1324

ENCANA SHALLOW GAS INFILL DEVELOPMENT PROJECT

AND EUB APPLICATION NO. 1435831

______

JOINT REVIEW PANEL HEARING CONDUCTED PURSUANT TO:

SECTION 4.5 OF THE "AGREEMENT TO ESTABLISH A PANEL

FOR THE ENCANA SHALLOW GAS INFILL DEVELOPMENT PROJECT"

AND THE EUB'S RULES OF PRACTICE

______

PROCEEDINGS AT HEARING

OCTOBER 15, 2008

VOLUME 7

PAGES 1324 TO 1666

______

Held at: Energy Resources Conservation Board Govier Hall, 640-5th Avenue S.W. Calgary, Alberta

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APPEARANCES

JOINT PANEL:

Robert (Bob) Connelly, Panel Chair Bill Ross, Panel Member Gerry DeSorcy, Panel Member

CANADIAN ENVIRONMENTAL ASSESSMENT AGENCY (CEAA):

Marie-France Therrien Jeff Davis Lucille Jamault

ENERGY RESOURCES CONSERVATION BOARD (ERCB):

JP Mousseau, Esq., Board Counsel Meighan LaCasse, Board Counsel Jodie Smith Jennifer FitzGerald Mirtyll Albiou Peter Hunt Bruce Greenfield Carrie Dickinson Shaunna Cartwright Ken Banister Tom Byrnes Steve Thomas Karl Jors Lawrence Jonker Darin Barter Bob Curran

PROPONENT

Shawn Denstedt, Esq. ) For EnCana Corporation Ms. Terri-Lee Oleniuk ) Ms. Leanne Campbell )

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INTERVENERS:

Kirk Lambrecht, Esq. ) For Government of Canada, Jim Shaw, Esq. ) Environment Canada, Robert Drummond, Esq. ) Natural Resources Canada, ) Department of National ) Defence, Parks Canada, ) Agriculture Canada, ) Department of Fisheries ) and Oceans

Ms. Jennifer J. Klimek ) For the Environmental Mr. H. Binder ) Coalition )

John McDougall, Esq. ) For the Suffield Ms. Kelly Lemon (student) ) Environmental Advisory ) Committee.

Keith Miller, Esq. ) For the Suffield Industry ) Range Control.

REALTIME REPORTING:

Mainland Reporting Services, Inc. Nancy Nielsen, RPR, RCR, CSR(A) Tambi Balchen, CRR, CSR No. 9166

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INDEX OF PROCEEDINGS

DESCRIPTION PAGE NO.

Request by Mr. Trottier 1329

Encana witness panel (on former 1330 oath/affirmation): Joel Heese (On former affirmation) Francis L'Henaff (On former oath) Gerard Protti (NOT PRESENT) Stephen Fudge (On former oath) Douglas Collister (On former oath) John Kansas (On former oath) Dr. David Walker (On former oath) Ron McNeil (On former oath) Ian Simpson Moss (On former oath) Spencer Cox (On former affirmation)

Cross-Examination By Board Staff, By 1331 Mr. Mousseau (Continued):

Questions By the Board, By Mr. Desorcy: 1429

Questions By the Board, By Dr. Ross 1460

Questions By the Chairman 1498

Undertaking Spoken To 1522

Re-Examination By Mr. Denstedt 1523

COALITION witness panel (sworn or 1534 affirmed): Dr. Powers Mr. Sedgwick Mr. Binder Mr. Unger Dr. Stelfox Ms. Bradley Mr. Wershler Mr. Wallis.

Opening Statements By the Coalition 1537

Discussion Re: Timing 1590

Opening Statement By the Coalition, 1592 Continued

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INDEX OF EXHIBITS

DESCRIPTION PAGE NO.

Exhibit 002-131: Licence to 1394 temporarily divert water dated September 9, 2008

Exhibit 001-049: COSEWIC Assessment 1409 and Updated Status Report on the Ord's Kangaroo Rat

Exhibit 006-037: Dr. Powers - Summary 1535 of Submission on Economics

Exhibit 006-038: Mr. Sedgwick - 1536 Summary of Submission

Exhibit 006-039: Mr. Binder - 1536 Presentation to the Joint Review Panel

Exhibit 006-040: Ms. Unger - 1536 Presentation to the Joint Review Panel

Exhibit 006-041: Dr. Stelfox - 1536 Presentation to the Joint Review Panel

Exhibit 006-042: Ms. Bradley - 1536 Presentation to the Joint Review Panel

Exhibit 006-043: Mr. Wershler - 1537 Submission on Terrestrial Biophysical Assessment

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1 (THE PROCEEDINGS COMMENCED AT 8:31 A.M.)

2 THE CHAIRMAN: Good morning, Ladies and

3 Gentlemen. Welcome once again to this hearing. This

4 begins our 7th day of proceedings.

5 It looks like all of you, perhaps with the

6 exception of our Secretariat, have recovered from the

7 excitement of last night's election and are ready to

8 resume the proceedings here this morning.

9 Before we begin, I understand that we have a

10 request from Mr. Trottier to speak to the, to the

11 Panel.

12 Go ahead, Mr. Trottier.

13 REQUEST BY MR. TROTTIER:

14 MR. TROTTIER: Mr. Chairman, my name is Gary

15 Trottier and I have registered as an individual to

16 give a presentation at the informal hearings next

17 Monday. And I was going to have some questions during

18 that to, to EnCana, and I think they are best answered

19 by Mr. Protti. So I would, I would request that I

20 could perhaps -- I understand that he's, he's here

21 tomorrow. And if I could ask those questions, I'd

22 appreciate it. And I have talked to Mr. Denstedt

23 about that, so...

24 THE CHAIRMAN: Thank you, Mr. Trottier.

25 MR. DENSTEDT: I can confirm that and it is

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1 common practice that in Joint Review Panel hearings to

2 allow this kind of flexibility, so we have no

3 objection to that at all.

4 THE CHAIRMAN: Thank you, Mr. Denstedt. We

5 would be pleased to provide you with that opportunity,

6 Mr. Trottier, so on Thursday we'll make provision for

7 you to have the opportunity to raise some questions.

8 MR. TROTTIER: Thank you very much, sir.

9 THE CHAIRMAN: Thank you. Just in terms of

10 our timing, we'll continue with the same schedule as

11 we had yesterday, breaking around 10:30, continuing

12 until noon, and recessing at 12:00 noon.

13 We'll now continue with Mr. Mousseau,

14 continuing off from his cross.

15 ENCANA WITNESS PANEL (ON FORMER OATH/AFFIRMATION):

16 Joel Heese (On former affirmation)

17 Francis L'Henaff (On former oath)

18 Gerard Protti (NOT PRESENT)

19 Stephen Fudge (On former oath)

20 Douglas Collister (On former oath)

21 John Kansas (On former oath)

22 Dr. David Walker (On former oath)

23 Ron McNeil (On former oath)

24 Ian Simpson Moss (On former oath).

25 Spencer Cox (On former affirmation).

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1 CROSS-EXAMINATION BY BOARD STAFF, BY MR. MOUSSEAU

2 (CONTINUED):

3 MR. MOUSSEAU:

4 Q. We left off yesterday with sort of a, a larger

5 question with respect to timelines and activity with

6 respect to the PDA and the regulatory process for

7 getting well and pipeline licences and getting on the

8 ground. And I'm not certain if you need me to repeat

9 the question or whether you've had a chance to work

10 on the question as I phrased it last night, so...

11 A. MR. COLLISTER: I think it would help,

12 Mr. Mousseau, if you could rephrase the question,

13 please.

14 Q. Sure. So what I wanted to understand was, assuming a

15 recommendation from this Panel, is that a permit be

16 issued and in fact a permit is issued, from that time

17 forward, I want to understand what's going to take

18 place before drilling starts. So, assuming a

19 permit's issued in March, what would take place in

20 terms of the preparing of PDAs, how many people

21 that's going to take, and how long that's going to

22 take, when Well Licence Applications and Pipeline

23 Licence Applications might be filed with the ERCB, so

24 that's, that's sort of the timeframe that I'm looking

25 at. If that frames the question for you.

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1 A. MR. HEESE: Thank you for restating the

2 question. I think we will begin with Mr. Collister

3 giving an outline of the various wildlife surveys and

4 inventories that will be conducted. And then he will

5 turn back to me to -- for the -- describe the

6 contractibility assessment, pulling together the

7 materials into a final product, and eventually getting

8 to the ERCB licence. So beginning with Mr. Collister.

9 A. MR. COLLISTER: Okay. It, it was my, my

10 intention just to go right into the field surveys and

11 describe just at a high level, as you'd requested, the

12 timing and sort of the effort that's required for each

13 of them. Prior to that, there would be obviously some

14 planning and there's a database of information that

15 would be worked with and so on, but that, that doesn't

16 necessarily relate directly to the field survey. So

17 I'll just go into the field surveys.

18 Q. Before you go there, and again just so I don't miss

19 this point, is it fair to say that you -- prior to a

20 permit being issued, EnCana is going to continue to

21 work on this so that the necessary ground work would

22 be complete? In other words, the desktop work, is

23 that ongoing, or would you be waiting for a decision

24 on the permits before you'd start the additional

25 desktop work for the first 400 wells?

Mainland Reporting Services Inc. [email protected] 1333

1 A. MR. HEESE: The stages that are outlined

2 here are outlined as individual stages, but there are

3 some that will be -- there will be flexibility that

4 those can be done concurrently. If the decision from

5 this Panel is to proceed with the Project, we would

6 certainly adopt any additional conditions placed by

7 the Panel on our PDA process. So in regards to

8 further development, at this point it is really

9 subject to additional conditions that may or may not

10 be placed by the Panel.

11 So once that decision is provided, we -- it

12 is our position that a permit would be issued for the

13 whole course of the planning and develop -- or, all,

14 all the planning and inventories, bringing it to a

15 stage where we would then apply to SEAC with the

16 process that we've identified, with routine and

17 non-routine situations. They would also, SEAC, make

18 recommendation to the Base Commander based upon those

19 decisions, at that point, would then pursue licence to

20 the ERCB for Well and Pipeline licence. Does that,

21 that clarify?

22 Q. No.

23 A. Okay.

24 Q. Really, what I, what I want to understand is, and from

25 what I've understood so far from Mr. Collister is,

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1 prior to hitting the ground to do the ground level

2 work, there's some desktop work that's going to

3 happen. Some initial desktop work. Is that, is that

4 accurate?

5 A. Certainly, yes. Understanding -- or doing the optimal

6 layout pattern, any, any sort of desktop work we don't

7 really see need for additional permitting outside the

8 recommendation to just proceed with this Project. So

9 desktop work --

10 Q. And I'm not focusing on the permitting at this point.

11 My question is simply this: Is that work going to be

12 ongoing from this time forward so that if a permit is

13 issued, EnCana can hit the ground running? That's,

14 that's the question.

15 A. And that is correct.

16 Q. Okay. So, sorry to interrupt you, Mr. Collister, if

17 we can keep it going.

18 A. MR. COLLISTER: No problem. The first field

19 survey that -- and maybe I'll preface this by saying

20 I'm going, I'm going to speak to the effort as it

21 pertains to surveying one-third of the NWA. Okay,

22 because that's what's happening each, each year prior

23 to the construction season.

24 So the first survey that would occur in the

25 year would be for Sharp-Tailed Grouse leks and the,

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1 and the timing for that is April. And our estimate

2 for the effort required is about 45 person-days. So a

3 four-person crew would be 11 or 12 days in the field.

4 April, April is a time when Military templating is not

5 too much of an issue, so there's a lot of flexibility

6 there. I just mention that because that is an input

7 into this, the whole effort and how large a crew do

8 you use and so on, is how much flexibility there is in

9 terms of Military templating.

10 Q. All right. And that's useful information.

11 A. So Sharp-Tailed Grouse in April. The next, the next

12 effort would be for amphibians, primarily Great Plains

13 Toads, and what we're looking for there is the

14 breeding ponds, the breeding areas. That's a

15 nocturnal call survey. It's -- it involves three

16 replicates through -- depending on the year, these

17 animals are very sensitive to temperature and

18 precipitation and so on. So it varies year-to-year,

19 and even in the season, when the animals call. So

20 it's a three replicate survey to try and accommodate

21 that. And it would span a period from late

22 April until early June, depending on the year.

23 And we're, and we're estimating

24 42 person-nights for that. So, again, a four-person

25 crew for 11 nights or, or a larger crew for less. And

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1 when we get into May, we do start to run into some

2 issues with templating, so, so that would factor in as

3 to how large a crew would be mobilized.

4 The next survey I can speak to is, is a

5 survey of nesting raptors in the river valley, that's

6 envisioned to be a helicopter survey, sometime in

7 May we'll say, later on in May. And that's just a

8 one-day effort, a few hours to do that survey.

9 Then we move into -- oh, I should back up a

10 second. During the Sharp-Tailed Grouse survey, we're

11 interested in, in identifying snake hibernacular as it

12 relates to wells that are close to the escarpment of

13 the Saskatchewan River or coulees associated with it.

14 And there, and there's potential, again, depending on

15 the year and when the Sharp-Tailed Grouse surveys are

16 done that hibernacular could be active and there would

17 be an opportunity for those crews, those Sharp-Tailed

18 Grouse crews, after they have done their Sharp-Tailed

19 Grouse survey in the morning to, to actually do some

20 work on snake hibernacular. So there's some potential

21 for efficiency there on those two surveys.

22 Then we get into Loggerhead Shrikes and

23 Burrowing Owls. Loggerhead Shrikes will be surveyed

24 for only in areas where the habitat's appropriate.

25 That species needs a shrub to nest in, so there has to

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1 be that on the ground. The southern portion of the

2 NWA tends not to have much of that. The Sand Hills

3 has a lot of it. There's a lot of Shrikes in the Sand

4 Hills.

5 So, if we're -- and those surveys for

6 Burrowing Owls and Loggerhead Shrikes would, would,

7 would occur from, let's say late May until as early as

8 early July for Burrowing Owls. Shrikes need to be

9 done from late May until perhaps the middle of June.

10 Where, where Shrikes need to be surveyed for,

11 Shrikes and Burrowing Owls can be surveyed together.

12 The technique is a little bit different, but, but, but

13 they can be surveyed during the same survey.

14 And in terms of efforts, if we're only

15 surveying for Burrowing Owls, so there are no -- if

16 there's no potential for Loggerhead Shrikes, we're

17 talking about 48 person-days for Burrowing Owl, so a

18 four-person crew is 12 days, let's say. And if we,

19 and if we're surveying for Shrikes and Burrowing Owls

20 together, then we're, then it goes up to

21 70 person-days because Shrike surveying is a little

22 more intense.

23 Then we move into surveying permanent

24 wetlands for Northern Leopard Frogs, and that would

25 occur primarily in August, early September, after the,

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1 at, at the time when there's most likely to be the

2 most frogs around, the tadpoles have, have turned into

3 adults, or young adults. So that would occur then.

4 That one's a difficult one to estimate the

5 time effort for because it, of course, depends on the

6 wetlands and so on. But, but we've kind of

7 guesstimated 14 person-days to do that. That's

8 probably high.

9 And then, and then there's potential in

10 September to, to survey for snake hibernacular, again,

11 adjacent to wells that are close to an escarpment

12 edge. And again, that's a little bit difficult to

13 estimate for. It will be very localized and very

14 specific, but let's say 10 person-days for that.

15 Again that's probably high.

16 And the other, the other survey I'll mention

17 on the wildlife side is Ord's Kangaroo Rat, which is

18 not -- if you recall, that's not an NWA-wide survey,

19 it's a focused survey, after the wells have been

20 located initially, subject to many of these other

21 surveys. And our estimate for that is 64 person-days.

22 It's an intensive survey right around the potential

23 location of infrastructure and wells.

24 So that's the -- those are the wildlife

25 surveys.

Mainland Reporting Services Inc. [email protected] 1339

1 Q. And just with, with the Ord's Kangaroo Rat, is that a

2 time sensitive one, is that --

3 A. Yeah, sorry. It's not very sensitive. The, the

4 appropriate time to do it that we've identified

5 anywhere from June to September.

6 Q. Okay.

7 A. So the animals are active and you can, and you can

8 identify that they're around all through that period.

9 Q. So what I get from what you've told me is that it's

10 not a question where every team is on the ground at

11 the same time?

12 A. No.

13 Q. It's, it's staggered?

14 A. It is.

15 Q. Okay.

16 A. Okay, so that's the wildlife surveys and I'll maybe

17 just pass off to Mr. Kansas and he'll speak just a

18 little bit to rare plant and vegetation species.

19 Q. Sure.

20 A. MR. KANSAS: Good morning. Rare, rare

21 plants, undesirable vegetation surveys, and general

22 plant community surveys, all will be done together.

23 And they will be done along the -- just, just --

24 they're focus surveys, as, as is the Kangaroo Rat, and

25 that will be done in the construction areas and, and

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1 right-of-ways that are staked already. They will be

2 done June and July and require approximately

3 80 man-days. Crews of four.

4 Q. Okay.

5 A. MR. HEESE: That kind of ends some of the

6 wildlife and rare plant inventory, so do you want me

7 to begin with the contractibility and some of the

8 other --

9 Q. Sure.

10 A. Okay. There are additional inventories or surveys

11 that will be done, specifically the archaeological and

12 historical. And that one is not time sensitive,

13 particularly, obviously you can't do it when there is

14 snow on the ground, but that's one of those that can

15 happen concurrently to all these other operations so

16 there's a broad window and opportunity to do that.

17 As well, after our preliminary siting phase,

18 it is our plan to forward a package to Siksika and to

19 begin discussions with them, so, again, that is a

20 concurrent phase overlapping the, the previous surveys

21 that Mr. Collister and Kansas have already outlined.

22 So your characterization earlier of a staggered

23 approach is appropriate for what they were describing

24 but there will be other concurrent activities possibly

25 being, being undertaken at that, at that time as well.

Mainland Reporting Services Inc. [email protected] 1341

1 The contractibility portion, which is

2 identified as stage 6, again, there is opportunity for

3 concurrency with that. It was outlined in the

4 specific stages to accurately describe it, but there

5 will be opportunity as well for that contractibility

6 assessment to occur somewhat concurrently, certainly

7 with the rare plants and Ord's Kangaroo Rat surveys,

8 once the right-of-ways have already been fairly well

9 designated.

10 We envision, essentially, teams of two with a

11 construction supervisor as well as an environmental

12 individual to undertake the contractibility and field

13 assessment, particularly looking at access trail,

14 final locations, development of mitigations, and it is

15 not unreasonable to suggest, you know, as a very

16 conservative number, you know, five locations they

17 could do in a day if we needed to or -- so using two

18 crews at, at five a day, it is a significant volume of

19 work, but happens somewhat concurrently with the other

20 operation, or the other inventories that are happening

21 at that time.

22 As well, a final legal survey of the

23 locations with Midwest Surveys; we envision two crews

24 working somewhat concurrently as part of the

25 contractibility assessment. You know, the final legal

Mainland Reporting Services Inc. [email protected] 1342

1 survey is wrapped in that final assessment. Again,

2 two crews doing, conservatively, five locations a day

3 is, is what we envision there.

4 Q. So when, when do you envision PDAs being complete for

5 the first 400 wells in terms of the time of year?

6 And I include pipelines in that as well.

7 A. For all 400 proposed? Again, remember, we will be

8 working on battery-by-battery basis, so it is our

9 intention to have battery -- one battery prepared, or

10 in, in some cases it might be two batteries prepared

11 to allow for pipelining beginning October 1st. That

12 doesn't necessarily mean every single battery of those

13 425 will be prepared for October 1st.

14 There will be continued applications to SEAC

15 and DND after, most likely, that date, but certainly

16 to have, you know, one, two, maybe even three

17 batteries prepared for October 1st with subsequent

18 batteries coming in after that point.

19 Q. Okay. And how long do you anticipate the SEAC review

20 to be for those applications?

21 A. One moment. As we had outlined earlier, it is our

22 intention to feed information to SEAC as it is

23 collected, so in advance of the final product. So,

24 again, to keep them abreast -- addressed of what's

25 going on, understanding the various iterations. So we

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1 don't want it to be a situation where we effectively

2 just throw a, a whole battery on their desk and, you

3 know, you're right, expect rapid approval. So we want

4 to keep them informed throughout the process. To

5 streamline their process, we have proposed routine and

6 non-routine process. So, again, recognizing, or our

7 position that they will be able to deal with routine

8 applications very promptly and focus most of their

9 attention and scrutiny to the non-routine locations.

10 So it is -- I believe it's reasonable for

11 several weeks review per battery, maybe as much as a

12 month, for, for an individual battery, you know,

13 somewhat concurrently again, recognizing that as they

14 review routine applications, they'll, they'll only

15 become more assured of the process as we've gone

16 along. The same for the non-routine. As they have

17 made decisions for either approval or denial, how they

18 arrive at those decisions will become more and more

19 streamlined and the whole process will expediate

20 itself with experience through the process.

21 Q. Okay, and I take it once you've got SEAC and the Base

22 Commander signed off, they'll be forwarded to the

23 ERCB as routine applications?

24 A. Unless there's reason that it would still be

25 non-routine according to the ERCB criteria, but I, I

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1 find that a highly unlikely situation, that there'll

2 still be an ERCB non-routine application once we've

3 gone through the SEAC and DND. If, if there was

4 reason to file as a non-routine, we would file as a

5 non-routine. However, it is our understanding that,

6 yes, they will, will be routine applications for

7 licence.

8 Q. Okay. And I just want to confirm that EnCana's aware

9 that any application involving a well or a pipeline

10 within 100 metres of a waterbody would be

11 non-routine.

12 A. My understanding of that particular section of

13 Directive 056 is there are provisions for how to

14 operate within 100 metres of a waterbody. So provided

15 you meet those provisions, it is still handled as a

16 routine application. It's only in the event that

17 you're not capable of meeting the additional criteria

18 the ERCB has laid out, that it would then welcome a

19 non-routine application.

20 I might also point out one of the specific

21 criteria is having a Crown approval that's typically

22 reserved on Provincial land for having a PLA or an

23 MSL. However, I believe the approval of SEAC and the

24 DND would be sufficient, however, that is up to the

25 ERCB.

Mainland Reporting Services Inc. [email protected] 1345

1 Q. Okay. Now, if SEAC doesn't agree, and you don't get

2 Base Commander approval, is it EnCana's intention to

3 still forward those applications to the ERCB?

4 A. MR. L'HENAFF: No, we would not forward

5 those to the ERCB.

6 Q. Okay. I think we're through last night's untimely

7 question, gentlemen.

8 Just before we move on, I'd, I'd asked you,

9 Mr. Heese, and you, Mr. L'Henaff, with respect to a

10 commitment on Spider-Plowing. I wonder if this is a

11 good time to go with that.

12 A. MR. HEESE: Sorry, I believe the

13 commitment that you requested us to go away with was

14 whether we would commit to working in non-frozen

15 conditions, it wasn't a specific commitment to only

16 using the Spider-Plow. So I was prepared to answer to

17 the commitment I understood that you were requesting

18 that we work under only non-frozen conditions for

19 pipelining. And the answer to that is, no, at this

20 point we are not prepared to make that commitment.

21 We feel that the construction methods that we

22 have designed will be appropriate, not only for the

23 soil type but for the conditions that we are based in.

24 And when you look at the overall program design, by

25 having a very small footprint in, in the first place,

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1 by maximizing the non-frozen period with our

2 pipelining, the, the gains that would be offered by

3 making a commitment like that are minimal. However,

4 our commitment is to use the right equipment for the

5 right soil type at the right season.

6 Q. Okay, sir. I'm, I'm just going over my question as

7 written in my -- my question as written. I would

8 have to check the transcript, but it was a specific

9 commitment with respect to Spider-Plowing only during

10 periods of dormant non-frozen period, so I'm not

11 certain if that changes your answer.

12 A. I don't believe it does. Again, we are committing to

13 using the right construction technique and equipment

14 for the right soil type at the right season.

15 Q. Thank you, sir. I'm going to give you a reference.

16 Again, I don't think it's necessary to turn it up,

17 but this, this relates to a statement made by EnCana

18 in its Reply Submission, page 2. -- or 2-21. And

19 EnCana states:

20 "Where it is necessary to access a

21 site during wet conditions, EnCana

22 will consider the use of

23 all-terrain vehicles to reduce

24 damage to the environment."

25 And I want to start with inquiring as to what

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1 circumstances will it -- under what circumstances will

2 it be necessary to access sites during wet conditions?

3 A. I'm sorry, I would like to find that reference. Can

4 you repeat that?

5 Q. Sure. 2-21.

6 A. And that was in --

7 Q. Sorry, it's in 002-010, that's Volume 1 of the EIS. I

8 misspoke. 2-21. And it's Section 2.2.3.4.

9 A. That particular comment was made early on in the EIS

10 Project, project, again specific to well inspections

11 and pipeline integrity checks.

12 Our Wet Weather Shutdown criteria has been

13 expanded significantly since that statement was made.

14 Specifically within our Environmental Protection Plan,

15 page 6.3, section 6.4.1, which describes our Wet

16 Weather Shutdown, and that will be applied to all of

17 our operations on the Suffield Block.

18 This specific reference was in the event

19 that, you know, the use of quads or something like

20 that was appropriate. It was to leave some

21 flexibility. However, our Wet Weather Shutdown has

22 built upon that and it is as it is described within

23 our EPP, which will determine how we approach the land

24 and periodic -- or it really is a system where we shut

25 down for wet weather and very, very rare instances

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1 where we would require the use of a vehicle such as

2 this as we described. So, I would -- if we wanted to

3 describe the specific Wet Weather Shutdown section --

4 Q. We're going to go there.

5 A. Okay.

6 Q. So --

7 A. MR. FUDGE: Maybe I -- perhaps I could

8 just add, because I recall the discussion about that

9 section explicitly. And my understanding is that it

10 was, it was really meant for -- that statement in

11 there was meant for in Wet Weather Shutdown conditions

12 but where there was a necessity because of accident or

13 upset conditions or something very unusual, event, an

14 unusual event, that's the only time that a quad or

15 something like that would be used during wet weather.

16 Otherwise it's a shutdown. So that, that was clear to

17 me at the time when we were reviewing that.

18 Q. And that makes sense to me as well, sir. I just

19 wanted to confirm that we're talking exceptional

20 circumstances, if there's a pipeline break, you've

21 got to get out there and it's wet?

22 A. MR. HEESE: That's exactly it, yeah.

23 Q. And I, and I think I'm going to where you were at

24 there, Mr. Heese. The reference I have is, is

25 002-077, which I think is what we were talking about,

Mainland Reporting Services Inc. [email protected] 1349

1 Section 3.7 and specifically page 3-9. And I'm going

2 to take you to four criteria developed by EnCana that

3 indicates shut down or work modification should

4 begin.

5 I'm ready, actually. I've been waiting.

6 A. Sorry. I, I too am ready.

7 Q. Okay. So when I read those shut down or work

8 modification criteria, it, it strikes me that some

9 damage has already been done if this is occurring; is

10 that, is that fair?

11 A. The specific criteria you're referring to, I believe,

12 is in association with Section 120. I think it's

13 important to read line 114 first, because that kind of

14 sets the stage for the entire Wet Weather Shutdown,

15 and maybe I'll even read it:

16 "All project personnel have a

17 responsibility to recognize and

18 prevent effects."

19 So, in regards to prevention, this, this section

20 is really for those rare circumstances where we find

21 ourselves in, in a situation. However, it is our

22 intention to shut down in advance of these very, these

23 very additional criteria that you've outlined in 120.

24 Again, I believe I have -- I'm on the record already

25 as describing the activities we currently do to

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1 prevent effects, you know; checking a variety of

2 weather sources, checking radar, checking even the

3 Alberta Motor Association weather cams that are on the

4 Trans-Canada Highway to actually watch approaching

5 storms and make decisions in advance of inclement

6 weather.

7 So the Wet Weather Shutdown and the criteria

8 outlined in 120 is really, again, a rare event and in

9 the event we find ourselves in such conditions, to

10 outline how we should respond to that.

11 Q. And I take it that those requirements apply equally to

12 operations as they do to construction. So in terms

13 of swathing or other maintenance activities, the same

14 things are going to apply?

15 A. Before answering that specifically, if I could just

16 again talk generally. This whole section was written

17 in consideration of Alberta Environment's CNR IL98-4,

18 which outlines Alberta Environment's expectations for

19 shutdown in wet weather. So as their expectation is

20 that it applies to all operations, it is ours as well,

21 that this applies for all of our operations, including

22 the ongoing operations which is why, when I originally

23 brought up this section, I was referring within

24 section 6.

25 It is essentially a repeat of this traffic

Mainland Reporting Services Inc. [email protected] 1351

1 protocol that's identified specifically in the

2 Construction section that we are now referring to,

3 that is correct. The use of protocols, as well as the

4 responsibility to prevent the effects, applies to all

5 of our activities.

6 Q. And does EnCana have the ability to shut their wells

7 down remotely? Can you do that through the SCADA

8 system? No?

9 A. SCADA is just monitoring.

10 Q. Okay.

11 A. It is not remote shut-off. Just let me confirm. That

12 is correct, we can't remotely shutdown.

13 Q. Okay. So in the event of really wet conditions and

14 you had a problem with a well, you'd still have to go

15 in to shut it in until conditions were dry, is that

16 fair, so you can do some work on it?

17 A. Shutting in, shutting in a well is a fairly

18 straightforward operation. If it happened to be

19 during a period of overall standdown, it would be a

20 matter of assigning the appropriate vehicle to access

21 the field in those conditions. But you are correct,

22 it would require manual shut-off.

23 Q. Okay. It's my understanding that EnCana previously

24 operated on Suffield with low pressure balloon tires

25 on pick-up trucks as a mitigation method. Can you

Mainland Reporting Services Inc. [email protected] 1352

1 discuss the effectiveness of that as a mitigation

2 method?

3 A. I'm aware of previous activities in the NWA where the

4 use of balloon tires was one of the mitigative factors

5 in areas of high risk.

6 My understanding of average tires in the day

7 where those were being operated were generally

8 narrower than the types of tires that are standard

9 equipment on trucks these days. The off-road truck

10 tires that are equipped with, or the off-road truck

11 tires on trucks these days are roughly equivalent to

12 what a balloon tire would have been in the '70s and

13 '80s when that was a primary mitigation for the area.

14 A. MR. L'HENAFF: If I can just add as well,

15 that was a period in time when the metering

16 requirements, the measuring requirements were

17 different due to regulation. The operators had to go

18 out to the sites basically every day and every week,

19 so they had to go there irrespective of the weather

20 conditions.

21 Now, because of the change in the regulations

22 and the medium requirements surrounding that, we have

23 a lot more flexibility on choosing, you know, just the

24 right conditions. So on top of, I guess, the tire

25 requirements that have changed significantly since

Mainland Reporting Services Inc. [email protected] 1353

1 back in the '70s and '80s, there's been quite a change

2 in the regulatory requirements. So our need to go out

3 to each site and recover those recorders has certainly

4 changed through the decades.

5 Q. Have you done any studies, though, recently, to

6 determine differences in compaction rates between, as

7 we say, ordinary tires and balloon tires?

8 A. MR. HEESE: No.

9 Q. Okay. Now, when we were talking yesterday, I think I

10 heard that the rig kick-off date is planned to be

11 around October 15th.

12 A. That's correct. Subject to weather and ground

13 conditions as always, yes.

14 Q. Sure. And I understand from earlier testimony that

15 the peak construction months are November to January.

16 Is that, is that accurate as well? I think that was

17 in your Opening Statement.

18 A. That would be accurate.

19 Q. Okay. I'm wondering how far past January EnCana might

20 extend its construction period to complete its

21 program and whether there's an absolute end date for

22 you.

23 A. The end date that we have proposed is April 15th, but,

24 again, as we are describing our traffic control

25 protocols and specifically wet weather, it is always

Mainland Reporting Services Inc. [email protected] 1354

1 contingent upon the actual weather and condition of

2 the ground at that point. It would be very difficult

3 to predict a hard cut-off date when spring break-up

4 might happen, when the ground might change. It would

5 be variable year to year, which is why the

6 construction activity is fairly heavily loaded to the,

7 more to the front end of the developments, recognizing

8 that towards the tail end, while we have identified

9 April 15th as the official end, the actual ground

10 conditions will be variable at any point from, or in,

11 in March and April.

12 Q. Okay. And we talked briefly about an event where a

13 pipeline might rupture and you need to go out there

14 in wet conditions. I guess my question is, is how

15 will EnCana be able to detect small pipeline leaks in

16 between annual inspections?

17 A. We currently use very specialized and highly sensitive

18 equipment. And that equipment is on the main access

19 trails, essentially the all weather or the built-up

20 gravel type roads, so that is a complement to the, to

21 the other inspection programs. So it is less, less

22 susceptible to weather conditions being that it can

23 operate from high grade roads.

24 Q. Okay. And I'm, I'm not certain that I got to my

25 question. Maybe it was asked poorly. I just -- I

Mainland Reporting Services Inc. [email protected] 1355

1 really want to know how EnCana will be able to detect

2 pipeline leaks in between annual inspections, if it's

3 a low-level leak.

4 A. Just one moment, please. Standard practice of driving

5 all of our pipelines to determine low-level leaks is,

6 is the standard. However, we are moving down a path

7 to try and eliminate as much actual pipeline travel as

8 possible. And that includes the use of highly

9 specialized units that can detect very, very low

10 levels from the all-weather access network with the --

11 or the, the high grade roads within the National

12 Wildlife Area.

13 So we will still conduct yearly inspections.

14 However, how that is actually done, moving from a

15 situation where we're driving every single

16 right-of-way to one where we can narrow or -- sorry,

17 use highly specialized equipment to drive only the

18 high weather, the high grade all-weather roads within

19 the National Wildlife Area to pinpoint the areas where

20 there might be a leak, and then only follow up with

21 specific right-of-way assess -- or investigations at

22 that time.

23 Q. And just so I understand, the equipment measures

24 pipeline pressure or something similar to that. It

25 doesn't measure the road? Like I guess that's where

Mainland Reporting Services Inc. [email protected] 1356

1 it's falling apart for me.

2 A. Sorry, it measures the air.

3 Q. Measures the air above the road?

4 A. In any -- in association with the air around the road,

5 whether or not there would be a pipeline leak. So in

6 the event that the equipment on our high grade road

7 senses that there's reason to believe there is a leak

8 or some sort of release in the area, then we follow up

9 with a site specific evaluation on that, in the area.

10 However, it's, it's intentionally to try and relieve

11 the overall traffic and presence on, on our pipelines

12 in the area.

13 Q. And is there pressure instrumentation as well to

14 back-up those concerns where you could notice a

15 change?

16 A. The level of leaks that I believe we're discussing are

17 so low that we would not recognize a pressure drop.

18 And it is only by active sampling that we would, that

19 we would find those leaks.

20 Q. And I guess what we want to understand is what

21 specifically is the technology?

22 A. We're currently using a company by the name of Gas

23 Track, which uses a gas ionization method which is

24 capable of measuring in parts per billion.

25 A. MR. L'HENAFF: If I could maybe just

Mainland Reporting Services Inc. [email protected] 1357

1 clarify, put it into context. So our, our pipeline

2 failure rate is extremely low. We've got a good track

3 record there. The plastic pipe is another feature of

4 that and it has a good track record.

5 And so -- and then our corrosion program,

6 that really goes to protect the steel pipes that we

7 have.

8 So the kind of leaks that we're talking about

9 are really -- we're talking about pinpoint leaks that

10 really release a small amount of, of methane. And so

11 it's an electronic sniffer that is basically sampling

12 the air.

13 So that, that degree of leak, so extremely

14 rare event, that degree of leaks, we won't, wouldn't

15 be able to detect it at a metered site that's

16 basically metering the battery production.

17 Q. Thank you, sir. Maybe going on to the other end of

18 the table for a little while and talk about some

19 Crested Wheatgrass. And my first question is how

20 will Crested Wheatgrass invasion rates be monitored?

21 A. DR. WALKER: I don't believe we've got a

22 targeted program for monitoring Crested Wheatgrass

23 invasion. There is the suggestion in the Submission

24 that, that an integrated undesirable plant program be

25 developed with the other stakeholders. And that a

Mainland Reporting Services Inc. [email protected] 1358

1 decision be made as to which species are actually

2 undesirable and what should be done about it.

3 Q. Okay, and just maybe to follow up on that a bit. I, I

4 think you suggested that other oil and gas operators,

5 PFRA, DND, and Environment Canada would be involved

6 in that sort of initiative. I guess my question is,

7 is there a successful working model out there to

8 document past experience with this sort of vegetation

9 management, sort of a stakeholder group approach?

10 A. Yes, there are other models, certainly.

11 Q. Can you expand on that?

12 A. Certainly the work that Dr. Darcy Anderson has done

13 would be a good model. Scott Henderson, the

14 University of Regina, has also done extensive

15 monitoring in Grasslands National Park. There are

16 other models in the States that have looked at Crested

17 Wheatgrass and, and the reason for its dominance and

18 rate of spread.

19 Q. And, and I think what I'm getting at is actually sort

20 of this multi-stakeholder approach to managing this

21 issue. I know there's multi-stakeholder approaches

22 in Alberta for other issues like air emissions. I'm

23 wondering if there's a model with respect to this

24 sort of weed or undesirable plant management upon

25 which this recommendation could be based.

Mainland Reporting Services Inc. [email protected] 1359

1 A. There are certainly invasive species organizations in

2 the province and in fact across Canada and across

3 North America that look at the issue and look at

4 solutions.

5 Q. Okay, but in terms of a multi-stakeholder group, you

6 don't, you don't know of another one that's been

7 successful in this sort of an approach?

8 A. MR. FUDGE: We have -- just to add to

9 Dr. Walker's comments. We have -- as part of the

10 Environmental Effects Monitoring Plan, we have put

11 forward a candidate study in foreign native grassland

12 integrity that would measure the, the status and

13 trajectory of weed densities. And the establishment

14 and persistence of tumbling weeds as a monitoring

15 study, not as a control study, or a control process.

16 And I think that's what, what Dr. Walker is

17 speaking to as well, is multi-stakeholder -- to what

18 are -- okay, we know where the weeds are, we know what

19 they are doing, which way they are going, as it were,

20 or what their trajectory is, but what are, what are

21 you going to do about it. And that, I believe, in my

22 interpretation of what's being suggested, is it would

23 take all the land users and adjacent land users

24 together to deal with those kind of issues.

25 Q. And I, and I think I get what the idea is. I just

Mainland Reporting Services Inc. [email protected] 1360

1 simply want to know if that idea's been tested

2 before, and if it has, I just want to know how it

3 works. And if it's novel, that, that's not

4 necessarily a bad thing. I just want to know if

5 it's, if it's been successfully implemented somewhere

6 else?

7 A. DR. WALKER: Certainly it, it's not novel.

8 I suppose it's probably novel in terms of Crested

9 Wheatgrass per se. Although I have to say, grasslands

10 certainly looked at it, looked at where the Crested

11 Wheatgrass was, where it was going. They have

12 recently done a study on, on the economics of, of how

13 the, the problem should be approached. So, yes, there

14 are models there and they work. And it does involve

15 everybody who uses the NWA to be involved so that it's

16 targeted and it's effective.

17 Q. And, and just from EnCana's perspective, who should

18 lead this initiative?

19 A. Well, it's not up to me to decide. That's possibly

20 something for the Panel or the...

21 Q. But I want to know EnCana's perspective. So the Panel

22 can obviously make a recommendation on it, but to

23 guide us in that, to guide them on that

24 recommendation, it might be useful to hear what

25 EnCana has to say.

Mainland Reporting Services Inc. [email protected] 1361

1 A. MR. L'HENAFF: I suppose we haven't put a

2 lot of thought in it, but I would think that it would

3 be natural for the DND to lead that initiative, as

4 the, as the landowner. But, you know, as Mr. Fudge

5 and Dr. Walker have indicated, it's, it's an issue for

6 the region, for the area. And so you would certainly

7 require commitment of all the users. And so I think

8 that would be key element, is that for the users of

9 the, of the Base, and specifically the NWA to, to be

10 able -- to be committed to the process. And, you

11 know, driving themselves towards a solution to the

12 issue.

13 Q. Okay. And Dr. Walker, back to you, you mentioned

14 Henderson. And in the, in the record there's a,

15 there's an article by Mr. Henderson, or maybe it's

16 Dr. Henderson. And it's found at 003C-006. And it's

17 entitled, "Crested Wheatgrass Invasion Influence of

18 Prevailing Winds and Grazing at Suffield National

19 Wildlife Area". I take it you're familiar with this?

20 A. Yes, I am.

21 Q. Okay. And, and my understanding of what he says in

22 this report is, traffic frequency affected the

23 density and distance of maximum invasion, and while

24 he wasn't able to tie his Suffield investigations to

25 specific traffic frequencies, he suggests that

Mainland Reporting Services Inc. [email protected] 1362

1 restricting traffic may be more important than

2 grazing management.

3 First, I wanted your opinion on that

4 statement or that concept. Why don't we start with

5 that.

6 A. DR. WALKER: I, I suppose that would be

7 one of the unanswered questions as to how Crested

8 Wheatgrass gets moved around, whether it's vehicles

9 or, or cattle or wildlife. But the, the bulk of the

10 evidence to date suggests that it is what we call

11 propagule pressure, the ability of this species to

12 produce huge amounts of seed that outnumber the native

13 seed production upon the landscape. And so, wherever

14 there is a large source of seed is where it's going to

15 spread from whichever means.

16 So it, it might be -- if the objective is

17 the -- if the goal is to reduce the amount of Crested

18 Wheatgrass on the landscape to, to catch it at the

19 source, is to reduce the seed production. Perhaps to

20 prevent it from, from heading out, although that has

21 collateral damage involved with that as well.

22 So I think all these issues need to be

23 weighed against the other issues and, and discussed

24 with the stakeholders as to how it's to be addressed.

25 There are, are pastures there that PFRA use, and, and

Mainland Reporting Services Inc. [email protected] 1363

1 certainly we don't want to start taking away those

2 prime pastures. Those are critical for reducing the

3 grazing pressure on native range. And, and there are

4 still remnant areas that were seeded during the

5 settlement in the NWA, in the SNWA. And as I've

6 mentioned previously, I think that we have to go about

7 controlling this species in a very thoughtful way

8 because some of the alternatives are not very

9 palatable. To have annual grasses, for example,

10 invade and take the place would be quite disastrous.

11 So, at the moment, I look at Crested

12 Wheatgrass on the landscape there, as a, as a place

13 holder. It's, it's keeping things out that we don't

14 want in. And there is some evidence that, that it can

15 be replaced. Usually on an episodic basis, when we

16 get certain droughts and when we get some good sources

17 of seed from other locations, and so that's part of

18 that EnCana Reclamation Plan, is to seed all areas

19 that have a possibility of, of undesirable species

20 becoming established with native species so that they

21 have the best chance of getting established. And we

22 have a, a preferred seed bank rather than an

23 undesirable seed bank on the sites.

24 Q. And I guess just to, just to follow up, given it's

25 been identified as a potential vector for Crested

Mainland Reporting Services Inc. [email protected] 1364

1 Wheatgrass, how should it be considered in terms of

2 ongoing cumulative effects?

3 A. Well, it, it's been on the landscape for the last 60,

4 70 years. We've, we've -- that, that's part of the

5 NWA. It's, it's certainly on my, my radar. It's not

6 a critical element in terms of ecosystem

7 functionality. And so I, I think that there are other

8 issues and other problems to direct our efforts

9 towards.

10 Q. I want to move a bit to issues of grazing and cattle.

11 And I just want to know whether wellheads will be

12 protected from cattle, with a metal guardrail?

13 A. MR. HEESE: You're referring to the Tech

14 Fence, the, the small wellhead fence? That is our

15 practice in areas where there's cattle grazing to have

16 all wells guarded by Tech Fences.

17 Q. Okay, and in terms -- has EnCana experienced issues

18 where cattle rub on the guardrails for the wellheads.

19 A. I have seen some instances where the Tech Fence is

20 used as a potential rubbing post, correct.

21 Q. And does that have the, the effect of creating bare

22 ground in those places?

23 A. In some cases the amount of hoof sheer and

24 congregation of cattle can lead to an increase in bare

25 ground on locations. However, they are generally site

Mainland Reporting Services Inc. [email protected] 1365

1 specific. It's not -- it's not a characterization of

2 all the wells. It's a subset of, of the wells. But,

3 yes, the additional impact of cattle can lead to bare

4 ground around some of the, some of the Tech Fences.

5 Q. Okay. And whose responsibility is it to, to deal with

6 that bare ground? Is that, is that for the PFRA or

7 is that for EnCana?

8 A. Ongoing discussions with PFRA as to how we can best

9 manage their operations with our operations is an item

10 that I will be taking into the future. It, it's a

11 situation that is not unique to the Suffield Block,

12 understanding the interactions of cattle with

13 wellheads. Certainly all the prairie areas outside

14 the block have that same sort of situation. And

15 maintaining open communications with, with the various

16 stakeholders is important.

17 Q. Maybe I can just bring you back to EnCana's

18 intention --

19 A. MR. L'HENAFF: If I can just add, but they

20 are responsible for the site. That's our well site.

21 So the ground conditions there and keeping it up to

22 snuff is certainly our responsibility.

23 Q. Okay, and so maybe if you can just walk me through

24 what, what happens and what steps are taken to deal

25 with that ground currently.

Mainland Reporting Services Inc. [email protected] 1366

1 A. MR. HEESE: I'm currently documenting the

2 situations where that was -- where that is occurring,

3 where I'm seeing, you know, systemic challenges with

4 PFRA to develop mitigation or additional steps, in

5 some cases, it may lead to additional fencing. In

6 some cases it may lead to additional seeding of the

7 location to try and regenerate some vegetation at this

8 point. But specific steps are, are in development.

9 Q. Okay. I'm going to turn now to the topic of

10 reclamation. And this is something I'm going to

11 explore with Mr. Protti as well, but here I want to

12 talk about some of the more practical aspects rather

13 than the regulatory requirements itself. And my

14 first question is, is what criteria should be

15 achieved to ensure reclamation is successful? And

16 I'm not talking regulatory criteria, I'm sort of

17 talking on, on the ground. If an area's been

18 successfully reclaimed, what should we see?

19 A. DR. WALKER: I guess that would be me.

20 I've, I've got a number of, of monitoring protocols

21 that are to be applied at various stages through the

22 reclamation process. And, and, in fact beginning

23 before construction, they are outlined in Appendix K.

