The Alberta Energy Regulator has ordered the immediate suspension of 15 pipeline licenses issued to Nexen, the Canadian unit of China’s Cnooc Ltd., after finding “noncompliant activities” at the company’s Long Lake oil-sands operations.
The order results in the closing of 95 pipelines carrying natural gas, crude oil, salt water, fresh water and emulsion, the regulator said in a statement late Friday.
Nexen will be required to provide documentation to assure the agency that it can operate the pipelines safely, and further enforcement action may be taken as the investigation continues, the regulator said.
“Given that this company has already had a pipeline failure at this site, the AER will not lift this suspension until Nexen can demonstrate that they can be operated safely and within all regulatory requirements,” said Jim Ellis, chief executive officer of the Alberta regulator. “We will accept no less than concrete evidence.”
The agency had been investigating a July spill of about 31,500 barrels of crude oil, sand and water after a pipeline failure in an area about 36 kilometers (22 miles) southeast of Fort McMurray.
The company said Saturday in a statement that it will comply with the agency’s order. Nexen said it had begun an internal audit of its pipeline management system after the July spill and on Aug. 25 voluntarily disclosed to the agency a number of non-compliance issues, mostly related to documentation of maintenance activities.
Cnooc CEO Li Fanrong, speaking Aug. 26 at a post-earnings press conference in Hong Kong, apologized for the July leak and said the company is actively cooperating with investigators.