EnCana is again the target of a mysterious saboteur.

By Andrew Nikiforuk

On Oct. 10, 2008, the Coffee Talk Express, a community paper in

Chetwynd, B.C, received a letter. It warned North America's largest gas

producer, EnCana, that it had until Saturday noon the next day to shut

down its $60-million Steeprock gas plant, as well as 150 feeder wells,

and leave the northeast part of the province. "We will not negotiate

with terrorists," the note read. It also accused EnCana of "endangering

our families with crazy expansion of deadly gas wells in our home lands."

The author (or authors) weren't kidding. The first bomb went off on the

evening of the 11th, creating a six-foot crater near an EnCana pipeline

south of Dawson Creek. Successive bombings of another pipeline, a

wellhead, and facility shack immediately sparked a massive police

investigation led by Canada's anti-terrorist Integrated Security

Enforcement Team (INSET). Despite 250 investigators combing several

provinces--and EnCana's offer of a $500,000 reward -- no bomber was found.

After six months of silence, the mysterious saboteur struck again. The

individual (or group) symbolically chose Canada Day to damage an EnCana

sweet-gas wellhead near Pouce Coupe. Then, on the Fourth of July,

another bomb damaged a 12-inch pipeline just 500 metres away from where

repair crews were working. The RCMP now labels the bombings "domestic

terrorism," and EnCana spokesman Alan Boras calls them "criminal acts

endangering critical infrastructure and the lives of workers and the

public."

The whole mess has turned the local community upside down -- and pitted

neighbour against neighbour. It's also one hell of a story about the

rapid industrialization of an agricultural frontier by a province hooked

on energy revenue.

To date, the fallout from the investigation has been disturbing. Nearly

a dozen local residents allege that they have been subjected to

harassment by police or industrial informers. Anyone who has complained

about the pace or scale of development seems to have been paid a visit

by the cops. One farmer, who opposed a sour-gas well, described a

21/2-hour interrogation by members of INSET as "the worst time of my

life." The discord in the community, he adds, is frightening. "People

that used to be friends are no longer friends. It's a nasty business."

One local businessman claims that police even shouted at him in a

restaurant, accusing him of being the bomber. "I understand they have a

tough job," he says, "but I'd like to confront my accuser." Others say

investigators have entered their homes demanding DNA samples. Masked men

with machine guns have been spotted in the bush, and roadblocks with

security checks aren't uncommon. Last March, Stan Pavlis, a 72-year-old

retired farmer, found himself interrogated in a Tim Hortons in Dawson

Creek by the RCMP just 10 minutes after he privately voiced concerns

about a gas plant proposed near his home. An unknown eavesdropper tipped

police.

The bombings follow an unprecedented drilling boom driven by high

prices, provincial incentives, and a rush to exploit unconventional

shale gas plays in northeastern B.C., such as Montney and Horn River.

While gas production in the province has increased by 31% in the past

decade, the number of wells punched annually into grain fields and

acreages in the Peace River area grew from 500 in 1995 to 1,800 by 2005.

(In 2008, EnCana got permits to drill 297 wells.) While industry has

invested an average of $5 billion in the province for the past three

years, the B.C. government earned more than $4 billion in royalties in

2008, its largest single source of revenue. Without them, it would be

running a sizable deficit.

The rapid development of gas zones containing hydrogen sulfide, or sour

gas, has raised issues about public safety and property rights. The U.S.

Agency for Toxic Substances and Disease Registry (ATSDR) calls hydrogen

sulfide an "extremely rapidly acting, highly toxic gas" that targets the

brain. "Just a few breaths of air containing high levels of hydrogen

sulfide," it reports, "can cause death." In the event of a leak (in one

five-year period the local regulator reported 73 releases in the

region), EnCana advises landowners to "immediately gather everyone

indoors and stay there." Given sour gas's notorious toxicity, a 2004

study by the University of Alberta found that the presence of wells

within a four-kilometre radius of a rural household typically reduced

property values by as much as 8% to 16%. Yet EnCana's Steeprock sour-gas

plant can generate more revenue for B.C. in a month ($5.7 million) than

an agricultural community can in a year.

An industry insider who worked in the region for the past decade

told Canadian Business the problems may be the legacy of drilling in the

late 1990s by one of EnCana's predecessors, the Alberta Energy Co. Back

then, the small community of Tomslake, south of Dawson Creek, strongly

opposed sour-gas developments. (The saboteur highlighted Tomslake in his

letter.) One of AEC's first wells "stank -- it was awful and some

families got sick," says the insider; extensive flaring or burning of

waste gas at many well sites released toxic fumes, and "it was not a

good place to live." The insider adds that the Oil and Gas Commission

(OGC), "both underfunded and understaffed," was sympathetic but

"shuffled paper." Given the original level of tension and the pace of

development in the area today, the source "was not surprised by the

bombings."

EnCana spokesman Boras said he could not comment on events that might be

a decade old. But the $50-billion Calgary-based company, he says,

operates in the safest manner possible and goes the extra mile to

accommodate landowners. Developments can sometimes disrupt rural

communities, but EnCana achieves consensual agreements with the vast

majority of people it deals with. "We all share in the benefits, and we

try to find the balance," says Boras.

Another issue has been the use of hydraulic fracturing in shale gas

plays. To open up these difficult formations, industry pumps vast

amounts of water and sand mixed with chemicals deep underground. The

process requires a steady parade of up to 700 heavy vehicles on rural

roads, a major nuisance. It has been associated with groundwater

contamination in various U.S. studies, including one by Ohio's

Department of Natural Resources.

EnCana, which now controls a land base of 3.4 million acres in B.C., is

no stranger to controversy. A drilling campaign close to homes and

ranches sparked massive rural protests in Garfield County, Colo., in

recent years. And a 2008 study by the Colorado School of Public Health

concluded that a 39% increase in drilling between 2000 and 2007 in the

county may have put local residents "at risk for adverse health effects

and psychological and social impacts," including increased

hospitalization of children for lung ailments and a rise in birth

disorders. The study recommended a comprehensive health assessment and

rigorous local environmental monitoring. (EnCana spokesman Boras

declined comment on the findings.)

Last March, B.C. quietly tried to address some development "challenges"

by announcing regulatory reforms and practices that "offer the least

amount of impact for people who live close to oil and gas operations."

The provincial government promised to reduce flaring of toxic gases by

2016, to "develop best practices to be a good neighbour," establish a

farmer's advocate and create a code for land agents, who secure drilling

rights. But Tim Ewert, an organic farmer near Pouce Coupe, says the

reforms don't address the need for community control over the pace and

scale of activity. "The OGC acts more like a facilitator than a

regulator," he complains. (Alex Ferguson, CEO of the commission,

declined comment for this story.)

As for who is responsible for the attacks, Paul Joosse, a University of

Alberta sociologist specializing in radical and terrorist groups, doubts

the bomber fits the profile of a "domestic terrorist." He defines a

terrorist as someone prepared to kill or murder to coerce people. "But

this is a personal vendetta against the company. ... It's a crime for sure."

Joosse suspects a local resident and highly conservative property-rights

activist. To him, the bomber's motivation closely resembles that of

Wiebo Ludwig, the radical Christian landowner. In the late 1990s, Ludwig

made headlines with a four-year campaign of industrial sabotage and

bombings against the Alberta Energy Co. (it became EnCana in 2002) after

he suspected sour-gas activity had harmed his family. Ludwig eventually

served 18 months in jail and still lives only a half-hour from the scene

of the current bombings. The RCMP says he is not a suspect.