24 There are some guidelines. But very briefly, the kind

25 of, of plant materials that are used has guidelines

Mainland Reporting Services Inc. [email protected] 1367

1 and criteria that is using source identified seed. In

2 other words, we know where it comes from, we have a

3 good idea where it -- how it performs. It, it may be

4 certified seed, but it also may be seed that has --

5 is, is acquired from a local grower. For example,

6 there is a grower near Brooks who, who cultivates wild

7 stands of Grama Grass. That would be an example

8 of a local source that is not certified that would be

9 source identified.

10 There's a protocol for, for maintaining the,

11 the chain of custody of the seed material so that it

12 doesn't get substituted by the contractor. So EnCana

13 will be acquiring and providing it to their

14 contractors to seed.

15 There's a protocol for monitoring the seed

16 rate because that has a big impact on the eventual

17 outcome. Too much seed ends up producing a

18 monoculture, much the way Crested Wheatgrass does when

19 it's overseeded.

20 There's a protocol for seedling establishment

21 a year after seeding. We need a certain number of

22 plants per square metre in order to get the cover we

23 need, in order to get erosion control. So that is

24 another stage at which there will be monitoring and

25 targets established.

Mainland Reporting Services Inc. [email protected] 1368

1 There's a ground cover protocol that we are

2 looking for in terms of providing erosion control. It

3 varies, whether it's wind erosion or water erosion.

4 We're looking for that target to be met in somewhere

5 between two and four years after. There are action

6 items or, or responses, of adaptive management

7 protocols if these targets aren't met. And, and then

8 we're looking at a couple of other protocols that are

9 in existence throughout the life of the Project. And

10 that is the absence of undesirable species and the

11 presence of desirable species through that.

12 There are a number of other aspects of the

13 monitoring protocol that look at, at hydrologic

14 function, and that relates to compaction, infiltration

15 rate and, and especially to erosion control. So the

16 erosion control target is, is in effect throughout the

17 life of the Project. And that's the, the basis for

18 the sustainability objective that Mr. Protti was

19 talking about.

20 So that's a brief rundown of the reclamation

21 monitoring that will go on through the Project.

22 A. MR. HEESE: If, if I might maybe, in

23 addition to the detail that Dr. Walker provided, the

24 question relating to what, what should you see, you

25 know, when you go to a location to determine

Mainland Reporting Services Inc. [email protected] 1369

1 reclamation. If I could bring this up a level. You

2 know, we, we want to restore rangeland functionality

3 to our disturbances.

4 To do that, we'll be using three specific

5 measures, the first being site stability, the second

6 being biotic integrity, the third being hydrologic

7 function, and looking at indicators on our

8 right-of-ways to confirm that. So in answer to your

9 question, you know, it is a return to rangeland

10 functionality.

11 Q. Then when you say return to, to rangeland

12 functionality, is that another way of saying

13 equivalent land capability?

14 A. DR. WALKER: Yes, it is. In fact, the new

15 criteria that SRD has brought out for forested lands

16 refers to that specifically as that, equivalent land

17 capability, in their interpretation means a

18 functioning ecosystem.

19 Q. And in, and in terms of reclamation, if we were to put

20 different reclamation standards on a spectrum, you'd

21 have equivalent land capability somewhere in the

22 middle and would you have full ecological restoration

23 to one side; is that a step up?

24 A. No, it means the same. Well, I -- pardon me. There

25 are, are situations, certainly lots of them, where

Mainland Reporting Services Inc. [email protected] 1370

1 equivalent land capability, or the pre-existing

2 condition may not be functioning. It may be less

3 because of prior land use. So that's where restoring

4 it to equivalent land capability may not necessarily

5 be the best goal. It may not be the intention of the

6 regulators to return a degraded landscape to a

7 degraded state. If there is the opportunity to

8 improve it, especially if it costs less, we somehow

9 need to have regulations that encourage that.

10 Q. Okay, but my, my understanding is that, that

11 intervenors such as DND and Environment Canada have

12 proposed a reclamation standard of, of ecological

13 restoration. And from reading their report it

14 suggests to me that it's requiring something more

15 than equivalent land capability.

16 A. I would agree. It, it requires the -- restoration to,

17 to a functioning landscape. The way the protocol is

18 set up is that it often -- it can be --

19 Q. Can I just -- I don't want to interrupt you, but I

20 think I need to really understand which protocol

21 you're talking about.

22 A. The protocol that's in Appendix K.

23 Q. Okay. Your protocol?

24 A. Yes.

25 Q. Okay.

Mainland Reporting Services Inc. [email protected] 1371

1 A. It, it is a way of comparing to a reference site. And

2 that reference site could be one that is in existence.

3 It could be one that DND and EnCana goes out and looks

4 at a well site and says, yes, this is exactly what

5 what we're looking for. The protocol provides a means

6 of measuring that and describing that quantitatively,

7 and then that can become a target. It's flexible

8 enough, the protocol, that it, it can accommodate a

9 very, a variety of different land uses and land use

10 objectives.

11 So, for example, if it would -- the land use

12 objective would be grazing, we might look at one

13 reference site. And if it was to, to encourage rare

14 plant habitat, preservation, it might be a, a

15 different set of, of, of measurements or targets for

16 the same criteria and indicators that I've listed

17 here.

18 But it, it is a very much a collaborative

19 approach in that the, the landowner and the Proponent

20 need to get together and decide what the targets are.

21 And, and these can be quantitatively described and

22 then it sets in place a clear target as to what is

23 expected.

24 Q. So, if I'm understanding your answer, hypothetically

25 speaking, if this Panel was to recommend ecological

Mainland Reporting Services Inc. [email protected] 1372

1 restoration to take place rather than equivalent land

2 capability, the protocols in Appendix K could address

3 that?

4 A. Yes, they do. The protocol in Appendix K, Ecosystem

5 Functionality, does follow the Society for Ecological

6 Restoration guidelines as well as, as the range health

7 approach. And that is based on a functioning

8 landscape.

9 A. MR. KANSAS: If I could add, just the

10 nature of these narrow pipelines and the mitigation

11 measures proposed, there's a natural tendency over

12 time towards ecological integrity from a biotic point

13 of view. There's a natural infilling of native plants

14 into the, into right-of-way. It's... Our findings

15 over the last few years have shown that.

16 Q. So -- okay, I think I'll move on from there. Turning

17 to EnCana's Reply Submission, we're going to

18 page 117, figure 8. And --

19 A. MR. HEESE: I've got it. I'll probably

20 be speaking to this section.

21 Q. And the EnCana assessment, Protocol for Range Health

22 includes category E, Noxious Weeds. And my, my

23 question is simply, what plant species are included

24 in this category?

25 A. And, and before I answer that, I think it's important

Mainland Reporting Services Inc. [email protected] 1373

1 to clarify and separate this exhibit from Appendix K,

2 which is proposed for the Project. These are not --

3 this is not the product of what is proposed in

4 Appendix K of our reply evidence. This was one

5 example where I have tried to apply the SRD method of

6 range health as part of an ongoing monitoring program

7 in the Koomati Block, on the Suffield Block. So I

8 just want to make that clarification. So this is

9 still a work in progress and it was to provide an

10 example of some of the long -- some of the monitoring

11 that we do of the area.

12 In specific answer to your question, there

13 were some particular items that I did have to modify

14 from the SRD category to try and understand the

15 regulatory environment that is placed on an oil and

16 gas company, as well as respecting oil and gas

17 disturbances versus grazing impacts, which is what

18 this protocol was originally designed for.

19 So the specific category of noxious weeds on

20 this case, or in this case, I chose to restrict that

21 to noxious and restricted weeds as identified in the

22 Alberta Weed Control Act. So, to know that if, in any

23 event, if I received anything less than full marks

24 that there was an immediate obligation to return to

25 that location and ensure compliance with the Weed

Mainland Reporting Services Inc. [email protected] 1374

1 Control Act.

2 So, again, separate this example from what is

3 proposed in, in Appendix K.

4 Q. So if I can jump, then, to what is proposed in

5 Appendix K, I take it it would include noxious weeds

6 but would it also include species like Crested

7 Wheatgrass?

8 A. DR. WALKER: Would that be included in the

9 protocol?

10 Q. The way I understand this, this, this report card is,

11 is it determines what noxious weeds are there and

12 includes that in, in an assessment of, of the range

13 health. I'm wondering if things like Crested

14 Wheatgrass or Smooth Brome would also be measured and

15 monitored, measured and monitored in a similar sort

16 of report card?

17 A. It, it would be in a, in a similar way. As I

18 mentioned, though, it, it's going to determine -- it

19 would depend on the stakeholders deciding what the

20 targets are. And that would certainly include the,

21 the presence of undesirable species. This, this is a

22 -- this report card is, is, an attempt to use the

23 standard range health protocol for a reclamation site

24 and it, it's appropriate certainly for, for managing

25 cattle on rangeland, but it -- there are, there are

Mainland Reporting Services Inc. [email protected] 1375

1 difficulties with it importing it over for reclaimed

2 sites because, as this indicates, bare ground was

3 quite high. And that, that would be expected at an

4 early stage after reclamation. So it, it, it may

5 not -- would not necessarily get the same score under,

6 under the system I'm proposing. There might be other

7 means of erosion control for site stability rather

8 than ground cover from litter that's accumulated.

9 So this is an example, but it doesn't work

10 very well. The protocol in Appendix K is based on the

11 same fundamental structure, but the indicators would

12 be different and would be scored differently.

13 Q. Okay. I think we should probably go to Appendix K,

14 then. If we can go to page K15 in Appendix K, which

15 is in the Reply Submission, I think on the first

16 paragraph, it states:

17 "Indicators are ranked in units of

18 departure from expected

19 hypothetical or from an appropriate

20 local reference site."

21 And I, I just want to understand how EnCana

22 intends to use reference sites and how they will be

23 selected.

24 A. They, they could be selected based on a, on a

25 theoretical site potential as, as, "as good as it

Mainland Reporting Services Inc. [email protected] 1376

1 gets", for example, but the way it's been set up, I

2 would like to have reference sites chosen from the

3 landscape, get the involved parties involved so that

4 they can have a look at it. And can approve it and it

5 can be described quantitatively and that becomes a

6 target, and there could be several reference sites

7 based on different ecological sites, based on soil

8 type or a position or land use, for example.

9 Q. And, and what's the timing for selecting the reference

10 sites?

11 A. There is no particular rush to choose the reference

12 sites because, at least for the final abandonment

13 stage, the, the protocol looks after the early stages

14 to a certain extent in terms of ground cover, species

15 selection. I suppose there may be some land uses

16 where, where an early decision on, on the land use

17 should be decided so that the Reclamation Plan can be

18 tailored for that. For example, if it is for rare

19 animal or rare plant habitat, you may want to do less

20 if -- rather than, than more, but in general, EnCana

21 would probably want to look after their facilities,

22 we'll look after the wellheads, the pipelines and the

23 trails and so there would be a high emphasis on site

24 stability in that regard.

25 Q. And would reference sites include reclaimed sites?

Mainland Reporting Services Inc. [email protected] 1377

1 A. I, I think they should be reclaimed sites. I think

2 they should be -- well, they could be existing

3 operational well sites. There are many sites out

4 there that have, have returned to all native species

5 that looks like somebody's just jammed a pipe in the

6 ground, and other than that, it, it looks like totally

7 native prairie, no non-native species, various

8 diversity and, and distribution of native plants. So

9 those sites could be used as target sites and for, for

10 similar types of landscapes where wells are proposed.

11 Q. On the same page, it suggests that the monitoring plan

12 was modelled after the range health assessment model,

13 which is an ASRD model, if I understand that?

14 A. Partially, but it's mostly modelled on, on the, the

15 U.S. indicators, the one that's proposed by -- well

16 proposes being used by the Bureau of Land Management.

17 Appellant and Pike (phonetic), Schafer and Herrick

18 (phonetic) are the authors, principal authors of that.

19 It's also based on an Australian model of

20 ecosystem functionality, and which covers the same

21 attributes. So it's, it's a rather rigorous

22 definition of functionality. It, it has been -- it is

23 well thought out, it's been used in a number of

24 different applications. In this case, we're adapting

25 it for use for reclamation.

Mainland Reporting Services Inc. [email protected] 1378

1 Q. Are there some key differences from the ASRD model

2 that, that could be highlighted?

3 A. Yes, there are. And the principle difference is the

4 composition of the species. With managing rangelands

5 for grazing, you're looking at the effects of grazing

6 pressure, removing the sensitive species, the

7 decreasers, and looking at the presence of increaser

8 species. So the composition is a, is a sensitive tool

9 to monitor grazing pressure, whereas for reclamation,

10 we're looking for a pioneer community and a trend and

11 a succession towards a target plant community at the

12 end. So it's, it's different in that regard.

13 A much higher emphasis is placed on site

14 stability for reclamation compared to the, to range

15 health. For range health, you're looking at a, an

16 undisturbed landscape and the background erosion rate

17 is what you get. There's not much opportunity for

18 changing that. Although, that is changing now in the

19 States where they are looking at problems with certain

20 kinds of rangeland, native rangeland, that's

21 contributing to sediment lows in streams, but it, it

22 simply reverses, I guess, the order of, of the

23 attributes. Site stability is first and on the, on

24 the protocol I'm suggesting, and the biotic integrity

25 and the particular, the species composition, is, is

Mainland Reporting Services Inc. [email protected] 1379

1 the principle attribute that's being looked at in the

2 ASRD model.

3 Q. I understand what you said was that one of the key

4 differences is it's been changed because of grazing

5 or to, to reflect grazing issues. Does that also --

6 do those changes take into account wildlife habitat

7 or --

8 A. The aspects of wildlife habitat are covered under

9 biotic integrity, and that would be covered under what

10 we call the desired plant community in biotic

11 integrity. Another aspect of biotic integrity is

12 whether there's nutrient cycling, whether it's

13 self-sustaining.

14 Under the desired plant community, certain

15 wildlife may require certain species and so that would

16 become part of the desired plant community. And that

17 would reflect the value of that landscape for wildlife

18 habitat.

19 Q. Okay, and just -- I want to know whether EnCana has,

20 has used this range health assessment protocol

21 proposed in Appendix K in other grasslands

22 environments or would this be the first application

23 of this protocol?

24 A. MR. HEESE: This would be the first

25 application.

Mainland Reporting Services Inc. [email protected] 1380

1 Q. And Dr. Walker, I take it you've applied this

2 elsewhere, just not for EnCana?

3 A. DR. WALKER: Yes, I did a, a field

4 verification, I'll call it, on, on a number of EnCana

5 well sites when I was looking into this. And prior to

6 that -- well, I -- I've been working on this for about

7 five years, applying it in different places, in the

8 Brooks area for two years, and prior to that, had a

9 look at the Express Pipeline right-of-way a number of

10 times as well, as I've tried to fine-tune it, and

11 looked for weaknesses and adjust for the, for

12 efficiencies.

13 Q. We're going to jump to Appendix Q now, and I'm looking

14 for a table entitled, "Site Inspection Summary". I

15 think it's on page 7-16.

16 A. MR. HEESE: I have Appendix Q. Was there

17 a specific page?

18 Q. 7-16, I think. That's where it is. There isn't a

19 specific page. My question is, is more general than

20 that. What I understand this table to list is sites

21 for immediate clean up and also sites for clean up at

22 the time of well abandonment and final reclamation.

23 And it appears that reclaiming some vegetation

24 deficiencies, small areas of drilling mud and cement

25 have been deferred for some wells until final

Mainland Reporting Services Inc. [email protected] 1381

1 reclamation. And I'm wondering whether EnCana has

2 accepted the recommendation to defer those activities

3 on those well sites?

4 A. The recommendations were accepted at this point in

5 time. However, we have since decided to revisit and

6 ensure that there is absolute -- that any deficiency

7 that can be remedied prior to final reclamation is

8 addressed immediately.

9 So the comments surrounding cement fragments

10 that could be left were very small in nature. They

11 weren't large piles. Any large pile of any sort of

12 residual material were absolutely cleaned up. They

13 were specific comments to just very small isolated

14 patches. So the recommendation was taken at the time,

15 however we are committed to returning to all of these

16 locations and ensuring that any deficiency marked is,

17 is remedied.

18 Q. And just if you can help me understand that

19 commitment. Is EnCana's intention to remedy those

20 deficiencies immediately or prior to reclamation? I

21 don't know the timeframe for that commitment.

22 A. Oh, as soon as possible.

23 Q. Okay.

24 A. We did also submit in Appendix N of our reply evidence

25 a revisit to those locations to confirm that the

Mainland Reporting Services Inc. [email protected] 1382

1 recommendations that were outlined in here were, in

2 fact, taken and to further confirm that we will again

3 ensure that everything is, is remedied in the specific

4 situations where they, in our revisits, again found

5 very small isolated patches, so those will be removed

6 as soon as possible.

7 Q. Okay. We're going to go back to the main body of the

8 Reply Submission. We're going to page 56. And,

9 again, I don't think we need to turn it up, but what

10 I understand EnCana has stated there is that it has

11 been successful at transplanting rare plants on the

12 Express Pipeline and Foothills Pipeline project. And

13 I wanted EnCana to expand a bit on, on that process

14 and whether or not it was successful.

15 A. DR. WALKER: On, on the Express Pipeline,

16 when rare plants were, were identified, you want a

17 detail of the whole process? Step by step or? In one

18 -- in, on Express Pipeline is what we called wild ling

19 transplants (phonetic). We took plants out of the

20 field as late in the fall as possible so that they

21 would be dormant and they were sent to various growers

22 with experience and they were stored and healed and

23 then brought out and transplanted back on the

24 right-of-way, and those were monitored after

25 construction and there was successful transplanting.

Mainland Reporting Services Inc. [email protected] 1383

1 It was variable.

2 On the, on the Foothills Pipeline example,

3 that was my project I was on the Foothills lines south

4 of the Frenchman River, and it was a stand of, of a

5 plant that was rare in Saskatchewan, but not in

6 Alberta, and where it's very prolific in British

7 Columbia, and we did two things there: we, we dug up

8 plants -- well, we narrowed the right-of-way to reduce

9 the impact. And we dug up plants, salvaged them, and,

10 and grew them up and transplanted them back on to the

11 right-of-way. We also grew some from seed. And we,

12 in the post-construction monitoring, we created a

13 setback, I guess you'd call it. We fenced off the

14 rare plant stand and monitored that over the next

15 eight years. And we, we did put plants back and they

16 did establish, although where they were fenced off

17 where the cattle didn't reduce the grazing, the litter

18 accumulation, the rare plants were crowded out, both

19 by the plants that we seeded but also adjacent where

20 it was undisturbed where the native plants grew back

21 and also crowded them out.

22 Where they survived and where they are still

23 increasing today is that part of the area that was not

24 fenced, where the cattle trampled and disturbed the

25 ground. And at that point they are increasing there.

Mainland Reporting Services Inc. [email protected] 1384

1 So I guess that would be successful and not

2 successful. The best approach would have been for us

3 to do less rather than more in terms of maintaining

4 the habitat for those rare species.

5 Q. And just so I'm clear, is it EnCana's intention to do

6 any plant transplants as a part of this Project?

7 A. The, the main objective is to, to find them and avoid

8 them. If, if there are situations where, where, where

9 a rescue may be a choice, then that needs to be

10 discussed with regulators in terms of certainly if

11 it's a SARA listed species before those actions were,

12 would be taken.

13 I notice from the rescue plans that, or the,

14 plans that have been prepared, there seems to be the

15 distinction between naturally occurring populations

16 and ones that are horticulturally derived. So it may

17 mean that, that under this protocol that they are

18 proposing that if, if we did transplant and were

19 successful, they wouldn't count as, as being rare

20 plants, so that would have to be investigated.

21 Q. You mentioned having to talk to regulators if it was a

22 SARA listed species. Would, would that require a

23 SARA permit, then?

24 A. I assume that, that harvesting seed would require a

25 SARA, a SARA permit, yes.

Mainland Reporting Services Inc. [email protected] 1385

1 Q. Okay. I want to talk a bit about controlled burns

2 now, and, and I'm wondering from a policy

3 perspective, does EnCana support a policy of

4 controlled burns for the NWA? I guess I don't want

5 to know what effect that would have.

6 A. Perhaps I could just add a bit of science background

7 to that. The northern part of the NWA, the Sand Hills

8 area has not burned since '87. And that was a

9 particularly hot severe fire. It ended up

10 extirpating -- extirpating Varny Buffalo Berry

11 (phonetic) from the area. And it has not burned

12 since.

13 And the fuel load has accumulated to a degree

14 that I find alarming, especially the last three years

15 of above average moisture. And so I think that some

16 sort of fire management needs to be investigated in

17 that area, not just from -- it is an issue, I know,

18 from, from some landowners that are outside to the

19 northeast have expressed concern about the fire hazard

20 that's there, and my own concern for, for EnCana

21 people working out there with that kind of fuel load

22 there.

23 So some sort of fire management plan I think

24 has to be looked at, investigated and that might, it

25 might include prescribed burns or some, or some sort

Mainland Reporting Services Inc. [email protected] 1386

1 of fuel reduction measures.

2 Q. Okay, and --

3 A. MR. L'HENAFF: If I could just add -- so

4 that's correct. We kind of see it as a collaborative

5 efforts initiative. It needs to be managed at a, at a

6 regional level. We're certainly willing to

7 participate in those management efforts, for sure.

8 Q. Okay. And if management efforts were introduced and

9 there were some controlled burns, can you comment on

10 the ecological and operational effects upon the

11 reclamation program involving native species. What

12 might the impact be there?

13 A. DR. WALKER: Of prescribed burns?

14 Q. Yes.

15 A. Are we talking before or after the Project, after

16 construction?

17 Q. Why don't we go after construction.

18 A. I, I -- it tends to be species specific and site

19 specific and, and I don't see that affecting our --

20 the reclamation targets or goals. In fact, if

21 anything, it may help enhance those goals by perhaps

22 controlling undesirable species.

23 Q. Okay. And in terms of a safety hazard, can you, can

24 you expand on what impact a controlled burn would

25 have on, on oil and gas facilities?

Mainland Reporting Services Inc. [email protected] 1387

1 A. MR. L'HENAFF: It really wouldn't have much

2 of an effect from a safety perspective. What likely

3 would occur would be some of the ancillary equipment,

4 like the, the insulation on the wellheads and, you

5 know, we've -- burns are a typical thing in the MTA,

6 so our facilities are frequently exposed to that level

7 of burning. And typically what we have to do is there

8 there are caissons, replace the plywood, above-ground

9 facilities have to replace the insulation, but it

10 doesn't pose much of a safety risk at all.

11 Q. Okay. I'm going to move to water use now. And my

12 first question is, did EnCana consider treating

13 higher salinity ground water from the Belly River or

14 deeper formations for drilling and completion

15 purposes?

16 A. No, we haven't considered that, for, for a couple of

17 different reasons. One is our existing sources, you

18 know, our, our -- seem to be satisfying the needs and

19 like I say, they are kind of, as I've indicated

20 before, spread between three main sources: The city

21 of Medicine Hat, the South Saskatchewan River, and a

22 couple of local dugouts.

23 On top of that, the water required for the

24 drilling, which is effectively half the requirement,

25 you really need that freshwater so you can't use

Mainland Reporting Services Inc. [email protected] 1388

1 the -- any water with saline content in it. So, for

2 those reasons, we hadn't really considered using

3 deeper source water.

4 A. MR. HEESE: While we're on the topic,

5 sir, of water in general, I just thought it would be

6 appropriate to offer that, through our production

7 fields, any produced water that is captured in the

8 field, we do take to a facility where we do recycle

9 the water for use in our completions operation. So it

10 is, it is somewhat consistent with the type of

11 question you were asking, but not, again, the same

12 application of using Belly River formation water.

13 Q. Okay. And how much make-up water will be used for

14 drilling and completion fluids then, can you -- by

15 way of a rough percentage?

16 A. MR. FUDGE: I have, I have the numbers

17 here. You mean in terms of the overall program and

18 the annual use of water and the sources thereof? Is

19 that what you'd like to know?

20 Q. Yeah, why don't we go there.

21 A. Okay. Okay. So, in a, in a -- there, there are in

22 the scenario of and in the NWA of 425 wells, and this,

23 these numbers, by the way, also include 200 other

24 wells, so in fact it's more than what is required for

25 425 wells. It's for 625 but these are numbers that we

Mainland Reporting Services Inc. [email protected] 1389

1 have. So this is a -- this will be a high-end

2 estimate. But -- and in the evidence, this has been

3 noted as well.

4 The total annual water use, and this includes

5 recycling, has already been included in this, would be

6 about 60,000 cubic metres of water per annum. And

7 about 10,000 of that would come from the South

8 Saskatchewan River. That's under licence by the

9 province. The licence, by the way, is for

10 70,000 cubic metres that could be withdrawn under

11 their licence with the, with the Alberta Government,

12 Alberta Environment, with EnCana's licence. But they

13 are proposing to take 10.

14 The EnCana, the Suffield wells that EnCana

15 uses, including dugouts, around 30, let's call it

16 35,000 cubes.

17 And off-site water purchase, which is

18 Medicine Hat, which was just referred to, about

19 16,000 cubic metres, for a total of 60,562 cubic

20 metres so just a little over 60,000 cubic metres per

21 annum.

22 Now, it, it's important to note, though, that

23 this water is presently being withdrawn today from

24 those sources. So it's not an incremental amount.

25 This is already being withdrawn from these sources on

Mainland Reporting Services Inc. [email protected] 1390

1 an annual basis for the ongoing drilling activities

2 that are occurring so there's no net increase in water

3 use proposed for the shallow gas drilling in the NWA.

4 So that's, that's important to know.

5 The other thing to note is that the period of

6 use of this water is during the dry, frozen winter

7 period where, one, withdraws for example from the

8 South Saskatchewan River are very low, two, the, the

9 groundwater use is during the period of recharge, and

10 not during the period of net water deficit that the

11 Great Plains undergo in this area. So those are just

12 a couple of items.

13 Anyway, so perhaps that answers your

14 question.

15 Q. No. I was actually curious about the, the produced

16 and swabbed water and I wanted to know where that fit

17 in in this. So what's the approximate volume of

18 produced and swabbed water that's going to be used?

19 Not that the other information wasn't helpful, but

20 the specific question was a bit different. I was

21 going to get to that. No one should feel bad.

22 A. MR. L'HENAFF: One moment. I'll just

23 confirm the number. So just the -- sorry. So just a

24 couple of numbers for you here just to calibrate what

25 is produced, water, how it fits in. So the NWA

Mainland Reporting Services Inc. [email protected] 1391

1 produced water is about 150 cubes a month year to

2 date. We've recycled approximately 3500 cubes for

3 this year.

4 Q. So it's pretty small?

5 A. In comparison to, to the overall, yes.

6 Q. Okay. And where will that produced water be stored

7 before and after it's treated?

8 A. It gets treated at a recycle pit at one of our

9 compressor stations, but it effectively gets used at

10 the same time as it is getting produced.

11 Q. Okay. So -- and where would that recycle station be

12 in relation to the NWA?

13 A. It's outside of the NWA at one of the compressor

14 stations on the southern border of the block. It's

15 basically a settling pond.

16 Q. Okay. Now, with respect to the, the permit that

17 EnCana has from Alberta Environment to withdraw from

18 the South Saskatchewan River, is that a temporary

19 water diversion permit?

20 A. MR. FUDGE: That's correct.

21 Q. And what's, what's the lifetime on that? Is there an

22 expiry period on it?

23 A. Well, this is a -- it's temporary -- my understanding

24 is it's an annual licence applied for and granted on

25 an annual basis. And I actually have a copy, if you'd

Mainland Reporting Services Inc. [email protected] 1392

1 like me to put it on the record here, of -- this was

2 received on September 15th, 2008. So this is the most

3 recent water licence that has been granted by Alberta

4 Environment to EnCana to withdraw 70,000 cubic metres

5 max from the South Saskatchewan River from the period

6 basically over the winter period is what they're

7 saying here.

8 Q. Okay. But, but it needs to be renewed each year, is

9 that fair?

10 A. That's my understanding. That's right.

11 Q. What, what's the potential of it not being renewed

12 September 2009? You may not be able to answer that.

13 A. I can't, personally.

14 A. MR. L'HENAFF: I guess we don't think that

15 the potential is very high. We've been renewing this

16 one for quite some time. But it is up to Alberta

17 Environment.

18 Q. Okay. It's my understanding that the South

19 Saskatchewan River basin has been designated as a

20 water short area. Is that accurate?

21 A. MR. FUDGE: I understand that's correct.

22 Q. Okay. And could that have any implications on future

23 renewals?

24 A. Well, it may. I really can't -- I don't think any of

25 us can speak for Alberta Environment. The only two

Mainland Reporting Services Inc. [email protected] 1393

1 things I can say is that of the 70,000 cubic metres of

2 water that are permitted under this, this water

3 licence, EnCana proposes to use 10,000. So it's a

4 small -- it's obviously a fraction of what they are

5 allowed to take. Number two, they are going to

6 withdraw that water during a low water withdraw period

7 where other users, like agriculture, which is probably

8 the, the largest, and even municipal water use is, is

9 either zero or low for that period of, of time of the

10 year.

11 Q. Okay. And are there any monitoring requirements

12 associated with that temporary diversion permit?

13 A. My understanding is they -- EnCana is obliged to

14 report their use. And they do. They track their --

15 how many tanks they are taking out, tank loads and so

16 on.

17 Q. Okay. And --

18 A. I believe -- excuse me. All those specifications and

19 requirements are, are in, are noted in the licence,

20 what EnCana is obliged to do and the reporting

21 thereof.

22 Q. And maybe we should take your suggestion, sir, and

23 enter that on the record since we've discussed a bit

24 of it, so...

25 MR. DENSTEDT: Sure, we'll undertake to make

Mainland Reporting Services Inc. [email protected] 1394

1 copies of that and I think that's exhibit 130. 131.

2 THE CHAIRMAN: I believe it's 131,

3 Mr. Denstedt. Thank you for that undertaking.

4 MR. DENSTEDT: I may be able to help on the

5 temporary water licence. As a matter of law, Alberta

6 Environment maintains management of their water

7 resources typically through temporary water licences.

8 They are more and more loath to grant permanent water

9 licences because of the, the priority associated with

10 that. And there is inherent in the Water Act in

11 Alberta, in any event, regardless of whether we have a

12 permanent licence or a temporary licence, an emergency

13 section that allows Alberta Environment to stop

14 withdrawal of water from anybody if an emergency

15 arises. So it's a way for Alberta to manage their

16 water resources. I hope that's helpful.

17 THE CHAIRMAN: Thank you.

18 EXHIBIT 002-131: Licence to temporarily divert

19 water dated September 9, 2008

20 MR. MOUSSEAU:

21 Q. I asked about monitoring in relation to the water

22 diversion permit. I'm wondering if there's other

23 monitoring proposed with respect to EnCana's water

24 use and in relation to the dugouts and the wells on

25 the base?

Mainland Reporting Services Inc. [email protected] 1395

1 A. MR. FUDGE: The licensed wells that have

2 been proposed to have water withdrawn from them, and

3 that is the "Big Bob" and Dugway wells. Those are

4 licensed wells, again, with the provincial licence.

5 And, in fact, in Appendix 2G of the, of Volume 3,

6 there is monitoring reports for 2005 listed there.

7 But that, again, is a requirement that those -- that

8 monitoring be reported for those wells. I think

9 it's -- anyway, that's the answer to that question.

10 And also, of course, in the, Environmental

11 Effects Monitoring Plan that has been submitted to the

12 Panel, there is a requirement -- there is a candidate

13 program for water quality and quantity from these

14 wells and dugouts that will be used on the, on the

15 Military base.

16 Q. Okay. And do you know if that monitoring data goes to

17 DND or SEAC?

18 A. I'd have, I'd have to refer to my EnCana colleagues on

19 that one. We understand -- yes, I understand it goes

20 to SIRC, those, those -- as well as the Provincial

21 Government.

22 Q. It goes to SIRC?

23 A. That's correct. Yes. SIRC.

24 Q. Now I have a question for sure. With respect to the

25 dugouts, are those associated with wetlands.

Mainland Reporting Services Inc. [email protected] 1396

1 A. MR. HEESE: There has been reference to

2 "Big Bob", which is a dugout in, in a wetland area.

3 Q. Okay. And is, is there monitoring associated with the

4 surrounding wetlands?

5 A. MR. FUDGE: There -- I believe there has

6 not, but I'll let EnCana answer that one but -- to

7 confirm that. But there is proposed to be monitoring

8 for this Project, particularly of those wetlands fed

9 by this overflow of well raw water into a dugout and

10 then into these adjacent wetlands.

11 A. MR. HEESE: There has also been a

12 recently submitted LandWise report looking at the

13 water bodies and we are proceeding with

14 recommendations outlined in the LandWise report, so

15 there is, there is monitoring going on on all the

16 various water sources with recommendations that EnCana

17 will be following up on.

18 Q. Okay. And is there any specific monitoring

19 requirements for shallow groundwater systems to

20 ensure wetlands won't be impacted?

21 A. MR. FUDGE: Well, that's I believe what

22 I -- that is, in fact, what is proposed.

23 Q. That's the specifics?

24 A. Yeah, exactly, to look at the, the, the connectivity

25 between, between these, these wetland areas and

Mainland Reporting Services Inc. [email protected] 1397

1 groundwater in this area, in the area of, of the water

2 withdrawal from dugouts and/or wells. So that is,

3 that is something that's been proposed.

4 I just want to point out that in volume, in

5 Volume 4, in the groundwater chapter of Volume 4, the

6 water level measurements for the, the licensed wells,

7 based on the 2005 data, show very clearly water

8 withdrawal and water recharge in those wells. That

9 you get a very, a very good recovery from, from water

10 withdrawal in terms of the level of the wells. And,

11 you know, the bottom line is that it's -- it, it is

12 evidence of a sustainable use of that groundwater.

13 The ground, the groundwater in that area in this

14 pre-glacial valley aquifer, there are no other real

15 users than the, than EnCana's proposed use.

16 Also, as I did point out, they are proposing

17 to use water from those wells much lower again than

18 their licensed amount, but also during the, the time

19 of recharge, during the winter, and not during the net

20 water deficit of the summer.

21 Q. Right. And just, just so I understand it, those wells

22 are licensed to EnCana, or are they licensed to the

23 Base?

24 A. To EnCana, I believe.

25 Q. To EnCana?

Mainland Reporting Services Inc. [email protected] 1398

1 A. Yes.

2 A. MR. HEESE: Just one moment, please. The

3 dugouts that are in association with water wells are

4 licensed to EnCana.

5 Q. Okay. And just so I'm entirely clear, EnCana's not

6 using any water sources that are licensed to the Base

7 or that would require Base approval?

8 A. No.

9 Q. Okay. Now, I'm informed that there are numerous

10 buried valley channels underlying the Suffield site

11 and that these buried channels generally contain

12 sediment layers with extremely high porosity. And

13 I'm just wondering if you can accept that statement?

14 A. MR. FUDGE: Are you referring to this

15 pre-glacial valley that's just to the west of the

16 National Wildlife Area?

17 Q. I am.

18 A. Yes, I believe that's correct.

19 Q. Okay. And what I guess I'm wondering is, has EnCana

20 experienced lost circulation while either drilling or

21 cementing in these areas?

22 A. MR. L'HENAFF: So we don't have any

23 information here to, to indicate if we have or have

24 not had any instances of lost circulations. However,

25 what I can add is in the southern part of, of the

Mainland Reporting Services Inc. [email protected] 1399

1 block in, in this area that you're talking about, we

2 are aware of an active aquifer there. And so our

3 practices have been to land our conductor pipe and

4 surface casing lower and, and basically manage the

5 situation like that through our drilling operations.

6 And then of course we've got a good track

7 record. Shallow gas has a good track record around

8 groundwater protection, and basically have cement

9 string going from our shallow gas zones up to surface.

10 And from a frac perspective, we basically have our --

11 the lead Park Pikauki (phonetic), 50 to 100 metres of

12 shale basically separating the formations.

13 Q. Okay, but should, should EnCana experience lost

14 circulation, does it have a protocol that it follows

15 if it's above the basic groundwater protection?

16 A. Yes, we do.

17 Q. Okay. Could, could you walk me through that?

18 A. That would be part of our drilling protocol. I'm not

19 familiar with the details of that. But effectively it

20 would be to maintain control of the well and basically

21 achieve circulation of that. Now, it's a rare event.

22 I don't know whether it has ever occurred. It's a

23 rare event. And like I say, the -- once we understand

24 where, where the active groundwater systems are, we

25 accommodate that through a modification of the

Mainland Reporting Services Inc. [email protected] 1400

1 conductor surface casing program.

2 Q. Don't take this the wrong way, but is there someone

3 behind you who might be able to answer that question,

4 in terms of the specific protocol for lost

5 circulation? It's just --

6 A. No, what I would have to do is get our drilling

7 engineer.

8 Q. Is that something we could do at the break? Is it a

9 matter of a quick phone call?

10 MR. DENSTEDT: I think we could take that by

11 way of an undertaking. Take a phone call and put it

12 on the record in that matter. Is that satisfactory,

13 sir?

14 THE CHAIRMAN: Yes.

15 MR. MOUSSEAU: I have one more question

16 along those lines and maybe it would be useful to put

17 that on the record as well if the same source is for

18 that information.

19 MR. DENSTEDT: You bet.

20 MR. MOUSSEAU:

21 Q. It's simply an expansion on that. What's EnCana's

22 protocol, should lost circulation be encountered

23 while cementing above the basic groundwater

24 protection and doesn't achieve full cement coverage

25 above the basic groundwater protection?

Mainland Reporting Services Inc. [email protected] 1401

1 A. MR. L'HENAFF: I'll, I'll confirm with our

2 drilling engineer and get back to you on that as well.

3 Q. That would be useful. Thank you, sir.

4 A. MR. FUDGE: Excuse me, I just have one

5 comment on your question, sir, that you asked a few

6 questions back on, on groundwater. When you made the

7 statement about, I believe, numerous buried channels

8 or something to that effect. You know, what -- and

9 then I spoke, spoke about, did you mean the

10 pre-glacial valley, et cetera, et cetera, that

11 conversation we had. I just wanted to point out that

12 from the McNeil and McNeil 2008 report, which has been

13 filed as evidence, it specifies that there is one, in

14 this area, that we're talking about, west, just west

15 of the NWA, in that pre-glacial valley area, there's

16 one major aquifer called the Lethbridge Buried Valley

17 or, or aquifer, that is the one that produces the

18 water. And there are others, but they are much less

19 productive.

20 I don't know if that helps, but just that

21 they're not all the same. But this Lethbridge

22 particular sequence is the one that's more productive

23 from a groundwater aquifer perspective.

24 Q. Sure, and that's useful. That's useful, thank you,

25 sir.

Mainland Reporting Services Inc. [email protected] 1402

1 A. Thank you.

2 MR. MOUSSEAU: I'm not sure if we want to

3 stop now. This is sort of a natural break. And

4 contrary to my expectations, I still have some more

5 questions, sir.

6 THE CHAIRMAN: Mr. Mousseau, I think that's

7 a good suggestion. Let's break now for about

8 15 minutes.

9 (MORNING BREAK)

10 (PROCEEDINGS ADJOURNED AT 10:30 A.M.)

11 (PROCEEDINGS RECONVENED AT 10:45 A.M.)

12 THE CHAIRMAN: Ladies and Gentlemen, I

13 believe we're ready to reconvene.

14 Mr. Mousseau, please continue.

15 CROSS-EXAMINATION BY BOARD STAFF, BY MR. MOUSSEAU

16 (CONTINUED):

17 MR. MOUSSEAU: Sure.

18 Q. I'm going to move now to, I have some questions on

19 Ord's Kangaroo Rats. And because I've meddled with

20 the questions, my reference may not be entirely

21 accurate, but I, I think we can get beyond that

22 problem.

23 My understanding is that EnCana has taken the

24 view that it's not possible to map habitat supply for

25 the Ord's Kangaroo Rat due to the fine scale of

Mainland Reporting Services Inc. [email protected] 1403

1 habitat used by the species. And my question is

2 simply, what, what does EnCana mean by "the fine

3 scale habitat selection"?

4 A. MR. KANSAS: Kangaroo Rats spend the vast

5 majority of their time in, in the vicinity of their

6 burrows and den sites. And they move perhaps

7 100 metres, 80 to 100 metres from their den site at

8 any given time. And the den sites are specifically

9 located in areas of active dunes or sandy areas on, on

10 riverbanks or along roadsides. So they are very

11 specific in their, in their habitat use. Many of the

12 burrows and den locations are, are already known in

13 the NWA through 15 years of research by the University

14 of Calgary, so it was not, not practical for us to --

15 given that we were going to avoid these K-rat areas,

16 known K-rat areas anyways, it would, would be

17 redundant to attempt at this point to map habitat at

18 that fine scale, okay.

19 Q. Okay, and but, could you map that, the high

20 suitability habitat based on soil mapping, is that,

21 is that a tool you could have used or...

22 A. No.

23 Q. No?

24 A. No, it would not work. At a, at a course level, you

25 could, but they are so specific in their habitat use.

Mainland Reporting Services Inc. [email protected] 1404

1 Q. Okay. One of the concerns expressed by the Government

2 of Canada was that underground drilling may be a

3 particularly acute form of disturbance for Ord's

4 Kangaroo Rats and my question is whether EnCana is

5 aware of any studies that have assessed the effect

6 of, of noise or drilling on, on Kangaroo rats?

7 A. The only study that, that is of any detail that was

8 done on the effects of, of oil and gas activities on

9 Kangaroo rats was done just outside the National

10 Wildlife Area on the North Suffield pipeline. And

11 that was a -- it wasn't a drilling study, it was a, a

12 major pipelining study with heavy equipment, 54 days

13 of construction. And there was minimal impact on the

14 Kangaroo rats. No, no mortality, et cetera.

15 In terms of drilling, I'm not aware of a

16 study, no.

17 Q. Okay. And, and what's the potential for, for winter

18 construction to disturb burrowing species? I think

19 we talked about this specifically with respect to

20 frogs. And I'm wondering if we can expand that a

21 bit, to the Kangaroo Rats, snakes. I guess it was

22 toads, not frogs, sorry. I think you indicated that

23 the impact would be minimal, but maybe if we could

24 address those other species as well.

25 A. I can start with the Kangaroo Rat. There would be two

Mainland Reporting Services Inc. [email protected] 1405

1 ways that you could affect, affect these critters; one

2 would be actual physical damage of their, of their

3 residence. The chances of that happening are very,

4 very slim because of the, the PDA process will allow

5 identification of, of the, of the residences, and they

6 will be avoided by the standard 250 metre setback.

7 The other would be interruption of, of torpor

8 activities, they are shallow, shallow hibernation, I

9 guess you could call it, during the winter. Now,

10 there has been work on, on that sort of thing, not in

11 terms of oil and gas interruption or drilling

12 interruption, but just generally, how Kangaroo rats

13 use torpor.

14 I think it's very uncertain right now, and,

15 that, that could be a subject of potential monitoring

16 research that could be done. And I, and I believe we

17 do indicate that in the Environmental Effects

18 Monitoring Plan, is to look at the effects of, of

19 winter drilling on Kangaroo rats. Specifically with

20 the University of Calgary.

21 Q. And is there other research proposed with respect to

22 the Ord's Kangaroo Rat with respect -- with the

23 University of Calgary, or is that the, is that the

24 specific one proposed?

25 A. Well, we were asked to, to supply EnCana with a kind

Mainland Reporting Services Inc. [email protected] 1406

1 of a what we thought based on the issues and that we

2 thought would be useful for regional monitoring and

3 monitoring with respect to the project. That's one of

4 the ones that I put in because there's a little bit of

5 uncertainty there.

6 It's really up to the Committee in setting

7 the Terms of Reference as to what, you know, we would,

8 we would -- I think EnCana would, would speak with the

9 University of Calgary researchers and ask them what

10 they felt the main issues were from their perspective

11 and then go forward from there.

12 Q. And if the University of Calgary didn't take up this

13 invitation, I take it there would be individual or

14 there'd be monitoring by EnCana itself under the EMP?

15 A. Yes.

16 Q. Yes, okay. Now, you were going to give me the

17 information on the Ord's Kangaroo Rat. And we were

18 going to talk about I guess the only other species

19 was snakes.

20 A. MR. COLLISTER: I, I think the comments that

21 I made previously with regard to hibernating toads and

22 the potential for direct mortality as a result to

23 disturbance penetration would hold for snakes as well.

24 In the uplands, the snakes that we'd be concerned

25 about would be Plains Garter Snakes and, and Western

Mainland Reporting Services Inc. [email protected] 1407

1 Hognose Snakes. Those are the two species that, that

2 would spend the winter in the upland. And so it's

3 certainly possible, as I mentioned, with respect to

4 Great Plains Toads that an overwintering animal could

5 be uncovered. As I stated previously, I'm not aware

6 of that happening. It would be a very rare event.

7 With respect to Rattlesnakes and Bullsnakes,

8 and Wandering Garter Snakes , which primarily winter

9 in the river valley or the coulees associated with the

10 river valley, because there's no drilling in those

11 areas then there's no, there's no risk of that sort of

12 impact.

13 Q. Okay. And does EnCana know roughly what numbers of

14 Ord`s Kangaroo Rats are in the NWA? Does it have a

15 rough idea of that population?

16 A. MR. KANSAS: Yes. Yes. The -- that

17 population is monitored closely by the University of

18 Calgary. It ranges -- there's a tremendous amount of

19 winter mortality just by way of -- because of the

20 nature of them being on the northern edge of the

21 range, they basically freeze or die of hypothermia.

22 And I think the -- subject, subject to check, I think

23 it ranges from perhaps 300 or 200 to 1,000, depending

24 on the time of the year. So early spring there'd be a

25 very low number.

Mainland Reporting Services Inc. [email protected] 1408

1 Q. And is that -- as much as you can say, is that range

2 stable over time? Is it increasing or decreasing?

3 A. I think Kangaroo rats, if anything, would be

4 decreasing because -- but not -- well, mainly because

5 of habitat change. There's a real problem with active

6 dunes becoming less abundant. And I think that's --

7 we were talking about fire, controlled fire, a while

8 ago, and I believe the DND has been looking at this

9 problem and trying to trigger blow-outs through

10 burning, burning dune areas. So it's really a habitat

11 issue that's the problem.

12 Q. Okay. It's like we're in sync now. I talked to your

13 counsel earlier about giving you a document which is

14 the COSEWIC assessment and updated status report on

15 the Ord's Kangaroo Rat. That you have in front of

16 you.

17 MR. DENSTEDT: Mr. Chairman, that's correct,

18 and we have no objection to that. In the Joint Review

19 Panel processes, it's typical to examine on documents

20 as an aid to cross-examination, so we have no, no

21 objection.

