mixed reactions, ranging from earnestdemands for inquiries and protests against entrapment tactics tojokes and cartoons about the Mounties developing strange ways toget their men. But there have also been eager defenses of the RCMPand AEC – especially in the Hythe and Grande Prairie areas, wherecommunity opinion is almost unanimous that it had become necessaryto fight fire with fire.
Morgan suggested there was nothing funny or wrong about theoperation. The Grande Prairie region is a growth area for AEC, andMorgan said “for more than two years, the affected northwesternAlberta communities and our employees have been living and workingin fear.”
The AEC president said, “What began as nuisance vandalismescalated to life-threatening acts of sabotage. Nails on accessroads, tire slashings and drill holes through pipelines escalatedto high-powered rifle shots – fired into plant facilities wherepeople were working – then to explosive devices on wellsitepipelines. Finally, there were explosions at gas productionfacilities, one of which handled poisonous hydrogen sulphide.”
Sour Gas Dispute
Known in Canada as “sour” gas, production laced with hydrogensulphide impurities is at the heart of the battle. About a third ofwestern Canadian gas is sour. Wells, pipelines and processingplants are strictly policed by provincial authorities. Even thoughprojects involving the hazardous substance are required to useextra-strength pipe, masses of safety gear and special precautionssuch as community evacuation plans, new developments invariablyprovoke protests and lengthy hearings.
Hydrogen sulphide, a nerve poison akin to cyanide, is lethal inatmospheric concentrations as low as one per cent. Far lowerconcentrations generate an overpowering stench of rotten eggs.Ironically, one of the first casualties of a potentially lethaldose is the sense of smell, robbing victims of their warning toflee.
The Canadian industry routinely produces concentrations as highas 35%, stripping out about 99.8% of the hydrogen sulphide asbyproduct sulphur and incinerating the rest in tall stacks atprocessing plants. The sour-gas region is a vast belt includingsome of Canada’s most prolific fields, stretching along thefoothills of the Rocky Mountains from northern Alberta south almostto the international border, where national parks halt drilling.
Farmers and environmentalists have for decades blamed livestockand wildlife problems on sour gas operations, but officialscientific and medical inquiries have repeatedly returnedinconsequential results. Ludwig has for years blamed a case of astillborn child at his Hythe commune on sour gas wells in the area.After the staged blast and a day-long search of the commune bysquads of Mounties, Ludwig and Boonstra have been charged with ninecounts each of counselling the RCMP informant, Robert Wraight, topossess explosives, destroy or damage valuable property and renderproperty dangerous. The case is expected to drag on for much ofthis year, with all concerned agreeing with Morgan that it istaking place “in what continues to be a highly charged andstressful atmosphere.”
“So why did AEC co-operate?” Morgan asked in explaining thecompany’s conduct. “Quite simply, the decision . . . had one clearobjective: to avoid injury or death.”
The AEC president made no apologies for letting the police drawthe company into the fray. Hazardous gas field operations wereinvolved, and “everything AEC stands for told me we couldn’t be abystander when people are at risk, and when there was even a smallchance that our assistance could help prevent injury or death . . .in all of our business activities over the past 25 years, there hasbeen only one time – October 1998 (the date of the stagedexplosion) – when our public responses were consciously less thanstraight up. We did so because we believed it to be absolutelynecessary, and with the knowledge that when the story was fullytold in the judicial process we would be held fully accountable.”
Morgan said, “we committed to full co-operation because it wasthe morally right thing to do. I believe it is what everylaw-abiding Canadian should do and indeed has an obligation to do.”
Gordon Jaremko, Calgary
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