Sally Wang
An in-depth investigation by The Narwhal and the Investigative Journalism Foundation has uncovered systemic failures in the oversight practices of the BC Energy Regulator (BCER), raising significant concerns about the agency’s ability to protect public safety and the environment. After analyzing more than 40,000 internal inspection records, journalists found over 1,100 instances where sites were documented by government inspectors as non-compliant but were later marked as compliant in the regulator’s official records. These apparent discrepancies highlight persistent issues in enforcement that span more than two decades.
A Dual Role: Regulator and Industry Promoter
“It undermines whatever policy stance they take—if you have transparency and accountability, you will have more credibility.”
Nancy Olewiler, Simon Fraser University’s School of Public Policy
The BC Energy Regulator plays a dual role in British Columbia’s resource sector. While it is responsible for overseeing and enforcing environmental regulations for industries such as oil and gas, fracking, liquefied natural gas (LNG), geothermal, and hydrogen development, it is also mandated to promote the expansion of these industries.
This dual mandate has fueled criticism from experts who argue it creates an inherent conflict of interest. Nancy Olewiler, a retired professor from Simon Fraser University’s School of Public Policy, observed: “That leads to confusion on what their ultimate mission is.” She added, “It undermines whatever policy stance they take—if you have transparency and accountability, you will have more credibility.”
The regulator’s funding structure intensifies concerns about its independence. The Narwhal reports that in the 2023-2024 fiscal year, the BCER operated on a budget of $78 million, with 99% of its funding sourced directly from industry through fees and levies. Four of its seven board members in 2022 had direct industry ties, while its current CEO, Michelle Carr, previously served in the BC Ministry of Energy, Mines and Low Carbon Innovation. Critics argue that these connections compromise the regulator’s ability to act independently from the industry it oversees.
Significant Risks Documented But Rarely Penalized
According to The Narwhal, among the thousands of inspection records reviewed, inspectors documented significant environmental and safety risks that often failed to prompt enforcement actions. In one case from August 2022, an inspector recorded the discovery of six dead birds floating in a mixture of diesel and water at a Canadian Natural Resources Limited site. The inspector’s note read: “Having the containments cleaned out before the things are half full of water and being aware of the hazards associated with dirty containments should be observed prior to dead wildlife being found.” Despite this, the site was marked as compliant in official records.
Another 2023 report documented “free water with hydrocarbon sheen” entering a creek, a potential violation of water protection regulations. Despite the inspector’s concern, the site was classified as compliant. In yet another case, a flare stack at a site producing raw hydrogen sulfide (H2S) gas—a toxic, flammable, and potentially lethal substance—was observed “continuously burning with the flame going out sporadically.” The inspector noted the release of “critical sour gas,” a term referring to gas that contains significant concentrations of H2S. Despite the severity of this observation, which poses immediate health risks to workers and nearby communities, the inspection was still marked as compliant.
“Will it have a legacy that we’ll find out we poisoned drinking water or killed off a bunch of caribou or something else?”
Nancy Olewiler, Simon Fraser University’s School of Public Policy
H2S exposure has been linked to several health and safety incidents across the oil and gas sector, and its release into the environment is strictly regulated. The failure to act decisively in the face of documented H2S leaks has intensified concerns among environmental experts and community members alike.
As reported by The Narwhal, some notes from inspectors on sites eventually deemed compliant include:
- “Upon gently poking a stick in the bottom of the flare pit, a strong hydrocarbon odour was detected. Due to system limitations, this inspection will show as a PASS, however, there are concerns about the contaminated flare pit and the style of fencing to keep wildlife out.”
- “Unfortunately, due to delays this site will see more than seven years of vegetation growth destroyed and a new disturbance will have been initiated.”
- “There are numerous wildlife tracks attracted to the area… The same request was required in October 2014 but nothing was received.”
- “I put a latex glove over the surface casing vent and the glove inflated immediately and blew off of the vent in approximately 30 seconds. My personal monitor over-ranged on [low explosive limits] when the glove blew off and I bent over to pick up glove. This well will be tested again sometime this summer I suspect?”
- A spill of approximately 30,000 litres of oil onto Crown land.
“If corporations can continuously break the law right in front of the very government agency that is supposed to keep things in check, then why on earth would we ever allow a pipeline through our communities?”
Shannon McPhail, co-executive director of the Skeena Watershed Conservation Coalition
Experts fear the long-term consequences of such regulatory inaction. Olewiler posed the question: “Will it have a legacy that we’ll find out we poisoned drinking water or killed off a bunch of caribou or something else?” These concerns are heightened by the fact that much of BC’s natural gas development takes place in ecologically sensitive areas, including critical caribou habitat. Without effective enforcement, there is potential for widespread and lasting environmental damage.
Community Leaders Sound the Alarm
For some community leaders, the findings validate longstanding concerns about government accountability and public safety. Shannon McPhail, co-executive director of the Skeena Watershed Conservation Coalition, wrote on Facebook: “The Province is trying to push/approve a major pipeline through our communities and we’re being told about all the policies and legislation that are in place to keep us safe. But if corporations can continuously break the law right in front of the very government agency that is supposed to keep things in check, then why on earth would we ever allow a pipeline through our communities?”
In a comment on McPhail’s post, Tyler Serle, who works in mining, construction, and forestry, echoed McPhail’s skepticism. “Accountability is non-existent both by the industry players and by the Government… Giving an oil company a $250k fine on a billion dollar project is like me getting a parking ticket when I’m in the bank depositing my lottery winnings. The fine is irrelevant at that point.”
The lack of transparency compounds public skepticism. Communities near oil and gas operations have long raised concerns about odours, emissions, and health impacts. According to The Narwhal, it is difficult for the public to access detailed inspection records, and the regulator rarely discloses whether violations result in enforcement action. This opacity has led to growing mistrust, particularly among communities that live closest to energy development projects.
Inconsistencies in the Compliance Process
The investigation also revealed that inconsistencies in the regulator’s compliance process contribute to enforcement gaps. The BCER categorizes site conditions as compliant, non-compliant, advisory, or warning. In theory, these designations should trigger specific follow-up actions. However, in practice, The Narwhal found that inspector observations of non-compliance were often overridden in the regulator’s official classifications. In 57% of cases marked as compliant, inspectors had recorded issues that suggested potential non-compliance.
“Operators are expected to correct any non-compliance as soon as possible. If they do not, the regulator has a range of tools it can use to enforce compliance.”
BC Energy Regulator
In its response to inquiries from The Narwhal, the BC Energy Regulator stated that it uses a “graduated enforcement model” and that its response to non-compliance “depends on the nature of the non-compliance and case-specific circumstances.” The regulator added: “Operators are expected to correct any non-compliance as soon as possible. If they do not, the regulator has a range of tools it can use to enforce compliance.” Despite this stated approach, enforcement actions remain rare. In 2023, only 47 enforcement actions were documented, despite the more than 1,000 potential violations recorded by inspectors that year.
Two Decades of Underenforcement
Despite a growing workload, the BC Energy Regulator currently employs just 17 compliance and enforcement officers and three technical advisors to conduct field-based inspections. These staff report to seven senior officials who also play a role in conducting field compliance activities, from inspections to investigations. This limited capacity raises questions about the regulator’s ability to manage increasing demands.
The findings paint a picture of systemic regulatory weakness rather than isolated incidents. The inspection records span over 20 years and reveal a persistent trend of under-enforcement, raising concerns about the province’s ability to meet its environmental protection commitments. The regulator’s close ties to industry—both financially and through its leadership—further exacerbate concerns about impartiality and effectiveness.