22 THE CHAIRMAN: Thank you.

23 MR. MOUSSEAU: And I think, in terms of a

24 number, it might be 009-009 (sic), if it's a panel

25 document.

Mainland Reporting Services Inc. [email protected] 1409

1 THE CHAIRMAN: I'll, I'll accept your

2 reference on that. I don't, I don't have the latest

3 updated list here in front of me.

4 MR. MOUSSEAU: I think the only other

5 exhibit we've entered is the notice and that was my

6 calculation.

7 EXHIBIT 001-049: COSEWIC Assessment and Updated

8 Status Report on the Ord's Kangaroo Rat

9 MR. MOUSSEAU:

10 Q. And the question I wanted to ask you about, and it was

11 fairly innocuous, but if we can turn to page 20, the

12 top of the page states:

13 "In addition, the Alberta Ord's

14 Kangaroo Rat recovery team has

15 proposed that experimental habitat

16 management and development of a

17 beneficial management plan for

18 maintaining active dune, active

19 sand dune habitats is a high

20 priority for 2005 to 2009."

21 And I'm wondering if you know what steps, if any,

22 have been taken to put that recommendation into play.

23 A. As I mentioned previously, it's my understanding that

24 the DND, and this is just by hearsay, is -- has

25 initiated that activity with Dr. Darren Bender of the

Mainland Reporting Services Inc. [email protected] 1410

1 university, the University of Calgary, in terms of

2 burning to try to trigger additional bare ground and,

3 and active sand dune habitat.

4 Q. Okay. Do you know if a specific beneficial management

5 plan has been developed?

6 A. I'm not aware of that, but it could be. It would be a

7 good question for, for DND, perhaps.

8 Q. Okay, and I guess the only other question I had to

9 follow up on that is -- would, would that be

10 something you would want to review in preparing

11 either the EIS or the PDAs?

12 A. Well, the EIS is prepared. I'm quite happy and

13 comfortable with my call and significance on Kangaroo

14 rats. It wouldn't affect, or change that.

15 The PDA, yes, that would be useful for the

16 PDA proceedings.

17 Q. Okay.

18 A. I just, just have a little information here,

19 Mr. Mousseau. That the best management plan has not

20 been done in consultation with the recovery team,

21 K-Rat Recovery Team. EnCana is a member of the K-Rat

22 Recovery Team. There's a -- someone sits on the, on

23 that team. It doesn't mean it's not in its infancy

24 and moving forward elsewhere.

25 Q. Okay, but I -- but it -- my read of the recommendation

Mainland Reporting Services Inc. [email protected] 1411

1 was that it was a high priority for 2005 to 2009. As

2 we're late in 2008 --

3 A. Well, there's best laid plans, you know.

4 Q. Fair enough, sir. One of the Panel's Information

5 Requests to EnCana was to inquire if EnCana obtained

6 input from the Ord's Kangaroo Rat Recovery Team to

7 determine the most appropriate measures to put into

8 place to compensate any cumulative effects of the

9 Project on the Ord's Kangaroo Rats. And I'm

10 wondering if EnCana had that opportunity to, to

11 explore the Panel's request.

12 A. We, we had contact very early on with Dr. David Gummer

13 of the Alberta Museum in Edmonton. And I believe that

14 EnCana's in, in pretty close contact with Dr. Gummer

15 on methodologies and research for, for Kangaroo Rat.

16 In terms of compensation, no, I, I have not

17 spoken with, you know, with the Recovery Team on that.

18 I would be happy to, though.

19 Q. Sure, fair enough, sir. In Exhibit 002-013, and this

20 is page 5-100, again, I don't think you need to turn

21 it up, but this is where I'm coming from, EnCana

22 states that the mitigations for the Ord's Kangaroo

23 Rat are those that are found in Section 5.8.2 and

24 those applied in the EnCana Suffield Pipeline

25 Project, which we talked a bit about earlier. And

Mainland Reporting Services Inc. [email protected] 1412

1 what I wanted you to do is briefly describe the

2 mitigations from the Suffield Pipeline Project that

3 are different from those found in 5.8.2.

4 A. I'd have to get 5.8.2 in front of me first, if I

5 could.

6 Q. Sure.

7 A. Perhaps I can start with the, the recommendations from

8 Gummer and Robertson, 2004, which is the North

9 Suffield Pipeline Study. Their principal

10 recommendations to limit the effects of this major

11 pipeline were:

12 - nighttime surveys to, to locate exact

13 locations of, of burrows and den complexes;

14 - to mark the known K-rat burrow

15 locations clearly for the purpose of the construction

16 people seeing them;

17 - to avoid burrow locations;

18 - no trucks or large vehicles where

19 K-rats occur; and

20 - to try to avoid nighttime activity.

21 Those were the, those were the main

22 recommendations.

23 And you're pointing me towards -- what page

24 is it again, Mr. Mousseau?

25 Q. It was 5.8.2.

Mainland Reporting Services Inc. [email protected] 1413

1 A. I've got the wrong document here. Let me... Oh,

2 page 5-45. Okay, I have that here. And this was

3 general mitigation, as I understand it, for wildlife.

4 This is not specific to Kangaroo Rats, but it doesn't

5 mean that what we mentioned in our reply isn't going

6 to be done.

7 Q. Right. And I think what I was noting was that the

8 mitigation mentioned for Kangaroo Rats were these

9 mitigation processes and those used in the pipeline

10 project. And I just wanted to find out where the

11 differences lay. And I think, I think you've set me

12 straight on that.

13 A. Sure.

14 Q. I want to turn now, and this may be a question that

15 has to be answered by Mr. Protti, but I'm not

16 entirely certain, and this comes from Appendix A of

17 the Reply Submission, which was the discussion of

18 legal matters. And if we could go to page A-9. And

19 it's a discussion of a recommendation by Environment

20 Canada that no industrial activity be permitted in

21 areas preliminary assessed as critical habitat.

22 And EnCana's response to this recommendation

23 is that it's not based on the law and is not relevant

24 to the Panel in considering the environmental effects

25 of the Project.

Mainland Reporting Services Inc. [email protected] 1414

1 And what I want to understand, is EnCana

2 saying that the Joint Panel should ignore the

3 information provided by Environment Canada regarding

4 their preliminary assessed critical habitat, or is it

5 simply arguing that it cannot be used for SARA

6 purposes because the critical habitat hasn't, doesn't

7 meet the formal requirements as that term is defined?

8 I want to know what use, EnCana believes,

9 this Panel should use that information for, or

10 whether EnCana believes it should be entirely

11 disregarded.

12 MR. DENSTEDT: I'm not sure the panel can

13 answer that question. That is a legal topic which

14 we'll address in final argument.

15 But if I can help, though, when we looked at

16 this from a legal perspective, there is no legal

17 definition of "Preliminary Critical Habitat". And

18 that's the point of EnCana's evidence. Absolutely the

19 Joint Review Panel can take into consideration what

20 Environment Canada is saying about the existence of

21 preliminary critical habitat. The effect or the

22 outcome from a legal perspective is, is quite

23 different, though.

24 I think if that helps, Mr. Mousseau.

25 MR. MOUSSEAU: I think that does help. And

Mainland Reporting Services Inc. [email protected] 1415

1 maybe this can crystallize the issue.

2 Q. I take it EnCana does not at this point take issue

3 with the methodology or analysis used by Environment

4 Canada, it's the use for which they have used it in

5 their recommendation; is that fair?

6 A. DR. WALKER: I think there would be

7 some disagreement with the method with which the

8 critical habitat has been defined, at least with the

9 plants.

10 A. MR. COLLISTER: I think your question is

11 going, Mr. Mousseau, to all of the assessment of

12 preliminary critical habitat across all of the

13 species, or are you still on Ord's Kangaroo Rat?

14 Q. No, this is a more general question. Let me put it

15 into context. Environment Canada's filed information

16 suggesting, "We've gone out and looked for critical

17 habitat and this is our, this is our preliminary view

18 of what we see as critical habitat." That

19 information is in front of the Panel. And I want to

20 know, from EnCana's perspective, what use should or

21 could be made of that information.

22 A. I think that, in EnCana's Reply Submission, it's

23 pretty clear that, that, that EnCana doesn't agree

24 with the calculation of preliminary critical habitat

25 for many, if not all of the VECs that it was

Mainland Reporting Services Inc. [email protected] 1416

1 calculated for. And, and that's well documented in

2 the reply, the weaknesses that were identified by

3 EnCana.

4 Q. Okay. And maybe, maybe I can be clearer, then.

5 There's, there's, there's an opinion from Environment

6 Canada on Preliminary Assessed Critical Habitat and

7 there's an opinion from EnCana. I just want to know,

8 EnCana's not saying, "Panel, don't consider what

9 Environment Canada is saying because it doesn't meet

10 the criteria"; you're saying, "Consider it, but

11 consider it in light of the, the shortcomings that

12 we've identified"; is that fair?

13 A. Clearly I think the panel is entitled to, to consider

14 that information, so.

15 Q. And I think that answers my question, sir.

16 In response to another Information Request

17 from the Panel, EnCana stated -- and this is

18 Exhibit 002-060 and it was Information Request 21.

19 It says:

20 "Assessing and managing regional

21 cumulative effects was a regional

22 planning exercise normally

23 conducted with other stakeholders

24 and land users."

25 And the question is, should a co-operative

Mainland Reporting Services Inc. [email protected] 1417

1 regional assessment or monitoring program of

2 cumulative effects be initiated?

3 A. MR. KANSAS: Yes, I, I would be very

4 much in support of that. I think it's a, I think it's

5 the right thing to do in this area. And it can be

6 informed by findings of the, the Project as well as

7 other findings in the Great Sand Hills, et cetera.

8 Q. Okay. And we talked about earlier a similar

9 multi-stakeholder group process for managing things

10 like Crested Wheatgrass and noxious weeds. Is it the

11 same approach, in your perspective, that would be

12 useful, given the different users of the Base?

13 A. Well, I think if there, if there were to be a broader

14 regional or a strategic cumulative effects assessment

15 triggered perhaps by this Project, as tends to happen

16 in Alberta, then, then that would -- the kind of model

17 that the Great Sand Hills has looked at might, might

18 be an approach to, to looking at, at setting up a

19 similar structure.

20 I think the key would be to keep it

21 constrained to perhaps the Dry-mixed Grass Region of

22 Alberta, or something like that. Something, something

23 like the sustainable strategy that the Alberta

24 Government's done, but a little more specific to, to

25 prairie environments. That, that would be ideal. And

Mainland Reporting Services Inc. [email protected] 1418

1 I, I think that has to be driven by, not so much by

2 EnCana, but, but by needs that are for the prairie

3 that are, that are concerns of the government more

4 than anything.

5 Q. Okay. And I take it if such a program was

6 established, EnCana would, would want to be involved

7 in it?

8 A. MR. L'HENAFF: Yes, that's correct.

9 Q. Okay. I'm going to jump now to the next Information

10 Request, which was JRP 21. And here the Panel asked

11 EnCana whether offset opportunities might be used in

12 the case where regional environmental impacts,

13 combined with EnCana's residual project impacts

14 within the NWA, and the purpose would be to create

15 net impacts that were zero or positive for the NWA.

16 EnCana's response was that offset

17 opportunities existed and the company would

18 participate in discussions about offset

19 opportunities.

20 And I wanted to know, first of all, what

21 other stakeholders or landusers should participate in

22 those discussions?

23 A. I think this question would be, would be best left for

24 Mr. Protti.

25 Q. Okay. And, and I have some other questions with

Mainland Reporting Services Inc. [email protected] 1419

1 respect to offsets. Again, are those questions for

2 Mr. Protti, or should I just -- my concern is some of

3 them deal -- I'm going to ask them and you can tell

4 me if they should go to Mr. Protti or not because I

5 don't think we're going to have the same panel

6 composition down the line.

7 I'm wondering whether there's environmental

8 offsets EnCana could suggest that would be applicable

9 to vegetation management or SARA species?

10 A. MR. KANSAS: Vegetation management of

11 SARA species. Could -- which SARA species are you

12 referring to?

13 Q. I don't have a particular one in mind, sir. I'm just

14 wondering more in general terms.

15 A. So your -- an example would be -- you mean existing,

16 existing vegetation issues that could be remedied to

17 offset residual impacts of the Project? That's sort

18 of what you're after?

19 Q. Yeah.

20 A. Okay. Well, I, I think an example would be sumps that

21 are being looked at outside of the, just outside of

22 the NWA. There's been talk about locating those sumps

23 in areas of Crested Wheatgrass. Maybe on the edges of

24 the battleground between Native Prairie and Crested

25 Wheat. And then after, after using the sump for a

Mainland Reporting Services Inc. [email protected] 1420

1 year or so, reclaiming back to native seed. And, and

2 producing some contiguous native habitat. That's

3 that's one example of a potential offset in the

4 Regional Study Area.

5 Q. And anything for wildlife species that you can...

6 A. Well, creating native prairie is good for wildlife.

7 That's -- anything you can do to, to create a near,

8 near native habitat, or near native prairie

9 environment is, is good for prairie wildlife in

10 general.

11 Q. Okay. Both the Environmental Protection Plan and the

12 Environmental Effects Monitoring Plan indicate that

13 those documents will require updating based on

14 adaptations through the Project. And I'm wondering

15 how EnCana envisions the process to change those two

16 documents and who would be involved in that.

17 A. MR. FUDGE: Well, I can speak to the

18 Environmental Effects Monitoring Plan in the first

19 case in that I see that as the, the Environmental

20 Effects Monitoring Committee, with EnCana, and with

21 the regulators, would be in a continuous -- it would

22 be a life-of-project document and life-of-project

23 evolving set of monitoring plans, which would be put

24 together by this Stakeholder Committee and, on behalf

25 of EnCana, would be reviewed by the Multi-Stakeholder

Mainland Reporting Services Inc. [email protected] 1421

1 Committee on behalf of EnCana and then forwarded to,

2 to SEAC, as it outlines there.

3 So I see that as a, like, continuously

4 evolving and a document that would be updated as the

5 Project progresses from construction through to, to

6 the first results of post-construction monitoring.

7 As far as the Environmental Protection Plan,

8 I believe it actually is stated in the Environmental

9 Protection Plan the fact that it is, again, a

10 life-of-project document and will be updated on a

11 regular basis as new information comes to light. And,

12 particularly, information from one construction season

13 to the next, for example, that we could -- EnCana

14 could update with the construction phase aspects of

15 the Environmental Protection Plan as information

16 became available from the first year construction that

17 would be appropriate to put in place for the second

18 year. If there's any refinements or additions, that

19 kind of thing. And then looking forward to, of

20 course, the -- to operations.

21 And may I also add that this process itself,

22 this review process, this Panel review process could

23 well inform aspects of both documents.

24 Q. And with respect specifically to the EPP, is that

25 something that EnCana would seek consultation with,

Mainland Reporting Services Inc. [email protected] 1422

1 with other parties, such as DND and SEAC?

2 A. MR. HEESE: That's a correct

3 characterization is how we would see any changes

4 specifically to the EPP being done.

5 Q. And just with respect to the Environmental Committee,

6 I take it DND and SEAC would be involved. Do you

7 envision any other outside players involved?

8 A. MR. FUDGE: That's a -- yes. Yes to

9 your first question. SEAC and DND involvement,

10 indeed. And also that other stakeholders, and I

11 believe there's a list here of potentials, that would

12 be involved, potentially could be involved in a

13 program like this. Government regulators, for

14 example, scientists, be they consultants or

15 researchers that have specific bodies of knowledge

16 that would be useful to sit on this committee. As

17 well as -- some of the groups, in fact, that are

18 intervenors here in these, in these hearings, that

19 have interest in the wildlife area, either vegetation

20 or wildlife, et cetera.

21 Q. Okay.

22 A. DR. WALKER: I would add that it would

23 be logical for CWS to be a lead for any scientific

24 investigations in the NWA.

25 A. MR. FUDGE: Yeah, exactly, yeah.

Mainland Reporting Services Inc. [email protected] 1423

1 Q. I just want to turn now briefly to the three well

2 applications. And, as I understand it, there's still

3 work to be done on the PDAs for those three well

4 applications; is that correct?

5 A. MR. HEESE: We expect that as

6 condition of approval for those three locations that

7 we would redo the entire Pre-Disturbance Assessment,

8 as we've outlined.

9 Q. Okay. And I think you've told me you want to redo it

10 because it, let's call it, it's "stale-dated"; is

11 that fair?

12 A. Various portions of it effectively have an expiry, in

13 some cases a legal expiry, in the case of the legal

14 survey plans. In other cases, effectively an expiry

15 when you're dealing with very mobile and dynamic

16 wildlife features, so we would want to revisit that to

17 make sure that again we're proceeding on the best

18 information we have.

19 Q. Right. And as I recall the evidence, some of the,

20 some of the studies that are going to be incorporated

21 into the PDA process haven't been done for these

22 wells; is that fair as well?

23 A. That is correct. There have been some additional

24 revisions to specific methodologies that have not been

25 done.

Mainland Reporting Services Inc. [email protected] 1424

1 Q. And is it possible that these revised PDAs may

2 identify environmental impacts that were not

3 previously identified?

4 A. I find that unlikely. That they would more likely

5 recognize a change. Again, when you're dealing with

6 highly dynamic wildlife features that might move

7 around there, it might be. But I would be quite

8 surprised if there was significant revision as those

9 locations are currently as a result of doing a

10 further, or redoing the Pre-Disturbance Assessment.

11 Q. Okay, but there's a potential there that an impact

12 could be discovered?

13 A. There's potential, thus we fully expect a condition of

14 the approval is to redo the PDA.

15 Q. And what then would occur if the PDA turned up an

16 impact that required a change?

17 A. If there was a change that required the -- or if there

18 was a change that would effectively null the licence,

19 we would then reapply. At least on changes.

20 Q. Okay. Right. And --

21 A. MR. FUDGE: Excuse me, Mr. Mousseau,

22 just in terms of your terminology, I guess I have a

23 little bit of difficulty with the word "impact".

24 You're using just -- "interaction" perhaps might be a

25 better one. I think if -- or, or "location". If

Mainland Reporting Services Inc. [email protected] 1425

1 there was a location of a wildlife species or a

2 potential interaction due to the placement of a well

3 or pipeline, then it would be moot. But it's not an

4 impact on that, on that VEC per se. So just so we're

5 not confused by the environmental assessment versus

6 this PDA process.

7 Q. Right. And just to be really clear, Section 3 of the

8 Energy Resources Conservation Act requires the Board

9 to consider the potential environmental impacts of a

10 proposed project. And I guess the question is, how

11 can a Panel fulfill its mandate if there's a

12 potential for the discovery of additional impacts

13 arising from a revised PDA? So the term was chosen

14 carefully.

15 A. Right. And with the PDA process properly carried out,

16 there will be no impact in that context. So that

17 would be, would be my suggestion. And if there were

18 to be any potential even, i.e., the non-routine

19 recommendation that have to go forward with to SEAC,

20 if there was a, for example, not necessarily an impact

21 to, but at least even an infringement on a buffer,

22 right, so.

23 Q. But as I understand it, these aren't going to SEAC.

24 These have been filed straight with the Board. So,

25 so we're in a different scenario in this case. And

Mainland Reporting Services Inc. [email protected] 1426

1 so I guess one of the issues the Panel has to

2 struggle with is, if there's a potential for a

3 change, can it fulfill its mandate until the final

4 PDA update has been filed?

5 MR. DENSTEDT: Maybe I can help. I think we

6 heard this earlier. Non-routine applications under

7 the NWA permit, if it should be approved, do go to

8 SEAC for confirmation of compliance with the PDA

9 process. So it's not that it goes straight to the

10 Board, they all go to SEAC.

11 MR. MOUSSEAU: But these ones haven't gone

12 straight to the Board. And I'm talking very

13 specifically about these three well applications. So

14 I understand what the intended process is down the

15 line. What the Panel has to struggle with is, if I

16 can use the term, this is a bit of a "one-off" in that

17 these PDAs haven't gone to SEAC, they are not

18 complete, and, and the Board is dealing with them

19 differently than it otherwise would.

20 So I'm wondering if this Panel thinks that

21 there's a potential for impacts that might impact the

22 Panel's n ability to assess them.

23 MR. DENSTEDT: Well, maybe I don't

24 understand the question. The --

25 MR. MOUSSEAU: I don't either.

Mainland Reporting Services Inc. [email protected] 1427

1 MR. DENSTEDT: As I understand it,

2 Mr. Mousseau, you're asking the witnesses that in

3 respect of the three Well Licence Applications in

4 front of the Panel what's the process because it's

5 come straight to the Board. And I think what

6 Mr. Heese said is that, yes, but we expect a condition

7 to be in compliance with the PDA process, which

8 includes going to SEAC, and that therefore is the, is

9 the way in which the impacts are avoided.

10 I believe that was his testimony, but.

11 MR. MOUSSEAU:

12 Q. Okay. And maybe I, maybe I heard it differently. My

13 understanding was that they were asking for -- that

14 EnCana's asking for approval of these well licences

15 with a condition requiring EnCana to go out and redo

16 the PDA. Is that fair?

17 A. MR. HEESE: Forgive me for the delay.

18 We expect condition of approval to follow through with

19 the PDA. The PDA process includes referral to SEAC

20 and the Base Commander for final approval. If, as a

21 result of fulfilling that condition by doing the PDA

22 it results in, you know, a recommendation or the SEAC

23 recommendation is that the well or the pipeline,

24 whatever conflict might be, resulted in a relocation,

25 we would have to reapply for licence.

Mainland Reporting Services Inc. [email protected] 1428

1 We do believe, however, that it is unlikely

2 that those locations will move. And we'll be

3 successful effectively obtaining SEAC approval and DND

4 approval, thus fulfilling the requirements of the

5 licence. But in the event, in the unlikely event that

6 there was a further move, we would either amend the

7 licence or reapply for the particular situation where

8 there was a re-route.

9 Q. So then would an additional condition be put on the

10 licence essentially providing that it requires an

11 approval by SEAC and DND as well? Is that what

12 you're envisioning?

13 A. I believe that's inherent in the process, but if they

14 wanted to explicitly specify that, we would not be

15 adverse to that.

16 Q. Okay. And I think it's inherent in the normal

17 process. I'm just trying to explore how we're going

18 to do this one-off.

19 And my final question is, it's more for

20 convenience than anything else, but EnCana's made a

21 number of environmental commitments throughout the

22 proceeding and it can be useful to have a single

23 consolidated list of those commitments. And I'm

24 wondering if EnCana can undertake to provide one of

25 those to the Panel and to parties prior to final

Mainland Reporting Services Inc. [email protected] 1429

1 argument.

2 A. MR. L'HENAFF: Yes, we will undertake

3 that.

4 MR. MOUSSEAU: Thank you, Mr. Chairman,

5 those are my questions.

6 THE CHAIRMAN: Thank you, Mr. Mousseau.

7 I recognize you will be back later with further

8 questions to Mr. Protti beginning tomorrow, but I

9 thank you for the examination that you have brought to

10 these proceedings at this point.

11 At this stage we'll now turn to my colleagues

12 on the Panel and, and provide them with an

13 opportunity, including myself, for questions of EnCana

14 as well. And I'll start to my right with Mr. DeSorcy.

15 QUESTIONS BY THE BOARD, BY MR. DESORCY:

16 MR. DeSORCY: Good morning, Gentlemen.

17 Q. I have a number of matters that I want to make sure I

18 understand EnCana's position on. And the first one,

19 sir, relates to a conversation you had, Mr. L'Henaff,

20 with Mr. Mousseau yesterday about abandonment

21 conditions. And if I heard you correctly, I believe

22 you were indicating that abandonment conditions would

23 occur on the basis of an individual well rates, when

24 each well is incapable of producing, so to speak.

25 And that the abandonment conditions would be

Mainland Reporting Services Inc. [email protected] 1430

1 essentially independent of a project or a battery

2 threshold or limiting rate. And, indeed, if I heard

3 you correctly, I thought you also said that

4 abandonment would be essentially independent of the

5 price for gas. And I have to confess, I need some

6 help understanding your position, sir. Can you go

7 over that again and make sure I understand your

8 position on the abandonment conditions.

9 A. MR. L'HENAFF: Absolutely. I'd love to

10 do that.

11 So, no, I guess we don't believe that they

12 are independent of all those factors. I think all of

13 those factors are intrinsically built into the

14 abandonment decision or the abandonment point in time.

15 I think when we're -- when I was talking

16 about abandonment evaluation, at a pilot level or at

17 a, at a battery level, we use a well rate as a proxy

18 for looking at what, when that well may cease to

19 produce. But I entirely agree with your comments that

20 abandonment of a field, abandonment of a battery is a

21 complex thing and you really need to integrate all of

22 those factors into it. And that would be our approach

23 is to do that appropriately at that moment in time.

24 Q. And, sir, that helps me, I obviously was

25 misunderstanding the position you were taking.

Mainland Reporting Services Inc. [email protected] 1431

1 Tell me, if you were making an assessment, an

2 abandonment assessment, how significant would the

3 fact that many of the wells were drilled

4 directionally as opposed to the plain vertical

5 drilling? How large a role, in your experience,

6 would, would that play in determining those

7 abandonment limitations for, for the well, for the

8 battery, for the Project?

9 A. So the, the path of the wellbore would relate to the

10 bottom hole pressure that, that the well would, would

11 cease to flow at economic rates. So because of the

12 path of the wellbore is quite tortuous, and a key to a

13 shallow gas well is its ability to lift the liquids,

14 so lifting the liquids through the life of the well is

15 a key element to that pressure. And that's where in,

16 through our calculations, depend upon the nature of

17 the wellbore, but I think between 30, I think the

18 numbers were between 30 percent and 45 percent of

19 those reserves would be not recovered due to, due to

20 the condition of that wellbore.

21 Q. And, sir, you're getting to the point that I really

22 wanted to understand. It wasn't clear to me whether

23 that 40 percent or so loss was due to the contact of

24 the reservoir and the lengthy reach, or whether it

25 was due to additional costs and difficulties in, in

Mainland Reporting Services Inc. [email protected] 1432

1 producing the well and lifting the water. And I want

2 to make sure that I understand, does that 40 percent

3 loss include both of those factors or just one of

4 them?

5 A. No, you're absolutely correct, it includes both of

6 those factors. It's difficult to peel them apart from

7 one and another. But our, our rough calculations

8 indicate in between 10 and 15 percent is due to the

9 production character of the wellbore and the rest is

10 due to the contact character of the wellbore.

11 Q. So 25 or 30 percent due to the contact of the

12 reservoir?

13 A. Yes.

14 Q. Let me, let me continue the discussion on directional

15 drilling. And, again, a follow-up to some

16 conversation that you had with Mr. Mousseau to make

17 sure I understand the situation.

18 One of the things that I believe he asked you

19 was, if you had an environmental constraint that kept

20 you from drilling a vertical well where you would

21 like to drill it for resource or recovery purposes,

22 would you drill directionally or would you not drill?

23 And I think you said, typically you expect you would

24 not drill. Am I correct so far?

25 A. That's correct. But, but we, of course, would look at

Mainland Reporting Services Inc. [email protected] 1433

1 the situation. So we'd evaluate it for sure.

2 Q. And, sir, when you're evaluating it, maybe I better

3 back up and, and say that I, I took it that you were

4 responding to Mr. Mousseau's question from the

5 viewpoint of using an existing well site and drilling

6 directionally from that well site because you alluded

7 to the losses and recovery due to the reach. So I, I

8 took it that was the case. And my question to you,

9 sir, is whether or not one of your considerations

10 would be to select a well site that avoids the

11 constraint but is perhaps halfway between an existing

12 trail or a road and where you would otherwise locate

13 the well so that you avoided much of the loss due to

14 reach.

15 A. Yes.

16 Q. And my question, is is -- would that be part of your

17 consideration presumably in the PDA process?

18 A. Yes, it would. We would absolutely take a look at

19 that. And, again, it would be based upon the -- how

20 far off of the, the perfect optimal target zone and

21 how far the reach would be, so we would absolutely

22 take a look at that.

23 Q. One other question relative to the resource aspects

24 and it relates to the McDaniels review. I've read

25 the letter. I've listened to what you had to say.

Mainland Reporting Services Inc. [email protected] 1434

1 And, quite frankly, it isn't clear to me just what

2 McDaniels did.

3 Did, did McDaniels review the work of EnCana,

4 the estimates that EnCana made, and agree with them,

5 or did EnCana take all of the -- or, or McDaniels

6 take all of the information and do an independent

7 study and come up with similar results? And it's

8 quite frankly not clear to me. Can you help me?

9 A. I think I can. What McDaniels has done, when it comes

10 to those specific pilot areas that we've been talking

11 about, they, every year, review those pilots, and

12 publish their own analysis of that. And the reserve

13 numbers that I ran through I believe it was yesterday

14 where, where they were showing an appreciation of

15 those reserve numbers because of the confidence level

16 that they were seeing was due to that independent

17 review.

18 On top of that, we asked them to take a look

19 at our NWA program and to make their comments with

20 regard to our estimated recovery of 125 bcf due to

21 that program. So what they did was take a look at

22 that as an independent analysis, levering off of the

23 information that they have already done with regard to

24 our pilots, as well as our ongoing infill drilling

25 operations across the block and, as a result of that,

Mainland Reporting Services Inc. [email protected] 1435

1 they were, they were able to generate that letter.

2 Q. That helps me, sir. I'd like now to turn to the PDA.

3 And a lot said about that. And, and certainly the

4 recent questions and the responses have helped me in

5 understanding, but there are a number of general

6 matters I want to ask you about and, and perhaps a

7 few detailed ones.

8 One of them, sir, has SEAC been involved in

9 any way with EnCana in developing this PDA?

10 A. Not really. We have sat down with them before, before

11 this hearing to consult with them around that and

12 basically we walked them through that process, but

13 they haven't been involved in developing this PDA

14 process.

15 Q. Should they be?

16 A. Their input absolutely should be included.

17 Q. And, sir, I take it that you have not, EnCana has not

18 had any discussions with SEAC that would assist us in

19 understanding from your point of view what kind of

20 additional resources SEAC might need? You've noted

21 that, you've made a recommendation, but I take it

22 that's based on EnCana's position and without input

23 from SEAC?

24 A. No, that was a sentiment that, that they, or at least

25 the two members that they -- that we've met with,

Mainland Reporting Services Inc. [email protected] 1436

1 echoed in our meeting with them as pre-consultation is

2 that they also indicated that resourcing was a

3 constraint and resolving that would, would help.

4 Q. Was that general or do you have anything specific to

5 add? I know we'll hear from SEAC, but I want to make

6 sure I understand EnCana's position in that respect.

7 A. Yeah, it was just a general discussion. You know,

8 the, the additional resources could be provided in, in

9 a multitude of ways.

10 Q. Sir, I note that on several occasions you've alluded

11 to I think the term was "availability of staff" from

12 SEAC. And I took that to be perhaps a suggestion on

13 the part of EnCana that perhaps the three members of

14 SEAC would be adequate to do the task, but they have

15 got too many other things on the go. Was that what

16 you were getting at, or?

17 A. Kind of. You know, I think these are busy times for,

18 for everyone. And when people have multiple things to

19 do, they balance their time as, as best they can. And

20 so I think it's really a comment with regard to

21 re-invigorating SEAC and providing the necessary

22 resources to accomplish their task properly.

23 So whether it's different members or

24 additional members or whether it's supporting members

25 to help them, I don't know exactly, but I do know that

Mainland Reporting Services Inc. [email protected] 1437

1 I certainly had the impression that, like all of us,

2 we're being pulled in many directions. And we need

3 to, I guess, help the resourcing side of that and the

4 focus side of that.

5 Q. I guess in part what I'm getting at, sir, and I hope

6 you'll appreciate that it's somewhat difficult for a

7 Panel such as this to recommend resourcing something

8 when we don't have an appreciation for what kind of

9 resources we're talking about. And so what I'm

10 getting at is, is it EnCana's view in any respect

11 that three people, if they had the time, would be

12 able to do this, or, or are you thinking it would

13 take considerably more people? Any, any comments?

14 A. I do have a few comments.

15 Q. Please.

16 A. And Mr. Protti may well have additional.

17 So I guess how we've tried to construct this

18 proposal is to put the lion's share of the effort on

19 EnCana; so for us to do all of the legwork, for us to

20 do all of the summarization so that it's in nice tight

21 packages and all the required information is, is

22 basically being borne by EnCana. And even if there's

23 subsequent questions to be answered or subsequent

24 studies to be made, I would envision that that work

25 would be thrown back to EnCana to execute.

Mainland Reporting Services Inc. [email protected] 1438

1 However, just to go through the material and

2 to consume the material, and then to have some

3 discussion around that, I, I would envision that the

4 three SEAC members would likely need a support staff

5 to assist them.

6 Q. And, and, sir, can you tell me in your six steps, and

7 because of the earlier discussion I'm not going to go

8 through them with you as I had planned to at one

9 stage, but, but where during that time would you be

10 identifying and, again, I understand that the outcome

11 from each step would go to SEAC and DND, but when

12 would the routine/non-routine designation have been

13 made? Is that in effect after step six, is that when

14 they become routine/non-routine?

15 A. For the most part. I think because we envision

16 80 percent of the wells or in excess of 80 percent of

17 the wells will fall into the "routine", I think early

18 on, you'll be able to see that happening, and so

19 you'll get confidence that you'll be able to avoid all

20 of the environmental resources.

21 The, the pipelines or wells or access trails

22 that, that have a tighter pinch point, that it looks

23 like you're closer to an environmental resource, those

24 are the ones that would require further work and you'd

25 have to do a -- go down to the constructibility side

Mainland Reporting Services Inc. [email protected] 1439

1 of things, look at various options.

2 So I would think that through the course of

3 the process, the wells would separate themselves out

4 relatively nicely and you would be able to see which

5 of the wells are going to be non-routine earlier on.

6 And the non-routine -- or the routine -- sorry, the

7 routine wells would be separated out relatively early,

8 you would be able to see them coming. The non-routine

9 wells would have to be worked. But, again, you would

10 be able to identify which those are, and really what

11 those issues are. A lot of the time the issue would

12 be a buffer with a wetland, or a wildlife.

13 Q. Well, sir, if, if I may, to make certain I understand

14 just what kind of a task SEAC would be facing, can I

15 ask you to look at Figure J9. That's the three wells

16 you're applying for licences for. And I know that

17 this was prepared under a process other than the

18 proposed PDA, so I'm just using it as an example to

19 ask certain questions.

20 And I'll -- if, if we're looking at the 11 of

21 28 well, for example, and this is constructibility

22 sitings, so it seems to me it's in -- in terms of the

23 currently proposed PDA, it's step 6 --

24 A. Yes.

25 Q. -- has been done.

Mainland Reporting Services Inc. [email protected] 1440

1 A. Yes.

2 Q. And tell me with respect to that well, and with

3 respect to the access through the buffer zone, and

4 with respect to its location in proximity to the

5 buffer zone, would this go to SEAC in this form, or

6 would there be other material that would cover every

7 option that you looked at, the benefits, the costs,

8 or disbenefits associated with them, would it, would

9 it identify those options, if there's more than one,

10 that's acceptable to EnCana, those that aren't

11 viable, so that when SEAC looks at it, they

12 understand everything and, and, perhaps more

13 importantly, if they make the decision "no", it's

14 "no"; it's not "more work to be done", it's "no".

15 Can you help me, sir, just what EnCana plans and what

16 EnCana is prepared to commit to in terms of the

17 information that would go to SEAC.

18 A. Absolutely. That is in fact our vision, is that this

19 would, for these non-routine wells, this is a

20 partially-done project. What we would then do is take

21 this and hire some specialists to take a look at the

22 pros and the cons of the various alternatives. So do

23 an analysis of this. Look at alternatives. If the

24 pipeline isn't going to go across this buffer, what's

25 the next best alternative route and what's the pros

Mainland Reporting Services Inc. [email protected] 1441

1 and cons associated with that.

2 Button that up into a proposal and move that

3 forward through SEAC so that their job would be as

4 easy as possible, so that all of the options, all of

5 the impacts, the pros and the cons, some of the

6 suggested mitigation to reduce some of the impacts.

7 In this example, one of the mitigations might

8 be you, you plough in dormant conditions but you don't

9 have an access route that's there. You basically have

10 an access route that's in a different place. Or you

11 say the access route has a calendar lock-out. That

12 might be one of the suggested mitigations in the

13 recommendations that would be moved forward to SEAC.

14 So really the vision would be to do as much

15 of the legwork as we possibly can to allow SEAC to

16 really just absorb that material and to be able to

17 come up with a decision and judgment as best as they

18 can and, and move it forward if they so chose to to

19 the Base Commander.

20 Q. And, sir, can I confirm again with you that if, and

21 much of this questioning is a hypothetical, if the

22 Panel agreed with this proposed process, and, and

23 with the notion that a project could go forward, that

24 a "no" from SEAC would mean a "no" and would not be

25 the trigger for an ongoing negotiation and

Mainland Reporting Services Inc. [email protected] 1442

1 consideration of options?

2 A. That is correct.

3 Q. Sir, how would the issue of, the potential issue of

4 offsets be handled in the PDA process? Because it

5 seems to me it's broader and not, not really

6 addressed by the six steps. Can you help me?

7 A. Yes. As I guess I see it. And Mr. Protti, again, I

8 think would, would certainly add to the comments. But

9 as I see the offsets, that discussion is more in the

10 context of our overall footprint. So our overall

11 footprint, you know, at the, at the moment of

12 construction is 0.5 percent, and then, whatever it is,

13 it improves to through the course of time.

14 So really the offsets are, I think, the way I

15 think about it should be applied at a project level.

16 When it comes down to specific locations, avoidance is

17 always our first, and, and the bulk of our locations

18 would fall into this. And so I think offsets should

19 be considered at the project level.

20 Q. And it was that very consideration that led to the

21 question, is it doesn't seem to fit into a PDA

22 process.

23 I should make it clear that I would welcome

24 any further comments when Mr. Protti is available on

25 any of these matters. It's hard to distinguish which

Mainland Reporting Services Inc. [email protected] 1443

1 ones are for you and which ones are for him.

2 A. I appreciate that.

3 Q. In step 1, where you reference the optimizing resource

4 recovery step, I want to make sure I understand that.

5 Is your control and knowledge of these reservoirs,

6 these formations, such that you have geological maps

7 or the like, or is this optimization step more based

8 on the geographical centre of the target drainage

9 area? Just what is the situation?

10 A. Yes, that, that is more the situation, is it's just

11 the inter-well spacing of the existing wells, so it's

12 basically picking, picking the centre spot of that.

13 We don't have enough understanding of the local

14 geology. There's, there's a lot of factors that, that

15 make that unmappable at that local scale. So it's

16 really a, taking a look at the geographic locations of

17 that, of that optimal spot to hit that un, undrained

18 part of the reservoir.

19 Q. And, sir, I can understand the desire to do that. If

20 you're drilling 1,000 wells, statistically you're

21 better off to have done that. But would you agree

22 with me that, for any one target area, that that --

23 you may be picking the wrong spot by picking the

24 centre; there may well be a spot elsewhere that would

25 pick up more permeable stringers, which are more

Mainland Reporting Services Inc. [email protected] 1444

1 extensive and would provide better drainage? I'm not

2 suggesting, again, that doing it for 1,000 wells or

3 not having that goal for 1,000 wells isn't a good

4 one. I'm asking: Do you recognize that sometimes

5 you could be moving the well for an environmental

6 constraint and actually improving the situation?

7 A. We absolutely do recognize that. The difficulty comes

8 in in quantifying those local reservoir differences.

9 We don't have the degree of, of detail because these

10 are at the microlevel. And so, you know, what we had

11 thought about is could we manage this through

12 geostatistics. But, again, that's a probabilistic way

13 of managing it. So we recognize the fact that the

14 centre, the geographic centre may not be the best, but

15 we have no better way of determining fine movements

16 within that centre spot.

17 Q. I understand. I fully appreciate that, sir. I guess

18 my question is would you be prepared -- are you

19 prepared to recognize that you don't know that when

20 it comes to an environmental trade-off?

21 A. Yeah, absolutely. In fact, our very first criteria,

22 when we looked at the -- when you start with the

23 perfect centre spot, but, but 50 metres movement is,

24 is the very first criteria, is make those moves with,

25 with no, no hesitation whatsoever.

Mainland Reporting Services Inc. [email protected] 1445

1 Q. And, sir, when it comes to this initial optimizing

2 resource recovery step, or siting, in doing so, would

3 you have any regard for, you know, the four

4 surrounding wells that really set out the kind of

5 triangular target you're after? Would you have

6 regard for the capability of those wells? I guess

7 what I'm asking you, sir, is, in your experience, if

8 you've got four wells and perhaps three or maybe four

9 of them tend to be poor wells, they don't have a lot

10 of silt stringers, they don't appear to be very

11 extensive, and the production and related drainage

12 seems to be on the poor side, do you typically find

13 in your experience that an infill well is not as good

14 or can -- is it just so variable that it may be a

15 very good well? Just what is your experience?

16 A. Our experience is that, locally, wells are similar for

17 sure. But if you are in a tighter part of the

18 reservoir, the, the issue is really where those silt

19 stringers are. And often is not what we find is when

20 we look back at the old wells they were completed with

21 different frac designs and so what we would need to

22 do -- and so their past performance would be related

23 to that older design. So what we would need to do is

24 make some accommodations for -- and that's part of the

25 process, too, is go in and optimize those other wells.

Mainland Reporting Services Inc. [email protected] 1446

1 But you don't have the same degree of baseline

2 assessment to tell, you know, whether or not you're in

3 a sweet spot or not because the old wells may not have

4 accessed the group of stringers that the frac at that

5 point in time was designed to capture.

6 Q. Can you tell me, sir, if during that step one, the

7 siting for recovery, resource recovery optimization

8 purposes, would you have regard for the location of

9 the existing wells? And let me explain. I recognize

10 your discussions with Mousseau, Mr. Mousseau

11 regarding, you know, perhaps 14 or 15 wells might be

12 an optimum. But if you already have 8 wells in a

13 section, and they are in the centre of LSDs 2, and 4,

14 and 6, and 8, and so on, that you really don't have

15 much choice, because if you drill 15 wells, you're

16 leaving one target area un, undrained.

17 However, I notice, and I just have a, a

18 limited well plot here, less than a township, and I

19 notice that some of them are quite irregular now.

20 I'm sure for, for reasons, I see some with only three

21 wells in a half section. At least on my plot. I see

22 some where, you know, you have five wells in the

23 northern half of the section. And three in the

24 southern.

25 And I'm, I'm just wondering, sir, if your

Mainland Reporting Services Inc. [email protected] 1447

1 siting process is one whereby you say, "We're going

2 to drill a well in LSDs 1, 3, 5, 7, et cetera. Now,

3 geologist, engineer, pick the best spot in that LSD."

4 Or do you start from quite a different direction and

5 lay out a battery area and say, "Having regard for

6 whatever you do know about the reservoirs, about the

7 formations, and given the existing wells, where

8 should the additional wells go that will best drain

9 the reservoir with the fewest number of wells?" So

10 that if there are opportunities to get effective

11 drainage with, with 14 wells or 15 wells in a square

12 mile, not necessarily a legal section --

13 A. Yes.

14 Q. -- that you would avail yourself of it. Now, I'd like

15 to understand just what your philosophy is in that

16 regard.

17 A. Sure. So I guess there's two areas that I'd like to

18 explore in answering your question.

19 You're absolutely correct. Our approach in

20 designing the additional wells is we take a look at

21 the existing wells and take a look at the reservoir in

22 between them. So we're really looking at all of those

23 undrilled blocks of land. And that's where the

24 inter-well distance, so the 400 metres, which is the

25 effective 40-acre spacing, the 400 metres we believe

Mainland Reporting Services Inc. [email protected] 1448

1 is the block of land that we're targeting. And that's

2 why you can move it around because sometimes you have

3 more than 400 metres leeway before you start bumping

4 into an existing well.

5 And sometimes you say, well, I can put two,

6 or three or four wells in there for sure to get that

7 spacing that we're targeting. So that is the approach

8 on the local design.

9 With regard to what is the optimal, just

10 thinking about those questions last night, and if you

11 mentally reference back to the plot from the GLJ in

12 the Sand Hills, it's similar. Like, I think our

13 reservoir is better than that. That was our study

14 area they were looking at. But -- so on the part of

15 the curve that's still rising up, and based upon our

16 estimates, we still anticipate on average 100 mms per

17 well, so there's still quite a bit of, of resource to

18 recover.

19 So I think our optimal -- if, if we had a

20 greenfield and we didn't have any pattern established,

21 our optimal would be probably 22 wells or 20 wells per

22 section. But because the inprint is already mostly

23 there, we're working with that 16. And so those two

24 elements I think go into the local design; is that we

25 try and maintain that inter-well distance of 400

Mainland Reporting Services Inc. [email protected] 1449

1 metres and we fit them in as best we can.

2 So sometimes that --

3 Q. I think -- you have agreed with me earlier that the

4 inter-well distance concept is a good one,

5 statistically, over a broad area; but in any one

6 region, it may not give you the sweet spot.

7 A. Yes.

8 Q. I guess, sir, what I'm really trying to understand is

9 are you targeting a number of wells per section or

10 are you, or do you have as your target effective

11 drainage with the fewest number of wells, even though

12 it might be a little less than you would get if you

13 drilled more wells, it's still pretty effective

14 drainage because the existing pattern is irregular.

15 And that's really what I'm trying to understand, what

16 your, what you're aiming for.

17 A. Yes, we're aiming for effective drainage. And like I

18 say, we believe the four -- what we're -- the blocks

19 of reservoir we're looking at is about the 400. But

20 if we can do that with three wells rather than four,

21 that is absolutely our desire.

22 Q. And that, sir, is the part I wanted to make sure of.

23 Now, with respect to the PDA, and perhaps I'm

24 getting more and more into an area where Mr. Protti

25 might be involved, but I would like to raise them and

Mainland Reporting Services Inc. [email protected] 1450

1 see if that's the case or if you have responses.

2 Would you agree with me, sir, that the PDA

3 proposal that you've put forward is, is a major

4 undertaking for SEAC?

5 A. Yes, I think that would be true.

6 Q. And would you also agree with me that it's very

7 important if the NWA is to be developed at closer

8 spacing without lasting environmental impacts?

9 A. Yes, I agree.

10 Q. Would you agree with me that, that, especially if

11 you're going to drill or construct in three years,

12 that it's right to get it -- that we need to get it

13 right the first time, you can't, you can't have a

14 process that you play with for a few years before the

15 wells are drilled?

