ACE Technical Conference – Opening Remarks

Calgary, Alberta

21 November 2017

Sandy Lapointe, Executive Vice President, Transparency and Strategic Engagement

Good Morning Everyone.

My name is Sandy Lapointe and I am the NEB’s Executive Vice President, Transparency and Strategic Engagement. I want to welcome you to the National Energy Board and thank you for being here. This is a week-long workshop and I know you are all very busy people. So I want you to know that we are grateful to you for making the time to work with us to refine and advance the Board’s current abandonment cost estimates framework.

Now, as you know, we not only have a role to play regarding the economic and financial regulation of the pipelines under our jurisdiction, we are also a safety regulator, so let’s kick things off with a safety moment. I am going to ask each of you to be very diligent when you are leaving our parking garage and pulling out into the street. We have seen a number of very unfortunate collisions between vehicles and bicycles and vehicles and pedestrians in front our building and in the alley. So please be aware and take an extra few seconds to look out for each other.

Now, getting back to the topic at hand.

When we developed our initial framework for estimating abandonment costs in 2009, we knew that we were facing a steep learning curve. At the time, we had limited experience in dealing with abandonment issues. To give you some context, from 1959, when the NEB was created, until 2009, we received fewer than 30 applications to abandon a facility. In fact, prior to the Pipeline Safety Act coming into force in 2016, the NEB did not have the authority to regulate projects after they had been abandoned. We have learned a lot since then. However, as some of our pipeline infrastructure approaches the end of its life span, we are seeing more and more applications to abandon pipelines. And we will be ready.

The purpose of this technical conference is to refine and advance the abandonment cost framework. And in fact, this process has already started as we review the comments and input you have provided in response to the Discussion Papers.

We have heard you say you understand the need for transparency and consistency.

We have heard you say that you value flexibility and have some concerns about a one-size-fits-all approach.

We have heard you say that you value consultation.

We have heard you say that it is important to account for company-specific or pipeline-specific characteristics or knowledge, and that may be expensive for you to adopt a new approach.

We also heard some of you, OK, all of you, say now just hold on here. We filed our revised cost estimates last September and now you want to change the framework????

I want to assure you that we will not be asking you to file another round of cost estimates right away. The refinements we are hoping to make to the framework will apply to the next round of cost estimates updates.  I can also assure you that at this Technical Conference, we will not be discussing the merits of the ACE filings that came in last September. Any reference to these filings are for example only and will help us refine the framework for the next review. So you can all breathe a sigh of relief!

We’ve also read in your submissions that there are some really great ideas for how we can improve the framework. And those are the ideas we are hoping to mine this week.

Now you may be asking yourself, why am I here? Just tell me what I need to do and I’ll get it done. And I am sure you would get it done. But we know from experience that we get our best results when we collaborate with our stakeholders. When we strive for a transparent and collective approach, good things happen.

I hope you will see the next five days as an opportunity. We are asking for your input as we advance this country’s abandonment cost framework. We are asking you to share your expertise and experience. We will be looking to you for your input, your suggestions and your questions. And at the end of this Technical Conference, we expect to develop an approach that we can all be proud of.

Thank you.