|March 21, 2016|
They told me to take money and run, says pipeline whistleblower
|A few days after TransCanada terminated his job and offered him a severance package, a whistleblower travelled to Calgary to meet with staff and lawyers at Canada's federal pipeline enforcement agency.|
It was early in September 2014, and he told his story to a group of senior staff at the National Energy Board's downtown offices. Some of the NEB staff encouraged him to take the severance money and leave the company without a fight, he later told National Observer.
"They told me to take the money and run," the whistleblower said.
This was despite newly introduced federal rules that were supposed to require pipeline companies to protect whistleblowers.
The whistleblower, who had worked as a heavy machine operator for TransCanada showed engineers and senior staff a copy of an unofficial pipe fitting manual that was being used by pipeline workers as a guide for jobs in the field. People in the room believed the manual was a guide to risky welding procedures, the whistleblower explained.
The whistleblower had been in contact with the regulator since March 2014 after taking a pipeline safety course with senior NEB engineer, Joe Paviglianiti. Paviglianiti had encouraged TransCanada worker to make a formal complaint about what was seeing in the field, he said.
The whistleblower claimed there was a poor safety culture at TransCanada, an allegation that the company has denied.
What followed from that September meeting is a complex saga that provides a window into some of the casual dealings that the regulator has had with the industry it is mandated to regulate.
TransCanada has noted that the NEB reviewed the allegations and concluded that all the matters were resolved and that no violations occurred.
However, critics say that new documents released through access to information legislation raise questions about whether the NEB is a regulator that has been captured by industry.
The evidence includes an email that indicates that TransCanada received a heads up about the investigation before it even started.
It also includes an unusual exchange of emails in which an NEB employee asked a contact at pipeline company Kinder Morgan whether he could help find the whistleblower a new job, with Kinder Morgan.
While many Canadians might not know much about the NEB, it actually has extraordinary powers in Canadian law, making it the equivalent of a federal court. It also has full powers of inquiry for any matter under its jurisdiction.
The NEB staff say they took the whistleblower's complaints seriously and offered to help him get back on his feet. So, when the former TransCanada worker asked them if they had any job leads at other pipeline companies, he said the NEB's vice president of operations Chris Loewen nodded and agreed to help.
Loewen has declined to respond to questions about what he said in the September meeting, but internal NEB records show that he received emails about efforts by the regulator's staff to help the whistleblower find a job.
Those efforts went beyond simply sending the whistleblower job leads and actually resulted in one NEB employee openly asking a Kinder Morgan official whether it could hire the former TransCanada employee. Ironically, Kinder Morgan - a Texas-based pipeline and energy company - was also making its own request at that time. The Kinder Morgan employee had just told the NEB staffer that it was about to seek the regulator's authorization to reopen a segment of its Trans Mountain line.
The Trans Mountain line has also been in the news in recent months because the NEB has been reviewing Kinder Morgan's proposal to substantially expand the pipeline. This would triple the amount of heavy oilsands crude that it's transporting between Alberta and the Vancouver port from 300,000 to 890,000 barrels per day. The proposed expansion is strongly endorsed by the oil industry and fiercely opposed by First Nations and local communities along its route.
The NEB is expected to make its final recommendations about the expansion project to the federal government later this year.
But while responding to a Kinder Morgan email from Sept. 5 about the existing pipeline, Doug Ochitwa, a technical specialist of integrity management at the NEB, asked whether the company could hire the whistleblower.
Ochitwa had previously worked on an NEB probe of Enbridge's Edmonton control room. The probe was triggered by the Alberta company's 2010 crude oil pipeline disaster in Marshall, Michigan. Now, he continued his email by touting the whistleblower's experience and expertise.
"A guy like that is hard to come by these days. Despite being relatively young, I think he has more than 20 years in the field," Ochitwa wrote. "If it's appropriate, could you provide me with a direct contact? Otherwise, I could give you his name and contact information. I'd advocate his hire here at the Board, but we simply don't always have that degree of freedom to hire. I think he'd be a good catch. Thanks, Doug."
Less than 20 minutes later, the Kinder Morgan employee, a lead official specializing in compliance with pipeline regulations, offered to help.
"Thanks Doug," wrote the Kinder Morgan employee. "There are a few places where I could direct you, but perhaps it may be easiest for you to get him to call me, so I can better identify the appropriate individual(s) for him to speak to. Would you be able to provide me his name?"