16 A. Yes.

17 Q. Given all those things, sir, has EnCana considered the

18 possibility, if it does get approval for the Project,

19 of perhaps having a pilot period to test the ability

20 of SEAC to handle the PDA process and, indeed, to

21 test the process itself whereby you might drill one,

22 one battery, for example, as a pilot and use the

23 learnings to modify SEAC to ensure that it's properly

24 resourced? Any comments along those lines, sir?

25 A. I have a few comments.

Mainland Reporting Services Inc. [email protected] 1451

1 Q. Please.

2 A. And I'm sure Mr. Protti will. We haven't, we haven't

3 considered that and that's predominantly because we're

4 very confident in this PDA process. It's, it's not

5 absolutely brand new. I think how it's all come

6 together and the various forms of surveys are

7 enhanced. But we certainly have been surveying for

8 wildlife and for vegetation out there. We certainly

9 know how to do that. We know how to take that

10 information and incorporate that into a site-specific

11 plan. We know how to make site, site assessments.

12 And so these are all pieces that we've done

13 many, many times before and we know how to move them

14 through a process that manages at a campaign level.

15 So we are fairly experienced at that. And I

16 think we're very proud of the PDA process because we

17 think we've gone quite a few steps ahead. We're,

18 we're siting environmental assets at the battery level

19 and will ultimately be at the NWA level. But, you

20 know, we've, we've, as a community, we've done that

21 before in the past and we know how to do that.

22 So a lot of these elements are, are very

23 tried and true. How we are putting them together is

24 just a new and a better way to put them together. How

25 they affect modifications of specific project elements

Mainland Reporting Services Inc. [email protected] 1452

1 I think is tried and true. We are very confident that

2 80 percent of the locations will be able to be

3 avoided. So it's because of those factors that, that

4 we believe that we've evolved it to a high degree.

5 Q. I recognize that, sir. I take it you recognize that

6 that view is not necessarily shared by all, all

7 stakeholders.

8 A. I appreciate that.

9 Q. Can I ask you a somewhat related question, sir, and,

10 again, one that you may wish to have Mr. Protti

11 comment on. I know that you're proposing, and I'm

12 going to term it a three-year drilling and

13 construction phase, you have mentioned the

14 possibility of a spillover, and if I understand what

15 has been taking place in the total Suffield Block,

16 that means drilling in the NWA more or less on the,

17 at the same pace of development in the Suffield Block

18 elsewhere than in the NWA.

19 I hear EnCana, recognizing the importance of

20 the, this, the environment and including the wildlife

21 in this area, and, and yet I hear EnCana proposing

22 the same pace of development in this very sensitive

23 area that they have typically followed in a less

24 sensitive area.

25 Indeed, if I heard Mr. Fudge correctly this

Mainland Reporting Services Inc. [email protected] 1453

1 morning, there was some reference to the 425 wells in

2 the NWA and 200 elsewhere. So it might even be in

3 total at a, at a greater pace.

4 And I guess, sir, it occurs to me that some

5 people might see a disconnect in the position that

6 EnCana is taking; that it's very important to do

7 things properly in the NWA and yet we can maintain

8 the same pace of development that we do elsewhere.

9 Can you comment for me, sir, and, in

10 particular, what I'm looking for is I would like to

11 understand the reasons why EnCana is proposing to do

12 this development at that pace over three years. And

13 I would like to know from the viewpoint of

14 environmental impacts, from the viewpoint of impacts

15 on the use of the surface by others, I would like to

16 know from the viewpoint of resource recovery, and I

17 would like to know from the viewpoint of EnCana's

18 corporate objectives.

19 So I'm looking at the total package. And

20 what, what the trade-offs are involved --

21 A. Sure.

22 Q. -- in, in this pace of development --

23 A. You bet.

24 Q. -- of the Project that you have.

25 A. So I'll leave some of those comments to Mr. Protti.

Mainland Reporting Services Inc. [email protected] 1454

1 But with regard to the pace, a lot of the numbers that

2 were provided was just to kind of give the indication

3 that, that we wouldn't carry on in the Suffield Block

4 in the same manner. We would just treat it as an

5 integrated program. So, so the level of activity,

6 which has been ranging at between 500 and 600 wells

7 per year on the block. That's within the scope of, of

8 what we've been doing and this is within the scope of

9 what I guess the Military experiences with regard to

10 our activities. So those -- that's where those

11 numbers are coming from.

12 With regard to the Project design in the NWA,

13 the way that we viewed it was the winter construction

14 period was the best time to get that work done. And

15 we looked at it that if, if we could kind of go

16 through that construction period in a shorter time, so

17 three years, then we would be getting on the road to

18 recovery as quickly as possible and really maintaining

19 that footprint through the next 40 years. So it was

20 really a sense around trying to optimize that

21 construction period. And it was from the

22 environmental footprint perspective.

23 If, you know, the Panel would see it as a

24 different way, and that, you know, the better way to

25 go would be to spread that out over a five year

Mainland Reporting Services Inc. [email protected] 1455

1 program -- like I say, our intent was to try and

2 minimize our footprint by moving through that

3 construction period in a relatively efficient way and

4 then getting on with the, with the operations period

5 and the reclamation associated with that, the recovery

6 associated with that.

7 So, so that's where the design came from. It

8 was, it was purely from a sense of trying to get on

9 with that construction period.

10 Q. And, sir, it, it -- it seems to me that when you're

11 facing that kind of pressure, and you referred I

12 think to the window from October 15th to April 15th,

13 you're putting a tremendous amount of pressure on

14 extending that period beyond what it should be

15 extended. Mother Nature is in control of just what

16 happens during that period. And so it's that kind of

17 consideration.

18 And I hear what you're saying, but I would

19 like to leave with you that I -- perhaps you could

20 respond later, or when Mr. Protti has joined you, but

21 I would like to understand the reasons why you've

22 chosen that, if they go beyond what you've just said,

23 and, in particular, whether or not you've had regard

24 for environmental impacts of a, of a three-year

25 versus a five-year and whether you've had regard for

Mainland Reporting Services Inc. [email protected] 1456

1 impacts on the other surface users of, of a change.

2 And, indeed, whether or not you took into account the

3 views of other stakeholders. I would like to

4 understand where your three-year target comes from.

5 A. Sure.

6 Q. One additional question, if I may, and that relates to

7 your Opening Statement. I think it's -- I believe

8 it's on page 18 of your Opening Statement, sir. If I

9 can find out. Where you have referred to the

10 viability. You're looking at other -- I better wait

11 until you have that, sir. You've referred to there

12 being no viable alternative to this Project. And I

13 know you discussed that with others earlier, but I

14 want to make sure I understand what you're getting at

15 there.

16 When you say "no viable alternative", are you

17 thinking of economic viability or is it in a broader

18 sense? Just what do you mean by that?

19 A. Sure. It's, it's basically looking at it from a

20 simple stance; it's the statement that we can't get

21 these reserves out without drilling. You know,

22 compression, additional compression, we've examined.

23 That won't get these reserves out. Additional frac'g.

24 It's, it's from that sense that the only way to get

25 these reserves is, is through additional contact with

Mainland Reporting Services Inc. [email protected] 1457

1 those reserves.

2 Q. And, sir, do I take it from that, then, that use of

3 the term "to this Project" does not necessarily

4 relate to every cubic foot of your 125 billion

5 incremental estimate, that, that it may well be that

6 a project that involves certain areas where the

7 target drainage area is undrilled, or where it's

8 drilled directionally, or where perhaps the start of

9 the first year of construction is delayed for a year

10 because of a pilot of the PDA process, or even where

11 you string out construction over a few more years,

12 are you suggesting that those are not viable

13 alternatives by this statement?

14 A. No. Those, those -- this comment is not related to

15 Project schedule, how it all unfolds, or even, like

16 you say, the magnitude or the amount of wells. Like,

17 each well kind of stand on, stands on its own as a

18 unit. So, no, it was certainly not related to

19 schedule.

20 MR. DeSORCY: Thanks very much. And those

21 are all the questions I have. I might add that I

22 certainly would welcome further comments on any of the

23 matters I raised when Mr. Protti is available and I'm

24 specifically looking for more information related to

25 the schedule, the three-year schedule.

Mainland Reporting Services Inc. [email protected] 1458

1 A. Sure.

2 MR. DeSORCY: Thanks very much,

3 Mr. Chairman.

4 THE CHAIRMAN: Thank you, Mr. Protti.

5 Sorry, Mr. DeSorcy.

6 MR. DeSORCY: Does that mean I'm going to

7 get paid Mr. Protti's salary?

8 THE CHAIRMAN: With that slip, I think

9 it's pretty certain that we do need a break at this

10 stage, so we will break until about 1:20 to allow an

11 hour for lunch. Thank you.

12 (NOON RECESS)

13 (PROCEEDINGS ADJOURNED AT 12:20 P.M.)

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Mainland Reporting Services Inc. [email protected] 1459

1 REPORTER'S CERTIFICATION

2

3 I, Nancy Nielsen, RCR, RPR, CSR(A), Official

4 Realtime Reporter in the Provinces of British Columbia

5 and Alberta, Canada, do hereby certify:

6

7 That the proceedings were taken down by me in

8 shorthand at the time and place herein set forth and

9 thereafter transcribed, and the same is a true and

10 correct and complete transcript of said proceedings to

11 the best of my skill and ability.

12

13 IN WITNESS WHEREOF, I have hereunto subscribed my

14 name this 16th day of October, 2008.

15

16

17

18 ______

19 Nancy Nielsen, RCR, RPR, CSR(A)

20 Official Realtime Reporter

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22

23

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Mainland Reporting Services Inc. [email protected] 1460

1 (PROCEEDINGS RECONVENED AT 1:20 P.M.)

2 THE CHAIRMAN: Ladies and gentlemen, I

3 believe we're ready to start again this afternoon.

4 Mr. Denstedt, you have a matter you wish to

5 draw to our attention.

6 MR. DENSTEDT: Yes, sir. The Exhibit 131

7 has been made available to the Panel and the Panel

8 staff. That's the Alberta Water Licence.

9 THE CHAIRMAN: Right.

10 MR. DENSTEDT: Thank you.

11 THE CHAIRMAN: Thank you, Mr. Denstedt. In

12 that regard, since you've made reference to an

13 exhibit, just one administrative matter. The exhibit

14 that Mr. Mousseau referred to needs to be corrected.

15 It actually is Exhibit 001-049 and this was the

16 COSEWIC assessment for the Ord's Kangaroo Rat, just to

17 correct the record.

18 And with that we will continue our, our

19 questioning and I will turn to Dr. Ross to continue

20 the Panel's questioning this afternoon.

21 QUESTIONS BY THE BOARD, BY DR. ROSS:

22 MR. ROSS: Thank you, Mr. Chair.

23 Q. The first question -- I'll just pose them and you can

24 allocate. It will be mostly at that end of the

25 table. The first question relates to snake mortality

Mainland Reporting Services Inc. [email protected] 1461

1 and the mitigative measure of reducing speeds from

2 70 kilometres per hour to 50 kilometres per hour.

3 The question is a simple one. Is there any empirical

4 evidence either with EnCana in the National Wildlife

5 Area or elsewhere that shows the effectiveness of

6 that mitigative measure?

7 A. MR. COLLISTER: I'm not aware, I'm not aware

8 of any. It's -- that, that speed limit was arrived at

9 for mortality in general, including snakes. Snakes

10 were a big consideration from road mortality, but it

11 also is in consideration of other species and slower

12 is better is, I guess, about all I can, I can provide,

13 but I'm not aware of any empirical studies at that

14 level, at the 50-kilometre level. It's slower than

15 the one or two studies we are aware of.

16 Q. Thank you, Mr. Collister. The next question relates

17 to the use of your PDAs to avoid rare plants. I

18 think it intuitively, it's clear if you go and do a

19 survey to find where the rare plants are and avoid

20 them, that's straightforward enough. How would you

21 avoid rare plant critical habitat?

22 A. MR. KANSAS: Rare plant critical habitat

23 has not been finalized, so there's -- for, for SARA

24 listed plant species there is preliminary rare plant

25 habitat mapping for, for SARA listed rare plants, but

Mainland Reporting Services Inc. [email protected] 1462

1 it's on the basis of if there is even one, one

2 location within a quarter section, the entire quarter

3 section is deemed to be critical habitat.

4 Now, Dr. Walker and I both have problems with

5 that designation as being far too broad. It seems

6 logical that rare plants are subject to basically

7 moving the earth. If you, you plow, SpiderPlow

8 directly over or, or trench directly over or, or run

9 an area badly, critical habitat for rare plants, by

10 nature has to be close to the individual species.

11 Maybe Dr. Walker can add to that somewhat.

12 A. DR. WALKER: Yeah, the question is, what's

13 the definition of "critical habitat". Are you using

14 the definition that is in the recovery plans that

15 Environment Canada put out or...?

16 Q. Certainly my intent was the conceptual level of

17 critical habitat. I understand that there is a legal

18 definition that is important. I also know that, that

19 that critical habitat is not yet in place. It seems

20 logical to me that before the end of construction of

21 this Project, should it proceed, that there could be

22 in place, critical habitat, defined under the Species

23 At Risk Act in which case my question would be: how

24 would you accommodate the existence of such critical

25 habitat in the PDAs because that would create a more

Mainland Reporting Services Inc. [email protected] 1463

1 onerous response, I would think. And so perhaps the

2 question would be, just given the concept of

3 critical, small "c", critical habitat, how would you

4 deal with that in the PDA process?

5 A. DR. WALKER: Well, if, if you were to

6 accept the assumption that, that the rare plants out

7 there are, are in critical habitat and that it's been

8 -- and oil and gas activity has been going on for the

9 last 30 years and that disturbance is part of their

10 regime that it requires, then you might say that

11 what's going on now, the area plus the level of

12 disturbance is critical and just as some of the

13 threats that are described in the recovery plan might

14 be stabilization of dunes or a, a reduction in grazing

15 which creates habitat -- bear with me.

16 You might say that a threat would be a

17 reduction in the kind of activities that are going on

18 out there now, the traffic, truck traffic, et cetera.

19 So what I'm saying is, is what's there now might be

20 considered the default and that altering that may

21 threaten the habitat.

22 Q. Do I infer from that, Dr. Walker, that you have some

23 disdain for the idea of critical habitat?

24 A. No, on the contrary, sir. I'm, I'm just suggesting

25 that, that where the source of disturbance comes from

Mainland Reporting Services Inc. [email protected] 1464

1 probably doesn't matter to the plant whether it's

2 human induced or whether it's naturally induced. We,

3 we have a bit of an issue in southern Alberta on a

4 potato farm. The operator there washes the potatoes

5 with sand and so there's a large pile of sand

6 constantly in use and in motion and there's a stand of

7 sand Verbena growing on that and, and so what I'm

8 suggesting is if, if you were to put a setback or to

9 prevent the normal use of that product for, for what

10 it's being used for might end up destroying the

11 habitat and in that regard you might say that's

12 critical.

13 Q. I think I'm going to move on at this point and I'll

14 thank you, gentlemen, for your advice. But related

15 to that, Dr. Walker, you indicated that -- I think

16 this morning that you would probably need a Species

17 At Risk Act permit to relocate a, a listed -- sorry,

18 an endangered plant species. Now, my question is not

19 so much about that particular example, and it may be

20 to Mr. L'Henaff or to Mr. Heese, but under what

21 conditions more generally would EnCana likely require

22 permit under SARA?

23 A. MR. HEESE: My understanding of the

24 Species At Risk Act right now, there contains specific

25 prohibitions that are already in effect. If, through

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1 the course of our PDA process, we were led to believe

2 that our activities may approach (phonetic) one of

3 those prohibitions, that would be a situation where we

4 would go and obtain a permit. Likely it is a

5 situation where we would just cancel the development

6 or really look at relocation, that sort of thing.

7 In regards to your previous comments about

8 critical habitat and our ability to avoid critical

9 habitat, I think our ability to avoid is obviously

10 based upon the scale of the critical habitat

11 designation. My understanding is the Canadian

12 Wildlife Service is looking at various ways of

13 designating critical habitat. It may be identified at

14 the quarter section level. It may be identified

15 through GPS co-ordinates, those sort of things. There

16 are various ways of doing it. So speaking from a

17 quarter section level, if critical habitat was

18 designated on one specific quarter section, our

19 ability to avoid that critical habitat would be fairly

20 straightforward.

21 However, if, if it turned into a situation

22 where it was quarter section adjacent to quarter

23 section adjacent to quarter section where they built

24 upon each other and created large tracts of

25 essentially critical habitat, once that critical

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1 habitat has gone through the procedures outlined in

2 the Species At Risk Act we would adhere to the Species

3 At Risk Act and apply for permits to potentially

4 operate within those critical habitats.

5 Q. Okay. My, my purpose in asking about critical habitat

6 was not to provoke a discussion of the proposed

7 interim critical habitats that, that will come up,

8 I'm sure, very soon and then we'll ask some questions

9 about that. My question was about the concept and

10 how your process would deal with that and I think I

11 understand that.

12 If, if you -- I'm sorry, Mr. Kansas?

13 A. MR. KANSAS: Dr. Ross, if I could, I'm not

14 100 percent happy with my last answer and I would like

15 another chance here.

16 Q. Please.

17 A. By definition, rare plants occur in micro habitats.

18 That's a pretty common -- for the most part, most rare

19 plants occur in rare areas, either very wet or very

20 dry, escarpments, et cetera, so that's, that's -- I

21 don't even -- this idea of, of mapping habitat with an

22 existing mapping system, you know, over the years I've

23 worked with quite a few really high quality rare plant

24 people and, and they often do not want to map rare

25 plant habitat. I'll say map rare plant potential.

Mainland Reporting Services Inc. [email protected] 1467

1 They say, hey, they occur everywhere they're in

2 microhabitat. So, so by nature I think the PDA

3 process will be very effective because it will look

4 for those rare habitat types, those very wet, very dry

5 areas and that's where we'll be avoiding, EnCana will

6 be avoiding wetlands.

7 For example, saline wetlands tend to have a

8 lot of rare plants. Those areas will be avoided. So

9 I'm not saying the concept of critical habitat for

10 rare plants is not necessary but ultimately I think it

11 will, it will focus down to these rare plant

12 communities or rare seepage areas, et cetera, and by

13 nature you can't map those very effectively. They

14 have to be seen on the ground.

15 Q. Thank you for that, Mr. Kansas. In seeking SARA

16 permits more generally, I'm, I'm not sure what the

17 process is. Is there -- have there been a lot of

18 such permits issued? What's the nature of the

19 application process? How, I guess, in EnCana's view,

20 and in case there's anyone else listening from the

21 Government of Canada there may be a hint of a future

22 question here as well, how in EnCana's view would

23 those permits be dealt with -- applications be dealt

24 with and under what conditions would you expect to be

25 successful?

Mainland Reporting Services Inc. [email protected] 1468

1 A. DR. WALKER: Can I take a shot at that? I

2 would, I would envision SARA permits being sought to

3 get more information. The recovery plans are outlined

4 and there's a certain amount of uncertainty as to

5 where the population is, what, what the requirements

6 are and I think EnCana might be in a position to

7 contribute, participate or support a program that

8 might do a population level survey of the, of the rare

9 species, perhaps look at means of rescuing them,

10 propagating them perhaps and finding out just why

11 they're rare and what their requirements are. And in

12 that regard that information becomes power and becomes

13 easier to ascertain what the risks are.

14 At the moment, you know, Environment Canada

15 is perhaps responding appropriately to the lack of

16 information by, by setting some very large areas for

17 critical habitat, but I think the opportunities for

18 getting more information are very ripe at this point

19 and that could benefit everybody by, by investigating

20 that and in that case you would need a SARA permit to,

21 to perhaps collect and transplant or relocate those

22 particular species.

23 A. MR. COLLISTER: I could maybe just add a

24 little bit and I hope it's helpful. I've seen the --

25 the application process for a SARA permit at this

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1 point in time, to my knowledge is, it's

2 straightforward. There's an application form that's

3 been developed. EnCana, in, in terms of some of the

4 surveys that have been done, and I'm thinking of the

5 ones that fed into the demonstration of the PDA, some

6 of those surveys could be construed, for example, the

7 Burrowing Owl surveys are called a playback survey,

8 and involve when an owl is detected, the nest burrow

9 has to be approached to get co-ordinates so that it

10 can be avoided in the future and so that could be

11 construed as resulting in harassment and disturbance

12 and under SARA that could be interpreted to require a

13 permit.

14 EnCana did investigate that with Environment

15 Canada prior to those surveys and was advised at this

16 time that that was not the case, a permit wasn't

17 required. So I, I think the permitting process is

18 evolving a little bit with Environment Canada, at the

19 risk of speaking for them which I can't. But that's,

20 that's the experience I think that EnCana has had with

21 it so far.

22 A. MR. HEESE: If I might add just a little

23 bit to that. I am not aware of many permits that have

24 been issued for incidental activities. It's something

25 that I have been trying to stay on top of through the

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1 SARA registry where they document all the permits they

2 have given. It has been sometime since I've checked,

3 but I am aware of only one previous instance in

4 British Columbia where a, an incidental activity or a

5 permit was granted due to an incidental activity and

6 that was specific to shoreline protection and, and the

7 presence of some rare plants. So it is something that

8 does not happen regularly.

9 Other than the situation that Mr. Collister

10 explained where we approached SARA or Environment

11 Canada to get the assurance on what would be necessary

12 for doing Burrowing Owl surveys we have not applied

13 for permits of this nature and I think that speaks to

14 our ability to address the prohibitions in Section 32

15 and 33, protections of the individual and the

16 protections of the residents. Certainly as the scale

17 of protections increase, particularly through the

18 designation of critical habitat, we will definitely

19 become more familiar with that, that process and apply

20 for the necessary permits as critical habitat is

21 designated.

22 My, my understanding is the material that

23 they would review when determining whether or not to

24 issue a permit or an agreement, there's those two

25 options within the Species At Risk Act. The very

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1 information that we would be collecting through our

2 PDA process would be very similar, if not fully

3 appropriate, for them to make a decision. If through

4 that process they needed additional information we

5 would go get that information, but I believe the

6 process as we've put forward would, would be very

7 similar to what their expectations would be prior to

8 issuing the permit.

9 Q. I'm going to change subjects to talk about the

10 suggestion that I think Dr. Walker made this morning

11 about a multi-stakeholder group to examine the

12 transport of seeds. Under the assumption -- sorry,

13 probably seeds of evil plants, invasive plants and

14 Crested Wheatgrass and all of those terrible things.

15 It seems to me that one of the important

16 principles of managing cumulative effects is that

17 cumulative effects require cumulative solutions and

18 so this multi-stakeholder idea is certainly one that

19 is attractive, but I, I guess I want to understand a

20 little bit more about what a group is intended to do.

21 Groups can study things, groups can discuss things.

22 But at some point either this leads to an

23 intervention that would actually reduce impacts or it

24 doesn't. And so I'm, I'm interested in the purpose

25 of this stakeholder group and what kind of outcomes

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1 are anticipated.

2 A. DR. WALKER: Well, I would think that the

3 first thing that such a group would do would be to

4 identify what the undesirable species are. We're not

5 calling them "evil". We're calling them "undesirable"

6 species and the definition that we've used in the EIS

7 for "undesirable" is one that, that causes some sort

8 of environmental impact for our objectives, so that

9 may be a plant that is preventing our re-vegetation of

10 the species to establish.

11 It may be the wheat skeletons that are

12 blowing into the coulees, but this certainly needs to

13 be put in context because some of the species that we

14 just sort of say, yes, we will avoid anything under

15 the Alberta Wheat Act is not necessarily applicable,

16 that is, if you're not near farmland and it's an

17 agricultural weed it's not going to impact

18 agricultural production and, to my mind, is not a

19 problem if it's not persistent on the landscape. And

20 that's kind of the view we've taken to things like

21 Russian Thistle. It is a problem in agriculture, but

22 it's not if you're not near cultivated land and it's

23 not too dense, we tend to just leave it on the

24 landscape. It doesn't persist. It acts actually as a

25 facilitator plant in trapping snow and cutting wind,

Mainland Reporting Services Inc. [email protected] 1473

1 et cetera. If it is too thick, though, then it

2 becomes a problem. So context is everything in that

3 case. So that would be the first order.

4 There are -- we're in a bit of a dilemma.

5 There is one plant that is rare on the landscape, but

6 it's also prohibited under the Wheat Act and so you're

7 -- not only are you required to destroy it but you're

8 perhaps required to look after it. Now, that could

9 perhaps be resolved by such a committee.

10 In my opinion, that plant should probably be

11 delisted as an, as a prohibited weed rather than taken

12 off the rare plant list. So the same goes for other

13 species and it tends to be area specific. So this is

14 where DND and CWS and the PFRA and EnCana need to get

15 together to decide which of these species are creating

16 a problem and then develop some sort of approach as to

17 how to control it and that would mean, first of all,

18 putting your efforts where you're going to get the

19 best results and then what sort of control mechanisms

20 because without such a co-ordinated effort, it often

21 doesn't amount to anything.

22 So your question was what sort of an outcome?

23 I would say that it would be a target list and then

24 the next would be a cost benefit analysis of control

25 and then it would be how, how are they going to go

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1 about it without too much collateral damage to other

2 species on the landscape?

3 Q. I'm going to go off on a little tangent and then I'm

4 going to move on. You listed a bunch of the likely

5 suspects for such a multi-stakeholder group but you

6 didn't neighboring, for example, the Grassland

7 Naturalists or environmental groups, and yet I would

8 have thought they would have had a fair bit of

9 expertise in this sort of an area. Was that an

10 inadvertent slip or did I just not pay attention?

11 A. DR. WALKER: I don't think I made a list

12 of stakeholders but, you know, certainly I hope I

13 mentioned CWS in my list of --

14 Q. I believe you did.

15 A. Yes, okay. Good. Well, then the rest would be EnCana

16 has offered to have various stakeholder steering

17 groups formed, so I would assume that they might open

18 the door for other stakeholder inputs, yes. In my

19 mind it would include other interested parties, yes.

20 Q. If in terms of the outcomes, I guess this, this may

21 shift from your end of the table to the other, but to

22 what extent is EnCana committed as an outcome of such

23 a process to undertaking some of the measures that

24 that such a group might determine would be effective

25 or necessary and under what conditions would you

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1 proceed to do something or to what extent is this a

2 group that would study things?

3 A. MR. L'HENAFF: So no, we're committed to

4 this. We think it's the right solution as well and we

5 don't see it merely as a group to study things. We

6 really want to get out there and make a difference, so

7 we would be committed to to studying things at the

8 front end, understanding what's driving that and then

9 converting that into a regional action.

10 Q. So you have a huge budget to take action, do you?

11 A. I suppose that would be Mr. Protti's.

12 Q. Changing the subject -- I'm sorry, first, thank you

13 for the answers to those questions. They were quite

14 helpful.

15 You indicated earlier that last Tuesday, my

16 notes say, that potential bad streak of weather could

17 have a major effect on the constructibility and, and

18 you might have to defer a lot of construction from

19 one year to another.

20 I guess I'm interested in the process by

21 which such a decision would be taken. Obviously it

22 involves advice and so on, but the first -- the

23 question, and I'll even make it multiple choice for

24 you: Who, in EnCana's view, would make the decision

25 to defer a major chunk of the annual construction?

Mainland Reporting Services Inc. [email protected] 1476

1 And the suspects that I have here are: EnCana, SEAC,

2 Base Commander, ERCB, none of the above, or I guess,

3 before "none of the above", "all of the above"?

4 A. MR. L'HENAFF: So I can offer, I guess, some

5 comments around that. Often a deferral is as a result

6 of bad conditions and you're not able to accomplish

7 the work that you envision. Wet weather would be

8 probably a good example of that. An early spring. So

9 rather than just a short rainshower that may or may

10 not affect a little localized area, an early spring

11 break-up that basically locks you out of an area.

12 We're very familiar with, with this sort of

13 thing. It happens to us fairly frequently. Working

14 on the Military block, we, we have to combine the

15 appropriate weather conditions with also the Military

16 template. So, basically, when the Military is out

17 there doing their training, we're locked out of, of

18 those lands. And so, in effect, we have to leave

19 behind pieces of undone work. So wells might get

20 drilled but they don't get completed and they don't

21 get tied in. So I think that's a normal course of

22 business for us. We are used to making those

23 decisions. And those decisions are based upon the

24 factors on the ground. Can you do the work properly?

25 If you can't, leave it behind for the next season. So

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1 I think we would take that exact same approach.

2 If we can drill a well, great. If we can

3 complete it and tie it in, great. If a piece of that

4 has to fall behind, then it has to fall behind. And

5 we'll catch up on it.

6 Q. I guess I was more interested not in leaving three

7 wells behind, but if you had to leave 250 wells

8 behind and, and the question was, who decides?

9 A. So we often do leave many, many wells behind, 50, 100

10 wells. It's -- that's -- it happens. It's part of

11 doing business out there. And so who decides is, is,

12 you know, really right at the ground level. The

13 co-ordinators basically decide when work can proceed

14 and when it cannot. And it won't proceed until the

15 conditions are right. And if that means you miss your

16 construction season and you have to wait for the next

17 construction season, so be it.

18 Q. I'll take it that the answer, then, is EnCana?

19 A. Yes.

20 Q. Thank you. Do you have an NWA permit for the

21 activities that are -- the operation of the existing

22 wells in the National Wildlife Area?

23 A. So I think part of that's outlined in our Appendix A,

24 but -- so we feel that our existing facilities are --

25 fall under kind of a grandfathering. But we certainly

Mainland Reporting Services Inc. [email protected] 1478

1 do have a permit. And we've been working with the DND

2 for some time now, working out the conditions, what

3 those conditions might be for a permit for routine

4 operations, and so we do have a permit for a large

5 part of those operations.

6 Q. I'm a little bit confused as to whether the answer was

7 "yes" or "no". But I guess you said you do have a

8 permit for a large part of the operation?

9 A. For the routine part of the operation.

10 MR. DENSTEDT: Maybe I can help.

11 THE CHAIRMAN: Thank you.

12 MR. DENSTEDT: There is a legal debate in

13 respect of whether a permit is required or not, so I

14 think it is a "yes" or "no". It is a "yes" and "no"

15 answer; that EnCana, in an attempt to protect its

16 rights, on the advice of counsel, has protected its

17 rights by taking the position that it may in fact not

18 need a permit but, at the same time, has proceeded to

19 develop a permit with conditions and is in the process

20 of negotiating those conditions so that both bases are

21 covered. If that helps.

22 MR. ROSS: I have a lawyer joke about

23 that, but I think I won't go there.

24 Q. Adaptive environmental management has been a term that

25 EnCana has used a good deal at this hearing. And I

Mainland Reporting Services Inc. [email protected] 1479

1 guess I'm interested in knowing a little bit more

2 precisely about what EnCana's understanding of that

3 term is. For example, in the literature "active

4 adaptive environmental management" is often used

5 where one purposely explores multiple management

6 strategies and then measures the outcome of them to

7 compare and see which one might be best, or "passive

8 adaptive management" where one tries a single

9 strategy and monitors it purposely to see what the

10 outcomes are to see whether adaptations are in order.

11 I guess I'm interested in, in exploring this. And

12 I've got a bunch of derivative questions later on.

13 But how, how do you see your practices as being

14 adaptive environmental management?

15 A. DR. WALKER: Perhaps I could go first and

16 then you could get cornered with commitments.

17 The adaptive management comes in because the

18 way the reclamation success protocol is set up is that

19 it is goal oriented. There's a target to, to get to.

20 And because of the way the process goes, everybody

21 wants to know, well, how are you going to get there?

22 So the EPP and the reclamation plan and the protection

23 plans all have suggested ways of doing this, but the

24 adaptive part comes in as to, depending on

25 circumstances, whether it's a hot, dry spring or a

Mainland Reporting Services Inc. [email protected] 1480

1 cool, wet one, or other circumstances are what

2 triggers the choice of mitigation. So the adaptive

3 part comes from the choice of mitigation methods that

4 are site specific and weather dependent and

5 appropriate for the particular circumstances. Does

6 that help somewhat?

7 Q. I, I guess the purposeful intent of trying a

8 management strategy, a reclamation strategy, if you

9 prefer, and then having some hypotheses about what

10 will be the consequences and then measuring the

11 results to see how they fit with the theory and then

12 adapting as appropriate is what I had -- what would

13 be the nature of the hypotheses that would be tested

14 in such a, such a scheme? And, more importantly, how

15 are they determined within the company or within the

16 relevant organization?

17 A. Well, I think it's -- it's how you define adaptive

18 management. I guess, in the sense that EnCana is

19 using it in the EIS, is it's not, it's not a sort of

20 experimental "we'll try this, we'll try that, and see

21 how it works" kind of thing, or "we'll see if this

22 fails and then we'll try something else". It's, it's,

23 it's a decision tree in choosing an appropriate

24 mitigation measure. That's where the adaptive

25 management comes in so that we're not necessarily

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1 wasting resources but we're also doing enough. And

2 that determination of what's enough is, is part of the

3 PDA process that -- and this is where a professional

4 qualified person would come in to make the

5 determination as to whether or not erosion control

6 measures are necessary, if siting well sites are

7 located in low protected, well drained areas, then an

8 erosion control plan wouldn't be necessary. But if it

9 is in a more exposed area and the reclamation

10 assessment suggests that there is a risk of erosion,

11 then it would be a matter of choosing one of the

12 appropriate erosion control measures.

13 The same would hold true in terms of, of

14 proximity to watercourses where runoff water may be a

15 concern where water quality is a concern. It would be

16 up to a professional to determine what the risk is and

17 what the mitigation measure is appropriate. And in

18 some cases a setback may be appropriate. Sometimes it

19 might have to be violated if there are other competing

20 interests. But it would be up to a professional to

21 make those kinds of determinations and not try to

22 cookbook the results in terms of some of these very

23 tight decision trees, which give me a bit of grief,

24 because they aren't really goal-oriented; it's just

25 some of -- it's convenient for regulators because you

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1 just go A, B, C, or whatever, to come up out with a

2 decision, but it doesn't look at the overall picture

3 which is, you know, conserve the environment.

4 A. MR. KANSAS: Maybe a hard example of

5 what I, what I envisioned we could do for adaptive

6 management is, say, pipelines are put in with a

7 certain technique and a certain soil type and a

8 certain site condition and the -- a certain seed mix

9 is used and a seeding rate, I would say, for example,

10 monitoring the results of that seed, that seed mix and

11 seeding rate, in particular, habitat types, and if the

12 result wasn't moving in a trajectory that was thought

13 to be best for the land, then modifications could be

14 made to the seeding rate or the seed mix. So that's

15 the kind of how I envision adaptive management working

16 in the context of that, that aspect of the Project.

17 Q. I was expecting Mr. Fudge next, so go right ahead.

18 A. MR. FUDGE: Oh, I'm sorry. It's a chain

19 reaction.

20 Dr. Ross, in the environmental effects

21 monitoring, the Environmental Effects Monitoring Plan

22 on page 14, Section 3, there's a discussion of

23 adaptive environmental management that's in the

24 evidence. And I think it captures, it captures some

25 concepts I think quite well. One, it refers back to

Mainland Reporting Services Inc. [email protected] 1483

1 EnCana's Corporate Responsibility Policy and it refers

2 to that. And it might be just worth while, if I may,

3 just to read a couple of sentences from that because

4 it does, it does relate adaptive management. We've

5 just heard a number of, a number of examples of how

6 when that might occur, but it relates it back to

7 corporate, EnCana's corporate philosophy or policy.

8 So on page 14, Section 3 of the Environmental

9 Effects Monitoring Plan, I don't have the exact number

10 there, but anyway, it says, and I quote:

11 "EnCana's Corporate Responsibility

12 Policy defines its commitments

13 towards environment, health and

14 safety, EH&S, and provides the

15 foundation of its management. One

16 of the principles guiding the

17 behavior of EnCana to implement its

18 corporate policy commitments are to

19 achieve high performance of EH&S is

20 the following."

21 And it's a quote:

22 "We establish EH&S objectives

23 regularly, measure our progress,

24 and strive to continually improve

25 our EH&S performance."

Mainland Reporting Services Inc. [email protected] 1484

1 So I see it imbedded in their corporate policies,

2 that particular piece.

3 And, you know, throughout the -- and then it

4 goes on in this section to discuss the adaptive

5 management, adaptive environmental management that we

6 see as a part of the Environmental Effects Monitoring

7 Program.

8 So where, where, during the course of

9 environmental effects monitoring and carrying out

10 those plans, unanticipated adverse effects occur, for

11 example, anything untoward or anything that's -- or

12 new or modified mitigation measures could be applied

13 or something, is working or not, all those things can

14 be approved or modified as long as you're out there

15 actually measuring something and inspecting and

16 monitoring these, the, the Project as it, if it were

17 to be approved.

18 So I think that, that the Environmental

19 Effects Monitoring Plan inherently has this adaptive

20 environmental management piece that's articulated

21 there and EnCana's corporate policy and commitment to

22 adaptive environmental management is articulated

23 there.

24 Q. Let me try to put the pieces I've heard together and

25 see if I've got it roughly right. You have an

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1 Environmental Protection Plan that you put in place,

2 and because you're not entirely certain about the

3 outcome of these things you, you, you have an expert

4 panel who will suggest to you in some fashion what

5 monitoring should be carried out to determine the

6 success of those mitigative measures to determine the

7 effectiveness of the Environmental Protection Plan.

8 And if the results show that it's working

9 brilliantly, then you just keep on doing the same

10 thing. And if it shows there are some ways of

11 improving, then you make the relevant adaptations to,

12 to improve. Would that be roughly right?

13 A. DR. WALKER: From my perspective --

14 sorry, go ahead.

15 Well, with the exception of your first

16 sentence which was "if we're not quite sure what the

17 outcomes are". I hope what we've done is, is

18 predicted possible circumstances and mitigation

19 measures.

20 And I guess the first big one would be

21 weather. There is such a variation in weather and so

22 various mitigation methods and methods would be

23 appropriate for that.

24 I think other, other things that can get off

25 schedules, perhaps DND exercises that would lock out

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1 activities. So that's where the adaptive part needs

2 to come in is choosing appropriate measures based on

3 the conditions that are there. And I don't think that

4 it's based on uncertainty as to the outcomes. It's

5 just dealing with uncertain weather and operating

6 conditions.

7 Q. I might have thought that if you were certain about

8 the outcomes, then you probably have better things to

9 do with your money than to fund monitoring studies

10 that would predict what you already know would

11 happen. Certainly the Environmental Protection Plan,

12 as I read it, has, has descriptions of what you would

13 do under different weather conditions. And so those

14 are already incorporated. I wouldn't think you could

15 change the weather if the weather doesn't work out

16 well. But I do understand that weather is one of the

17 things that will lead to uncertainties of outcome.

18 And I think on that point we're of common mind.

19 THE CHAIRMAN: Sorry, Mr. Fudge,

20 you're --

21 A. MR. HEESE: If I might add as well,

22 regardless of the specific monitoring plans that are

23 identified for follow-through, if there is opportunity

24 amidst our active operation that we can continue to

25 minimize our impact, absolutely we will continue it,

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1 making those sorts of decisions. If new technology

2 becomes available, maybe even as an example this gas

3 track technology that I mentioned earlier, here is a

4 superior piece of equipment out there that we can now

5 apply to our pipeline testing. That's not necessarily

6 something that might have been tracked specifically

7 with our monitoring program in the EEMP. But when it

8 comes to adaptive management and embracing new

9 technology and new techniques, absolutely those are

10 things that we will continue in spite of what's in the

11 EEMP. I guess to give you maybe some real examples of

12 things that we are already trying, recently we have

13 tried equipping one of our drilling rigs with a more

14 advanced water recycling device in that, it's not

15 because there was a specific problem, but just in

16 general we want to reduce our water consumption. And

17 if there was opportunity to recycle, we wanted to

18 grasp that. So we demo'd the technology on one of our

19 rigs. It turns out the shallow gas wasn't the

20 appropriate application. So we recognized a

21 technology, we gave it a shot, and it didn't work.

22 In the same regard, understanding spot stains

23 and how to best respond to the occasional equipment

24 leak. First of all, it's our practice to have good

25 operating equipment. But there was a, there was a

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1 situation where we recognized we were having some

2 failures on our hydraulic hose. So looking back and

3 responding to a specific deficiency, we realized it

4 actually went back to the actual manufacturer, that

5 there was a manufacturing defect, and we had the

6 crimping on the hydraulic hoses changed. So we

7 responded to the problem.

8 But to go one step further, again, we are

9 currently evaluating the use of vegetable-based

10 hydraulic oils and the potential application as a demo

11 in just -- in any unit or two. So, again, it's not

12 something that we're prepared to move forward. But

13 both situations where we recognize a deficiency and

14 adaptively manage and fix that, but also take the next

15 step and say, well, look, how can we even get better,

16 I think that's an example of how small changes like

17 that are, are evident and are part of our, our

18 corporate structure. And how we operate is to grasp

19 ahold of new technologies and anything that might

20 change or -- change our operations for the better.

21 Q. Thank you. I have two residual questions about this.

22 The first one relates to this committee to advise on

23 the Environmental Effects Monitoring Program and to

24 shape it, and I'm just trying to figure out what

25 would be the nature of those recommendations? Would

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1 those recommendations be made by your committee of

2 experts and then posted on the web for public

3 comment, or would they be internal to EnCana, or

4 somewhere in between?

5 A. MR. FUDGE: Typically, and I'm just

6 basing this on other projects, I'll let EnCana speak

7 to this as well, but certainly the web has been one

8 mechanism that -- recently I've been involved with,

9 myself, with a similar kind of committee, putting

10 forward recommendations and the work being carried

11 out. So both the recommendations and the results,

12 summaries of the results of the work and so on were

13 all made available on the web, on a dedicated website

14 for this committee and for the monitoring plan.

15 That's one way certainly.

16 And in, in the past, certainly other

17 mechanisms of distribution in terms of having it

18 available in libraries, that sort of thing.

19 Q. Okay. The next question is: Suppose that as a result

20 of the monitoring program the adaptive management

21 plan determines that a notable revision to the

22 Environmental Protection Plan is in order, as you've

23 indicated, you update it routinely, but you've also

24 suggested it would be a condition of approval. And

25 so I guess the question is, when you make a change to

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1 it, what is the regulatory process that would be

2 involved in, in making that change? Would it go to

3 the ERCB, would it go to SEAC and DND? Would it go

4 to the public? I'm not sure of the process that you

5 envisage.

6 A. MR. L'HENAFF: So the process we

7 envisioned is, is to have this whole process, this

8 Panel hearing to inform and really kind of flush out

9 the EEMP and the EMAP, but I guess what we had

10 envisioned would be, it's one of the flow charts

11 that's in the EEMP section, having a series of

12 scientists, knowledgeable people look at effects that

13 are really kind of confirming the EIS, so the inherent

14 work that's going on in the EIS. It's a confirmation

15 of that.

16 So you take the areas that you're most

17 sensitive to and you design some studies around that.

18 You get those studies back. And it will confirm or it

19 will say you need to adjust.

20 SEAC and DND is integral to that process, so

21 that's kind of the central hub that you're developing

22 these studies for, developing the learnings from these

23 studies for.

24 When it comes to an adjustment to the EPP, I

25 suppose we haven't thought through all of those

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1 pieces, but it would make sense that it would go

2 through that same train. That SEAC and DND, and

3 likely the ERCB would review those changes because

4 those changes would come as a result of observing an

5 effect, redesigning a mitigation for that, and then

6 incorporating it into a new process, and then that new

7 process would be, would have to be sanctioned

8 basically by the regulatory bodies. And that would be

9 like SEAC, the Base Commander, the ERCB.

10 Q. Thank you. Lastly, some cumulative effect questions.

11 First, let me deal with the geographic boundaries

12 chosen. On Thursday, Mr. Collister indicated that

13 the number one impact on species at risk, I think

14 including specifically Burrowing Owls, but I don't

15 care which ones, was agriculture. And I pose this

16 question in such a way as to provoke but also to

17 invite a response. So why did you choose your

18 boundary so as to exclude all agricultural

19 activities?

20 A. MR. KANSAS: The reason for that was

21 that -- well, first of all, the size of this, this

22 study area relative to the increment is appropriate in

23 my mind, as well as the nature of the boundaries. My,

24 my feeling about cumulative effects is, and I think

25 this is represented in the, in the CEAA

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1 Practitioners's Guide, is that the nature and the

2 magnitude of the increment and its effects, its, its,

3 its halo effects, should dictate in part the nature,

4 the size of the Regional Study Area and the bounds of

5 the Regional Study Area.

6 And, in this particular instance, when I

7 looked at this Project and went to the noise people,

8 for example, and asked them, "Will noise transfer out

9 across the South Saskatchewan River to the other side

10 of the river?", they said, "No, no, it will not to any

11 great degree." Or, "Do antelope utilize areas east of

12 the river as a large mammal that tends to sometimes

13 dictate regional study area boundaries?" The answer

14 was "No". The other -- "The SARA-listed mammal that

15 I'm dealing with, is it, is it affected by the, by the

16 South Saskatchewan River, Ord's Kangaroo Rat?" "Yes,

17 it's a barrier."

18 EnCana has no influence over, over

19 agricultural activities in the region. That's another

20 one.

21 The other thing is that I asked the Special

22 Areas people, if you look at the surrounding areas

23 around what we chose as the Regional Study Area, to

24 the north of it's special areas lands, which are

25 grazing lands, to the, to the west is a grazing co-op,

Mainland Reporting Services Inc. [email protected] 1493

1 to the south is a grazing co-op, and to the east is a

2 river. And all of those areas -- I looked into, for

3 example, I called Lorne Cole (phonetic) from the

4 Special Areas and asked him directly, or Joel did, "Do

5 you anticipate changes over time in the Special Areas

6 in terms of agriculture and change in that regard?"

7 And he, he said, "No, I don't expect it in the

8 timeline of your Project."

9 So, to me, it was not appropriate to just

10 grab a chunk of, of -- widen the study area to 6, 7

11 thousand square kilometres just to grab some

12 agricultural lands that, that really are agricultural

13 lands now, they don't serve as, as habitat for these

14 species. To me it wouldn't have added to the, to the

15 value of the Project in any way. And it wouldn't have

16 helped us assess the significance of cumulative

17 effects of the Project in combination.

18 The other thing I could add is that the Great

19 Sand Hills study, you have to ask yourself, if that's

20 an example, an exemplary example, which I believe it

21 is, of a strategic CEAA at a broad regional level, why

22 did they choose not to, to use the agricultural lands

23 that surround, surround the Great Sand Hills area,

24 which they didn't, as part of their study area? I

25 think it's probably for the same reasons I looked at.

