Sinopec unit fined $1.5-million over workplace deaths at Alberta oil sands projectchristine balderas/Getty Images/iStockphoto
A Canadian subsidiary of the Chinese state-owned oil giant Sinopec was ordered to pay a record $1.5-million workplace safety fine Thursday, six years after two Chinese workers were struck and killed by falling steel at an oil sands construction site.
The collapse of a tank roof on Canadian Natural Resources Ltd.'s Horizon project site north of Fort McMurray in April, 2007, also injured five other workers, two of them seriously.
In the rush for foreign investment, critics say the case should serve as a reminder that the Alberta government must be vigilant to ensure foreign companies with a stake in the oil sands are held to Canadian law. On Thursday, the Alberta government emphasized the $1.5-million fine is the largest penalty the province has ever imposed on a single defendant.
"Alberta is serious about prosecuting these kinds of cases," Alberta Justice spokeswoman Michelle Davio said.
The fine decision is culmination of a long process. SSEC Canada Ltd., a small arm of Sinopec – formally known as China Petroleum and Chemical Corp. – pleaded guilty last October to three charges under Alberta's Occupational Health and Safety Act. Two of the charges were for failing to ensure the safety of both fatally injured men, scaffolder Ge Genbao and electrician Liu Hongliang, and one charge for failing to ensure the safety of two seriously injured workers.
During the height of the last bitumen-driven construction frenzy in northern Alberta, CNRL had contracted SSEC to construct a number of large tanks for fluids involved in processing bitumen. In late 2006, SSEC brought 132 temporary foreign workers from China to Canada to work on the construction site.
The agreed statement of facts says that following construction delays, a revised assembly procedure was put in place in early 2007 that saw the tank wall and tank roof structure assembled at the same time, instead of erecting the tank walls first. The court document also said there were not enough guy-wires, nor were they of sufficient size, to stabilize the tank in the winds during construction.
The agreed statement of facts noted that in May, 2007, another tank collapsed in identical fashion. However, no one was injured.
According to Thursday's court order, most of the fine will go to fund a training and education program on legal rights and responsibilities for temporary foreign workers, other new Alberta workers, and their employers.
Gil McGowan, president of the Alberta Federation Labour, said the $1.5-million fine – the maximum allowed for three such charges under Alberta law – is insufficient as it amounts to "less than a rounding error" for a global giant like Sinopec.
"It's clear there were outrageous breaches of health and safety regulations," Mr. McGowan said.
As foreign investment dollars flow into Canada's oil and gas sector, he said it's crucial both Ottawa and the Alberta government hammer home the message that companies doing work here will be held to Canadian standards.
In an investigation that stemmed from interviews conducted following the two workers' deaths, the Alberta government also discovered the Chinese workers were not paid during several months of their employment. Although they were employees of SSEC, Canadian Natural Resources eventually paid the workers or their families the wages they were owed.
No one from SSEC could be reached for comment Thursday but a public relations firm issued a statement on its behalf.
"SSEC Canada accepts the order from the Provincial Court of Alberta issued today related to charges laid by Alberta Occupational Health and Safety," the statement said.
"SSEC Canada sincerely regrets the deaths of two workers in 2007."
The company said it would have no further comment on the matter.