Eight minutes later, Ochitwa emailed the company employee with the whistleblower's name and phone number. He didn't mention the issues surrounding the TransCanada allegations.
The next week, the Kinder Morgan employee sent updates on the regulatory request as well as on the requested favour.
"Hi Doug - I connected with (censored) late last week on the status of the return to service application," wrote the Kinder Morgan employee on Sept. 15. "They are seeing some delays due to work load issues. I hope to get this application into you relatively soon. On another note, I have passed on (the whistleblower's) CV."
Nigel Bankes, a law professor from the University of Calgary with expertise in natural resources issues, said this type of job request from an NEB employee to a regulated company "seems entirely inappropriate."
Kinder Morgan did not immediately respond to questions about the email correspondence, so it is not clear whether NEB lawyers who met with the whistleblower were aware of the job request and had warned staff not to proceed.
"Too much BS" in government
Ochitwa later exchanged text messages with the whistleblower who asked about whether there were job openings at the NEB.
Ochitwa encouraged him to stick with the private sector.
"The pay is poor," Ochitwa wrote in one of the text messages, also sent on Sept. 15.
"You and I would both be better off working for an operator... It's NOT easy working for the government. Too much BS. I'm only here to get some experience on the other side of the equation."
The whistleblower asked Ochitwa for an update a few weeks later. But Ochitwa then recognized it would be inappropriate for him to proceed.
"If you have concerns then you need to speak with Kinder," Ochitwa wrote in a text message on Oct. 1. "Given I'm a regulator, short of an introduction, it could be viewed as influence peddling. That's not appropriate bud!"
Internal emails released by the regulator through access to information legislation also show that the employees at the NEB were disorganized and struggled to access the evidence the whistleblower gave them to investigate the allegations.
"My guys received a thumb drive from a whistleblower 2 wks ago," wrote Chris Loewen, the NEB's vice president of operations in an Oct. 3, 2014 email to other staff. "We need to get the info, but Larry M is telling us that there are security concerns and that also need special software to unpack some of the files. Can you please help expedite this?"
But the NEB staff continued to tell the whistleblower that they intended to investigate his allegations and that they would help him find work if possible.
Paviglianiti, the senior NEB engineer, told the whistleblower that all of them, including the NEB's chief engineer, Iain Colquhoun, were willing to help.
"Iain is asking if we can do anything," Paviglianiti said in a text message on Oct. 27. "Did Doug send you some leads last week?"
Two months later, after the NEB had finally managed to open the electronic files on the thumb drive, Paviglianiti told the whistleblower that he and his colleagues were still trying to get permission to investigate.
At that point, it was not clear whether any staff had asked senior management to approve inspections or whether the NEB's leadership was blocking efforts to investigate.
"We are reviewing and proposing some actions," Paviglianiti texted the whistleblower on Dec. 9, 2014. "We need to know some exact locations so if our proposal to do inspections is accepted. We may have to phone you to chat is that okay?"
Paviglianiti finalized the scope of the investigation a few days before a December 2014 coffee meeting with TransCanada, exchanging emails with the whistleblower and summarizing his complaints into a list of 12 allegations.
Throughout this time, the NEB has said it didn't rush to investigate because it didn't believe there were immediate threats to public safety. It also said the whistleblower told NEB staff he didn't believe there were immediate threats to safety, an allegation he has denied.
After reviewing the list and discovering it had left out some key allegations, the whistleblower looked to others for help. He said he was suspicious about whether the NEB staff was leading him on about job prospects and about investigating the allegations.
Kinder Morgan never offered him a job.
Enter Evan Vokes, whistleblower Number 2
An active TransCanada employee advised the whistleblower on Dec. 18 to speak with another TransCanada whistleblower, engineer Evan Vokes, for advice.
A few years earlier, Vokes had attempted to blow the whistle on TransCanada's safety practices and its senior management. Eventually, the NEB confirmed in a 2014 audit that several of his allegations were valid. But the NEB never blamed or punished anyone at TransCanada for violating safety rules and putting public safety at risk.
Don Deaver, an engineer and pipeline expert from Texas, who worked for Exxon for more than 30 years, said these types of safety issues may seem small by themselves. But taken all together, he said, details like these can contribute to a major safety problem that could emerge at any time.