Mainland Reporting Services Inc. [email protected] 1494

1 Q. Okay. Let me move on to your cumulative effects

2 assessment for the Ord's Kangaroo Rat. That was one

3 where I think you indicated earlier today the primary

4 issue is a habitat issue.

5 A. Yes.

6 Q. Your -- I think it would be fair to characterize your

7 work on cumulative effects of Ord's Kangaroo Rats as

8 being within your Regional Study Area; indeed, within

9 the local study area since, as you say, they don't

10 move around much, and in a timeframe from the

11 mid-'70s to the present.

12 Now, the evidence seems that, that we've seen

13 around here, including the COSEWIC report that was

14 discussed earlier, suggests that the, the habitat has

15 shrunk greatly within that very timeframe and within

16 that very study area. And so we have a species that

17 has become listed driven primarily by, I think I'm

18 characterizing it correctly, by the loss of habitat,

19 and yet you still seem to have no significant

20 cumulative effects. And so help me to understand

21 that one.

22 A. Okay. Maybe I'm reading it wrong, but I, I see a

23 cumulative effect as defined in your own guidelines as

24 being the effects of the Project in combination with,

25 with -- the residual effects of the Project in

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1 combination with the effects of other reasonably

2 foreseeable land actions and projects that occur in

3 the study area that you choose that would lead to an

4 issue for the, for the VEC that you're talking about,

5 a long-term sustainability issue.

6 Q. I might have said "and past activities", but --

7 A. And past activities.

8 Q. -- I agree with your --

9 A. Yeah. So when I think about Kangaroo Rat, you know --

10 and I was wrong earlier, I may as well put it on the

11 record now to be expedient -- I was low. 300 to a

12 thousand, I was way off. It was 700 to 3,000 in terms

13 of the range.

14 Q. Thank you.

15 A. When I think about the Kangaroo Rat and the effects, I

16 think of the Project-effect first. I think of all the

17 mitigation measures that are used to, to address that,

18 the impacts on Kangaroo Rat; winter drilling when the

19 animals are in their burrows, daytime driving only in

20 the operational period when the animals are not

21 normally out, studies that were done in the past that

22 indicate, you know, a major pipeline activity had no

23 effect on, on reproduction, survival, movements, or

24 negligible effects.

25 And, you know, and I think to myself, well,

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1 the incremental effect of the Project is minimal. The

2 likelihood that we're going to even kill a Kangaroo

3 Rat is, is, is negligible. There's no evidence that

4 that's happened in many years of research.

5 And then I think of the other things that

6 have been happening. For example, you say the habitat

7 is changing over time. Now, that's due to, likely, to

8 the lack of fire in the NWA, or the shortage of fire,

9 putting fires out on that Double Wide Scrape on the

10 west side, and lack of a, of large herbivore. There

11 were cattle there '60s and '70s until they were pulled

12 out because of impacts. And perhaps, although it's

13 contradictory to what the Sand Hills study says,

14 perhaps climate change. I say it's contradictory, the

15 Great Sand Hills studies indicate that there should be

16 more dunes over time based on climate change.

17 So I, I find it difficult to know how to

18 assess that. I know our increment is small. I know

19 our possibility of impact is very, very low. So to

20 attribute a cumulative effect to something that's

21 totally outside the halo of this Project I, I find

22 difficult. I see that as a, as a broader -- that's

23 where I see project-specific CEAA moving into a

24 strategic, you know, realm.

25 Q. Okay, could I -- I just want to be sure I understand

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1 so I'm going to try and walk you through your

2 words --

3 A. Okay.

4 Q. -- and see if -- where I go wrong here. You indicated

5 in the EIS -- well, I'm going to get carried away

6 here -- quite reasonably, that you would predict the

7 Project residual impact. And if it were -- if it

8 were negligible --

9 A. Negligible, yes.

10 Q. -- then you would not do a cumulative effects

11 assessment. But if it were significant or

12 insignificant, then you would?

13 A. Yes.

14 Q. And if you do a cumulative effects assessment, then

15 you look at the effects of the Project plus the

16 effects of other human activities.

17 A. Yes.

18 Q. And we agree -- we agree -- I'm sorry, you have stated

19 that the fire control has resulted in this rather

20 heroic collapse of habitat for the Ord's Kangaroo

21 Rat. It's an endangered species. I might have

22 thought that that alone would have been a significant

23 adverse cumulative effect to which your project adds,

24 however modestly. Now, I, I try to use your words.

25 A. No, you're correct. You're correct in that regard.

Mainland Reporting Services Inc. [email protected] 1498

1 My feeling, though, is that -- that the -- the

2 residual project effect is so minimal, even though

3 I've called it "insignificant", "non-negligible", it's

4 so minimal that I, I couldn't mathematically model my

5 way out of this and look at change over time.

6 Certainly, if, if they're predicting that -- "they"

7 being Dr. Bender from the U of C -- that if there's no

8 intervention in terms of opening up those active

9 dunes, that dunes could be gone by I think 2014 or

10 something like that. Now, these animals require

11 active dunes. Certainly from a cumulative effects

12 point of view, a regional cumulative effects point of

13 view, something has to happen there or else the

14 impacts of the Project, even if they were very, very

15 small, could be in issue.

16 I'm making the assumption that, that there

17 will be, as part of our Environmental Effects

18 Monitoring Plan, movements in that direction to, to

19 increase habitat quality. In fact, the, the

20 development itself may open up dunes through, through

21 pipelining, through, through active dune areas.

22 DR. ROSS: Thank you very much for your

23 responses.

24 Mr. Chairman, I'm done.

25 QUESTIONS BY THE CHAIRMAN:

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1 THE CHAIRMAN: Thank you, Dr. Ross. I have

2 a few questions as well. And I would like to start

3 with a question, or a clarification to Mr. Denstedt in

4 his response to Dr. Ross's question regarding the

5 application of the National Wildlife Regulations in

6 the NWA. If I understood you correctly, your comment

7 was in relation to existing operations only. Is that

8 correct, sir?

9 MR. DENSTEDT: That's correct.

10 THE CHAIRMAN: It has nothing to do with the

11 Project as -- that we're currently reviewing; in other

12 words --

13 MR. DENSTEDT: That's correct.

14 THE CHAIRMAN: Thank you for that

15 clarification.

16 Q. My next question has to do with baseline information.

17 And I think I might direct it to Mr. Fudge in part

18 because he referred I think a few days ago to a, to

19 the original environmental assessment that was done I

20 believe in 1977. It was also mentioned in

21 Mr. Protti's opening remarks, if I recall, on the

22 first day.

23 I don't recall seeing much reference to that

24 study in the documentation associated with this

25 review. And I wonder, Mr. Fudge, does -- did that

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1 study produce any baseline data that you could rely

2 on in terms of your present Environmental Impact

3 Statement, or did you just disregard that? I just

4 don't have a good understanding of what it was all

5 about and would appreciate some background on that

6 historically.

7 A. MR. FUDGE: I think -- I'll start off

8 with my appreciation and perhaps my colleagues here

9 might speak to their use of this information or others

10 in the work they did.

11 But it's clear -- I actually read that

12 document years ago when I was working in the, in the

13 area in my -- during my thesis work. And also -- but

14 I think what's important is that was an assessment

15 done to the standards of the day, and so in 1977, by

16 Renewable Resource Consultants I believe in Edmonton

17 in 1977, as you said.

18 It was followed by at least four reports that

19 I'm familiar with; two done by Hardy Associates in

20 subsequent years and two done by Western Oil Field

21 Environmental Services thereafter. So for four years

22 after drilling started in the Middle Sand Hills, in

23 particular in that northern area, the National

24 Wildlife Area. And perhaps it was for the, yeah, for

25 the whole area that encompasses the National Wildlife

Mainland Reporting Services Inc. [email protected] 1501

1 Area today. But it focused a lot on the Sand Hills

2 because, in those days, one, there were a lot more

3 active dunes 20 some-odd years ago than there are

4 today. In fact, that was the, the big -- one of the

5 big environmental concerns was, was the stability of

6 those dunes. There's a lot of active dunes today.

7 They're actually moving along and would oil and gas --

8 shallow gas activity get more of these dunes active

9 and, and create a negative impact from more active

10 dunes. As we -- it's interesting to note the

11 discussion we're having today that there's, in fact,

12 perhaps from an Ord's Kangaroo Rat, there's not

13 enough.

14 But, anyway, so those -- but, so, really -- I

15 think what really transpired and the learnings, at

16 least for my own personal self, came from the

17 application of, of, of the -- sorry, the

18 investigations, which were similar to some of the

19 evidence we've seen, like the AXYS investigations of

20 how are the, how is the, how are these sites being

21 revegetation -- revegetated? How is the soil being

22 stabilized? What are the environmental issues around

23 the pipelining aspect, the well-site drilling and so

24 on, and the selection of routes and sites?

25 So that I think was the real take-home

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1 message for me over the period of the original

2 assessment and then the work done thereafter. In

3 terms --

4 So that it was really the environmental

5 protection measures, if you like, and the siting

6 issues. And obviously that's, that's evolved over

7 time. So that's number 1.

8 I think the -- and number 2, even in those

9 days in the 1970s, Canadian Wildlife Service was doing

10 -- was very active in the area and, by the way, the

11 Province as well. Provincial investigators in the

12 '70s, in the early to mid-'70s, prior to drilling,

13 they did a lot of inventory work in terms of wildlife,

14 in terms of vegetation and the like, and published

15 those. University researchers well. And that was the

16 real body of literature in the '70s, anyway, that

17 certainly I used in the late '70s and that -- those,

18 those were used today.

19 So that's my understanding of that

20 background, that -- just to give you a little

21 perspective. Now, how these gentlemen used it or

22 referred to it, I would have to ask them to respond.

23 A. MR. KANSAS: I've reviewed those five

24 studies that Mr. Fudge refers to. He's right. Back

25 in the '70s there was a real focus on, on large

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1 mammals, ungulates and raptors. Those were the big

2 topic of the day. We didn't get into the kinds of

3 small, smaller animals, birds, diversity, that sort of

4 thing. That, that's kind of an early '90s thing that

5 biodiversity started becoming big and started to

6 become a movement towards non-consumptive species.

7 So in a way the, for me, from a wildlife

8 point of view, those were really good contextually for

9 me to see, for example, what antelope numbers were

10 like back, back in the '70s, et cetera. But other

11 than showing graphs of change over time -- and, and

12 some -- there was some, some information on, on

13 impacts. I think it was Holtz and Reynolds 1980.

14 They -- from CWS. They actually did a small study

15 based on aerial surveys to understand how, I believe

16 it was three drilling wells; one deep gas well, two

17 shallow gas wells, would affect deer and antelope in

18 the northern -- in the Middle Sand Hills area. And

19 from that, they came to the conclusion that no more

20 than five drilling rigs at any given time should be

21 operating in the Middle Sand Hills.

22 So that kind of information I pulled out.

23 May not have referred to it in the reply -- in our

24 evidence, but I was conscious of it. But in terms of

25 using it as a baseline it's difficult because it's so

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1 old.

2 A. DR. WALKER: For the reclamation side of it,

3 some of the recommendations are actually -- were very

4 good and, and have been implemented. For instance,

5 from the, from the Western Oil Field report, the first

6 recommendation is that route and site selection should

7 be made by a person or group trained to recognize

8 areas most suitable for development. So they're,

9 they're suggesting something similar to what is being

10 proposed today; is a PDA process of site selection in

11 the field to reduce disturbance. And they go on to

12 suggest erosion control measures as well.

13 The Hardy report suggests that installation

14 of pipe using a plowing technique should be used

15 because it greatly reduces the environmental impact.

16 So that's another early recommendation that has been

17 adopted.

18 And another one of their suggestions,

19 wellsites were located on low ground where reclamation

20 will be enhanced by the presence of finer-textured

21 soil and the protection from winds. So that's another

22 procedure that was implemented then and was carried

23 on.

24 I was actually around at that time. And that

25 the invitation of the AEC environmental co-ordinator

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1 was invited there to, to, to make some suggestions.

2 I'd spent five years working in the Foothills and I

3 figured I knew most about Sand Hills, but I came away

4 from that visit learning more than I perhaps gave in

5 terms of information. And it was as a result of, of

6 the environmental co-ordinator at the time, a man

7 named Major Hank Barrett, thank you, he was a former

8 Base Commander, and when he retired went to work for

9 AEC, and he had no background in environmental

10 protection, but he had an enormous amount of common

11 sense and was a keen observer, and he got caught in

12 the middle; CWS wanted him to use native species, and

13 the advice he got from the Agricultural was to use

14 Crested Wheatgrass. And so, as a result, he said,

15 "I'm not going to use anything." And so chose sites

16 that, that reclaimed quickly, chose routes. That was

17 the first time I learned that you could tell a

18 reservoir engineer where to put a well site. That was

19 new to me. But he did that. And that has been policy

20 since then that, that wellsites could get moved 50

21 metres without even calling Calgary.

22 Further distances are in evidence out there

23 where they've re-located wells to be in protected

24 sites. So it was a matter of, of good common sense.

25 And, and I learned a lot from Major Barrett. And

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1 those lessons learned from those initial environmental

2 assessments and the work of Hank Barrett are the

3 reason why some of the sites out there are, are

4 exceptionally good in terms of their, their, I'm going

5 to say restoration back to a native plant community.

6 Because that's what you see out there.

7 THE CHAIRMAN:

8 Q. Well, thank you for that history. I gather that it

9 was of value in terms of environmental protection

10 rather than -- or those studies in terms of

11 environmental protection rather than being a value in

12 trying to establish baseline conditions.

13 Maybe another question related to that: At

14 what point, then, do you feel the studies that have

15 been going on in the NWA have produced information

16 that would establish a reasonable baseline? Would

17 this be in the '90s where you're starting to see data

18 gathered that you could rely on in terms of

19 understanding what, what the baseline conditions

20 would be?

21 A. I think it is very, very difficult to establish a

22 baseline in the NWA because it is recovering from such

23 a long history of disturbance. The early heavy

24 grazing, the farming, and then the trespass grazing,

25 early oil and gas activities that disturbed the

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1 ground. It is in a progression of recovering.

2 Removal of the horses in the early '90s is another

3 disturbance on the landscape that got removed and, and

4 made changes.

5 So at what point in point in time would you

6 like to have a baseline? Certainly from a functional

7 point of view it could be established, but in terms of

8 plant numbers and composition and animal numbers,

9 it's, it's a shifting baseline so far as I can see.

10 A. MR. KANSAS: I feel that it -- really,

11 the Canadian Wildlife Service inventory in '95, '96

12 was -- it was a really good inventory. And the

13 approach they took was very systemic. For most of

14 their inventories, they went along a UTM grid line.

15 They just plopped in plots all along. So, so to me

16 that's, that's really an ideal baseline. It's not

17 biased towards any particular habitat type. It's very

18 good work. And it served our purposes very well for

19 the EIS.

20 Q. So most of the, if I understand it, most of the

21 information that has been collected on the

22 environmental attributes over many years has been

23 collected by Canadian Wildlife Service, probably,

24 rather than EnCana or AEC before EnCana existed?

25 A. Yes. And DND. DND's got some good work that they've

Mainland Reporting Services Inc. [email protected] 1508

1 done in the last couple few years and, and prior to

2 that.

3 Q. Thank you. My next question: If, if this Project

4 does proceed as you have proposed, some of your

5 studies that you've done in connection with the

6 Environmental Impact Statement, the proposed PDAs,

7 Environmental Effects Monitoring Program will

8 certainly create a very large database. Are you --

9 do you have a high degree of certainty with the

10 collection of all of that information that you would

11 be able to see in the future should the project

12 proceed how it might affect the valued ecosystem

13 components?

14 A. I, I personally do. I think it's really important to

15 think about scale in that issue. For example, you

16 probably read or heard about this triangle method used

17 for sampling the quarter sections where we

18 systematically flip the triangle on its vertex and

19 took measurements along, five times along each side of

20 the 500-metre long triangles. That data in my mind

21 would serve a good basis for long-term monitoring of,

22 of quarter section level wheat, possible wheat issues

23 that might arise at that scale.

24 The other scale would be there's the option

25 to go back to individual pipelines and individual

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1 lease sites. There's, there's several databases out

2 there now that we've collected and are saber rattling

3 back and forth in these hearings with the -- but

4 they're all good data, and over time the land changes

5 and they could be monitored at that level. So there's

6 a good basis for, right now for monitoring change over

7 time and then adapting practices, I think.

8 Q. Thank you. The next question related to this again,

9 but following up on some of the discussion involving

10 Dr. Ross's questions. As you proceed through a

11 construction season, again, assuming the Project

12 proceeds, do you have some kind of a lessons learned

13 that, then, feeds into, I guess from your

14 Environmental Effects Monitoring Program that feeds

15 into the Environmental Protection Plan and can you do

16 that effectively within that short time period

17 between one construction season and another?

18 A. MR. FUDGE: Perhaps -- well, I can start

19 off on this. There are -- actually, in terms of the

20 Environmental Protection Plan itself and updates to

21 it, that is actually covered in a section of this, and

22 speaks about the, you know, in the field situation.

23 For example, when a change might be made to a

24 procedure or to -- or shutting a project down,

25 shutting a particular piece of work down for specific

Mainland Reporting Services Inc. [email protected] 1510

1 purposes, all of those are going to be documented as

2 part of the Environmental Protection Plan and part of

3 the duties of the environmental inspector.

4 So if there's any adaptation that needs to be

5 done by EnCana and their contractors in terms of

6 construction, there's a procedure here of how to

7 document that and how that feeds into the

8 Environmental Protection Plan. And we talked about, I

9 guess it was Dr. Ross, in response to his question,

10 about where it went from there to the, to the

11 regulatory authorities, but. So that, that's really

12 ensconced in the concept of the, of the protection

13 plan to update it with the real field information and

14 any changes that are proposed in terms of any of the

15 procedures, that kind of thing, to adapt them or

16 update them.

17 A. MR. L'HENAFF: And if I can just add as

18 well, it's another facet of the adaptive management as

19 we employ it at EnCana. Mr. Heese kind of outlined a

20 couple specific examples that were maybe more along

21 the line of the, the -- I can't recall what term you

22 used. Yeah, so not the passive side but the, I guess

23 the more reactive side or aggressive side.

24 With respect to the passive side of things,

25 another facet that fits into the adaptive management

Mainland Reporting Services Inc. [email protected] 1511

1 is project look-back, so at the conclusion of a

2 project we would, we would look at the project at

3 different degrees of, of detail. Formalized project

4 look-backs, what went off well, what didn't go off

5 well, go into a root-cause analysis. If something was

6 not occurring as you saw fit, what were the root

7 causes behind that? Was it a training element, people

8 weren't aware of it? Was it a systemic issue that the

9 processes just weren't built to fall like that?

10 So as a result of understanding that, then

11 you could cycle back and go into an improvement cycle

12 and make those, those changes.

13 So related to the NWA, of course there would

14 be heightened project look-backs and they'll -- that

15 sort of information will be fed, fed back through the

16 adaptive management cycle.

17 The Environmental Inspectors on site would

18 form a key element to that as in what's working,

19 what's not working. If it's not working, what, what's

20 the root cause of it, sort of thing. So, so those

21 would be facets of that adaptive management cycle.

22 Q. Thank you, Mr. L'Henaff. I understand the process. I

23 guess I'm struggling or trying to understand whether

24 between one season or another you can accomplish all

25 of this to take the lessons learned from one to apply

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1 to the next. That's really the fundamental question.

2 A. I guess, you know, I could offer that we, we do look

3 at our projects and turn them around in, in that

4 order. It's because of the nature of our projects

5 that we have project-specific start/stop cycles.

6 So it's a matter of getting that look-back

7 done in a timely manner. And, you know, we would do

8 that in the NWA.

9 Q. Thank you. My next question has to do with the

10 advisory committee for the Environmental Effects

11 Monitoring Program. This may be a policy question

12 that perhaps Mr. Protti might best answer, but I

13 believe in your suggested makeup of that committee

14 you have suggested including membership from possibly

15 the Environmental Coalition or some of its groups.

16 Is it your policy -- presumably for -- if they chose

17 to participate in that, they would need some

18 financial assistance to do that. Is it your policy

19 to provide that kind of financial assistance for

20 non-governmental groups such as the Coalition?

21 A. Absolutely, we would certainly look at that. And I'll

22 leave it to Mr. Protti to elaborate further on that.

23 Q. Thank you. My next question has to do with the issue

24 of, of trenching in frozen conditions that we talked

25 about a little bit earlier today.

Mainland Reporting Services Inc. [email protected] 1513

1 You, I believe, were, were, were not willing

2 to make a commitment about stopping the plowing in

3 frozen ground conditions. And I understand the

4 reasons that you provide in that respect. I wonder,

5 though, is this an example of the kind of matter that

6 you might discuss with the Department of National

7 Defence as you enter into the season where freezing

8 starts and you wish to continue to do trenching

9 activity at that point? Is that such an example

10 where that kind of consultation would occur?

11 A. MR. HEESE: I think it would be

12 appropriate again to keep them informed of how the

13 project progresses to ensure that we're adhering to

14 the conditions of the permit and ensuring that we are

15 doing a minimal disturbance job. That would be fair

16 to engage them in discussions at that point.

17 I would like to add, though, again it is our

18 intention to maximize the non-frozen period. And I

19 guess what we were -- again, to reiterate our

20 commitment using the best installation method for the

21 best conditions that are present and, and for the

22 appropriate soil type, that is our commitment, and to

23 continue to work openly with DND, certainly. That's,

24 that's fair.

25 Q. Okay. Thank you, Mr. Heese. My next question I think

Mainland Reporting Services Inc. [email protected] 1514

1 is probably also directed to you. It has to deal

2 with the matter of Environmental Inspectors. Do you

3 have inspectors currently employed in the MTA,

4 Military Training Area.

5 A. We do not currently have inspectors as they've been

6 described for this Project in the MTA. The -- some,

7 some of the roles have been assigned to activity-level

8 co-ordinators to ensure that they're doing the minimal

9 disturbance job. And I provide general council and

10 guidance to, to those activity inspectors as well.

11 As we have defined the role of an

12 Environmental Inspector within this Project, no, that

13 specific role does not currently happen outside the,

14 sorry, does not currently exist on the block.

15 Q. Given your -- thank you. Given the, I guess, the

16 practice in the MTA, which is a little bit different,

17 I think, than what you are proposing based on what

18 you just indicated, are there examples where

19 construction would be, would have been shut down in

20 the past as a result of that, that activity

21 supervisor, I think was the term you used?

22 A. Wet weather shutdown is one of those where I think the

23 current individuals actually do an exceptional job.

24 It is not to say we are without incident, but the

25 level of care that they take to evaluate the weather,

Mainland Reporting Services Inc. [email protected] 1515

1 approaching storms and systems, understanding the

2 length of the particular operation that they're

3 undertaking and their opportunities for shutdown, I

4 think they do make good decisions.

5 However, again, as an added level of

6 assurance, having somebody with an environmental

7 background, being a dedicated environmental inspector

8 will only reassure that the best decisions are made.

9 But I do feel that the activity co-ordinators that we

10 have in the MTA right now take that responsibility

11 very seriously. They discuss amongst themselves

12 almost hourly what they see changing in the weather

13 and how they might respond to that.

14 Q. Okay. In the future, moving into the NWA, I guess

15 what I'm seeking is, is what assurances do we have,

16 does DND have, if this Project proceeds, that these

17 environmental inspectors will have that full

18 authority to shut down an activity not only due to,

19 say, weather conditions but also other environmental

20 concerns?

21 A. MR. L'HENAFF: They absolutely will have

22 that authority.

23 Q. Okay. Thank you for that commitment.

24 My next question has to do with a matter that

25 I believe was raised by the Government of Canada and

Mainland Reporting Services Inc. [email protected] 1516

1 specifically Natural Resources Canada regarding the

2 issue of soil slumping, concerns about that. And I

3 wonder, again, based on your operating practices, do

4 you have or have situations occurred where drilling

5 has resulted in soil slumping?

6 A. MR. HEESE: Just to clarify the specific

7 reference, that would be slumping in association with

8 the river breaks or, you know, mass wasting as opposed

9 to specifics, subsidence on a pipeline? Do you have a

10 specific --

11 Q. I was thinking of drilling and it could be anywhere.

12 A. So drilling in proximity to the river --

13 Q. That would be one example --

14 A. - would be an example?

15 Q. -- that would probably be an area where it might more

16 likely occur I would presume, if it ever did occur.

17 A. Yeah, certainly from EnCana, I, I've had no knowledge

18 of any incident where drilling led to a slumping or

19 where it was a possible contributor.

20 Q. Okay. My next question is, is related to the, the

21 responses to Mr. Mousseau this morning regarding the

22 PDA process and the various studies that will be,

23 that will be conducted over the summer period. My

24 recollection is that the PDAs would be completed for

25 submission to SEAC, to the Base Commander, and then

Mainland Reporting Services Inc. [email protected] 1517

1 ultimately to the ERCB somewhere around the end of

2 September, first of October. And I really wonder to

3 what extent these people would be able to turn around

4 an approval in time for you to start your

5 construction as you are proposing, is the first

6 question. The second question is, given that there

7 could be delays there, what would that mean for your

8 program?

9 A. MR. L'HENAFF: So we feel that we'll be able

10 to get the first batches out early September,

11 September 1 basically. So the first batteries would

12 be coming out. So individuals reviewing those reports

13 would have effectively a month to kind of get the

14 program rolling. And then the remainder of the

15 program would follow through through September. And

16 we would anticipate that we would have all of the

17 material in October 1, basically.

18 If the reviews weren't completed in the

19 appropriate time and October 1 passed by, then we

20 would begin whenever those reviews were completed. So

21 if the first year it took, took some time, it took us

22 to October 15th, we would not begin until we went

23 through the process appropriately.

24 Q. Would you agree with me, Mr. L'Henaff that's a pretty

25 ambitious period of time, or a pretty ambitious

Mainland Reporting Services Inc. [email protected] 1518

1 timetable, a month, roughly, for all of those

2 approvals to be received for a process that in fact

3 will be very new at that point?

4 A. I guess I can, you know, refer back to how I, I talked

5 about the PDA process and, you know, these surveys,

6 each of these elements are not new to us. We've been

7 doing them in different ways. And, and even coupling

8 them together into an overall assessment for a battery

9 and that is not new to us.

10 So we certainly have -- you know, and it's

11 really due to the work that we've been working with on

12 -- with the DND around the work that's required for

13 the MTA and progressing the EOs (phonetic) and that.

14 So none of these pieces are really new to us.

15 Buttoning them together is not new to us. So I think

16 we do have a lot of experience in doing this sort of

17 work. We're certainly -- we understand how we would

18 want to really move our process to the next level and

19 really expedite a lot of that work. We've had a lot

20 of those thoughts and a lot of those discussions

21 because we've had at least two years of evolution

22 around, around the MTA process and that, so.

23 We've got a lot of experience in progressing

24 each of the widgets. We've got a lot of experience

25 from a well (indiscernible) perspective in buttoning

Mainland Reporting Services Inc. [email protected] 1519

1 these assessments together and, and, and using that to

2 move the wells and the pipe and then moving that

3 forward as a package of information which, you know,

4 predominantly gets communicated in an executive

5 summary, like, that's a map that shows you where all

6 of the features are and an executive table at the back

7 that shows you where all the key features are and what

8 the issues are there.

9 So I believe, I believe it is, it is do-able.

10 A. MR. COLLISTER: I don't -- maybe I could

11 just add one thing. I don't know if it's helpful,

12 maybe it's already understood, but much of the

13 information that would, that would be included in the

14 actual applications, as I understand it, come

15 September 1 or whenever the first application would be

16 put in, would already be familiar to SEAC, for

17 example, in the sense that we talked about surveys

18 this afternoon and, for example, a Sharp-Tailed Grouse

19 survey being done in April, it would seem to me that

20 that would be provided in its entirety to SEAC shortly

21 after that.

22 So those -- so the field surveys would be

23 provided in their entirety early and, and then the

24 applications would, would draw on those as required.

25 So I think that would help in terms of, of all the

Mainland Reporting Services Inc. [email protected] 1520

1 information not being new to SEAC when the application

2 lands on them, so hopefully that would speed it up a

3 bit.

4 Q. Okay. Thank you for that clarification. I imagine

5 we'll have similar discussions for SEAC and the

6 Department of National Defence later in these

7 proceedings on that same subject.

8 My next question, I think is a follow-up to

9 comments made by Dr. Walker regarding the matter of

10 possibly or at least the value of having targets

11 established for ecological restoration. And I

12 wonder, has there been any discussions with the

13 Department of National Defence on this subject at

14 this point?

15 A. DR. WALKER: None that I'm aware of.

16 Q. Okay. Thank you. And a similar, I guess a similar

17 question, the 1992 MOU between Environment Canada and

18 the Department of National Defence made reference to

19 the development of a management plan for the National

20 Wildlife Area. And we have evidence in the

21 Government of Canada submission about such a plan.

22 Again, I wonder, has EnCana participated in the

23 development of such a plan at this point?

24 A. MR. HEESE: I'm not aware of EnCana

25 participation.

Mainland Reporting Services Inc. [email protected] 1521

1 Q. Okay. Thank you. My final question is perhaps

2 related or perhaps best answered by Mr. Protti but I

3 will throw it out anyway, and, and have you reflect

4 on it, if necessary. I wonder to what extent, with

5 the creation of the National Wildlife Area in 2003,

6 how that has actually affected your day-to-day

7 operations in the National Wildlife Area. What I'm

8 getting at is, did EnCana decide at that moment to

9 undertake, I guess, practices that were different,

10 that were recognizing the value and the sensitivity

11 and the additional authority assigned to the Base

12 Commander associated with the creation of the NWA, or

13 did you continue to operate very much like you did in

14 the past?

15 A. MR. L'HENAFF: Yes, I think, I think

16 consideration on that question and having Mr. Protti

17 to spearhead the answer there would be, would be

18 appropriate.

19 THE CHAIRMAN: That would be fine. That

20 concludes my questioning. And I think that, that we

21 will start with the Coalition and hear their evidence,

22 but I think this is probably an appropriate time to

23 have a coffee break so that Ms. Klimek can assemble

24 her, her Panel.

25 MR. DENSTEDT: Mr. Chairman, I have a few

Mainland Reporting Services Inc. [email protected] 1522

1 questions by way of redirect on the portions that have

2 been covered so far. I can do that with the Panel

3 members now, which might be useful for some of the

4 environmental folks who may or may not be here

5 Thursday, but I'm in your hands on that.

6 THE CHAIRMAN: Yes, I'm sorry, Mr. Denstedt,

7 I should have asked if you had any questions in that

8 regard.

9 I think it would be appropriate to take a

10 break at this point. We'll come back and have you

11 back on the stand. Thank you.

12 (BRIEF BREAK)

13 THE CHAIRMAN: I believe we're ready to

14 proceed now. Welcome back, everybody.

15 And, Mr. Denstedt, I understand you wish to

16 undertake a re-direct examination of the EnCana panel,

17 so please proceed.

18 MR. DENSTEDT: That's correct, sir. But

19 before I start, though, Mr. L'Henaff can respond to

20 the undertaking he gave to Mr. Mousseau earlier.

21 THE CHAIRMAN: Mr. L'henaff.

22 UNDERTAKING SPOKEN TO:

23 A. MR. L'HENAFF: Yes, just to close off on a

24 couple of those questions. With regard to yesterday,

25 JRP15 on page 5, you had a question around the analog.

Mainland Reporting Services Inc. [email protected] 1523

1 Yes, it is a direct analog. And the well spacing is

2 205 metres.

3 With respect to the drilling protocol related

4 to loss circulation, so it's a very rare event. When

5 and if that would occur, the procedure is to mix up a

6 loss circulation slurry mix of gel bentonite, sawdust,

7 cellophane and, and basically control the loss

8 circulation. If, if it doesn't happen, repeat, repeat

9 the process. If you're not successful, another step

10 in the procedure would be to pump a cement plug across

11 that interval. And then again, if that's not

12 successful, then we'd cement off, you know, that --

13 off the whole well, the initial part of the well that

14 you're drilling in and basically start again. So

15 that's the drilling process.

16 The low cement, so if you have no returns or

17 any indication of low cement, no returns, we would run

18 a cement bond lock and then be able to determine where

19 the cement lock was and then basically fix it through

20 the casing. So basically perforate and circulate it

21 in cement.

22 MR. MOUSSEAU: Thank you, sir.

23 THE CHAIRMAN: Thank you, Mr. L'Henaff.

24 Please proceed, Mr. Denstedt.

25 RE-EXAMINATION BY MR. DENSTEDT:

Mainland Reporting Services Inc. [email protected] 1524

1 MR. DENSTEDT: Thank you, Mr. Chairman.

2 Just a very few questions by way of redirect and I

3 almost enter into this part of the program with some

4 trepidation, but I will forge ahead, nonetheless.

5 Q. The first one is for Mister, for you, Mr. L'Henaff,

6 and that's in response to Mr. DeSorcy. You were

7 questioned about your consultation with SEAC in

8 respect of the PDA process. And I wasn't clear on,

9 on the extent of that or why, why it was that EnCana

10 didn't pursue more lengthy discussions with SEAC.

11 And perhaps you could elaborate that, on that?

12 A. MR. L'HENAFF: Sure. So as I, as I had

13 indicated, we only had the two members of SEAC and the

14 member from the ERCB and the member from Environment

15 Canada did discuss the PDA process. It was a

16 high-level discussion. I believe that both members

17 were fairly familiar with the siting process, with the

18 survey process, because we've, we've had an ongoing

19 discussions related to stuff like this with the DND,

20 you know, that's another element, long-term

21 discussions with them over several years. I think

22 we're quite well aware of each other's concerns and,

23 and we're -- I think the DND as well as SEAC is, is

24 very aware of the evolving processes on the Base. So

25 I think for those reasons it wasn't required. They

Mainland Reporting Services Inc. [email protected] 1525

1 certainly didn't need to go into exacting detail

2 around, all around the PDA. They're fairly familiar

3 with the survey process, so fairly familiar with how

4 we put reports together and made adjustments to the,

5 to the specific sites.

6 My comments around some of their, I guess,

7 comments back was the resourcing side, the, you know,

8 you know, what, what would their role be, how would

9 the resourcing fit into that? But I got the

10 impression that they were certainly open and

11 listening.

12 Q. Mr. L'Henaff, the second question is for you again.

13 This is in response to examination by Mr. Mousseau.

14 He asked you a few questions about in a perfect world

15 if you could have avoided operational issues in

16 determining a steady state you would have. But could

17 you help the Panel on whether it's possible to do

18 decline analysis in the, in the face of those

19 challenges?

20 A. Certainly. So as I, as I had indicated, there were

21 many things going on and there was multiple objectives

22 that were going on and those were the dominant reasons

23 on choosing the offsets. However, you certainly can

24 do a decline analysis with changing conditions. Some

25 of the material that we've submitted, a re-analysis of

Mainland Reporting Services Inc. [email protected] 1526

1 pilot period and other things, certainly shows that,

2 that you can do an analysis with changing conditions.

3 And I think continuing to revisit your analysis year

4 after year and, and seeing what the trends are. When

5 you get past those high-transition states and then go

6 into a more stabilized period, that analysis is

7 possible and, and gives you confident results as well.

8 Q. Thanks, Mr. L'Henaff. The next question is for, for

9 you, Mr. Kansas, and this was in response to

10 cross-examination by both Mr. Shaw and Ms. Klimek and

11 I was, I was a little confused at a couple of spots

12 when you were discussing the footprint at 0.5 percent

13 and, and I guess my question was, did that take into

14 account reclamation and recovery, or does that

15 exclude those two things?

16 A. MR. KANSAS: It excludes reclamation and

17 recovery, so it's a worst-case scenario.

18 Q. And, Dr. Walker, I have a question for you, and it was

19 actually occurred this morning and it was in response

20 to questioning by Mr. Mousseau. And he was

21 questioning you about the, I believe it was

22 monitoring in respect of the invasion of Crested

23 Wheatgrass from, from pipeline right-of-ways and

24 trails. And I think you referenced Mr. Henderson's

25 work and Mister, perhaps Mr. Smith's work, but I

Mainland Reporting Services Inc. [email protected] 1527

1 can't recall.

2 And when I heard that exchange it wasn't

3 clear to me whether the references that you were, or

4 the answers you gave were in response to the

5 likelihood of the Project causing that kind of

6 invasion or whether you were commenting on Mr. Smith

7 or Mr. Henderson's work. And I wasn't clear on that.

8 And hopefully you can clear that up for me.

9 A. DR. WALKER: If I recall, the question

10 was, was there a model for monitoring the spread of

11 Crested Wheatgrass and, and perhaps controlling it or

12 removing it. Was that possibly the question?

13 MR. MOUSSEAU: My recollection was that the

14 questions relating to the Henderson project related

15 specifically to vehicle traffic as a, as a vector for

16 the spread of Crested Wheatgrass. And it's really

17 going to tax my brain to go back here, but I think I

18 asked you to comment, first of all, upon the

19 conclusions in the Henderson paper. And I think,

20 secondly, I asked you to comment on whether those

21 impacts were taken into account in the assessment of

22 cumulative effects. To the best of my recollection

23 that was the -- those were the questions I had asked.

24 A. Was I here?

25 MR. DENSTEDT: I'm sorry, I wasn't the only

Mainland Reporting Services Inc. [email protected] 1528

1 one that was confused, then.

2 A. I obviously didn't answer that question.

3 With regard to Dr. Henderson's assessment of,

4 of this spread of Crested Wheatgrass, I take issue

5 with some of the assumptions that were made in, in

6 doing the study; certainly not with the methods, but

7 the starting assumptions were that the right-of-way

8 was 2.44 metres wide, which is the, the width of a

9 seed drill, they said, and I take issue with that

10 because a right-of-way that width is, is, is too small

11 to put a pipeline in. And, and also, because my

12 observations at the time were that, that there were no

13 limitations on how wide a right-of-way should be and

14 they took as much space as they wanted in those days.

15 They sprawled all over the place. And then the

16 standard practice was just to seed everything at a

17 very heavy rate. And that was from the

18 recommendations from the agriculture people. I know

19 myself they said very heavy rates should be used.

20 And I also know they used to use a broadcast

21 method, and so if there was any wind at all, the seed

22 would blow all over the place. And so I felt the

23 assumptions that, that you start measuring the spread

24 of Crested Wheatgrass from edge of a 2.44 metre

25 right-of-way was not a good starting point. That,

Mainland Reporting Services Inc. [email protected] 1529

1 that the standard right-of-way at that time would have

2 been at least 20 metres. And with the drift of seed

3 blowing downwind, it, it could have gone anywhere up

4 to 30 or more metres wide.

5 And so what they were looking at was not the

6 spread of the Crested Wheatgrass out from the

7 right-of-way; they were looking at the recovery or

8 ingress of native species into the seeded area. And

9 Crested Wheatgrass would have established based on the

10 amount of disturbance. And over the trench it would

11 have been highly disturbed. They didn't save top soil

12 and so the Crested Wheatgrass would establish there.

13 And then, depending on the edges of that trench area,

14 depending on the amount of disturbance, would dictate

15 how much Crested Wheatgrass managed to get

16 established. And so that's what you see on the

17 landscape now is, is patches and elliptical bulges

18 along these right-of-ways of Crested Wheatgrass

19 growing and, and the native species establishing in

20 between.

21 So, in my opinion, using that as a means of,

22 of measuring the spread didn't start with good

23 assumptions. And that's in contrast to

24 Dr. Henderson's thesis and paper that started with a,

25 a very sharp edge, a seeded field right next to an

Mainland Reporting Services Inc. [email protected] 1530

1 undisturbed native prairie area where the measure of

2 egress would be much more rigorous.

3 And so that was that part of it. And the

4 monitoring part was?

5 Q. Thanks, Dr. Walker. I think that was in response to

6 Mr. Mousseau's question, but I won't venture any

7 further down that path.

8 I, I do have a couple questions about species

9 at risk and, Mr. Chairman, it is in relation to

10 redirect specifically, but one of the purposes of

11 Joint Review Panel hearings is to elicit information

12 that's useful in your report and useful for your

13 recommendations, not just in respect of the Project,

14 but other things, so I think I will venture there.

15 And, and the first question I had is to you,

16 Dr. Walker. Did I hear you right when you said that

17 when a, when a species at risk, a plant species at

18 risk is rescued and seeds are propagated from that

19 plant, if it's replanted, those seeds are replanted,

20 it is no longer a species at risk?

21 A. Well, I, I possibly need some guidance in interpreting

22 what I read in the recovery plans that are there, but

23 there is a, a rider, a condition that indicates that

24 if a plant is not the result of, of natural

25 conditions, if it's a result of disturbed conditions

Mainland Reporting Services Inc. [email protected] 1531

1 like roads, or if it's been propagated as a result of

2 horticultural intervention, then it, it has less than

3 rare status, I would say, or it doesn't get

4 inventoried, shall we say, in terms of where it sits

5 in the population.

6 Q. Thanks. I think if I have any other questions on

7 that, I'll pursue Environment Canada on that.

8 One, one final question, and that relates to

9 a series of questions that were posed by, by Dr. Ross

10 in respect of species at risk again. And, again, I

11 took it from the responses, and I want to make sure I

12 got it right because I'm, I seemed a little confused.

13 I thought what I heard you saying, Dr. Walker, and

14 you as well, Mr. Kansas, in respect of some of the

15 species at risk plants and in respect of Ord's

16 Kangaroo Rat that those species at risk might in fact

17 benefit from disturbance. Did I get that right?

18 A. Yes, you did.

19 Q. Okay. Mr. Kansas?

20 A. MR. KANSAS: Yes. I'll expand a little

21 bit. It's clear that Ord's Kangaroo Rat require

22 blown-out dunes as one, one aspect of their habitat.

23 They also use edges of roads and steep banks along the

24 river, but I don't think a Kangaroo Rat sees an

25 area -- let's say, for example, an area was

Mainland Reporting Services Inc. [email protected] 1532

1 accidentally blown out by cattle going through a key

2 hole in a dune and travelling over that area and then

3 the area blew out because of that disturbance. I

4 don't think they see that much differently than they

5 would see a dune, a naturally blown-out dune. So any,

6 any form of open sand adjacent to native prairie is,

7 is fair game for Kangaroo Rat.

8 MR. DENSTEDT: Thanks, Mr. Kansas.

9 Mr. Chairman, that's all I have. I think any concerns

10 I have with that I'll follow up with Environment

11 Canada.

12 THE CHAIRMAN: Thank you, Mr. Denstedt.

13 We'll now turn to Ms. Klimek to begin

14 presentation of direct evidence.

15 Ms. Klimek, before you begin, perhaps I

16 should indicate that I'm not sure how long you wish to

17 take but this panel, and I don't mean to rush you in

18 any way, but this Panel is certainly prepared to sit

19 for the duration of your, of your evidence this

20 afternoon if that is appropriate from your

21 perspective. We may need to take a break at some

22 point in, in that presentation of evidence, but I, I

23 leave that to you to advise us in response to my

24 remarks.

25 MS. KLIMEK: What I would propose is that

Mainland Reporting Services Inc. [email protected] 1533

1 we get through the direct presentations today, see

2 where we are, and then come back tomorrow morning for

3 cross-examination. And we do have one time limitation

4 which I have talked over with Mr. Denstedt and with

5 Mr. Mousseau and I do believe with Mr. Lambrecht.

6 Mr. Power has to be out of here by 4:00

7 tomorrow, he's got a flight back to southern climes,

8 and so if it looks like we're running up, I'm

9 wondering if we could finish the question with him,

10 he's pretty discrete, and then come back to the rest.

11 But I just wanted to give you an alert. I think it

12 may just play out just fine, but -- so we keep our eye

13 on that ball.

14 THE CHAIRMAN: Thank you, Ms. Klimek. We'll

15 certainly take that into consideration. Yes, we will

16 try to -- yes, we will accommodate that.

17 MS. KLIMEK: And we just need a few

18 minutes to do the switchover and get set up here if we

19 could, about five, ten minutes.

20 THE CHAIRMAN: Yes, please do so.

21 (Afternoon break)

22 THE CHAIRMAN: Ms. Klimek, I think you have

23 your Panel now seated. The first thing we will need

24 to do is to swear the witnesses in under oath for the

25 purposes of these proceedings.

Mainland Reporting Services Inc. [email protected] 1534

1 MS. KLIMEK: Yes, if we can do that now,

2 Mr. Chairman.

3 THE CHAIRMAN: I'll ask the Court reporter

4 to do that.

5 COALITION WITNESS PANEL (SWORN OR AFFIRMED):

6 Dr. Powers

7 Mr. Sedgwick

8 Mr. Binder

9 Mr. Unger

10 Dr. Stelfox

11 Ms. Bradley

12 Mr. Wershler

13 Mr. Wallis

14 THE CHAIRMAN: Thank you, please proceed,

15 Ms. Klimek, with your evidence.

16 MS. KLIMEK: Mr. Chairman, by way of a bit

17 of an opening, as you can see Dr. Mikenwinter

18 (phonetic) is not part of our Panel. She had the good

19 fortune, I believe, to move to Europe, and it was

20 impossible for us to get her here. Mr. Denstedt has a

21 few questions that he is going to put through to

22 Mr. Wallis. And she has advised us that she could be

23 available by phone. So if there are any questions

24 that we can do by way of undertaking or make some

25 arrangements if any other parties had a question for

Mainland Reporting Services Inc. [email protected] 1535

1 her, if that would be okay.

2 And our panel today will be speaking to their

3 submissions as well as evidence that has come out in

4 the last week through cross-examination of the EnCana

5 panel. And what they have done, they all have

6 prepared written statements that I would propose to

7 hand out so people can go along with them. They don't

8 have to be taking notes. And I was going to present

9 those. I think they should be marked as an exhibit,

10 but in the order that people will be speaking, if that

11 works okay. As well, we have two PowerPoint

12 presentations so when we get to those we'll deal with

13 those.

14 So our first one would be Dr. Powers. So

15 that would be -- I'm not sure -- 06. I'm not sure

16 what the last number is.

17 THE CHAIRMAN: Dr. Powers's exhibit would be

18 006-037.

19 MS. KLIMEK: Okay.

20 THE CHAIRMAN: Thank you.

21 EXHIBIT 006-037: Dr. Powers - Summary of

22 Submission on Economics

23 MS. KLIMEK: The next one would be

24 Mr. Sedgwick and that would be 006-038.

25 THE CHAIRMAN: Correct.

Mainland Reporting Services Inc. [email protected] 1536

1 EXHIBIT 006-038: Mr. Sedgwick - Summary of

2 Submission

3 MS. KLIMEK: And 006-039 would be

4 Mr. Binder's.

5 THE CHAIRMAN: Yes. Thank you.

6 EXHIBIT 006-039: Mr. Binder - Presentation to

7 the Joint Review Panel

8 MS. KLIMEK: And 006-004 would be

9 Mr. Unger's, 040.

10 THE CHAIRMAN: 040.

11 MS. KLIMEK: Yes, would be Mr. Unger's.

12 THE CHAIRMAN: Yes.

13 EXHIBIT 006-040: Ms. Unger - Presentation to

14 the Joint Review Panel

15 MS. KLIMEK: And Dr. Stelfox's would be

16 next at 006-041.

17 THE CHAIRMAN: Yes. Thank you.

18 EXHIBIT 006-041: Dr. Stelfox - Presentation to

19 the Joint Review Panel

20 MS. KLIMEK: And 006-042 would be

21 Ms. Bradley's.

22 THE CHAIRMAN: Yes.

23 EXHIBIT 006-042: Ms. Bradley - Presentation to

24 the Joint Review Panel

25 MS. KLIMEK: And the last one would be

Mainland Reporting Services Inc. [email protected] 1537

1 Mr. Cleve Wershler, which is 006-043.

2 THE CHAIRMAN: Correct. Thank you.

3 EXHIBIT 006-043: Mr. Wershler - Submission on

4 Terrestrial Biophysical Assessment

5 MS. KLIMEK: Now, I'm going to turn --

6 Mr. Wallis is going to Chair our panel and I'm going

7 to turn it over to him to introduce the panel and then

8 I have a few questions for him and then they'll go

9 into their presentations.

10 THE CHAIRMAN: Please proceed, Mr. Wallis.

11 OPENING STATEMENTS BY THE COALITION:

12 A. MR. WALLIS: Good afternoon. It's a

13 pleasure to be here and we appreciate your endurance

14 through these things.

15 I am the Vice President of the Alberta

16 Wilderness Association. I'm here as Chair, as our

17 counsel, Jennifer Klimek, has said.

18 We assembled this panel of experts on behalf

19 of three groups: Nature Canada, the Alberta

20 Wilderness Association, and the Grasslands

21 Naturalists. We were getting funding by CEAA to

22 assemble this panel of experts on the subject of

23 economics and biodiversity broadly, so we've looked at

24 policy matters, we've looked at some details in terms

25 of the natural gas recovery, and you'll hear expert

Mainland Reporting Services Inc. [email protected] 1538

1 testimony on everything from cumulative effects on

2 grasslands, the impacts of this kind of development,

3 to a variety of testimony on species and vegetation

4 reclamation.

5 So to start with, I guess we'll get

6 Ms. Klimek to go through the panel members and qualify

7 them.

8 MS. KLIMEK:

9 Q. First, Mr. Wallis, we'll start with you. I think

10 you've given your position with AWA. Did you give

11 your position with Nature Canada?

12 A. MR. WALLIS: No. I'm Vice President of

13 Alberta Wilderness Association, but I'm here also as a

14 director of Nature Canada. I'm here, as I said, in a

15 volunteer capacity.

16 Q. Can you tell us a little bit about your background

17 that gets you in those positions?

18 A. Sure.

19 Q. Other than the drawing the short straw.

20 A. The short straw. I'm a professional biologist

21 registered in the Province of Alberta, but I do a lot

22 of work, both professionally and on a volunteer basis,

23 so I do a lot of work with species at risk, grassland

24 environments in environmentally significant areas.

25 Professionally, I work with industry,

Mainland Reporting Services Inc. [email protected] 1539

1 conservation organizations, government agencies, and

2 landowners.

3 On the volunteer side, I've been involved

4 with a variety of conservation organizations since the

5 1970s and, again, focus largely on grassland

6 environments. It used to be the environment that drew

7 the shortest straw and didn't get any respect. I'm

8 glad to see that it's getting a lot more respect

9 today.

10 Q. And have you been presented before tribunals before?

11 A. Yes, I have. Various panels, including the ERCB way

12 back in the late 1970s on the Langdon Phillips Pass

13 500kV line, and then proceeding to the Old Man Dam

14 hearings, smaller environmental, NRCB, NAB, different

15 panel.

16 Q. Now, your CV is set out under Tab 8 of our submission,

17 is that correct?

18 A. Tab, pardon?

19 Q. Tab 8?

20 A. Yes, that's correct.

21 Q. And although you have some expertise, what capacity

22 are you here today?

23 A. My capacity largely was to corral the panel of experts

24 and keep them focused. There's a lot of information

25 here and we've tried to distill that down into what we

Mainland Reporting Services Inc. [email protected] 1540

1 think are the important points, and so we have -- my

2 job really was to work with the various experts to

3 hone their presentations so that it would be most

4 informative, we hope, to the Panel.

5 Q. And our submission, which I'm embarrassed to say, I

6 can't remember the exhibit number, is 06?

7 A. 018, I think.

8 Q. 018, was prepared under your direction?

9 A. That's correct.

10 Q. And you adopt that as the evidence of the Coalition?

11 A. Yes, I do. A lot of the -- I would put a caveat. A

12 lot of the Grasslands/Naturalists economics side of

13 things was prepared with Mr. Binder, but I accept that

14 as part of the global submission.

15 Q. Okay, thank you. Now, Dr. Power, I'm going to turn to

16 you next. Can you tell me a little bit about where

17 you work and what your position there is?

18 A. MR. POWER: Yes, I'm a Research

19 Professor and a Professor Emeritus in the Economics

20 Department at the University of Montana.

21 Q. And what is your -- how long have you been associated

22 with that?

23 A. I came to the University of Montana in 1968 and served

24 as Chairman of the Economics Department between 1978

25 and 2007, at which time I retired from administration

Mainland Reporting Services Inc. [email protected] 1541

1 and teaching but continued on as a research economist.

2 Q. And what areas of study have you focused on during

3 that time?

4 A. Primarily resource economics, including energy and

5 environmental economics, but also a considerable focus

6 on regional economic development.

7 Q. And what geographic area have you focused your studies

8 on?

9 A. I've done research and published papers and reports

10 covering a good part of North America, but most of my

11 work has been focused on western North America.

12 Q. And your CV and your report is under Tab 7 of our

13 submission and I take it that was prepared by you?

14 A. Yes.

15 Q. And I see from your CV you've published extensively in

16 the area; is that correct? Is there anything that

17 jumps out that are relevant to this?

18 A. Well, I published six books, a dozen and-a-half book

19 chapters, over a hundred articles, reports, et cetera.

20 Q. Okay, and you've -- I understand you've sat on some

21 advisory committees. What role have you played on

22 those and what committees of relevance to what we're

23 doing here?

24 A. Since 1968, I've been on a technical advisory

25 committee for the Montana Power Company and

Mainland Reporting Services Inc. [email protected] 1542

1 Northwestern Energy, two of Montana's electric and

2 natural gas utilities. I've also served on various

3 governors economic advisory councils.

4 Q. And you've presented evidence before panels and

5 tribunals before?

6 A. Yes. I've appeared before at least two panels,

7 Federal panels of this sort. I've also appeared

8 before a dozen public service or public utilities

9 commissions in the different states in the United

10 States. I've testified before the Federal Energy

11 Regulatory Commission, Bahill Power Administration

12 (phonetic), and other regulatory agencies.

13 Q. Have you appeared in Canada before?

14 A. Yes.

15 Q. And is that what you meant by the first Federal ones?

16 A. Yes. Federal. Canadian, Canadian panels.

17 Q. Okay. And Mr. Sedgwick, you're sitting next to

18 Mr. Power and what is your background?

19 A. MR. SEDGWICK: I'm a principal with Martin &

20 Brussett Associates and I'm a Reservoir Engineer.

21 Q. Okay. And how long have you worked in that field?

22 A. Over 25 years, close to 30.

23 Q. And have you been involved with regulatory processes

24 before?

25 A. No, I haven't.

Mainland Reporting Services Inc. [email protected] 1543

1 Q. Okay. Have you been helping clients get ready for

2 them and presenting things to --

3 A. I have done that, yes.

4 Q. Okay. And your report wasn't part of our original

5 submission, but it's now 06-025 and 06-032. Those

6 were prepared by you; is that correct?

7 A. Yes, they were.

8 Q. Now, Ms. Bradley, you're helping the gender equality

9 here. Could you explain a little bit about what your

10 background is?

11 A. MS. BRADLEY: If I may, I'm a Professional

12 Biologist registered in the Province of Alberta. My

13 specialty is Botany and I also have some facilitation

14 experience.

15 Q. Okay. And you prepared a report which is under Tab 4

16 and your CV is attached there; is that correct?

17 A. Yes.

18 Q. And, now, your curriculum vitae lists several projects

19 you've worked on. Do you want to talk about a few of

20 those that are relevant to the issues that we have

21 here?

22 A. I've worked on several projects regarding

23 Environmental Assessment in Prairies region of

24 Alberta. I've specialized in rare plant survey. I've

25 done vegetation inventory, vegetation mapping. That

Mainland Reporting Services Inc. [email protected] 1544

1 was more focused in the Southwest Foothills of the

2 province.

3 I've, in a volunteer capacity, participated

4 and I'm currently participating on reclamation

5 technical advisory committees for the Rugby Natural

6 Area (phonetic) in central Alberta and the Southern

7 Foothills study.

8 Q. Okay. And I understand you've had some involvement

9 with the Alberta Native Plant Council. Do you want

10 to explain what that is?

11 A. Yes, I've been a member of the Alberta Council, the

12 Alberta Native Plant Council since its formation,

13 about 20 years ago now. I'm currently southern

14 director and I represent the Alberta Native Plant

15 Council in various forums.

16 Q. And could you outline the work you've done with

17 respect to invasion of non-native species into

18 grasslands?

19 A. I've worked on a project for the Patisco (phonetic)

20 landowners related to a gas well, a proposed gas well

21 development in the Patisco (phonetic) grasslands. And

22 I did some work looking at reclamation of those sites.

23 I've recently been on a tour of the Express pipeline

24 right-of-way with Government agency people and

25 reclamation specialists and we've talked about

Mainland Reporting Services Inc. [email protected] 1545

1 additional work on monitoring that project. And, as I

2 say, I've been involved in technical, reclamation

3 technical advisory committees, overseeing or guiding

4 research in the Rumsey Natural Area and the Southern

5 Foothills.

6 Q. And have you appeared before any tribunals like this

7 before?

8 A. No, I have not.

9 Q. We all get our first time.

10 A. Yes.

11 Q. Dr. Stelfox, can we get you to up there? What

12 is your background?

13 A. DR. STELFOX: I'm a Landscape Ecologist.

14 My background, I'm Adjunct Professor, University of

15 Alberta, University of Calgary, Doctoral Thesis on

16 grassland dynamics.

17 Q. What is the focus of your work currently?

18 A. Most of the work I do is leading a team of people who

19 examine cumulative effects assessments that carries

20 scales from project-specific right up to large

21 regional assessments.

22 Q. Okay. And can you tell us a little bit about the

23 model you've developed?

24 A. Over the last decade, decade-and-a-half, I have led

25 initiative called the Alberta Landscape Cumulative

Mainland Reporting Services Inc. [email protected] 1546

1 Effects Simulator, or ALCES, and that model has been

2 increasingly deployed by a variety of clients, whether

3 they be city governments, municipal governments,

4 provincial governments to examine regional cumulative

5 effects assessment, sorry.

6 Q. And has that model been reviewed by peers or how has

7 that been done?

8 A. During the past decade there has been three or four

9 systemic initiatives by government or by different

10 resource sectors to assess or critique the model, yes.

11 Q. Okay. And what's the result of those?

12 A. The conclusions of those assessments in terms of

13 running the model head-to-head with sector-specific

14 simulation models is that they generate the same

15 results if the assumptions are identical.

16 Q. Okay. And have you -- you've talked about what types

17 of environmental assessments you've been involved in.

18 You've touched on these, didn't you, earlier, or do

19 you want to --

20 A. Recently -- well, I guess the largest effort at

21 looking at regional cumulative effects assessment in

22 Alberta arguably would be the CEMA, Cumulative Effects

23 Management Association work done in Northeast Alberta

24 and I've led the cumulative effects assessment of that

25 project with respect to the hydrocarbon trajectories

Mainland Reporting Services Inc. [email protected] 1547

1 and that of forestry and other land use practices.

2 Q. And for those people who don't know, CEMA is?

3 A. Cumulative Effects Management Association.

4 Q. Okay. And have you appeared before a tribunal before?

5 A. I have not.

6 Q. Now, Mr. Wershler, can you tell me a little bit about

7 what your background is?

8 A. MR. WERSHLER: I'm a Professional Biologist

9 in Alberta with expertise in both vegetation and

10 wildlife.

11 Q. And what areas, geographic areas have you been working

12 working on, and ecosystems?

13 A. I've worked in the grasslands for over 40 years. I'm

14 an environmental consultant now. I've worked on

15 surveys for the conservation and management of rare

16 species and habitats, population monitoring,

17 ecological surveys, environmental impact assessments,

18 environmentally significant areas, studies, and for

19 the oil and gas industry, I have experience ranging

20 from environmental constraints analysis for major

21 projects to surveys for well sites, pipelines and

22 seismic.

23 Q. And have you appeared in front of tribunals before?

24 A. Yes, I have. The Access pipeline, a couple of Cheviot

25 hearings, and a Wellbeck hearing (phonetic).

Mainland Reporting Services Inc. [email protected] 1548

1 And specific to this geographic area, I've

2 worked on rare plants, wildlife and wetlands in the

3 National Wildlife Area and the Military Training Area

4 and adjacent lands.

5 Some examples of projects that I've worked on

6 are multi-year monitoring surveys of grasslands,

7 birds, amphibians and rare plants in the Milk River

8 natural area, a provincial environmentally-significant

9 areas overview, planning major gas fields for Nexen,

10 and a member of a couple of national recovery teams,

11 Burried Sparrow (phonetic) and Piping Plover.

12 Q. Okay. And your report is under Tab 5 of our report;

13 is that correct?

14 A. Yes.

15 Q. And Dr. Stelfox, did I ask you, yours is under Tab 3

16 and you prepared that; is that correct?

17 A. MR. STELFOX: That's correct, yes.

18 Q. Now, Mr. Binder, can you tell us a little bit about

19 first of all your position with Grasslands

20 Naturalists and a bit about your background?

21 A. MR. BINDER: I'm a member of Grasslands

22 Naturalists, which is a naturalist organization based

23 in Medicine Hat, Alberta, which is very close to the

24 Project here.

25 My background is I have a Masters degree in

Mainland Reporting Services Inc. [email protected] 1549

1 Economics. I've done some post-graduate work in

2 optimal depletion of non-renewable resources. And

3 I've lectured in economics for four years at the

4 University of Alberta.

5 Then my career took a different path and I

6 become a lawyer. I practiced law as a criminal trial

7 lawyer for about 10 years and I've -- I quit doing

8 that about 11 years ago and have been ranching largely

9 since that time.

10 And, more recently, I've become involved in

11 writing smaller reports, economic reports that have to

12 do with projects such as the proposed Meridian Dam

13 (phonetic) project here in Alberta and also related to

14 wind farm development in the province. Thank you.

15 Q. And your evidence or report is under Tab 9 of our

16 submission; is that right, Mr. Binder?

17 A. MR. BINDER: Yes.

18 Q. Now, I'm sorry, did you want to?

19 A. Yes.

20 Q. Mr. Unger, can you tell us a little bit about your

21 background?

22 A. MR. UNGER: Sure. I'm a lawyer and

23 an active member of the Alberta Bar. My background is

24 in Biology and in Law. I have a B.Sc. In Biology and

25 a specialization in Environmental Law from Dalhousie.

Mainland Reporting Services Inc. [email protected] 1550

1 I practised in commercial and employment and

2 environmental litigation prior to moving to the

3 Environmental Law Centre in 2005 where I am currently

4 employed as staff counsel.

5 Q. And what's the nature of the work that you do at the

6 Environmental Law Centre?

7 A. Well, the Environmental Law Centre is a charitable

8 organization established in 1982 and they provide a

9 variety of public programs, everything from providing

10 information to the public on environmental and natural

11 resources law and policy to law reform activities as

12 well. My, my position there I've kind of focused on

13 water law, wildlife and conservation issues, tools for

14 conservation on private lands, and as well as

15 administrative law.

16 In that activities, I've been active in

17 collaborative, different collaborative kind of

18 councils in Alberta, including the Alberta Water

19 Council, and have done various law reform initiatives

20 based on species at risk and other issues.

21 Q. And what was your role for this panel?

22 A. I submitted a policy brief. I believe it's at Tab 12.

23 Q. Eleven.

24 A. Is it 11?

25 Q. Yes.

Mainland Reporting Services Inc. [email protected] 1551

1 A. Sorry, 11. Wrong one. So I prepared that for Nature

2 Canada.

3 Q. Okay. And what was -- and what were you looking at in

4 that? You'll get more into that in your

5 presentation?

6 A. Yes, I will. The primary focus of that information is

7 around conservation law and policy and specifically

8 international and domestic obligations that are

9 relevant to the Suffield NWA.

10 MS. KLIMEK: Okay. That is our panel,

11 Mr. Chairman and Panel Members, and I will now let

12 Mr. Wallis guide them through their presentations and

13 I will sit down.

14 THE CHAIRMAN: Thank you, Ms. Klimek.

15 Mr. Wallis, please proceed.

16 A. MR. WALLIS: Okay, without further adieu,

17 I will start with the economics and natural gas

18 recovery side of things. So our three experts there,

19 Dr. Power, Neil Sedgwick and Henry Binder. And we'll

20 start with Dr. Power. And try to speak slower, more

21 leisurely.

22 A. MR. POWER: All right. Good afternoon.

23 Thomas Michael Power

24 Research Professor

25 Economics Department

Mainland Reporting Services Inc. [email protected] 1552

1 University of Montana

2 Missoula, Montana 59801

3 Summary of Submission on Economics

4 Society of Grasslands Naturalists

5 EnCana Shallow Gas Infill Development Project

6 Joint Review Panel

7 Calgary, Alberta

8 October 15, 2008

9 My economics submission applied a relatively

10 small number of widely-accepted economics principles

11 to the EnCana infill proposal on the Suffield National

12 Wildlife Area. The intent was to use economics to

13 provide insight into some of the major public policy

14 issues raised by EnCana's proposal.

15 In this summary I would like to walk through

16 those economic principles and indicate some of the

17 insights that they can provide.

18 1. Diminishing returns

19 One of the oldest insights of economics is

20 the principle of diminishing returns. The general

21 idea behind diminishing returns is that, as we

22 continue to pursue a particular type of production or

23 consumption activity to the exclusion of other things,

24 after a point, the value to us of additional units of

25 that production or consumption begins to decline and

Mainland Reporting Services Inc. [email protected] 1553

1 the value of those things we have been ignoring begins

2 to rise. That shift in economic value is what

3 ultimately leads us to diversify our production and

4 consumption activities rather than continuing to focus

5 on only one or a very few things. This principle has

6 important economic implications for evaluating

7 EnCana's proposal for infill drilling in the Suffield

8 National Wildlife Area.

9 That infill proposal is just a small part of

10 very extensive natural gas developments that cover the

11 prairie lands across southern Alberta and southwestern

12 Saskatchewan. As a result of that natural gas

13 development and other human activities, intact natural

14 prairie lands have become increasingly threatened and

15 increasingly rare while natural gas wells have become

16 increasingly prevalent and common. In that sense, one

17 would expect the value of unique prairie ecosystems

18 such as the Suffield National Wildlife Area, was

19 intended to protect, to rise relative to the value of

20 the small increment of additional natural gas that

21 could be obtained by further drilling within the

22 National Wildlife Area.

23 We have lots of one thing, natural gas, and

24 an ever-shrinking amount of another, intact prairie

25 ecosystems and the natural services they provide. At

Mainland Reporting Services Inc. [email protected] 1554

1 some point, as more and more land is committed to

2 natural gas production and other commercial economic

3 activities, the natural area values associated with

4 the increasingly scarce, scarce natural prairie lands

5 will exceed the incremental value of the natural gas

6 that can be extracted. At that point it would be

7 economically rational to choose protecting the remnant

8 prairie lands by choosing not to further occupy and

9 develop those lands for natural gas.

10 2. Opportunity Cost

11 The second economic concept that I used in my

12 submission was that of opportunity costs.

13 The concept of opportunity costs seeks to

14 measure what it is we will actually go without when we

15 choose one course of action over another. It is

16 relevant in this case because central to a decision on

17 infill drilling is the question of what we would gain

18 or lose if the infill drilling does or does not

19 proceed.

20 That opportunity cost can be measured by

21 asking how producers and consumers coordinated by

22 markets would adjust if the infill drilling in the

23 National Wildlife Area is not approved. In response,

24 EnCana and other natural gas producers are likely to

25 invest in developing a natural gas resource somewhere

Mainland Reporting Services Inc. [email protected] 1555

1 else that might not be quite as attractive an

2 investment. The price of natural gas might go up

3 slightly encouraging natural gas consumers to consider

4 using natural gas more efficiently or shifting to

5 another source of heat or energy.

6 One thing we can be certain of, however, we

7 will not simply go without the energy services that

8 the infill drilling might have provided. We will

9 adapt and meet our ways in another way, meet our needs

10 in another way. The opportunity cost is the

11 difference in the cost of obtaining an increment of

12 natural gas from the Suffield National Wildlife Area

13 and the cost of satisfying our demand for energy

14 services by other means. It is that difference in the

15 cost of these alternative sources of energy services

16 that we lose or gain.

17 Given that the alternative might simply be an

18 infill investment in some other southeastern Alberta

19 natural gas field, the difference in cost, the

20 opportunity cost of not proceeding with the Suffield

21 infill proposal, is likely to be quite small.

22 The opportunity cost could actually be

23 negative. Cost effective improvements in the

24 efficiency with which we use a smaller amount of

25 natural gas may cost less than the gas itself,

Mainland Reporting Services Inc. [email protected] 1556

1 improving overall wellbeing while also reducing the

2 risk to the Suffield National Wildlife Area.

3 There is something economically disorienting

4 about proposals to "conserve" natural gas through

5 in-fill drilling in a natural area of national

6 significance while doing almost nothing to use the gas

7 so produced as efficiently as possible. In that

8 economic setting, there is no opportunity cost to

9 leaving the gas in place and pursuing energy services

10 by investing in those energy efficiency measures

11 instead. In fact, there is an economic, economic loss

12 associated with pursuing the gas because that is the

13 higher cost alternative. When the environmental risks

14 and costs associated with still more natural gas

15 development in the National Wildlife Area are also

16 included, the loss is likely to be even greater.

17 3. Economic Differences between Commercial Commodities

18 and the Environmental Services of Unique Natural Areas

19 The third economic principle I've developed

20 in my submission deals with the economic differences

21 between commercial commodities and the environmental

22 services provided by unique natural areas.

23 Natural gas is a commercial commodity that is

24 not desired directly but serves, rather, as an input

25 in consumption and production processes, processes

Mainland Reporting Services Inc. [email protected] 1557

1 that, in fact, are what serves our needs and desires.

2 For that reason, there is a broad range of alternative

3 ways of obtaining the equivalent energy services that

4 could come from the infill proposal from the Suffield

5 National Wildlife Area. There is not just one way to

6 keep our homes comfortable or our businesses

7 energized. There is a broad and constantly expanding

8 range of alternatives, substitutes to or substitutes

9 for, the small increment of natural gas that might

10 come from infill drilling in the Suffield National

11 Wildlife Area. That is, there are close substitutes

12 and the range of substitutes available will grow over

13 time. In the short term, EnCana and/or other energy

14 companies will simply produce more natural gas

15 somewhere else. In the intermediate term, investments

16 will be made to increase the energy services obtained

17 from every unit of natural gas or energy used.

18 Technological change will also make renewable energy

19 resources more efficient and cost effective. We will

20 learn how to serve our need for energy services at a

21 lower and lower environmental cost.

22 While there are readily available low-cost

23 substitutes for the energy services that would

24 otherwise come from infill drilling in the Suffield

25 National Wildlife Area, the same is not true of the

Mainland Reporting Services Inc. [email protected] 1558

1 Suffield National Wildlife Area itself. EnCana

2 recognizes the uniqueness of this natural area at the

3 national level. It was that uniqueness that led it be

4 included in the National Wildlife Area system to begin

5 with. Business firms cannot "manufacture" several or

6 even one new Suffield National Wildlife Area.

7 Electronic pictures or scientific studies of what that

8 Wildlife Area used to be do not even approach the

9 value of actually retaining the unique character of

10 that area as a fully functioning ecosystem.

11 Basically, the Suffield National Wildlife

12 Area is irreplaceable. That means that the cost

13 associated with its damage or loss is the full value

14 of that natural area, not just the difference between

15 its value and some close substitute. There is no

16 close substitute.

17 Looking forward, the gap between these two

18 values or opportunity costs, the natural gas commodity

19 value and the environmental values, will grow. While

20 technology and manufacturing will allow us to continue

21 to develop alternative ways of obtaining energy

22 services with as little environmental impact as

23 possible, technology and manufacturing will not

24 provide us with any more unique natural areas. In

25 fact, past trends that have steadily reduced the

Mainland Reporting Services Inc. [email protected] 1559

1 number of intact natural areas will continue to shrink

2 that supply.

3 Because of the ways in which technology can

4 be brought to bear, to extend our access to energy

5 services at relatively low cost, but cannot be brought

6 to bear to replace the loss of unique natural systems,

7 over time the economic value of places like the

8 Suffield National Wildlife Area will increase relative

9 to the energy resources that might further be

10 extracted from it. That steady rise in the future

11 economic value of a preserved National Wildlife Area

12 must be kept in mind when decisions are being made

13 today about pursuing every last bit of natural gas

14 that might be profitably extracted from that unique

15 natural area.

16 To threaten the Suffield National Wildlife

17 Area in the pursuit of a small amount of additional

18 natural gas is to risk irreversible damage to a unique

19 irreplaceable gift of Nature in the pursuit of what

20 today remains a relatively common and cheap commodity

21 that is quickly consumed and for which there are many

22 substitutes. Sacrificing the unique and valuable for

23 that which is common and plentiful can only be

24 described as economically irrational.

25 4. The Economics of "Wasting" Natural Gas

Mainland Reporting Services Inc. [email protected] 1560

1 The fourth economic concept I wanted to

2 briefly comment on is the idea of wasting natural gas

3 by leaving it in the ground.

4 Leaving natural gas under the Suffield

5 National Wildlife Area is not necessarily an economic

6 waste. At this point, EnCana intends to leave 57

7 percent of the original gas in place because it will

8 not be profitable to extract it. Most mineral

9 resources in the earth are left in place because the

10 cost of extracting and processing them exceeds their

11 value. Leaving in place a small amount of natural gas

12 that would be financially profitable for EnCana to

13 extract is not an economic waste if doing so protects

14 the unique values associated with the Suffield

15 National Wildlife Area. Just as EnCana weighs the

16 private costs and benefits and concludes that it is

17 not an economic "waste" to leave 57 percent of the gas

18 in place, it also would not be a "waste" if, after

19 considering the values associated with the Suffield

20 National Wildlife Area, it was concluded that the high

21 costs associated with damaging those values justified

22 not proceeding with the proposed infill development.

23 Just as private costs can justify proceeding no

24 further with extraction, high public costs can

25 certainly lead to a similar conclusion to proceed no

Mainland Reporting Services Inc. [email protected] 1561

1 further with natural gas development in the Suffield

2 National Wildlife Area.

3 The recent decision of the Saskatchewan

4 Government to put the most environmentally-sensitive

5 parts of the Great Sand Hills off limits to on-site

6 natural gas development in order to protect their

7 natural area values is an example of a Government's

8 judgment that the environmental costs of natural gas

9 development can be so high that it is not worth

10 pursuing the natural gas resource. Despite the

11 potential loss of provincial government revenues,

12 employment and income, and energy company profits, the

13 Saskatchewan Government did not see this decision as

14 "wasting", in any sense, the natural gas resource.

15 Instead, the Saskatchewan Government concluded that by

16 restricting natural gas development, and I quote:

17 "[T]he province will continue to

18 fulfill its commitments for a

19 brighter, stronger, and sustainable

20 future for the Great Sand Hills and

21 to ensure future generations of

22 Saskatchewan families continue to

23 enjoy this unique and

24 internationally-recognized legacy."

25 It should be kept in mind that the Great Sand

Mainland Reporting Services Inc. [email protected] 1562

1 Hills are not part of the Canadian National Wildlife

2 Area system.

3 5. The Impact of Infill development on jobs, incomes, and

4 Government revenues

5 Finally, and very briefly, I would like to

6 comment on the importance of potential jobs, income

7 and government revenues associated with the infill

8 proposal proceeding.

9 The employment opportunities, payroll, and

10 provincial revenues that the proposed infill drilling

11 would produce are, as EnCana points out, negligible or

12 insignificant from a regional and provincial point of

13 view. Jobs, income and government revenues provide no

14 economic justification for threatening the ecological

15 integrity of the Suffield National Wildlife Area.

16 Thank you.

17 THE CHAIRMAN: Thank you, Dr. Power.

18 A. MR. WALLIS: Now we'll proceed to Henry

19 Binder.

20 A. MR. BINDER: Chairman, Panel, Ladies and

21 Gentlemen.

22 MS. KLIMEK:

23 Q. Just hold for a second, Mr. Binder. I was just going

24 to make a comment about your references in your

25 paper?

Mainland Reporting Services Inc. [email protected] 1563

1 A. Okay.

2 MS. KLIMEK: Mr. Binder, in his paper, has

3 put in references, but rather than repeat them, if

4 it's okay with the Panel, the Court Reporter could

5 just put them into the transcript or we'll have them

6 on the exhibit because it will get quite tedious to,

7 to say them.

8 THE CHAIRMAN: Yes, that sounds, sounds

9 fine.

10 A. MR. BINDER: My comments are going to be

11 directed at a very specific issue, and only one issue,

12 and that is going to be in relation to incremental

13 recovery and the work that EnCana has done in this

14 regard and has presented in Figure 2-3 which it

15 indicates reflects the production forecasts for the

16 infill drilling program in the National Wildlife Area.

17 Presentation to the Joint Review Panel

18 By Henry Binder

19 RE: EnCana Shallow Gas Infill Development Project

20 Incremental vs. Accelerated Production

21 EnCana's Figure 2-3 (Ex 002-110 EIS Vol 2

22 p.2-8) depicts the initial burst in production,

23 represented by the blue area, associated with infill

24 drilling. A key issue is whether this burst is

25 primarily incremental production, that is, production

Mainland Reporting Services Inc. [email protected] 1564

1 that could otherwise not be realized, or is it largely

2 accelerated production, that is, production that comes

3 at the expense of what existing wells would otherwise

4 have produced.

5 Inconsistency

6 Before proceeding, it is important to note

7 that Figure 2-3 is not an accurate depiction as it

8 stands, or at least not consistent with EnCana's other

9 decline results.

10 EnCana indicates that its reserves estimation

11 is based on decline analysis (Ex 002-060 #JRP 5) which

12 indicates remaining life estimates of 20 to 25 years

13 for existing wells and 20 to 40 years for infill wells

14 (Ex 002-110 EIS Vol.1 p.2-8).

15 In the figure one can readily see that by

16 2028 [here in this region in 2028] existing well

17 production is continuing at a healthy rate (at 6.8

18 MMcf/day) and infill well production has just about

19 petered out (at only about 2.5 MMcf/day). This is not

20 consistent with infill wells generally being expected

21 to outlast existing wells.

22 There's a typo in the paper there. Where it

23 says "infill wells" it should read "existing wells".

24 Hearing Testimony

25 EnCana's evidence at the hearing appears to

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1 resolve this inconsistency by explaining that well

2 interference can be accounted for in the figure by

3 attributing some to the production of infill wells to

4 existing wells to compensate for interference losses.

5 (See Hearing Transcript October 7, 2008 Vol.2 pp.363

6 to 366).

7 EnCana's explanation can be illustrated in

8 Figure 2-3 by drawing a line below the red and blue

9 boundary to depict reduced production of existing

10 wells because of well interference and showing this

11 being compensated for by increased production of

12 infill wells, leaving total production not unaffected.

13 This circumstance is illustrated in Figure 2-3A.

14 On this interpretation, the blue area,

15 accordingly, does not represent actual production of

16 infill wells, as actual infill production would have

17 to be greater than what is shown to compensate for

18 interference effects. (See p.364, lines 23-25 of

19 above Transcript). In fact, what the blue area has to

20 represent in this explanation is incremental

21 production, which is less than actual production. On

22 this view, the type curve forecast labelled "Suffield

23 National Wildlife Area Type Curve" [in Ex 002-060

24 #JRP14] represents only incremental production for a

25 typical infill well, not actual production, which has

Mainland Reporting Services Inc. [email protected] 1566

1 to be larger.

2 The problem with this explanation is that,

3 despite significant well interference, incremental

4 production is not reduced. This doesn't accord with

5 reality, since if the behavior of the reservoir is

6 more like a conventional reservoir, with significant

7 interference, there should be less incremental

8 production. Also, in this circumstance, one would

9 expect the total production and pre-infill curves to

10 cross as a consequence of well interference, but they

11 can't. This is because the type curve figure clearly

12 shows production approaching zero and it is

13 effectively, after aggregating, this production which

14 is added to the forecast pre-infill curve.

15 The simple fact that the pre-infill

16 production forecast continues to play a role in

17 establishing a lower boundary for total production

18 indicates that EnCana's new explanation is not

19 correct. This boundary is only plausible if

20 pre-infill wells are forecast to actually produce

21 120 bcf. With well interference, this lower boundary

22 for total production would not exist. Total

23 production could then approach the horizontal axis, or

24 zero, as expected.

25 Finally, it is clear from the discussion

Mainland Reporting Services Inc. [email protected] 1567

1 below that the type curve reflects actual production

2 of a typical infill well. By not recognizing this,

3 EnCana's proposed rehabilitation appears to solve the

4 first inconsistency noted above, but adds new

5 problems. Figure 2-3 can be rehabilitated to reflect

6 reality, but this can only be done by first accepting

7 what it currently represents.

8 Consistent Explanation

9 To provide a consistent picture of production

10 forecasts, it is necessary to believe, as EnCana

11 states, that it produced Figure 2-3 in accordance with

12 its understanding of the complex geology of the

13 reservoir. This understanding is one of isolated

14 trapped gas being captured by the infill wells.

15 Accordingly, the assumptions made are that existing

16 wells will continue to produce what they are forecast

17 to produce despite infill drilling and that actual

18 production of infill wells based upon performance can

19 be legitimately added to that.

20 Evidence on Record

21 The position EnCana has maintained prior to

22 the hearing is clear from the following excerpts of

23 evidence on the record. (Highlighting in bold is

24 added). [First question]:

25 "Why in EIS Figure 2-3 do the

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1 proposed wells not reduce forecast

2 production of existing wells, as

3 one would expect?"

4 And this is the response from EnCana dated

5 August 17th, 2007:

6 "The historical and production

7 forecast shown in Figure 2-3 is

8 shown as stacked information; i.e.,

9 the Future Production from the

10 project is added to the Historical

11 and Forecast Production to

12 illustrate EnCana's estimate of

13 total production from all wells

14 within the Suffield National

15 Wildlife Area.

16 The forecasts from current,

17 from current wells was derived from

18 decline analysis: the incremental

19 production from future wells was

20 derived from a tight well. The

21 tight well behavior was established

22 from well performance from EnCana's

23 D6/D8 pilot which has not exhibited

24 well interference."

25 (Ex.002-033 IR No. CEAA-EIS-008 #Grass5 A p.2).

Mainland Reporting Services Inc. [email protected] 1569

1 Another question to EnCana:

2 "Does this figure simply hide the

3 interference at play?"

4 [The figure being referred to here is a

5 reproduction of Figure 2-3].

6 The response (b) dated January 31, 2008:

7 "Therefore, these figures are not

8 hiding interference. They merely

9 show the production profiles

10 associated with the reserve that

11 will be recovered. Infill

12 locations target the trapped gas

13 between the existing locations and

14 so have the effect of capturing

15 remaining benefits. The production

16 profile of the existing wells is

17 governed by the reserves that are

18 being recovered by the existing

19 wells than, likewise, for the

20 infill wells."

21 Also, in further support of a blue area

22 representing the actual production forecast for infill

23 wells, we find the following statements:

24 "Further, and regarding the type

25 curve, the D6/D8 and the D14/D16

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1 pilots were selected as the most

2 representative of the

3 behavior/recoveries expected from

4 additional drilling within the

5 National Wildlife Area. From these

6 pilots, a single type curve was

7 derived. This type curve

8 illustrated in the following figure

9 represents the behavior of an

10 average infill well. Each well is

11 expected to recover approximately

12 100 million cubic feet. Together

13 with the project schedule of 425

14 wells per year drilled during the

15 fall/winter months, the type curve

16 was used to develop the total for

17 project forecast shown in the EIS."

18 And also there's a further comment:

19 "The production profile from an

20 infill well within the pilot areas

21 demonstrates rapid initial declines

22 following by a long period of low

23 decline rates. This is

24 demonstrated by the type curve

25 developed for a typical proposed

Mainland Reporting Services Inc. [email protected] 1571

1 infill well. The type curve is

2 shown below."

3 So, clearly, this type curve is to reflect the

4 production profile from an infill well, so it

5 represents actual production of an infill well.

6 There are other supporting statements, but

7 very clearly EnCana is indicating that the red area

8 represents the actual forecast production of existing

9 wells. Infill drilling does not result in a change in

10 the forecast recovery of 16 wells which are expected

11 to recover an additional 120 billion cubic feet over

12 their remaining life.

13 Also, the blue area represents actual

14 forecast production of infill wells. Since it

15 reflects all of forecast production and not merely

16 incremental production, it can't expand to compensate

17 for interference losses.

18 To account for well interference in Figure

19 2-3 we must recognize that EnCana's forecast infill

20 production and assumed pre-infill forecast would not

21 change. With interference, the figure, therefore,

22 reflects an exaggerated picture of production

23 forecasts.

24 To account for well interference, the

25 production captured at the expense of existing wells

Mainland Reporting Services Inc. [email protected] 1572

1 must be attributed back. In this -- in the figure,

2 this is illustrated by the blue area sinking down into

3 the red area.

4 So as shown in Figure 2.3B on the screen,

5 since the blue area represents actual production of

6 infill wells in a no-interference case, and the red

7 area below reflects the existing well production

8 forecast, if there is well interference, the whole

9 blue area has to shift down into the red area.

10 The consequences of the blue area shifting

11 down are shown in Figure 2-3B. Part of what appeared

12 to be incremental production in this region is merely

13 replacement for interference losses of existing wells.

14 Also, the reduction in incremental production

15 in this figure depends upon the extent of well

16 interference. So just to interject a comment here, if

17 there's more well interference, if we get down here

18 somewhere, the whole, the whole area shifts down even

19 more. If we have more well interference down here,

20 this blue area would shift down more. And, as a

21 consequence, incremental production would be reduced

22 to an even greater extent.

23 Now, Figure 2-3C also reveals accelerated

24 production represented by the light blue area. In

25 that area of the diagram, production rates with infill

Mainland Reporting Services Inc. [email protected] 1573

1 are less than what pre-infill wells would have

2 achieved in the absence of infill drilling. This

3 wedged-shaped area must be subtracted from the blue

4 wedge-shaped area across from it to arrive at actual

5 incremental production.

6 And as can be seen in the figure, the blue

7 wedge could become quite large over time. Even at 4

8 million cubic feet per day, this amounts to 1.4

9 billion cubic feet per year, or 40 billion cubic feet

10 of accelerated production in 30 years.

11 So if I can, if I can just interject here,

12 this area here, this light blue area, you can see here

13 along the blue curve I'm pointing to here, with infill

14 production, well life would be shortened to about

15 here, which is what one would expect with well

16 interference. But if the infill hadn't taken place,

17 this curve here running along the top of this light

18 blue area would reflect production that could have

19 been achieved by existing wells but now can't be

20 achieved. And that has to be subtracted from the area

21 over here across, from the crossing to the left of it,

22 so that, so that with well interference you get two

23 effects; you get a very significant loss of

24 incremental production associated with the well

25 interference, then you get even more loss because of

Mainland Reporting Services Inc. [email protected] 1574

1 this accelerated production, this light blue area,

2 that has to be subtracted in order to arrive at

3 incremental production.

4 So this figure accounts for what is happening

5 in the reservoir in a very reasonable way and in

6 accordance with what one would expect.

7 Since the last incremental production is

8 directly linked to the extent of the interference

9 effects, an appreciation of this loss can be gained by

10 reviewing the Martin and Brussay & Associates

11 (phonetic) results depicted in their Figures 4, 5 and

12 8, 9.

13 So just to show what Martin and Brussay

14 arrived at, is a very similar situation where you have

15 the curves crossing, you have the infill well

16 production coming on stream, and a huge shift down, a

17 significant shift down in this case in what the

18 existing wells are now expected to produce. So you

19 have the interference effect, you have these curves

20 crossing, and then this area here, this is on a log

21 long scale so it's not as easy to appreciate, but this

22 area here would have to be subtracted from the area to

23 the left of the crossing.

24 So these show significant interference

25 effects in the case of the D6/D8.

Mainland Reporting Services Inc. [email protected] 1575

1 Now, in the case of the D14/D16, as shown

2 here, the interference effects aren't, aren't nearly

3 as great. But you still have this crossing here, but

4 it comes at a later point in time.

5 So by, by properly making the adjustments to

6 the Figure that is being presented by EnCana, moving

7 away from its very strict assumption of no well

8 interference and accounting for well interference, we

9 end up with a picture that looks much like the

10 pictures in the Martin Brussay report that are based

11 on actual quantitative analysis.

12 To continue on. That these interference

13 effects cannot be attributed to backout as EnCana

14 claims is confirmed by EnCana's statement that the

15 backout response disappears in 3 to 6 months.

16 I didn't expect it would take me this long to

17 read this. I apologize. It seems to be taking quite

18 a while. But we only have two paragraphs to go.

19 I chose to look at the hyperbolic cases since

20 the consensus is that this decline is appropriate for

21 tight rock reservoirs. It is noteworthy that, after

22 Figure 2-3 is properly adjusted to account for well

23 interference, it looks quite similar to Figures 4 and

24 8, which show reduced production of pre-infill wells

25 and the curves crossing to reflect accelerated

Mainland Reporting Services Inc. [email protected] 1576

1 production. The importance of correcting Figure 2-3

2 to properly account for well interference lies in the

3 fact that these profiles show a reservoir performance

4 and take into account all of the complexity of the

5 tight rock formations. The decline analysis includes

6 whatever is happening in the reservoir.

7 The primary problem with EnCana's suggested

8 revision of the Figure is that EnCana appears to

9 sometimes want to abandon its position of no well

10 interference but stay with its number on incremental

11 recovery. However, well interference and reduced

12 incremental recovery go hand in hand.

13 As can be seen from Figures 5 and 9 -- that

14 should be 8 and 9 -- if one waits long enough, and

15 presumes end rates within a reasonable range, forecast

16 production, forecast production can be zero. Like,

17 this is the forecast for infill well production and

18 this line here shows existing wells. And over time,

19 if this is with the appropriate end rate, this curve

20 here can come out and does, in fact, in this analysis

21 reach the same level of production if a lower end rate

22 is assumed here. Then for this curve -- and you can

23 arrive at the same level of cumulative production

24 which indicates that incremental production would then

25 be zero.

Mainland Reporting Services Inc. [email protected] 1577

1 Now, these forecasts are subject to error, as

2 all are, but based on this work and on the Martin

3 Brussay results, it's clear that incremental recovery

4 is, indeed, very small. And I would ask the Panel to

5 take that into account.

6 I would like to add that Mr. Sedgwick agrees

7 with the results of this analysis, but he indicated to

8 me that he doesn't necessarily agree with the wording.

9 You may have a similar view, I don't know,

10 but he would certainly express it differently.

11 Thank you.

12 THE CHAIRMAN: Thank you, Mr. Binder.

13 A. MR. WALLIS: And if we could now turn to

14 Mr. Sedgwick.

15 A. MR. SEDGWICK: Thank you, Mr. Chairman,

16 Panel Members, Ladies and Gentlemen.

17 Martin and Brussay was approached in late May

18 of 2008, which was also pretty late in these

19 proceedings. We were approached by Mr. Binder on

20 behalf of the Grasslands Naturalists. They were

21 looking for an independent review of EnCana's

22 representations on incremental reserves and reservoir

23 issues. Our initial reaction --

24 MS. KLIMEK: Mr. Sedgwick, could I just

25 ask you to slow down a little bit. Our Court Reporter

Mainland Reporting Services Inc. [email protected] 1578

1 is trying to write what you're saying.

2 A. MR. SEDGWICK: Sorry. I'm not sure I

3 can, but I'll try.

4 Our initial reaction was that there would not

5 be enough time to do a complete review. However, we

6 agreed to look at some of EnCana's submissions,

7 particularly JRPs 5 and 7, and get back to Mr. Binder

8 regarding what we could do, if anything, within the

9 timeframe.

10 When we reviewed JRPs number 7, the

11 inconsistency in the evaluations between the D6/D8

12 pilot and the other analogies, including the D14/D16

13 pilot, stood out like a red flag. The D6/D8 analysis

14 used exponential declines and an external comparison

15 of the performance of the pilot developed at 16 wells

16 per section to the performance of a group of offset

17 sections developed at 8 wells per section.

18 The other analogies, including the D14/D16,

19 were evaluated using hyperbolic declines and an

20 internal comparison of the performance of the same

21 section at various stages of development.

22 This latter is the normal approach to

23 estimating incremental reserves. We got back to

24 Mr. Binder and said we could look at the decline

25 analysis of the D6/D8 and D14/D16 pilots which were

Mainland Reporting Services Inc. [email protected] 1579

1 the primary analogies used for the National Wildlife

2 Area.

3 In our report dated July 16th we presented

4 our evaluation of the two pilots which was done using

5 a consistent methodology. Our method was to compare

6 the analysis of the performance at various stages of

7 development within the pilot area. The results were

8 similar to EnCana's on the D14/D16 pilot, but much

9 lower on the D6/D8 pilot.

10 Based on a review of offsetting sections, we

11 suggested that the D6/D8 pilot was located in the area

12 of best reservoir, or sweet spot, and that the

13 reservoir quality degraded as you moved away,

14 particularly to the west and to the north.

15 We indicated that a comparison between

16 different well groupings to determine incremental

17 reserves was not valid as the reservoir quality was

18 not the same.

19 Our conclusion was an average incremental

20 reserve of 100 million per infill well for the entire

21 project was unreasonably high. In our opinion, an

22 average of 40 million per well was more reasonable.