One of the issues that Vokes raised in 2012 - about substandard pipeline parts - would later contribute to a TransCanada pipeline rupture in Oct. 2013, a few hundred metres away from a cabin on traditional Cree hunting territory.
The NEB finally accepted Vokes' concerns and responded by issuing a special safety order in 2016. When asked why it waited four years to act, an NEB spokesman said the issue involved complex matters and that it was acting now.
After the whistleblower contacted Vokes and the two of them compared their stories, they realized that they both had a lot in common based on their experiences. They both felt victimized by a pattern of blunders by the NEB and they agreed that the regulator needed a stronger push to take action.
So, in January 2015, they contacted the media and prepared a formal complaint against the NEB as well as a complaint to the Alberta association that regulates engineers.
"The National Energy Board technical staff sat by the sidelines instead of dealing with the issues directly while serious infractions and risks to the public (have) occurred and will certainly be occurring in the future," said a letter to the NEB, dated Jan 26, 2015, signed by the heavy equipment operator, and released through access to information legislation. "All citizens of Canada have the right to know what they are accused of..."
The whistleblower addressed his letter to Sheri Young, the secretary of the Board, explicitly appealing for the appointed members of the NEB to directly investigate the allegations.
"We have engaged legal"
Within a day, the whistleblower's letter had arrived at the NEB. The news began to spread among staff, including the chief engineer, Iain Colquhoun and executive vice president for regulatory issues, Sandy Lapointe.
A flurry of emails reveal that staff started planning a strategy to deal with the complaint, before sending the letter up to the top officials at the regulator.
"I just saw (NEB vice president of operations) Chris Loewen and he informed me that (the whistleblower) sent a letter... stating the the Board is not doing enough and that the Board should investigate his allegations and set up a WB (whistleblower) process," wrote Paviglianiti in an email sent to his colleagues in the evening of Jan 27.
"Chris also said that the letter names Iain, Doug and myself and alleges that we defamed (Evan Vokes) and that he has proof. Chris says he will chat with (executive vice president) Sandy (Lapointe) tomorrow before the letter gets sent to Board members.
"I guess this issue will contribute to making our day even busier tomorrow."
Loewen forwarded the letter of complaint to Lapointe, on Jan 28, 2015, as Paviglianiti had indicated.
"We have engaged (NEB lawyers) to discuss options for a response, but Iain (Colqhoun) and I would like the opportunity to discuss this with you before proceeding," Loewen said in the email to Lapointe. "Do you have 30 mins tomorrow to meet with Iain and I?"
By Jan 30, Loewen finally provided a copy of the letter to the secretary of the Board, Sheri Young, to whom the complaint was addressed in the first place. He explained that Colquhoun would help prepare the NEB's response.
"Sheri - apologies for the delay in releasing this letter, but it was quite sensitive and involves accusations against operations staff," Loewen wrote. "We wanted to make sure that we understood how to deal with it prior to releasing it broadly. Iain C. is preparing a letter of acknowledgement and will be sending it your way shortly."
The whistleblower also asked Alberta's professional engineering association to launch its own investigation against two senior NEB engineers and one former NEB engineer. This matter remains open.
About two weeks later, Loewen sent an email on Feb. 18 to Jim Baggs, who was then a TransCanada vice-president. Baggs responded to the "meeting request" copying Colquhoun and another TransCanada employee.
The NEB censored most of the correspondence before releasing it through access to information legislation, but revealed that Loewen was on a first name basis with Baggs, starting their Feb. 18 email exchange informally with: "Hi Jim."
Subsequent emails showed that the NEB would present its allegations in a formal meeting on Feb. 27, 2015 with Baggs. The TransCanada vice president would wind up leaving the company in 2016 as part of a wave of budget cuts announced in the fall of 2015.
But with Baggs still at TransCanada, the NEB pursued the investigation, increasing the number of allegations against the company from 12 to 18.
Large sections of the documents released by the NEB through access to information legislation have been censored, including a list highlighting its own chronology of events.
Still, the records show that the NEB prepared an agenda for its February meeting with TransCanada.
The NEB has not confirmed whether its staff prepared similar agendas and minutes for its numerous discussions with the whistleblower in restaurants and other public places. The NEB's code of conduct requires staff to prepare an agenda and keep minutes for any meeting that deal with matters before the regulator.