23 This is incremental reserves.

24 We have not changed this conclusion. EnCana

25 defended their methodology on D6/D8 saying that

Mainland Reporting Services Inc. [email protected] 1580

1 internally there was not a sufficient period of

2 stabilized production.

3 Sorry. Are you caught up? Where would you

4 like me to start? Go back to... Okay.

5 Internally, there was not a sufficient period

6 of stabilized production at 6.5 wells per section.

7 We agree that this is problematic but

8 maintain that our best-efforts analysis is valid and

9 more so than EnCana's method. One of EnCana's

10 defences was that they had a better understanding of

11 the reservoir. True. And they should have. But,

12 remarkably, in their latest response, referring to

13 Exhibit 2-124, Table 1, which I'm assuming you have

14 it. It was the latest response. They basically

15 confirm our analysis that there are variations in

16 reservoir quality, that the reservoir degrades to the

17 west and north of the D6/D8 pilot, and defend that the

18 D6/D8 pilot is in an area of best reservoir. In other

19 words, using the offset sections as a comparison for

20 determining incremental reserves is also very

21 problematic.

22 We can see from Table 1 that the alternate

23 recovery reserves at 8 wells per section vary

24 substantially from 2 bcf per section to over 5 bcf per

25 section.

Mainland Reporting Services Inc. [email protected] 1581

1 On the other hand, it would take only a

2 relatively small variation of just 400 million per

3 section, which could be reasonably expected, to change

4 the incremental reserve estimate by 50 percent.

5 In that regard, in our second letter dated

6 September 29th, we illustrated the problem with

7 EnCana's D6/D8 methodology by pointing out that the

8 same methodology applied to the D14/D16 pilot, using

9 the D14/D16 east offset, would yield an incremental

10 reserve of zero.

11 EnCana appears to have misread that report.

12 In their latest response, EnCana claims, and I'm

13 quoting here:

14 "Arguments against any incremental

15 recovery are contradictory to the

16 tight nature of this reservoir."

17 We agree and we have not argued against any

18 incremental recovery. Our objective was to show the

19 problem with EnCana's D6/D8 methodology. And we

20 believe their response actually confirms our point.

21 In addition to the D14/D16 east offset well

22 being looked at by Martin and Brussey, EnCana looked

23 at two more well groupings:

24 One they called the D14/D16 west offset,

25 which they discussed in Paragraph 4 of their response.

Mainland Reporting Services Inc. [email protected] 1582

1 This is the most northwesterly grouping. And the

2 ultimate recoveries were the lowest of all the

3 groupings shown in Table 1. There were no surprises

4 there.

5 The second group, though, appears to be an

6 offset ring surrounding the D14/D16 pilot. It is not

7 discussed directly in the text, nor does it appear in

8 Table 1. The results however, do show up in Figure 3

9 of the response that is the curve, it's the blue curve

10 labelled offset, in brackets, 8 wells per section.

11 In Paragraph 5 of the text, this Figure 3 is

12 represented as an updated analysis of the original

13 analysis of the D14/D16 pilot which was presented in

14 JRP number 7, Figure 7C, only this analysis includes

15 -- the updated analysis included updated production

16 performance.

17 A close look at Figure 3 shows that it is

18 more than just an update. In fact, it is an attempt

19 to re-evaluate the D14/D16 pilot using the same

20 methodology as used in D6/D8, in the D6/D8 case.

21 And they have also changed the decline

22 analysis of the current 16 well performance, the 16

23 well per section performance, to increase the ultimate

24 recovery from 3.3 bcf per section to 4.4 bcf per

25 section, which is an increase of over 30 percent.

Mainland Reporting Services Inc. [email protected] 1583

1 This is a significant change. And any reserve auditor

2 or reserve committee would question the justification

3 based on the actual new data.

4 A comparison of Figure 3 and JRP number 7,

5 Figure 7C shows that the small amount of production

6 data added provides no justification, justification

7 for any change, let alone such a significant change.

8 Ironically, if they had used the original ultimate

9 recovery of 3.3 bcf per section as shown in JRP number

10 7, their comparison to the offset group would have

11 resulted in zero incremental reserves.

12 In our initial report we also raise the issue

13 of acceleration. We established that there would be a

14 significant acceleration component and that it would

15 have a significant economic impact.

16 To clarify, oil and gas reserves are valued

17 by discounting at an annual discount rate, the value

18 of the product in the year it's expected to be

19 produced, the number of intervening years for the

20 present. The cumulative discounted value for each

21 year of production represents the net present value of

22 the reserve. The process is essentially the reverse

23 of an interest calculation. Obviously, the similar

24 (indiscernible) of gas or a barrel of oil is likely to

25 be produced, the more value it has as a reserve. Each

Mainland Reporting Services Inc. [email protected] 1584

1 of the rate versus time projections in our report is

2 accompanied by the associated rate versus time

3 projection. Both the D6/D8 and D14/D16 plots show

4 that the pre-infill and post-infill projections cross,

5 which is a valid indication of acceleration, whether

6 or not you can see the interference at the wellhead.

7 EnCana has chosen to downplay the impact of

8 acceleration claiming they've seen no evidence of

9 interference. They have chosen not to present any

10 rate versus time projections. Evidence provided by

11 EnCana last week implied that our rate versus time

12 projections were interpretive and EnCana did not agree

13 with them. Specifically, EnCana stated, and this is

14 in the transcript for October 7th:

15 "In reference to rate versus time

16 projections", and I quote, "a rate

17 cume is more appropriate, is a more

18 appropriate analysis technique.

19 And where it crosses is kind of

20 neither here nor there."

21 We want to make it clear that rate versus time,

22 rate versus cume projections do not represent

23 different analysis techniques. They are simply

24 different visual presentations which highlight

25 different attributes, attributes of the same analysis.

Mainland Reporting Services Inc. [email protected] 1585

1 Any rate versus cume projection can be plotted on a

2 rate versus time graph and vice versa. The rate

3 versus time is simply the derivative of the rate

4 versus cume with respect to time.

5 This is a mathematical exercise, not an

6 interpretive one.

7 Also, where the curves cross is not neither

8 here nor there. Integrating the volume represented by

9 the wedge formed by the curves after crossover is a

10 valid estimate on accelerated production.

11 It should be noted here that an economic

12 evaluation by EnCana, its reserve auditors, would have

13 required converting the rate versus cume projections

14 to a rate versus time forecast.

15 I would like to make a couple comments about

16 reserve auditors, too. In their evidence presented

17 last week, EnCana relied on and expressed confidence

18 in their reserve auditor. While we appreciate the

19 sentiment, it can be misleading. A reserve auditor's

20 job is to estimate and categorize corporate reserves

21 within certain probabilistic confidence levels.

22 EnCana, under NI51-101, which is the, the National

23 Instrument for reporting standards for oil and gas

24 issuer's. Under NI51, for example, there should be at

25 least a 90 percent probability that the reserves

Mainland Reporting Services Inc. [email protected] 1586

1 actually recovered will meet or exceed the estimated

2 proved volumes. The evaluators rely on aggregation to

3 achieve these goals. Most reserve reports for public

4 recording issuers contain statements to the effect the

5 confidence levels expressed in the reports are from

6 the aggregate and any extraction of individual,

7 individual evaluations may not meet the same

8 confidence levels.

9 In EnCana's AIF, Annual Information Form, for

10 the year-end 2007 filed on CR, EnCana booked over 13

11 tcf, trillion cubic feet, of net proved gas reserved

12 worldwide, including 7 tcf in Canada, of which 4 tcf

13 were evaluated by McDaniel. This represents gas

14 reserves only and does not include liquids.

15 The 125 bcf in gross reserves discussed --

16 sorry. Yes. Okay. Where do I have to go back to

17 again? Oh, you're not missing that much. Okay.

18 In EnCana's AIF for the year-end 2007 filed

19 on CR, EnCana booked over 13 tcfs, or trillion cubic

20 feet, of net proved gas reserves worldwide, including

21 7 tcf in Canada, of which 4 tcf were evaluated by

22 McDaniel. This represents the gas reserves only and

23 does not include liquids.

24 The 125 bcf of gross reserves discussed for

25 the NWA infill project represents only about 3 percent

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1 of the proved gas reserves evaluated by McDaniel,

2 unless the 1 percent of the total proved gas reserves.

3 Reserve estimates for this Project could

4 sustain significant revisions without affecting the

5 overall confidence levels of the Corporation's

6 aggregate reserves. For a company of EnCana's size,

7 the degree of rigor actually declined to an individual

8 reserve estimate may be considerably less than implied

9 by the aggregate confidence levels without affecting

10 those aggregate confidence levels.

11 In conclusion, EnCana has stressed their

12 better informed analysis and their confidence in their

13 numbers. They're asking you to trust them.

14 We think our analysis shown has shown a level

15 of inconsistencies that belies that trust. In our

16 analysis, we did not have access to all the data,

17 which EnCana had, and also we were restricted by time.

18 However, our analysis is consistent and reasonable and

19 should be seriously considered.

20 THE CHAIRMAN: Thank you. Thank you,

21 Mr. Sedgwick.

22 A. MR. WALLIS: Yes, thank you. And

23 Dr. Power, I think you will conclude the economic

24 section here.

25 A. DR. POWER: Yes, I just have a minute or

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1 a minute-and-a-half trying to summarize.

2 The justification for additional industrial

3 activity in the Suffield National Wildlife Area and

4 the environmental risks associated with it is the

5 benefit of the incremental natural gas that can be

6 retrieved by infill drilling.

7 Our economic submissions have made several

8 points about the size of those incremental natural gas

9 benefits.

10 First, some of the benefits of infill

11 drilling will be accelerated gas production that is

12 profitable to EnCana but does not represent net

13 incremental production.

14 Second, the net incremental production is

15 likely to be smaller than EnCana estimates.

16 Third, in the context of the province, Canada

17 and North America, the incremental production will be

18 tiny and easily replaced by other sources that do not

19 threaten unique natural areas. The value of the

20 Suffield National Wildlife Area however, is huge, and

21 the value will only grow over time relative to the

22 temporary value of accelerated production and

23 consumption of the natural gas.

24 Fourth, and finally, the Prairies of Alberta

25 and Saskatchewan have already been squeezed

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1 intensively to give up their natural gas and other

2 resources. Given the extent and intensity of that use

3 and the damage to Prairie lands, it is economically

4 rational to set some of the few remaining examples of

5 Prairie ecosystems off limits to further industrial

6 development such as the Saskatchewan Government has

7 already begun to do in the great Sand Hills.

8 Thank you.

9 THE CHAIRMAN: Thank you.

10 MS. KLIMEK: Mr. Chairman, I just want to

11 give you a road map where you're going so you can

12 gauge where you want to break. We're done the

13 economic side. And the roadmap is Mr. Unger is going

14 to go over the policy and legislation. And then we're

15 going to go into the biodiversity side. So I leave it

16 up to you when you think a break -- if we need one.

17 THE CHAIRMAN: I think given your

18 intervention, this is probably -- I think what you're

19 doing, Ms. Klimek, is making a suggestion that we

20 should have a break now, so I do accept that. We will

21 stop for about 15 minutes.

22 MS. KLIMEK: Okay. Thank you.

23 (SHORT BREAK)

24 THE CHAIRMAN: My apologies to the Court

25 Reporter. She sits so far from me she's hard to see,

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1 you know.

2 Mr. Lambrecht, please, go ahead.

3 DISCUSSION RE: TIMING:

4 MR. LAMBRECHT: Thank you for recognizing me,

5 Mr. Chairman.

6 With respect to an administrative matter

7 regarding our hours of sitting today, I understand

8 there are four more witnesses to go and what I'm going

9 to ask of the Panel, if it's not all right, is some

10 direction as to the hours in which we might sit to

11 facilitate some forward planning for the events ahead.

12 I have had some discussion with my friends

13 for the environmental groups and for EnCana and

14 advised them that I would like to propose that we

15 break at 6:00 today. I understand from speaking with

16 my friend for this Panel that it is not expected that

17 the remaining presentations will go too far beyond

18 that point and I'm of course reasonable and flexible.

19 However, I would like to suggest in view of

20 the future schedule of the Panel which includes

21 sittings on Saturday and, and Monday and some of the

22 other events that -- looking ahead, that in balancing

23 longer hours with some efficiency of process in the

24 proceedings that might be a reasonable balance to

25 break at 6:00 today. But, again, it's in the hands of

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1 the Panel so I just want to make that point.

2 THE CHAIRMAN: Yes. Thank you,

3 Mr. Lambrecht. Clearly there is a challenge trying to

4 fit all of these important presentations in, into the

5 evidence and we appreciate the effort that everybody

6 is, is, is setting here and contributing to this

7 hearing process. On the other hand, I, I would like,

8 if we can, to complete the, the evidence from the

9 coalition this evening. I know that this will mean a

10 long sitting but, Ms. Klimek, can you give us a sense

11 as to how much time you think may be required?

12 MS. KLIMEK: This Panel hasn't figured

13 out. Nobody trusts me on time estimates. I think we

14 won't be much past 6:00, 6:30 probably at the outset.

15 We have four left. We would prefer to get the

16 evidence in chief done because it holds together, I

17 think, in a better framework. It's been organized in

18 that way. So I'll sit down so they can get going.

19 THE CHAIRMAN: We would prefer to, if we

20 can, to hear the evidence. Obviously, we may have to

21 take a decision as we, as we proceed, but let's try

22 and, and proceed.

23 I would remind you, though, in the interests

24 of getting this recorded, please slow down. This is

25 not going to in fact speed things down. It may take

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1 longer as a consequence, so I would ask you to speak

2 slowly when you do speak, please.

3 MS. KLIMEK: We've reminded them and in

4 fact we've threatened them with pain, so I think it

5 will work.

6 THE CHAIRMAN: I will rely on your threat to

7 keep them in line, Ms. Klimek. Please proceed.

8 OPENING STATEMENT BY THE COALITION, CONTINUED:

9 A. MR. WALLIS: Okay, Mr. Unger, could you

10 continue with the, with the policy evaluation.

11 A. MR. UNGER: Mr. Chair, Panel, Ladies and

12 Gentlemen.

13 My presentation will focus on some key policy

14 considerations operating in the Suffield National

15 Wildlife Area or NWA. Further details regarding the

16 law and policy framework -- sorry, related to wildlife

17 conservation can be found at Tab 11 of the Coalition

18 submission. Policy around wildlife and protected

19 areas in Canada has evolved over the years to become

20 more inclusive in terms of ecological considerations

21 and more precautionary in how decisions are made.

22 This evolution is reflected in the designation of

23 Suffield NWA and in the various laws and policies that

24 operate in that area.

25 The realm of conservation policy law has

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1 moved from one that is anthropocentric focused on

2 conservation of hunted and commercially related

3 species to a broader more robust system of wildlife

4 and ecosystem protection.

5 An illustration of this is found in past

6 amendments to the Canada Wildlife Act which in 1970s

7 and 80s referred to wildlife as "non-domestic

8 animals". In 1994, the definition of "wildlife" was

9 repealed and the Act amended to apply to all organisms

10 and their habitat. On a broader scale, federal and to

11 a lesser degree provincial policies have progressed

12 from conserving wildlife for human use to conserving

13 ecological integrity protecting species at risk and

14 their habitat and preserving biodiversity for future

15 generations.

16 Pervading this policy evolution is the

17 concept of precaution. The precautionary approach

18 made its way on to the international stage through the

19 1992 Rio Declaration as principle 15. It states:

20 "In order to protect the

21 environment, the precautionary

22 approach shall be widely applied by

23 States according to their

24 capabilities. Where there are

25 threats of serious or irreversible

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1 damage, lack of full scientific

2 certainty shall not be used as a

3 reason for postponing

4 cost-effective measures to prevent

5 environmental degradation."

6 The principle also appears in the preamble of the

7 United Nations Convention on Biological Diversity and

8 the Accord for the Protection of Species at Risk.

9 Being a signatory to the Rio Declaration and the

10 Convention of Biological Diversity. The Government of

11 Canada proceeded to integrate the precautionary

12 principle in its domestic policy. The Canadian

13 Environmental Assessment Act adopted the principle in

14 its purpose statement and later reiterates that

15 precaution should be used in administration of the

16 Act.

17 Similarly the Species At Risk Act or SARA

18 specifically adopted the precautionary principle in

19 its preamble. SARA also implicitly incorporates the

20 principle in its provisions that protect critical

21 habitat. The critical habitat provisions recognize

22 that attempting to discern all impacts on an

23 individual organism and how management decisions might

24 impact the individual organism is fraught with

25 uncertainty. It is this uncertainty that requires

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1 that a precautionary approach be taken in making

2 decisions that will have an impact on the NWA.

3 Taking a precautionary approach is not

4 limited to areas of ecological or biological

5 uncertainty. Decision makers are obliged to take a

6 precautionary approach where regulatory uncertainty

7 exists. There's a need to develop regulatory

8 certainty around management monitoring and compliance,

9 around invasive species and reclamation in the

10 Suffield NWA.

11 Canada also has international obligations to

12 protect significant and important wetlands and wetland

13 complexes as espoused by the Ramsar Convention on

14 Wetlands, and to conserve migratory birds. The

15 importance of Suffield in this regard is outlined in

16 the Regulatory Impact Analysis Statement or RIAS that

17 accompanied the National Wildlife Area amendment

18 regulation. It states:

19 "The expansion and consolidation of

20 key prairie habitat areas for

21 migratory birds will be an

22 important contribution towards

23 Canada's international agreements,

24 including the Migratory Birds

25 Convention, the sorry, the North

Mainland Reporting Services Inc. [email protected] 1596

1 American Waterfowl Management Plan,

2 the North American Bird

3 Conservation Initiative and the

4 United Nations Convention on

5 Biological Diversity."

6 The Convention on Biological Diversity seeks to

7 have biological diversity of member states maintained

8 or sustained. The Convention resulted in the creation

9 of the Canadian Biodiversity Strategy as the central

10 federal policy for biodiversity. Notably, the

11 strategy considers the creation of a network of

12 protected areas as a central management approach to

13 conserving biodiversity. The Convention and Canada's

14 Biodiversity Strategy is implemented into domestic law

15 through numerous instruments including the Canada

16 Wildlife Act and the Wildlife Area Regulations, SARA,

17 the Migratory Bird Convention Act 1994 and the

18 Fisheries Act, to name a few.

19 The Federal Policy on Wetland Conservation is

20 another key policy document aimed at preserving

21 biological diversity. The policy is focused on

22 wetland function both in terms of hydrology and in

23 terms of ecological function. The third strategy of

24 the policy indicates:

25 "The Federal Government will

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1 continue to manage the use of

2 National Parks, National Wildlife

3 Areas, Migratory Bird Sanctuaries,

4 National Capital Commission lands

5 and other federal areas established

6 for ecosystem conservation purposes

7 so as to sustain their wetland

8 functions and natural processes."

9 SARA is also a key legislative instrument for

10 sustaining Canada's biodiversity. Prior to the

11 passing of SARA, Canada was lacking legislation to

12 specifically protect threatened and endangered

13 wildlife. Substantive legislation to facilitate

14 species at risk recovery was also elusive. Now, I

15 should mention that there are some provisions -- there

16 were some provisions under the Wildlife Act. They

17 still exist, but they didn't really deal substantively

18 with the issue.

19 The provisions in SARA dealing with critical

20 habitat illustrates the government's recognition of

21 the importance of habitat to species diversity and

22 retention. On most lands both provincially and

23 federally the SARA habitat protection provisions only

24 apply when further action is decided upon by the

25 responsible Minister and/or Cabinet, depending on the

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1 circumstances. When critical habitat is located

2 within a federal park or protected area such as the

3 National Wildlife Area, SARA's habitat protection

4 provisions do not rely on further discretion -- I'm

5 sorry, discretionary decisions being made by

6 government.

7 Section 4 of the Wildlife Area Regulations

8 provide similar legislative protection. A permit

9 under the Wildlife Area Regulations can be granted

10 where the purposes -- or proposed activity does not

11 interfere with the conservation of wildlife. SARA

12 defines "critical habitat" as that habitat which is,

13 and I quote:

14 "...necessary for the survival or

15 recovery of a listed wildlife

16 species and that is identified as a

17 species' critical habitat in the

18 recovery strategy or in the action

19 plan for the species."

20 If an activity disrupts habitat necessary for

21 recovery of a species, it is also interfering with the

22 conservation of that species.

23 Wildlife areas also receive management

24 direction through the creation of management plans.

25 These plans are used to outline pre-existing uses and

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1 ecological conditions in these areas and to detail

2 specific management approaches and objectives for an

3 area. Unfortunately, a management plan for the

4 Suffield NWA has yet to be created. Johanna McNulty

5 has submitted for Nature Canada a review of various

6 management plans across the country. As reflected in

7 this report, management plans have focused on the

8 protection, maintenance and improvement of habitat

9 within wildlife areas. Where the plans discuss

10 permitted uses, they are generally limited to

11 recreational or agricultural activities. Permitting

12 of other activities is usually not considered in the

13 management plans indicating a deferral to the primary

14 objective of the Wildlife Area Regulations of

15 conserving wildlife.

16 The Wildlife Area Regulations include some

17 very protective measures prohibiting a wide range of

18 impacts. Some of these prohibitions are worth

19 restating. Section 3 of the regulation indicates

20 that:

21 "No person shall ... damage,

22 destroy or remove a plant ...

23 operate a conveyance, [a

24 'conveyance' is defined in the

25 Canada Wildlife Act as 'a vehicle

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1 aircraft or water-borne craft']

2 ... destroy or molest animals or

3 carcasses, nests or eggs thereof

4 ... carry on any commercial or

5 industrial activity, disturb or

6 remove any soil, sand, gravel or

7 other material ... dump or deposit

8 any rubbish, waste material or

9 substance that would degrade or

10 alter the quality of the

11 environment."

12 Those are just a collection of a few of the most

13 relevant prohibitions that I find applicable to the

14 situation. These protective provisions, along with

15 the rest of federal wildlife conservation regulatory

16 framework, inform how an Environmental Assessment is

17 to be conducted and also they inform how the Canadian

18 Environmental Assessment Act is to be applied. The

19 suite of international and domestic wildlife

20 conservation policies will impact the determination of

21 adverse effects and whether an effect is justified in

22 the NWA.

23 The regulatory context and the ecological

24 context are of central relevance to environmental

25 assessments. The federal government has produced

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1 several guidance documents that indicate how an

2 Environmental Assessment should be undertaken where

3 species at risk, migratory birds and other federal

4 matters of interest are involved. What becomes clear

5 through all these documents is that the ecological

6 context, including species diversity and abundance, is

7 central to how environmental assessments are

8 conducted. All EIAs are not equal, nor should they

9 be. In determining whether there is a significant

10 adverse effect, an EIA must look to the particular

11 ecological and regulatory context.

12 The ecological context in the Suffield NWA is

13 stated in the RIAS, and I quote:

14 "The national significance of this

15 area as a northern refugium for

16 endemic prairie wildlife has

17 eloquently substantiated by recent

18 wildlife studies on invertebrates,

19 birds, mammals, reptiles and

20 amphibians. This is as a result of

21 three factors unique to the area:

22 its location near the northern

23 limit of the mid-continental

24 grasslands, the eolian grasslands

25 contained therein, and its

Mainland Reporting Services Inc. [email protected] 1602

1 relatively unaltered vegetation."

2 The RIAS continues by noting:

3 "This contribution to prairie

4 species conservation, whereby large

5 blocks of native prairie landscape

6 are protected under a single

7 jurisdiction for the benefit of

8 endemic species and their habitat,

9 is unique because no similar

10 opportunities will arise in the

11 future. This area will provide a

12 secure habitat in which species can

13 reproduce and repopulate

14 surrounding prairie environs

15 currently impacted by human

16 development and population growth."

17 The Government of Canada decided to secure the

18 Suffield NWA as a protected area with the primary

19 objective of conservation, conserving wildlife. This

20 decision constituted a key step in meeting Canada's

21 international and domestic wild conservation --

22 wildlife conservation obligations, obligations that

23 include protecting species at risk and their habitats,

24 protecting wetlands and sustaining biodiversity.

25 Obligations that must not be overlooked in

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1 environmental assessments.

2 Thank you for your...

3 THE CHAIRMAN: Thank you, Mr. Unger.

4 A. MR. WALLIS: Dr. Stelfox, are you ready to

5 go? We'll start at a pretty high level here and go

6 right down to the species, to the next three.

7 A. DR. STELFOX: Mr. Chairman, the Panel,

8 Ladies and Gentlemen, thank you very much for the

9 opportunity to speak to you today.

10 My presentation is a synoptic overview of the

11 written, the written material that I've submitted.

12 There's two key messages that I'm going to deliver:

13 one is to argue why a full regional scale cumulative

14 effects assessment is required for this Project; and

15 secondly, to provide some commentary on what I

16 consider to be the significant inaccuracies of the

17 cumulative effects assessment that has been conducted

18 to date.

19 We'll start with the first. As indicated

20 before, the National Wildlife Area of Suffield is a

21 key remnant of what was a much more broadly

22 distributed mixed grass ecosystem. It is not uniform

23 but highly variable and in things like slope, aspect,

24 relief and soil types creating an equally diverse

25 assemblage of plant communities and biodiversity.

Mainland Reporting Services Inc. [email protected] 1604

1 This landscape is anything but static. It's

2 been dynamic through time and since the glacial ice

3 age retreated ten thousand years ago it has been

4 reshaped and altered by floods, by herbivory, by fire,

5 and this has been going on for several thousand years,

6 since glacial ice age retreated.

7 And the suite of biodiversity that we have

8 today which is profound in the National Wildlife Area

9 is a product of that and one of the key points here is

10 that the abundance and distribution of the

11 biodiversity is not constant. It's highly variable,

12 creating wicked problems to us as landscape ecologists

13 in terms of measuring their abundance through escape

14 and time. This will be a key message I'll come back

15 to.

16 Now, in recent decades, this area has not

17 only been shaped by natural disturbance regimes but

18 increasingly by human land use practices including

19 military activities, grazing, by cattle and in

20 previous decades by horses, by extraction of

21 hydrocarbon reserves and the associated road network.

22 So this landscape is now being shaped by normal and

23 natural disturbances but human land use practices in

24 its designation is in the National Wildlife Area.

25 Now, this image we're looking at I should ask

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1 are you able to see the images on your laptop, too,

2 because some of the ...

3 THE CHAIRMAN: Yes.

4 A. Okay. What we're looking at here is the distribution

5 of a natural -- of, sorry, the grassland natural

6 region of Alberta showing not only the NWA but also

7 the entire Suffield Block and the Suffield is

8 relatively absent as we see here in terms of its

9 interior, major highways and major public roads, and

10 major rail systems but at the same time you're looking

11 at the natural gas wells and the first thing I need to

12 remind people that is there's spatial exaggeration.

13 We see lots of blue dots from well sites. They look

14 like they cover Suffield. They don't. But what we

15 can see clearly is that there's a network of natural

16 gas wells spread across Suffield and pipeline

17 infrastructure and of course associated with that is a

18 trail network or access roads.

19 Now, having said that, as we look here and

20 place the Suffield region in context of Alberta's

21 natural region, natural grassland region is that it is

22 one of the last strongholds of relatively contiguous

23 native grassland in Alberta and work done by the

24 southern Alberta sustainability strategy, work that I

25 did in conjunction with the Government of Alberta,

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1 indicated that, in general, in Alberta, we will look

2 at somewhere between 1 and 0.5 percent loss of these

3 remaining native grasslands per year as a result of

4 expanded cultivation, the transportation network and

5 the footprint of the hydrocarbon sector. So this

6 landscape which is already highly fragmented and lost

7 will continue its decline in decades to come under a

8 business as usual scenario, making the natural, making

9 the natural grassland areas of Suffield

10 proportionately more important from a conservation

11 biological perspective as time marches on.

12 So clearly, from the perspective of

13 conservation biology the stakes are high. The

14 Suffield NWA is an internationally recognized native

15 grassland system. But it's only a vestige of what's

16 been once a broadly distributed bio.

17 From my perspective, given what we don't

18 know, which is a lot more than what we do about the

19 functioning of these systems, precautionary principles

20 should apply. If one of our goals is to maintain a

21 reasonable level of ecological integrity on the NWA, I

22 can't emphasize how much -- and it's come out time and

23 time again in questions I've heard in the last few

24 days -- the importance of having ecological

25 benchmarks, of having some place that is native

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1 grassland where we can look at and try to understand

2 not only the distribution but relative abundance of

3 key biota and their ecological processes.

4 The NWA is probably our best bet and to

5 fulfill that purpose what we need to see through

6 meaningful time is a gradual increase in that natural

7 disturbance regimes that characterize that landscape

8 and a gradual reduction in the human land use

9 practices that occur.

10 So I would argue that the scale, magnitude

11 and intensity of the proposed gas well infill in

12 combination with existing hydrocarbon footprints and

13 the other land issues that occur on the NWA

14 necessitate a proper regional cumulative effects

15 assessment. Why?

16 A. The site is a National Wildlife Area with

17 its unique ecological properties. It's of significant

18 size, almost 50,000 hectares. The kind of development

19 that we're seeing proposed is not a few wells being

20 advocated by a mom and pop operation but rather 1275

21 wells by a large firm.

22 The current proposal, I would argue,

23 represents one of multiple drilling purposes that are

24 likely to influence this regional landscape and it's

25 important to adopt an appropriate life history

Mainland Reporting Services Inc. [email protected] 1608

1 perspective in terms of understanding the extraction

2 of this natural gas well. So as we went from zero to

3 four wells per section, and four wells to 8 wells per

4 section, and now we're considering 8 to 16, knowing

5 that in terms of the volume in place that we're

6 expecting approximately half to remain under the

7 ground after 16 wells per section, that as commodity

8 prices increase and technologies improve every

9 reasonable argument would suggest that there should be

10 another pulse place. Here in this image we're just

11 reminding ourselves of the current footprint and the

12 proposed footprint of moving from 8 to 16. This is an

13 extensive land use trajectory by our criteria.

14 Now, I would like to shift to the key issues

15 that I have with the EIA that has been conducted so

16 far. My first is, in finding a meaningful reference

17 point for that performance, so clearly the plans have

18 identified a series of VECs and they're being

19 measured. The question is when do they get to a point

20 where they're unacceptable? And as they change

21 through time what do we compare them to?

22 So I would like to provide a hypothetical

23 example, so just a general example looking at three

24 species that are well known to have been reduced in

25 distribution and abundance in North America through

Mainland Reporting Services Inc. [email protected] 1609

1 time. So in this particular scenario rule out a

2 2 percent decline per year over five decades, over 50

3 years. And anyone who would look at the graph would

4 see that there's been a significant reduction in this

5 case of abundance. However, we can look at just one

6 small chunk of that same curve. And in this case it's

7 a five-year in. And what we see is the curve is much

8 flatter. It's still declining but exactly the same

9 rate it did in the first image, but as it declines our

10 ability to detect that change is significantly

11 diminished because when it comes to VECs we do not

12 census it. We do not go out and count every

13 individual. It's very expensive, very time consuming,

14 arguably impossible.

15 We sample, and we also sample only a

16 proportion of the landscape and when we do the

17 variances relative to the means are very high, making

18 it statistically very difficult for us to detect

19 changes even when changes do exist, when we contrast

20 over short intervals of time, and that's what this

21 four-year interval will show us. If we compare that

22 to even ten years, yes, we continue to see the decline

23 at 2 percent per year. But our abilities to detect

24 changes, even when changes do exist is problematic in

25 a world where the species and the processes are so

Mainland Reporting Services Inc. [email protected] 1610

1 variable in space and in time.

2 So here we'll illustrate in a slightly

3 different way. Again, we have this species changing

4 in abundance over 50 years. Someone proposes a

5 development and there it is. Someone measures

6 something on the ground, maybe the relative abundance

7 of a particular VEC and then contrasts it to the

8 status or the relative abundance of that VEC five, ten

9 years before.

10 In this case, clearly from the graph we can

11 see that the VEC has declined, but because of the

12 variances around those means our ability to say that

13 there has been a significant change is very difficult

14 statistically. In reality, what we do, as we march

15 on, is we have a benchmark that floats. So as one

16 proposal begets another proposal, in this case as zero

17 becomes 4 and 4 becomes 8 and 8 becomes 16, rather

18 than comparing the relative abundance and distribution

19 to what we had in a range of natural variability

20 situation, we always look over our left shoulder and

21 say where were we yesterday?

22 It's the kind of argument that if I were

23 asked to determine statistically whether I'm older

24 than I was a year ago and I always measure myself and

25 compare it to my age yesterday, I'm never

Mainland Reporting Services Inc. [email protected] 1611

1 statistically different than I was, yet inescapably

2 I'm older than I was 50 years ago. This is a key

3 problem we have when we're measuring VECs that are so

4 variable in space and time. So we often come to the

5 conclusion that there's no significant change and this

6 is because we choose the wrong benchmark.

7 I would like to illustrate that. Here we see

8 a graph with the number of natural gas wells in

9 Alberta. It's been increasing. We have about 140,000

10 natural gas wells in Alberta. Here is a picture of

11 Alberta with the major cities. And now you can see

12 Suffield, and I'm going to start in 1905, and here is

13 1915, and here, as time marches on, you'll see small

14 red dots, the natural gas wells in Alberta. No one

15 here in this room would dispute that we had more than

16 we had 50 years ago. It's in fact grown at 7 percent

17 per year.

18 But as an ecologist, if I was asked not to

19 measure this population, not to census it, but to

20 sample it, say at 10 percent and do that every two

21 years, at that kind of sampling intensity if it was a

22 random design approach, I would conclude there has

23 been no significant increase in the number of natural

24 gas wells in the Province of Alberta through time.

25 So that leaves us with what is a better

Mainland Reporting Services Inc. [email protected] 1612

1 approach to measure a VEC performance. And I would

2 argue it's something called range of natural

3 variability. It represents the spatial and temporal

4 variation in a VECs in a world defined primarily by

5 the natural disturbance regimes they're characterizing

6 throughout most of their evolutionary history.

7 So we have a recognition that natural

8 disturbance regimes like floods and droughts and

9 herbivory and fire, through pertubation (phonetic)

10 regimes that causes variation. And account for why in

11 some places frogs are common and other places they're

12 rare and some years they're numerous and other places,

13 other times they're not.

14 It is not, in any way, necessarily where we

15 want to be but what it becomes is a very useful

16 reference point against which we can compare the

17 performance of our VECs. So I'm not here to say that

18 with respect to species that we always want to be

19 inside of the range of natural variability. But it

20 gives us a consistent and valuable reference point on

21 which we can compare. And this is key to the National

22 Wildlife Area.

23 Where is it that we would go where land use

24 practices are relatively rare or absent and the

25 natural disturbance regimes exist. Where are these

Mainland Reporting Services Inc. [email protected] 1613

1 ecological benchmarks, these scientific controls that

2 are so important? The National Wildlife Area

3 represents one such opportunity, but only if it

4 increases in ecological integrity and not if it

5 declines.

6 So EnCana and their consultants have

7 basically adopted a comparison where the 16 wells per

8 section were compared to 8. Again this is the

9 approach of looking over your left shoulder to where

10 you were yesterday and because of the spatial and

11 temporal variances of the data sets they have it is

12 exceptionally difficult to demonstrate a difference

13 even if a difference did exist. And we'll talk about

14 this here in a few minutes when we talk about pile

15 analysis (phonetic).

16 My second issue is one of how do you measure

17 footprint? There's no one I believe in this room that

18 would disagree that the gas play will require gas

19 wells, access trails, certain number of roads and

20 pipelines. By my analysis, and I think they're not

21 that different from that of EnCana, the direct

22 footprint, the actual direct footprint of where we are

23 today is around 2, 2.5 percent. It's not 20 percent

24 and we don't think it's half of 1 percent. At 2,

25 2.5 percent sounds like a small number. In fact it

Mainland Reporting Services Inc. [email protected] 1614

1 is. The vast majority is not indirect footprint.

2 Direct footprint is a primary currency used

3 in this EIA in terms of evaluating consequence to the

4 VECs. So if we look at this image it's clear to see

5 that the vast majority of the landscape would appear

6 not to be in direct footprint. The question is

7 whether or not the VECs that have been selected are

8 being adversely affected by the movement from 8 to

9 16 wells per section.

10 So, here in simulating the NWA into the

11 future and the upper left graph is an area, units in

12 hectares, in the bottom it's in percentage. We can

13 see the effect of the first pulse of going to 4 then

14 jumping to 8. Then you can see where we are today.

15 That's basically 2008 so we're looking at 50 years

16 back and approximately 50 years forward. And as we

17 move to the next pulse and going from 8 to 16, yes,

18 we're going to go from about 158 hectares to about a

19 thousand which means going to -- from about 2.2 to

20 about 2.9 percent. In absolute area and in percentage

21 area it is small and the argument was made by the

22 consultants that it's insignificant.

23 From previous work that I've done in, in

24 prairie ecosystems and clearly from the literature

25 review, one of the key metrics that needs to be

Mainland Reporting Services Inc. [email protected] 1615

1 examined in terms of looking at effects is edge.

2 Right now, on the NWA, we're sitting somewhere around

3 3.5 kilometres of edge per square kilometre of

4 landscape. This is anthropogenic or human caused

5 edge.

6 If the 8 to 16 trajectory unfolds it will

7 jump and go up to somewhere around 5 and, as discussed

8 earlier, how quickly it stays there will depend on how

9 quickly they reclaim, so that's, that's a key point.

10 Once we're looking at edge we can then begin to ask

11 the question: are there ecological processes or

12 species that are sensitive to edge?

13 The conclusion of the consultants is that

14 there is not. There is no evidence to conclude a

15 significant adverse effect in specific, or in general,

16 as caused by the linear features proposed by the

17 8 to 16. Yet this is in contrast to the work that was

18 conducted through the southern Alberta sustainability

19 strategy and the grassland component of the Southern

20 Foothills Study where edge was viewed and determined

21 from a modelling perspective based on empirical data

22 and literature review to be the key driver.

23 Once one looks at edge, you can begin to

24 examine the question of what would happen if that edge

25 displaces either species or ecological processes from

Mainland Reporting Services Inc. [email protected] 1616

1 areas that are adjacent to that edge. And in this

2 case what I'm showing is, I think, six different

3 examples. These are full exclusion buffers varying

4 from 50 metres up to 500 metres. Now, the graph is

5 scaled to the size of the NWA which is 45,000 hectares

6 I believe. And you can see today we're sitting there

7 just past year 50 so that's basically 2008.

8 If there were a species or a process that was

9 displaced, either physically or behaviorally, from

10 edge up to 500 metres, fully displaced, approximately

11 80 percent of our landscape would have been lost to

12 them.

13 Now, in reality for most buffers they're not

14 full exclusion. Maybe 20 percent are, maybe it's

15 40 percent. But it still illustrates quite nicely

16 that as edge increases and if there are species or

17 processes that are sensitive to edge, the effects can

18 be profound. So the key question is, is there

19 scientific evidence, robust empirical scientific

20 evidence to defend that we should be buffering these

21 edges? Because if we're not then we can just go back

22 to area. And area is profoundly small. And then

23 probably logically conclude there is very little

24 additive incremental effect caused by this Project.

25 So the key question, in my mind, is what does the

Mainland Reporting Services Inc. [email protected] 1617

1 evidence say?

2 Flipped around the other way, we can look at

3 the total amount of habitat on the landscape and here;

4 using an example of 100, 200 and 300-metre buffers,

5 show how much would have been lost if those buffers

6 were full exclusion and, again, at 200 metres about

7 40 to 45 percent of that landscape has been lost to

8 the species.

9 In the work that's been done in this Project

10 the footprint focus was on area. The area was said to

11 be, and I agree, the direct area to be exceptionally

12 small and therefore be insignificant. That latter

13 conclusion I, I disagree with wholeheartedly. All

14 evidence I have seen and the literature that I'm

15 familiar with would suggest that footprint edge is a

16 very important metric and that many species and many

17 processes are sensitive to it and so the Coalition is

18 going to present evidence as to the extent to which an

19 indirect habitat loss occurs.

20 The third issue -- so I think what we heard

21 from the consultants is we've got the good data.

22 We've got the data to show that there is no

23 significant adverse effects. And this point was made

24 to us in the pre-hearing scientific -- I'm not sure

25 what we'd call it -- review meeting and I asked the

Mainland Reporting Services Inc. [email protected] 1618

1 consultants if they had conducted any statistical

2 power tests to determine whether or not the data they

3 had collected could determine a difference if a

4 difference did exist? We were told that work had not

5 been done and the consultants kindly agreed to do that

6 work and provided it to us.

7 So here is a concern: We have VECs, here is

8 an example of three, we go out there and compute a

9 range of natural variability, land use unfolds through

10 time, a VEC performance declines -- I'm speaking

11 generically and we have a project that's proposed and

12 we're comparing it to the previous one.

13 We do not census again, we sample. We

14 determine use and there are variances around that.

15 There's true variances associated with the spatial and

16 temporal variation of these critters and plants that

17 are measured on the landscape and here we can see it

18 today as proposed and here is a measurement of what it

19 might have been five, ten years ago. So yes, that VEC

20 has declined but there's tremendous variation around

21 that.

22 The problem is when you go out and sample

23 often because of limited resources and time and money

24 and person power we find it hard to sample with lots

25 of intensity. It's just another way of saying we

Mainland Reporting Services Inc. [email protected] 1619

1 don't collect lots of data. And when your sampling

2 intensity declines the standard error or the measure

3 of variation increases making it increasingly

4 difficult to detect an effect if an effect is actually

5 there. That's what we as scientists call type 2

6 errors. In other words there is a difference. We

7 just can't detect it.

8 So with that, we asked the consultants to

9 conduct a power analysis. Now a power analysis is

10 just an empirical test which actually looks at the

11 data that, in this case, has been collected by EnCana

12 and ask the question: Can that data actually

13 determine a difference statistically if that

14 difference does exist?

15 Now, we'll start with the wildlife data and

16 we're only given one data set and this had to deal

17 with Sprague's Pipit. And I assume the reason we're

18 given Sprague's Pipit is that it's relatively abundant

19 in this area, so it would be an example of the

20 wildlife species that should have what we call "high

21 power." In other words, the data set should have a

22 higher probability of demonstrating differences.

23 The consultants asked a consultee company to

24 conduct an analysis for power. And they categorized

25 the results of these paired comparison of data into

Mainland Reporting Services Inc. [email protected] 1620

1 four categories: Those that had high power, in other

2 words, could readily detect the difference of the

3 difference existed; moderate, low and extremely low.

4 And for the one example that we were provided

5 by EnCana, 22 of the 25 data sets of paired

6 comparisons were 80 percent of these field data

7 comparisons collected could not have detected a change

8 even if an actual change did exist. This is an

9 example of the type 2 error.

10 So when we looked at the EIA conducted by

11 EnCana, there's a very common conclusion in most of

12 the, most of the work that's been done. There's no

13 significant effect.

14 Now, that conclusion could be a result of one

15 of two different options. There really is no

16 difference out there when you compare 8 versus 16

17 wells, or close to a footprint versus far away. That

18 could be one conclusion. Or the other is you've

19 concluded that only because you didn't collect enough

20 data or at the proper resolution to actually determine

21 an effect even when that effect did exist.

22 And this statistical test indicates that

23 their data with respect to the wildlife applied-for

24 groups is not powerful enough to do the job.

25 With respect to plant communities, there were

Mainland Reporting Services Inc. [email protected] 1621

1 two that were looked at. One was the vegetation

2 triangle program. And the other was the paired

3 pipeline program. And in both cases more than half of

4 the data that were collected were inadequate to

5 determine if there was an effect if the effect, if the

6 difference was actually there, and the words -- the

7 data couldn't have demonstrated a difference if the

8 difference did exist.

9 So the field data collected to compare energy

10 sector treatments has poor statistical rigor. These

11 data in general I would conclude cannot detect true

12 differences. As a result, the conclusions of the EIA

13 cannot be supported by data.

14 So my final conclusions is that the CEA

15 methodologies employed by EnCana could not have

16 detected a cumulative effect even if a profound one

17 did exist in this region. There's many inadequacies

18 that lead toward this conclusion: One, the methods

19 only considered the direct footprint effect, only the

20 area in the well pad, the area in the access road, or

21 the trail, the area in the pipeline. There is no

22 attempt -- or not. That's unfair. There was a

23 consensus or understanding that there was no need to

24 look at any of the indirect effects because they

25 weren't there. Why? Based on the data that was

Mainland Reporting Services Inc. [email protected] 1622

1 collected. The data that had no statistical power to

2 demonstrate effects if they were there.

3 Someone's behind. Now, this is going to be

4 challenging. Someone has actually got to go and --

5 thank you. Okay. Thank you. Thank you.

6 I seem to have lost -- maybe what I could ask

7 you to do, Jennifer, could you just click it manually

8 because I think it will work then. Maybe it is

9 frozen.

10 THE CHAIRMAN: Dr. Stelfox -- here we go.

11 A. DR. STELFOX: Secondly, the comparison of

12 the treatment effects was not again for range of

13 natural variability. It was just looking over your

14 left shoulder comparing 16 to 8.

15 Thirdly, the field data collected generally

16 have low, the example would be plant community

17 metrics, or very low power, and that would be with

18 respect to wildlife metrics, to detect changes even if

19 they did exist.

20 The CIA ignored the most important taxil

21 group with respect to ecological integrity, ecological

22 functioning, and biodiversity. And that's arthropods.

23 The study did not evaluate the consequences

24 of poor reclamation performance. When we grow these

25 land uses into the future, we grow footprints.

Mainland Reporting Services Inc. [email protected] 1623

1 What would be the consequence of alternative

2 reclamation trajectories in terms of landscape metrics

3 and the performance of VECs? This part of the work

4 was not completed.

5 From the perspective of a VECs, EnCana did

6 not demonstrate the key drivers to VEC performances

7 and the role of best practices. It would have been

8 very helpful to adopt the modelling approach which

9 could have looked at, what are the key footprints, are

10 they the wells or the pipelines, or the access roads,

11 in terms of influencing these VECs, and how might

12 their performance have been changed under a variety of

13 best practices? This speaks to an earlier question I

14 believe from the Panel looking at adaptive management

15 and active adaptive management, is how could we kick

16 the system in different directions to learn the most?

17 And this is where a modelling approach, doing rigorous

18 cumulative effects assessment would have been helpful.

19 And thank you for the opportunity.

20 THE CHAIRMAN: Thank you, Dr. Stelfox.

21 MR. WALLIS: Ms. Bradley, I presume you're

22 Ms. Bradley now, not -- not Mr. Bradley.

23 THE COURT REPORTER: Tomorrow. Sorry.

24 A. MS. BRADLEY: Okay. Mr. Chairman, Panel

25 members, ladies and gentlemen, I'm hired by the

Mainland Reporting Services Inc. [email protected] 1624

1 Environmental Coalition of environmental organizations

2 to provide comments on the EnCana Shallow Gas Infill

3 Development Project in the Suffield National Wildlife

4 Area with a focus on the potential environmental

5 effects of the Project on soils and vegetation.

6 I was also asked to consider mitigation

7 measures as they affect soils and vegetation as well

8 as reclamation and restoration matters.

9 I have prepared a written submission and

10 responses to information requests based on my review

11 of EnCana's Environmental Impact Statement and other

12 relevant information filed with the Joint Review Panel

13 as well as discussions I participated in, in a

14 scientific working session on the Project held in

15 February, 2008.

16 I have also drawn on some published peer-

17 reviewed literature, reports prepared by consultants

18 and staff of government and industry, documents

19 regarding environmental matters on CFB Suffield that

20 were obtained through an Access to Information request

21 by the Federation of Alberta Naturalists on behalf of

22 the Environmental Coalition and my own experience and

23 discussions with professional colleagues including

24 those sitting beside me today.

25 In this presentation, I wish to highlight

Mainland Reporting Services Inc. [email protected] 1625

1 some of the key points in my submissions which are

2 part of the record and some overall concepts regarding

3 project specific and cumulative effects of the

4 proposed Project that I see arising from the

5 application before the Joint Review Panel.

6 Grasslands are one of North America's most

7 threatened ecosystems and the Suffield National

8 Wildlife Area and its environs is a nationally and I

9 would venture internationally significant remnant of

10 native prairie. The function of national wildlife

11 areas and other protected areas is to preserve native

12 species and to serve as a benchmark or control against

13 which we measure the effects of our actions on

14 ecosystems which support prairie life, including

15 humans.

16 EnCana's EIS takes a landscape level approach

17 to consideration of the Project's effects on soils and

18 vegetation and I assume this is because the VECs for

19 soil and vegetation comprise almost all of the

20 National Wildlife Area and most of the local study

21 area and these effects include soils that are rated

22 as extreme to high sensitivity, to wind erosion,

23 subsurface contamination, water erosion and

24 salinization. Nearly all of the NWA is comprised of

25 these VECs and a large percentage of the local study

Mainland Reporting Services Inc. [email protected] 1626

1 area.

2 The other key VEC was native prairie

3 grassland integrity and the National Wildlife Area and

4 the local study area together comprise a largely

5 intact block of native prairie.

6 An indicator used in EnCana's EIS to assess

7 effects of past land uses on soils and vegetation is

8 surface disturbance and, as my colleague Dr. Stelfox

9 pointed out, the area of existing surface disturbance

10 is estimated in the EIS to be about 2 percent of the

11 National Wildlife Area. The additional surface

12 disturbance of the Project is predicted to be less

13 than .5 percent of the NWA.

14 This level of disturbance is assessed as

15 "negligible to minor magnitude" and it is used as a

16 key reason to support the conclusion that cumulative

17 effects of the Project combined with past, existing

18 and future projects on soils and vegetation in the NWA

19 are insignificant. Rationale, other than subjective

20 observation, is not provided for the assertion that

21 this level of footprint is negligible to minor.

22 EnCana's EIS demonstrates a narrow

23 understanding of disturbance or footprint, and I think

24 we've heard this already, and it has likely led to

25 an underestimation of actual disturbance, direct and

Mainland Reporting Services Inc. [email protected] 1627

1 indirect. The following are not considered in the

2 calculation of existing disturbance: Areas where

3 soils have been disturbed in the past and revegetated

4 although not to native condition; vegetation adjacent

5 to surface disturbance that has been modified by

6 ongoing activities, for example, destruction of

7 vegetation through compaction or high dust levels and

8 encroachment of non-native species which is termed

9 indirect disturbance; the area between the tracks on

10 a double-track trail or the area between a pipeline

11 and an adjacent double-track trail are not included

12 and that is in the footprint refinement provided to us

13 on October 7th.

14 In addition, findings of ground-truthing are

15 that the air photo interpretation misidentified or

16 overlooked a high proportion of double-track trails.

17 DND, the Department of National Defence,

18 determined that the 2001 shallow gas infill program

19 in four sections of the NWA resulted in a total

20 disturbance of well over 5 percent. A similar

21 analysis for 12 sections in the Koomati training area

22 determined total disturbed area to be 5.8 percent.

23 Other researchers have used empirical data to

24 determine that 2.3 percent and 2.7 percent of the NWA

25 is already invaded and compromised by non-native plant

Mainland Reporting Services Inc. [email protected] 1628

1 species spreading from pipelines. ALCES model

2 results, conducted independently of the empirical

3 studies, estimate that 2.6 percent of the NWA may

4 already be occupied by non-native species spreading

5 from linear disturbances.

6 As my colleague Dr. Stelfox has already

7 noted, EnCana's EIS does not consider disturbance in

8 terms of fragmentation and anthropogenic edge; that is

9 the distribution or density of disturbance on the

10 landscape. These are widely viewed as more meaningful

11 ecological concepts than total area for considering

12 footprint over space and time.

13 Conclusions about linear fragmentation from

14 the regional environmental study in the Great Sand

15 Hills, a prairie environment similar to the Suffield,

16 Suffield NWA, are instructive. Esteemed scientists,

17 Dr. Reed Noss and Dr. David Gauthier, considered a

18 density of roads and trails of 1.9 kilometres per

19 kilometre squared to be the threshold between highly

20 developed and less developed areas.

21 In CFB Suffield, trail pipeline density

22 following two infill development projects have been

23 measured at 7 and 12 kilometres per kilometre squared,

24 four to six-fold the highly developed thresholds set

25 by the Great Sand Hills Advisory Committee. And

Mainland Reporting Services Inc. [email protected] 1629

1 simulations using the ALCES model estimate current

2 linear footprint of about 3 kilometre per kilometre

3 squared which will increase to 5 kilometres per

4 kilometres squared should the Project proceed. These

5 are well above the cautionary "highly developed"

6 threshold of the Great Sand Hills study.

7 The EIS provides little insight into trends

8 and disturbance footprint and that's disturbance in

9 the broad sense in the NWA. Introduction of

10 non-native species through human activity in and

11 around the Suffield NWA and subsequent invasion of

12 native plant communities is arguably the biggest

13 threat to native vegetation. Many studies have shown

14 that linear disturbances such as roads, vehicle trails

15 and pipelines act as conduits for the dispersal of

16 non-native plants into grassland environments. For

17 example, in the Great Sand Hills there is an increased

18 presence of Crested Wheatgrass and Smooth Brome along

19 roads and trails associated with gas development.

20 EnCana's EIA acknowledges that vehicles act as a

21 vector for non-native plants. It was just not

22 measured.

23 Experts with substantial field experience

24 conclude that invasion of non-native species occurs

25 even with the use of minimal disturbance techniques in

Mainland Reporting Services Inc. [email protected] 1630

1 semi-arid grasslands. In a background report for the

2 Southern Alberta Sustainability Strategy, rates of

3 invasion of invasive agronomics such as Crested

4 Wheatgrass into dry mixed grassland, upland grasslands

5 are conservatively estimated, and I won't go through

6 the numbers there but it ranges from as low as .08

7 metres per year along small trails and small pipelines

8 to 0.3 metres per year from roads. And this is for

9 linear disturbances constructed after 1995 using

10 minimal disturbance techniques. Higher rates of

11 invasion are estimated as ongoing for land use

12 footprints prior to 1995 when native vegetation and

13 top soil were removed and agronomic species such as

14 Crested Wheatgrass were seeded during reclamation.

15 These are values, are the ones being used in

16 cumulative effects modelling for regional planning in

17 southern Alberta.

18 The paired pipeline sampling conducted as

19 part of EnCana's EIS was not designed to test

20 non-native plant species encroachment into native

21 prairie, a shortcoming of the sampling design.

22 The paired pipeline study attempted to test

23 restoration of native plant community on disturbed

24 pipelines. Data collected purports to demonstrate a

25 trend towards native community on older pipelines

Mainland Reporting Services Inc. [email protected] 1631

1 reclaimed after 1980; however, most of the data did

2 not withstand the test of power analysis.

3 Results of the vegetation triangling sampling

4 effort to assess native prairie grassland integrity

5 are also cited in the EIS as a reason for assessing

6 cumulative effects on native prairie integrity as

7 insignificant. The effort was confined to upland

8 grasslands and ignored consideration of wetlands and

9 other less common vegetation cover types in the NWA.

10 An objective of the vegetation triangle

11 sampling effort was to measure the effects of

12 different well densities, 16 wells per section versus

13 8 wells per section versus 4 wells per section on

14 native prairie grassland integrity. A pre-development

15 baseline was not considered.

16 Considering that well densities of 16 wells

17 per section did not occur in the NWA until 2001, it is

18 premature to anticipate the technical differences from

19 8 wells per section at a landscape level, particularly

20 with respect to encroachment by non-native species

21 into native habitats.

22 EnCana's field study design is not at the

23 appropriate level of detail. Ecological variability

24 across the landscape, in topographic position, for

25 example, confounds any associations of ecological

Mainland Reporting Services Inc. [email protected] 1632

1 integrity measures with disturbance. It is well

2 known, for example, that mesic plant communities tend

3 to have greater numbers and higher frequencies of

4 alien plants than do dryer communities.

5 Regardless, power analysis of the vegetation

6 triangle sampling results shows that a less -- less

7 than a third of comparisons of integrity measures

8 between 8 and 16 wells per section met the test of

9 true significance. Power analysis is not provided for

10 the comparison of integrity measures between 4 and 8

11 wells per section. Hence, there is inadequate

12 information from the vegetation triangle sampling

13 effort to draw conclusions about the significance of

14 the effects of gas well density on native prairie

15 integrity.

16 A key underpinning of the conclusions of the

17 EIS is the assertion that mitigation measures will

18 result in insignificant residual effects on soils and

19 vegetation. Several of these mitigation measures were

20 the subject of the Coalition's cross-examination of

21 EnCana. Responses with respect to the feasibility of

22 fully implementing well-intended measures such as

23 avoidance of steep slopes and wetlands, shutdown in

24 wet weather, use of SpiderPlow, vehicle cleaning and

25 access management are a matter of record already.

Mainland Reporting Services Inc. [email protected] 1633

1 Experience suggests that many mitigation

2 measures are not found to be practically feasible for

3 the oil and gas industry. The predicted reduction of

4 adverse effects is not fully realized. Audits of

5 industry activity on CFB Suffield over the last few

6 years by DND staff, SEAC and environmental consultants

7 have found numerous examples of excessive well site

8 clearing, multiple vehicle tracks or multiple access

9 routes to well sites, soil vehicle ruts indicating

10 access in wet weather, erosion issues along access

11 trails and pipelines, sites with discarded mud,

12 garbage and cement as well as hydrocarbon spills.

13 One of the most comprehensive studies of

14 industry compliance with minimal disturbance measures

15 is contained in an audit of land spraying while

16 drilling on CFB Suffield and public lands elsewhere in

17 Alberta. The review included examination of hundreds

18 of case files and field inspection records, a field

19 audit of land spraying while drilling sites at CFB

20 Suffield and other, other aspects. This review

21 revealed a number of major issues including activity

22 occurring outside of approved areas, no final field

23 report, field plans of poor quality, heavy loading

24 rates and siting problems. The survey of sites within

25 CFB Suffield reveal poor distribution of residual

Mainland Reporting Services Inc. [email protected] 1634

1 solids resulting in skins and mud packs which smother

2 grassland vegetation, rutting of soft soils and

3 application on sensitive sites including sand dunes,

4 watercourses, wetlands and steep slopes. Land

5 spraying while drilling is no longer allowed on other

6 public lands in southern Alberta, but the practice

7 continues on CFB Suffield.

8 The heavy reliance on unproven

9 pre-development assessments to mitigate potential

10 adverse effects is also of concern. Attempts by the

11 Base Commander to implement environmental overviews

12 starting just about three years ago met with

13 resistance from industry. According to documents

14 obtained under the Access to Information Act, concerns

15 were expressed by managers of CFB Suffield beginning

16 in June, 2005 that these environmental overviews were

17 rather superficial, simply a site-by-site inspection

18 for avoidance of species at risk and sensitive

19 habitat, failing to address cumulative effects, being

20 done too late to detect species at risk and being

21 completed by biologists who were under unreasonable

22 pressure by industry. I observed similar problems

23 with the three PDA's provided for this hearing.

24 EnCana is proposing to do much of its work

25 such as soils assessments, range health assessments,

Mainland Reporting Services Inc. [email protected] 1635

1 rare plant community and rare plant surveys and

2 mitigation planning after the approval is granted.

3 It would be better environmental planning if these

4 results are available to inform the Panel's decision.

5 And I'll, finally, address some reclamation/

6 restoration matters. EnCana considers its obligation

7 to be to reclaim to "equivalent capability" as defined

8 in Alberta's Environmental Protection and Enhancement

9 Act. And that is the ability of the land, I'm quoting

10 here:

11 "The ability of the land to support

12 various land uses after reclamation

13 is similar to the ability that

14 existed prior to an activity being

15 conducted on the land, but the

16 ability to support individual land

17 uses will not necessarily be equal

18 after reclamation."

19 The "equivalent capability" goal is reflected in

20 statements in the EIS. EnCana's reclamation planning

21 is focused on maintaining soil and site stability and

22 hydrologic function and places little value on

23 restoring native plant community.

24 The Rangeland Reclamation Success Assessment

25 Protocol for the Environmental Effects Monitoring

Mainland Reporting Services Inc. [email protected] 1636

1 states:

2 "With the rangeland functionality

3 protocol, plant community

4 composition does not play the same

5 important role it did for both the

6 previous method of assessing range

7 status with regard to grazing

8 capacity or to some other methods

9 of assessing reclamation success."

10 That is, put it back the way it was.

11 This "equivalent capability" goal appears to

12 be out of step with the direction of the provincial

13 Reclamation Criteria Advisory Group currently revising

14 its criteria pertaining to grasslands reclamation.

15 In a protected area such as the Suffield NWA

16 where the mandate is to protect ecological integrity,

17 the reclamation goal is better reflected by the

18 definition of restoration, a term that is becoming

19 more widely used among reclamation specialists. And

20 I quote:

21 "Restoration is defined as the

22 process of returning a disturbed

23 site to the ecosystem

24 characteristics that existed prior

25 to surface disturbance, usually

Mainland Reporting Services Inc. [email protected] 1637

1 based on the characteristics of an

2 adjacent reference or control

3 site."

4 This definition implies that restoring a site to

5 pre-disturbance condition is a process, often a

6 long-term one, that requires addressing not only the

7 effects of a current project but also the effects of

8 previous disturbances on the native ecosystem.

9 Success is measured through reference to

10 characteristics occurring on a site typical of the

11 ecosystem which has not been impacted by the Project

12 or by previous anthropogenic disturbance.

13 There are many challenges to doing

14 reclamation in the Suffield NWA. Several of the gaps

15 in revegetation strategies for the grassland natural

16 region generally, and specifically the dry mixed grass

17 subregion, are identified in a recent report regarding

18 reclamation prepared for Alberta Sustainable Resource

19 Development. They relate to the need for clear

20 definitions for industrial disturbance-related

21 activity including criteria for field-based assessment

22 of suitably dry or frozen ground conditions; more

23 precise definition and evaluation of minimal

24 disturbance procedures; understanding the implications

25 of decreased well spacing for reclamation; addressing

Mainland Reporting Services Inc. [email protected] 1638

1 interactions of industrial disturbance and grazing

2 practices; addressing difficulty in re-claiming steep

3 slopes, choppy sandhills and solonetzic or saline

4 soils and how reclamation strategies affect species at

5 risk. And I refer the Panel to my submission of

6 February 15th as well as the original Alberta

7 Sustainable Resource Development report for more

8 insight into that.

9 It would be better to address these issues

10 outside of a protected area which is intended to be

11 an ecological benchmark just in case we fail.

12 There also are issues regarding reclamation

13 of existing disturbances in the Suffield NWA. It

14 would appear there is a legacy of poor practice with

15 respect to reclamation of industrial disturbances.

16 A precautionary approach would be to address these

17 legacy issues before any consideration is given to

18 contemplating new industrial disturbances that would

19 need to be reclaimed in the Suffield National Wildlife

20 Area, a protected area. It is clear that the existing

21 footprint is on a negative trend.

22 Thank you.

23 THE CHAIRMAN: Thank you, Ms. Bradley. I

24 know it is getting late, but we do have just one more

25 presentation I understand, Ms. Klimek, and, if so, I

Mainland Reporting Services Inc. [email protected] 1639

1 would prefer to continue.

2 MS. KLIMEK: Yes, and I have about ten

3 minutes of questions, but we could start the morning

4 with those, if that would work.

5 THE CHAIRMAN: I think that would be best to

6 do, but we -- I think it would be good if we could

7 continue to hear from the Panel this evening.

8 MS. KLIMEK: Okay, so we'll finish with

9 Mr. Wershler then for today then?

10 THE CHAIRMAN: Yes, thank you.

11 A. MR. WERSHLER: How is this level? Good?

12 Mr. Chairman, Panel Members, I'm going to try not

13 to fall asleep. Maybe I'll have to talk too fast, I

14 don't know. This, this presentation is a summary and

15 highlights of my submission on rare plants and rare

16 ecological communities, wetlands, wildlife and

17 biodiversity, and it will reinforce a lot of the

18 concepts that we've heard already this afternoon.

19 1. Vegetation.

20 Rare Plant Species and Plant Communities.

21 At least 29 provincially rare and federally

22 listed plant species have been recorded in the NWA

23 including three SARA species and there is high

24 potential for other federally listed species and

25 provincially rare species in the area.

Mainland Reporting Services Inc. [email protected] 1640

1 However, no rare plant or rare plant

2 community surveys have been conducted by EnCana and

3 there is reliance on PDAs for this information, which

4 is a recurring theme.

5 Locations of rare plants and rare plant

6 communities should have been surveyed and mapped as

7 accurately as possible (as described in the EIS

8 guidelines) so that they could have been used with

9 other rare and sensitive features in environmental

10 constraints mapping.

11 The quote "avoiding known occurrences of rare

12 plant species and rare ecological communities whenever

13 possible" implies a low level of commitment and this

14 kind of statement represents another recurring theme.

15 Under cross-examination it was evident that

16 EnCana will not be meeting even the minimum

17 requirements for rare plant surveys as per ANPC

18 guidelines.

19 Another quote:

20 "It is possible that in exceptional

21 circumstances additional mitigation

22 measures, (transplanting), may be

23 required if avoidance is not

24 feasible."

25 This approach is unproven for most native species of

Mainland Reporting Services Inc. [email protected] 1641

1 concern that occur in the National Wildlife Area.

2 The residual impact on rare plants is

3 assessed as insignificant. There is no basis for

4 this, given the preceding and, unlike the faunal VECs,

5 no scientific information is provided in the EIS on

6 the three federally listed species that would allow a

7 determination of "insignificant" or "negligible"

8 effect.

9 In the case of the endangered Tiny

10 Cryptanthe, EnCana's lack of concern does not follow

11 two urgent recovery strategies as outlined in the

12 National Recovery Strategy: One, to survey and

13 monitor populations and, two, develop plant

14 species-at-risk guidelines for setback distances from

15 industrial activity. EnCana's novel proposal for

16 dealing with mitigation for these species (ploughing

17 through a population and hoping the plants will

18 reseed) runs counter to the recovery strategy.

19 Wetlands.

20 A variety of wetland types occur in the

21 National Wildlife Area, but no original wetland

22 surveys were conducted. Ephemeral and temporary types

23 have not been identified and mapped as required by the

24 EIS guidelines, even though these provide critical

25 habitats for amphibians at risk and rare plants.

Mainland Reporting Services Inc. [email protected] 1642

1 There is reliance on the PDAs to provide

2 site-specific information on wetlands. These habitats

3 should have been identified and mapped with buffers,

4 as without -- without this information overall

5 constraints of the Project cannot be evaluated in

6 concert with the other constraints.

7 EnCana indicates wetlands will be avoided

8 where appropriate and, if unavoidable, ephemeral

9 drainages will be crossed perpendicular to the flow.

10 Wetlands will be avoided whenever possible

11 during construction of pipelines. A setback distance

12 of 100 metres from the centre of the well will be used

13 as a buffer, but this distance may be reduced in

14 exceptional circumstances where a resource extraction

15 would be severely compromised and effects on the

16 environment would be more adverse if the buffer was

17 adhered to.

18 EnCana has demonstrated in the PDAs for three

19 well application (sic) that it will apply for

20 a relaxation of setbacks where avoidance is not

21 possible. These statements and actions contravene the

22 accepted 100 metre setback for all wetlands in

23 Environment Canada and Alberta Fish and Wildlife

24 guidelines and, potentially, the no net loss of

25 wetland function under federal policy.

Mainland Reporting Services Inc. [email protected] 1643

1 There will be use of water from spring-fed

2 dugouts in the Military Training Area and this

3 represents a cumulative impact of the proposed

4 development that was not considered by EnCana.

5 EnCana assesses residual environmental

6 effects on wetlands as negligible and, therefore, did

7 not undertake a cumulative effects analysis. This is

8 absurd, given EnCana's stated option of reducing

9 wetland buffers where it is deemed necessary.

10 Wildlife.

11 Of the SARA (Species At Risk Act) listed

12 wildlife species that occur in the National Wildlife

13 Area, three particularly stand out as being at risk

14 from the proposed development and for which EnCana did

15 not adequately consider the effects as required in the

16 EIS guidelines.

17 Burrowing Owl (Endangered)

18 The National Recovery Strategy lists, among

19 other key steps in the recovery of this species,

20 documentation of the location of occupied and

21 unoccupied nesting sites, which EnCana has not

22 undertaken. In addition, the proposed Project would

23 further fragment native grassland habitat and increase

24 traffic on roads, (raising the risk of mortality),

25 both of which are contrary to recommendations in the

Mainland Reporting Services Inc. [email protected] 1644

1 National Recovery Strategy. It simply defies the

2 available science that EnCana assesses residual

3 environmental effects on this species as

4 "insignificant" and "negligible", given its precarious

5 status.

6 Recent population trend monitoring surveys

7 in a 16 quarter section area in the Kininvie area,

8 west of CFB Suffield, re-confirm and extend a

9 significant downward population trend in this area.

10 2007 numbers of Burrowing Owls represent a decline of

11 greater than 80 percent over the last ten years and a

12 60 percent decline since 2004. This is Stevens and

13 Todd, 2008. These authors state that habitat change

14 and cumulative effects from land uses, including oil

15 and gas activities, (that is, increased vehicular

16 traffic and sensory disturbance from drilling

17 operations), could be playing a role in the decline by

18 affecting adult survival or nesting success.

19 It is a major deficiency of the EIS not to

20 have made a concerted effort to locate nesting birds

21 in 2006 using protocols recommended by Alberta

22 Sustainable Resource Development.

23 Sprague's Pipit.

24 Threatened, and a bird species endemic to the

25 Great Plains. The National Recovery Strategy for this

Mainland Reporting Services Inc. [email protected] 1645

1 species lists linear development, for example, roads

2 and pipelines and resource extraction as reducing

3 interior habitat and increasing edge, thereby

4 resulting in reduced resource availability for this

5 species.

6 Sprague's Pipits are relatively intolerant of

7 non-native vegetation and native habitat loss is

8 considered a major threat for this species. Habitat

9 degradation, including fragmentation, typically

10 reduces the population but can lead to local

11 extirpation if the magnitude, frequency and duration

12 of these threats are great enough.

13 Linear development and stretches of broken

14 land are typically associated with invasion by exotic

15 plants that reduce habitat suitability.

16 In a study of the effects of minimal

17 disturbance shallow gas activity on grassland birds in

18 Saskatchewan, it was concluded that minimal

19 disturbance well sites and trails may contribute to

20 decreased territory establishment in Sprague's Pipits

21 and Lark Buntings.

22 Reduced (sic) research in the National

23 Wildlife Area indicated that Sprague's Pipit

24 territories rarely crossed trails, roads and

25 pipelines. EnCana fails to recognize the

Mainland Reporting Services Inc. [email protected] 1646

1 deterioration of the grassland ecosystem in the

2 National Wildlife Area through cumulative

3 fragmentation including linear disturbances; the

4 presence of non-native vegetation in and around the

5 existing gas development and the proposed planting of

6 a mixture of grasses including non-native forms of

7 native species that will create a plant community that

8 is different in structure and species composition to

9 native grassland. Given the preceding analysis, this

10 is an ongoing threat to Sprague's Pipits.

11 Sprague's Pipits are widely distributed and

12 very -- and relatively common in the National Wildlife

13 Area. While winter construction will avoid

14 destruction of nests and young, it will not prevent

15 destruction of nesting habitat. There would be little

16 chance to site wells, pipelines and roads if a buffer

17 were applied to every nesting territory used over a

18 multiple of years of occupation and that is high

19 potential habitat.

20 EnCana's assessment of residual environmental

21 effects of the Project on Sprague's Pipits as

22 "insignificant" and "negligible" is inappropriate and

23 it contradicts the best science available.

24 Ord's Kangaroo Rat - Endangered.

25 The COSEWIC (2006) status report indicates

Mainland Reporting Services Inc. [email protected] 1647

1 the trend toward increasing use of anthropogenic

2 habitats (specifically roads in the National Wildlife

3 Area), appears to be a threat to this species by

4 providing low quality "sink" habitats in which

5 mortality exceeds recruitment. In spite of this

6 concern, this red flag, EnCana assesses residual

7 effects of the Project including the existing and

8 proposed footprint that contain these habitats as

9 "insignificant".

10 The updated status report for this species

11 states that the trend towards increasing use of

12 anthropogenic habitats, roads, trails, fireguards and

13 bare ground associated with oil and gas fixtures and

14 the margins of cultivated agricultural lands also

15 appears to be a threat to Kangaroo Rats in Canada. It

16 appears that anthropogenic habitats are low quality

17 "sink" habitats in which mortality exceeds

18 recruitment.

19 EnCana's assessment of residual effects of

20 the Project on Ord's Kangaroo Rat as being

21 "insignificant" contradicts the best available

22 scientific evidence.

23 Now, for some other species. The

24 Sharp-Tailed Grouse is listed as a sensitive species

25 in Alberta. Sharp-Tailed Grouse are vulnerable to

Mainland Reporting Services Inc. [email protected] 1648

1 human disturbance in the breeding complex which

2 includes the lek or dancing ground and surrounding

3 nesting grounds. The breeding complex includes all

4 lands within a 2-kilometre radius of lek sites.

5 The following is a summary of disturbance

6 factors including impacts that relate specifically to

7 the oil and gas industry from across the North

8 American range and stricter timing and setback

9 guidelines provided for this species in other

10 jurisdictions.

11 Disturbance on leks appears to limit

12 reproductive opportunities and may result in regional

13 population declines. Females appear to be more

14 susceptible to various kinds of disturbance and if

15 females are flushed frequently during the early stages

16 of egg laying, this may cause nest abandonment.

17 Excessive disturbance to wintering birds may impair

18 their ability to cope with unfavourable winter

19 conditions.

20 Additional impacts include increased

21 mortality due to collisions with vehicles.

22 In Colorado and adjacent states, oil and gas

23 development has only recently been considered a threat

24 to Sharp-Tailed Grouse as increased oil and gas

25 activity has spread into the core of the species

Mainland Reporting Services Inc. [email protected] 1649

1 range. If oil and gas resources in the region are

2 developed to their fullest potential, it is feared the

3 outcome could be devastating to populations. While

4 the amount of habitat directly affected is relatively

5 small, avoidance and stress responses of wildlife may

6 extend the influence from well pads, roads, pipelines,

7 power lines and other facilities to over 1 kilometre

8 in open country, affecting use of habitats that

9 otherwise appear undisturbed. These impacts can be

10 especially problematic when they occur in wintering

11 and reproductive areas.

12 The following have been recommended in

13 Colorado as standard management practices to reduce

14 wildlife impacts associated with oil and gas

15 development, and these impacts or these guidelines are

16 specific to Sharp Tails: No development activity

17 between the 1st of March and 30th of June within 2

18 kilometres of active lek sites; no development

19 activity in winter habitat between the 1st of December

20 and the 15th of March; no surface occupancy in areas

21 within 0.64 kilometres of any leks. These recommended

22 guidelines are in contrast to more liberal timing and

23 setback guidelines for oil and gas activity

24 recommended by Alberta Fish and Wildlife that appear

25 to be -- they appear to be inadequate especially for

Mainland Reporting Services Inc. [email protected] 1650

1 a protected area like the National Wildlife Area where

2 the highest standards should be applied for the

3 protection of sensitive species.

4 In Section 5.8.3.2 EnCana states:

5 "Disturbance within 2 kilometres of

6 a lek during the breeding season,

7 (March through June), may be

8 harmful. Although leks may appear

9 to remain active after disturbance

10 because of male tenacity, females

11 avoid such leks and thus

12 reproductive capacity may be

13 inhibited."

14 End of quote. In spite of this statement, a

15 buffer from leks of only 500 metres is being adopted

16 by EnCana and this demonstrates the lowest level of

17 commitment to protection for this species, that is,

18 nothing that exceeds the statutory compliance even

19 where there is evidence of harmful effects at greater

20 distances.

21 EnCana fails to consider the effects of

22 disturbance to Sharp-Tailed Grouse in critical

23 wintering habitats.

24 Based on the preceding, EnCana's assessment

25 of residual environmental effects from the Project on

Mainland Reporting Services Inc. [email protected] 1651

1 Sharp-Tailed Grouse as insignificant and negligible is

2 unreasonable and not supported by the best available

3 scientific documentation and management approaches.

4 Northern Pocket Gopher.

5 Like the Richardson's Ground Squirrel, this

6 species is very significant in the grassland

7 ecosystem, but unlike the Richardson's Ground Squirrel

8 it is common in the National Wildlife Area. The

9 failure to recognize this species as a VEC is a

10 shortcoming of the EIS given this species importance

11 in parts of the Suffield National Wildlife Area.

12 Pronghorn.

13 The Pronghorn is another listed Sensitive

14 species in Alberta and the extent and quality of the

15 winter range is the most limiting factor for Alberta

16 Pronghorns.

17 On average, the Canadian Forces Base Suffield

18 provides habitat for approximately 15 percent of the

19 total provincial Pronghorn population. The area

20 classified, is classified as "key" winter range and is

21 used extensively by a large number of Alberta and

22 Saskatchewan Pronghorn, and I would suggest probably

23 some Montana ones as well.

24 Traditionally, the most important Pronghorn

25 habitat on CFB Suffield has been found within the

Mainland Reporting Services Inc. [email protected] 1652

1 National Wildlife Area. Based on aerial surveys in

2 the second week of January, 2008, it was estimated

3 that at least 12 percent of the total Alberta

4 Pronghorn population was in the National Wildlife

5 Area. The western portion of the Base may have

6 contained equal numbers which would have raised the

7 total wintering population to a maximum of one quarter

8 of the provincial population.

9 CFB Suffield, which includes the National

10 Wildlife Area and the Military Training Area, are part

11 of a significant migration corridor for Pronghorn,

12 sometimes -- travelling sometimes long distances

13 between winter and summer range and this has only

14 recently come to light.

15 Oil and gas activities and associated

16 developments constitute a potential threat to

17 Pronghorn in winter by impeding or causing delays in

18 movement to alternate critical winter range resulting

19 in increased energetic costs, increased exposure to

20 natural or human-related hazards and ultimately to

21 increased mortality or reduced reproductive rates.

22 Severe winter conditions can result in high

23 mortality. For example, up to half of the provincial

24 population has died off during winter conditions that

25 caused forced movements.

Mainland Reporting Services Inc. [email protected] 1653

1 North Dakota Game and Fish Department

2 reports -- in 2006 reports that winter ranges,

3 seasonal movement corridors and fawning areas require

4 special management attention. To reduce stress from

5 oil and gas activities on Pronghorn in these critical

6 habitats, land managers have used seasonal use

7 restrictions and buffers to prohibit fluid mineral

8 exploration and development activities.

9 By assessing the residual environmental

10 effects of the Project on Pronghorn as "insignificant"

11 and "negligible", EnCana contradicts the best current

12 knowledge for Pronghorn as well as the application of

13 conservation in a broader ecosystem concept.

14 Mule deer.

15 This species is not identified by EnCana as

16 a VEC for the Project but given its abundance in the

17 National Wildlife Area, especially on the winter

18 counts, and its sensitivity to human disturbance in

19 the winter, the proposed development does present a

20 risk to this species.

21 Prairie Rattlesnake.

22 May be at risk in Alberta. Populations of

23 this species have declined in recent years and

24 numerous snakes are killed on the road each year with

25 rattlesnake mortalities being the most numerous.

Mainland Reporting Services Inc. [email protected] 1654

1 Increased road traffic associated with the proposed

2 Project would logically lead to an increase in

3 mortality. Even with the proposed mitigation of speed

4 limit reduction, there will still be some snake

5 mortality on roads and trails.

6 The assessment of residual environmental

7 effects on the Project on Prairie Rattlesnakes in this

8 light as insignificant and negligible is, therefore,

9 not credible.

10 Western Hognose Snake.

11 May be at risk in Alberta. Like other snake

12 species, it is vulnerable to roadkill mortality and

13 being a little smaller and cryptic, I would say very

14 vulnerable in certain cases.

15 Since they may be dependent on Pocket Gopher

16 burrows for over-wintering, they may also be

17 susceptible to disturbance during pipeline

18 construction. These risks are not reflected in

19 EnCana's insignificant and negligible assessment of

20 residual environmental effects and EnCana provides

21 no scientific documentation that would support their

22 conclusion.

23 Great Plains Toad.

24 Of special concern in Canada. The Alberta

25 status report states that numerous activities

Mainland Reporting Services Inc. [email protected] 1655

1 associated with oil and gas development may impact

2 Great Plains Toads. Since this species burrows in

3 sand to over-winter at unknown distances from breeding

4 ponds, it is vulnerable to winter surface disturbance

5 including pipeline construction. Also, breeding ponds

6 are very inconspicuous and difficult to identify when

7 dry, often very inconspicuous.

8 EnCana's assessment of its impacts as

9 insignificant and negligible is inadequate to address

10 these concerns especially since EnCana may apply for a

11 relaxation of the 100-metre wetland buffers.

12 Furthermore, calling surveys to detect this species

13 must be carried out during wet conditions at the

14 appropriate time of year and there may be very limited

15 or no breeding or calling activity during dry years.

16 And this could go on for a number of years. This is

17 noteworthy since EnCana is relying heavily on these

18 surveys and PDA assessments in mitigation for this

19 species.

20 Inadequate sampling for amphibians in 2006

21 is admitted by EnCana and the poor data set for

22 amphibians represents a major deficiency of the EIS.

23 Another amphibian, Plains Spadefoot, is

24 listed as "may be at risk" in Alberta and, like the

25 Western Hognose Snake, this species may be dependent

Mainland Reporting Services Inc. [email protected] 1656

1 on Northern Pocket Gopher burrows for over-wintering

2 and, therefore, could potentially be disturbed by

3 pipeline disturbance in the vicinity of breeding

4 sites.

5 Biodiversity/Environmental Significance.

6 Let's move on to biodiversity and

7 environmental significance. A major deficiency of the

8 EIS is EnCana's failure to recognize and document the

9 overall environmental significance of the National

10 Wildlife Area and its major role in the conservation

11 of the mixed grass ecosystem. This understanding has

12 implications as to how additional gas development and

13 associated changes to habitat should be assessed.

14 The following are examples of significance

15 rankings given to the Suffield National Wildlife Area

16 either on its own or as part of a larger contiguous

17 area of habitat. Through various studies and

18 initiatives by government agencies, conservation

19 groups and these would be at provincial, national and

20 international levels. These rankings place the area

21 in the upper echelon of the remaining native mixed

22 grass habitats.

23 It's classed as a Global 200 Site. World

24 Wildlife Fund identified the Northern Great Plains as

25 one of approximately 200 of the most significant

Mainland Reporting Services Inc. [email protected] 1657

1 natural regions on the planet for biodiversity. Many

2 of these, like the Northern Great Plains, are also

3 some of the most threatened.

4 An environmentally significant area, CFB

5 Suffield including the Suffield National Wildlife Area

6 has been identified as an internationally significant,

7 environmentally significant area or ESA.

8 Representative features include its unique combination

9 of badlands river valley, sand dunes and upland

10 grassland.

11 A priority area for conservation, CFB

12 Suffield is rated as very high in a selection of

13 grassland priority conservation areas within North

14 America's central grasslands through an international

15 co-operative initiative.

16 An important large intact remnant block. In

17 a World Wildlife Fund Canada study, CFB Suffield is a

18 component of one of six large remaining blocks greater

19 than 5,000 square kilometres of native prairie in the

20 Northern Glaciated Plains of North America. These

21 larger remnants of grassland habitat are also

22 extremely important as control areas against which we

23 can measure change in smaller, more fragmented

24 grassland areas.

25 An important habitat for endemic grassland

Mainland Reporting Services Inc. [email protected] 1658

1 birds, the Suffield National Wildlife Area has some of

2 the best breeding habitat globally for endemic

3 grassland birds and is one of two major centres, two

4 major centres of grassland bird species richness in

5 North America. When you see these on a map, they just

6 glow at you. They stand out.

7 An important bird area, part of a network of

8 sites that conserve the natural diversity of bird

9 species in Canada and around the world, these areas

10 are critical for the long-term viability of naturally

11 occurring bird populations.

12 An important habitat for species at risk.

13 A good concentration of SARA-listed species of plants

14 and animals occurs in the Suffield National Wildlife

15 Area including numerous rare species and uncommon

16 species.

17 Part of a major wildlife movement corridor.

18 Recent studies are revealing significant landscape

19 level movements of Pronghorn through the Military

20 Training Area and National Wildlife Area indicating

21 the extreme importance of retaining contiguous large

22 blocks of habitat on the Northern Great Plains,

23 including habitat connections that cross political

24 boundaries.

25 Summary and conclusions.

Mainland Reporting Services Inc. [email protected] 1659

1 Based on the points outlined in this

2 submission, evidence is clear for the following: A

3 recurrent theme of EnCana's in the EIS is a language

4 that allows for, in special cases, reduction of

5 buffers or the lack of avoidance of sensitive

6 features. In their assessment of the effects of the

7 Project on Valued Ecosystem Components or VECs, EnCana

8 has consistently arrived at "negligible" or

9 "insignificant" for residual environmental effects

10 which often does not agree with information documented

11 in federal and provincial species status reports and

12 recovery strategies, also, peer-reviewed reports or

13 the opinions of experts in the field.

14 EnCana fails to recognize the significance

15 of linear disturbances as a contributor to habitat

16 fragmentation and a reducer of habitat effectiveness.

17 While terms like "grassland integrity" and

18 "Valued Ecosystem Components" are incorporated into

19 the assessment, a general lack of understanding,

20 knowledge or appreciation is displayed for ecosystem

21 processes and the overall significance of the National

22 Wildlife Area and contiguous lands in the -- in

23 ecosystem conservation.

24 Some of what EnCana is proposing may be

25 considered appropriate by some for a landscape zoned

Mainland Reporting Services Inc. [email protected] 1660

1 for industrial management priorities, but it is

2 clearly inappropriate for a National Wildlife Area.

3 Information that could have been collected

4 and should have been collected in 2006 fieldwork is

5 proposed for the pre-development assessment or PDA

6 phase after the project has been approved. As much

7 information as possible should have been collected on

8 sensitive features and traditionally used key wildlife

9 habitats in 2006. This, in turn, should have been

10 mapped along with setbacks or buffers to show

11 environmental constraints.

12 This kind of information is required for a

13 proper evaluation of the Project and would also add

14 more tangible analysis and presentation of key

15 information. Mapped information should have included

16 the following but did not: wetlands of all classes;

17 stream valleys and coulees; seasonal drainages plus

18 setbacks, Great Plains Toad and Plains Spadefoot

19 breeding ponds plus setbacks from wetlands;

20 Sharp-Tailed Grouse leks and in critical wintering

21 habitat, plus setbacks -- (the setback distance for

22 leks should be increased to accommodate nesting

23 habitat); Burrowing Owl burrows plus buffers; critical

24 ungulate including Pronghorn wintering range and key

25 movement corridors; rare plant locations and rare

Mainland Reporting Services Inc. [email protected] 1661

1 plant communities.

2 Timing restrictions should also include

3 winter restrictions to avoid Pronghorn and

4 Sharp-Tailed Grouse in critical wintering areas. For

5 the portion of land that remains after the mapping of

6 these constraints, there would still be potential

7 effects of fragmentation and loss of habitat

8 effectiveness caused by new developments and increased

9 activity on existing roads and in currently

10 undeveloped areas. The effects of these VECs has been

11 shown in my submission to cause undue risk to some of

12 the Valued Ecosystem Components.

13 Thank you.

14 THE CHAIRMAN: Thank you, Mr. Wershler.

15 Ms. Klimek?

16 MS. KLIMEK: I think that is it for

17 presentations. I have about five, ten minutes of

18 questions, but I think it would be appropriate to

19 start with them in the morning, given the time.

20 THE CHAIRMAN: I think that's fair.

21 Tomorrow we would continue with this Panel sitting for

22 cross-examination. That is the plan in the morning.

23 Mr. Denstedt?

24 MR. DENSTEDT: That was my question, sir.

25 What is the plan for tomorrow because Mr. Protti will

Mainland Reporting Services Inc. [email protected] 1662

1 be here tomorrow?

2 THE CHAIRMAN: Our, our assumption is -- or

3 at least our plan, I'm sorry, is that we will continue

4 with the cross-examination of the Coalition's

5 witnesses and then proceed to resit the EnCana Panel

6 with Mr. Protti.

7 MR. DENSTEDT: Okay. I'm, I'm curious then

8 as to the expectation of when we will be completed

9 with the cross-examination. I will likely go longer

10 now than anticipated, certainly more than half a day

11 probably.

12 THE CHAIRMAN: Well, I guess we'll have to

13 see how that unfolds. It, it has been difficult to

14 predict with precision, I guess, how some of the

15 presentations -- how long they would take and of

16 course the length of the cross-examination. But I

17 would think that we might get to the EnCana Panel

18 later in the afternoon tomorrow.

19 MR. DENSTEDT: Okay, thanks, Mr. Chairman.

20 Two things I would like to raise. One is, I need

21 Mr. Sedgwick's resume, it's not -- or CV, it's not on

22 the record or we weren't able to detect it on the

23 record, if it is.

24 MS. KLIMEK: I thought it had been

25 submitted but we'll track it down for you.

Mainland Reporting Services Inc. [email protected] 1663

1 MR. DENSTEDT: And the other thing, just, I

2 think it might be worthwhile if we all thought about

3 the schedule in the next couple of days and how that's

4 going to unfold. And I only raise it for a couple of

5 reasons: one, there is a need to prepare in the

6 evenings and it's making for some pretty long days and

7 I do want to be sensitive to the, the human side of

8 this equation; and, and the second thing is that I

9 think in order for the witness to have a fair chance

10 to perform at their best they should be allowed the

11 ability to be fresh, too.

12 THE CHAIRMAN: I note that comment,

13 Mr. Denstedt. We, we certainly also find it is a long

14 day, but we have a lot of information to, to get

15 through and a lot of presentations to hear and

16 opportunities to question that information. So we'll

17 have to continue as best we can.

18 MS. KLIMEK: Mr. Chair, I just have one

19 more comment. I've, I've talked this over with my

20 friends and I just want to get the Panel's views or, I

21 guess, agreement or okay to it. I would like to spend

22 tonight to prepare for cross for the Canada Panel and

23 I've talked to Mr. Denstedt and Mr. Mousseau about

24 being able to talk to my witnesses, understanding I

25 cannot talk about their evidence but to assist -- them

Mainland Reporting Services Inc. [email protected] 1664

1 to assist me in preparing for cross so we can be ready

2 for Friday if we need and I just want to check if

3 that's okay with the Panel. Mr. Denstedt and

4 Mr. Mousseau were made aware of that request and said

5 they had no concerns about it.

6 THE CHAIRMAN: Mr. Denstedt?

7 MR. DENSTEDT: That's, that's standard

8 practice in board proceedings.

9 THE CHAIRMAN: Thank you. I, I think it's

10 important, Ms. Klimek, to raise this on the record and

11 I think with the comment from Mr. Denstedt -- and

12 Mr. Mousseau, you wish to add to this? No? Obviously

13 no objections to it so, in that case, we will accept

14 your proposal, Ms. Klimek.

15 MR. MOUSSEAU: I just wanted to raise one

16 other matter, sir, and that was the, the motion by the

17 Environmental Coalition with respect to Alberta

18 Environment and, and just -- I discussed this with

19 Ms. Klimek but I think we should put on the record

20 the, the revised plan to deal with that motion.

21 MS. KLIMEK: Do you want me to go ahead?

22 THE CHAIRMAN: Yes, please do.

23 MS. KLIMEK: Seeing that is my motion, I

24 am prepared to argue it but I thought it was important

25 to get our Panel up and on their way. So any time

Mainland Reporting Services Inc. [email protected] 1665

1 after that I'm -- you know, I've got -- I'm ready, so

2 if you want to do it before Mr. Protti or after him, I

3 would be more than prepared. It won't be long. It

4 will be ten minutes tops, but -- my response, but I

5 leave that to your discretion. I am ready at any

6 time, but preferably not right now because I'm going

7 to fall asleep.

8 THE CHAIRMAN: I think what we would -- what

9 I would propose is that we deal with that after we

10 have finished the cross-examination of your Panel

11 tomorrow, okay? Thank you. We will close now and

12 reconvene at 8:30 tomorrow morning. Good night.

13 (THE PROCEEDINGS ADJOURNED AT 7:07 P.M.)

14 (PROCEEDINGS TO RECONVENE AT 8:30 A.M. ON

15 THURSDAY, OCTOBER 16, 2008)

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Mainland Reporting Services Inc. [email protected] 1666

1 REPORTER'S CERTIFICATION

2

3 I, Tambi Balchen, CRR, CSR No. 9166, Official

4 Realtime Reporter in the Provinces of British Columbia

5 and Alberta, Canada, do hereby certify:

6

7 That the proceedings were taken down by me in

8 shorthand at the time and place herein set forth and

9 thereafter transcribed, and the same is a true and

10 correct and complete transcript of said proceedings to

11 the best of my skill and ability.

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13 IN WITNESS WHEREOF, I have hereunto subscribed my

14 name this 16th day of October, 2008.

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19 Tambi Balchen, CRR, CSR No. 9166

20 Official Realtime Reporter

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Mainland Reporting Services Inc. [email protected]