In one email, sent by Colquhoun, the chief engineer explained that the NEB was still trying to remember what happened in meetings with the whistleblower.
"By the way, in terms of corporate memory, I believe we have yet to interview (NEB lawyers) Alex Ross, Carol Gagné, Carol Vats and (vice-president) Chris Loewen with respect to their recollections of the meetings we had with (the heavy equipment operator)," Colquhoun wrote on June 11, 2015."
Also missing is whether the NEB did any analysis or investigation into the informal handwritten manual that the whistleblower gave them in September 2014. Numerous sources have said that the manual continued to be circulated in the field in 2015 and used as guidance for workers and contractors in the industry. But these sources also said that the guide was giving them dangerous instructions that would put pipelines at risk of ruptures or leaks.
By April 2, 2015, the NEB's politically-appointed chairman and chief executive officer, Peter Watson, wrote to the staff who had been named in the whistleblower's Jan 26, complaint. He defended the employees and dismissed allegations that they had acted inappropriately, based on a review by the NEB's chief operating officer Josée Touchette.
"With respect to the specific complaint that staff 'sat by the sidelines instead of dealing directly with issues associated with regulatory infractions and public safety', the (NEB chief operating officer) found that the Board's information does not support the complaint," Watson wrote.
"(The whistleblower) advised on numerous occasions that the nature of the issue raised did not pose immediate threats to public safety or the environment and staff agreed (and) ... Executive Vice President, Regulatory Sandy Lapointe, confirmed that there was no immediate threat to public safety or the environment raised during the relevant timeframe. The (NEB chief operating officer) went on to note that it was only in December 2014 that staff, for the first time, received clear and specific information from (the whistleblower) respecting his TransCanada allegations and have acted on it accordingly."
The NEB has declined to comment on whether it was appropriate for staff to communicate with the whistleblower on their personal phones or whether any of their candid comments about the inner workings of the regulator were appropriate.
Vokes, the former TransCanada engineer, has noted that he repeatedly raised flags about potential threats to safety. He explained that he sent specific letters and emails, dating back to 2012, that warned of imminent dangers, including a lengthy complaint to the NEB on May 1, 2012 that was tabled in Parliament in the spring of 2013. This complaint included his warning about substandard parts that contributed to an October 2013 pipeline rupture, within a few hundred metres of a hunting cabin near Fort McMurray.
While the NEB investigated Vokes' allegations after 2012 and confirmed that TransCanada was violating some federal pipeline safety rules, one of the company's internal emails show that some of its staff were trying to discredit the whistleblower.
"My understanding is that we have been reasonably successful at influencing authorities portion censored and pointing out EV is disgruntled, and actually had the responsibility to correct these same matters and did not," said an internal TransCanada email, dated July 26, 2013, that was released to Vokes under federal privacy legislation.
TransCanada has previously declined to explain the context of the email, while the NEB has said that the company didn't interfere with its audit of management practices.
On April 10, 2015, Ochitwa and Colquhoun exchanged emails about the whistleblower with Paviglianiti and Alan Murray, the former NEB chief engineer. Murray was retired, but NEB staff had asked him in 2014 to speak to the whistleblower and help him. Murray, Colquhoun and Ochitwa are all former employees of TransCanada. So is the NEB's top lawyer, Rob Cohen, who joined the regulator in 2006 after leaving TransCanada and a lengthy career in the pipeline industry.
The NEB has declined to say why its staff invited Murray, as an outside third party, to help the whistleblower.
Cohen, the regulator's executive vice president and general counsel, also provided advice to NEB chair and chief executive officer Peter Watson and chief operating officer Josée Touchette about the case. The three exchanged several emails over several months in 2015. All of these records were censored by the NEB, prior to release through Canada's access to information law. The legislation requires the government to release records upon request, but it allows the government to withhold information that contains legal advice and matters under consultation.
Later in April, as the NEB employees discussed an access to information request about its investigation into the safety allegations, Lapointe, the vice-president, and Ochitwa both leaked out their deliberations about the whistleblower to Murray. The latter responded by pointing out that it was inappropriate for them to share this information outside of the organization.
"I know Doug is polite and means well in including me in this saga however I think it is appropriate that I am removed me (sic) from this thread and being privy to your deliberations,'" wrote Murray in an April 24 email, released through access to information legislation.
Ochitwa replied with a message that was also released by the NEB, but censored. Then Murray responded.
"No need to apologize Doug but you know how email threads work. No one checks who is on the addressee list. At least it didn't include Comrade (whistleblower). Oops! now you will have to include this email in your package! It is almost midnight in Norway, So I'm signing off! have a great weekend."
Murray said that he called the whistleblower "comrade" in reference to the past when he worked with him and Ochitwa in the 1990s at Nova Gas Transmission, which eventually merged with TransCanada.
When asked by National Observer, the NEB did not say whether it attempted to notify the whistleblower that it had breached his privacy, through emails to Murray that included some of its deliberations.
But by May, Lapointe, the NEB executive vice president, sent the whistleblower a letter that defended the other staff. Her letter made no mention about the mistake she made by emailing information about the case to Murray.
"With respect to the allegations you have made respecting safety practices at TransCanada, as previously advised, the Board has been aware of your concerns since shortly after your initial communication with Board staff in March 2014," Lapointe wrote. "The Board's active investigation of TransCanada practices in respect of those allegations is ongoing."
Murray declined to comment on the details of the NEB report, which largely dismissed most of the whistleblower's allegations. Murray said he retired several years ago and was no expert. "An expert is somebody who is actively involved in what's going on and actually, at least just in Canada, an expert is anybody who's 100 yards away from their office carrying a briefcase. Even the people who cut your lawn are supposed to be a professional," Murray said.
He added that the whistleblower was free to pursue complaints and that there should be reasonable limits to how far he can go.
"He's perfectly entitled to make - I would say - fresh allegations if he has them and they're supported by specific facts," said Murray, a founding member of the pipeline division of the American Society of Mechanical Engineers. "If those are true, fine."
Murray doesn't believe the pipeline industry is perfect.
He wrote a blog post last July for a pipeline industry lobby group that explained that pipelines were necessary for modern lifestyles and that they were generally safe. But he also said in the blog that pipeline companies needed to improve efforts to detect spills.
Most companies report all safety incidents as required by federal pipeline regulations, but there is room for improvement, he said. "If you're going to ask me what my opinion is of the reporting procedures in the country and could they be improved? Of course. When I say they could be improved, there's the legal obligation. Does every company report? I would say the vast majority do, but go and ask the Board that... How many? What's their reporting like? Is it 100 per cent? If they tell you it's a 100 per cent, they're lying through their teeth. So, they wouldn't tell you it's a 100 per cent. They know very well it's not. But it's quite high."
In its final report into the whistleblower's allegations, released in October, the NEB said there was no evidence that TransCanada was using risky welding practices in the field, based on internal company documents, reports and memos.
The whistleblower said that several employees he knows were ready to speak about those welding procedures and confirm his allegations, but were waiting for the NEB to approach them.
He said the NEB doesn't seem to want to pursue the matter.
Loewen, the NEB's vice president of operations, told him that there was no point in getting names of people who could confirm allegations of safety violations.
"It's not like we actually go out there and cross examine staff at TransCanada. If you have names, I don't know what those names would help us accomplish," Loewen told the whistleblower in a phone conversation on Oct. 30, 2015 that was played for National Observer. "We don't put them under oath or anything like that. We're looking for documentation. This is not a criminal case. The kind of stuff we're looking for is records, pictures, that kind of stuff. That's the kind of stuff that helps."
As they were speaking, the TransCanada website posted a new blog that publicly thanked the NEB for its investigation. The blog featured a message from Mark Yeomans, the TransCanada vice president who had received a "heads up" from NEB engineers in December 2014, before they started a formal investigation into the whistleblower's allegations.
"We are very pleased to see the NEB determined that not a single allegation involved a violation of NEB regulations," said Yeomans, in the blog, posted online right after the NEB released its report. "The investigation involved dozens of staff members investing hundreds of hours to clear up these allegations."
The NEB has since recognized that it needs to improve its interactions with whistleblowers. It has received about two dozen complaints about industry from whistleblowers since 2012. Last year, it awarded a contract, worth about $40,000 to a firm, Clarium Fraud and Compliance Solutions, to design a new training program to help its staff develop better methods to communicate with whistleblowers and investigate their allegations.
"We want to avoid having those kind of one off conversations where we have coffee and things like that," said Loewen, the NEB vice president of operations, during the Oct. 30 conversation last fall with the TransCanada whistleblower.