UPDATE 2-Syncrude Canada fined C$3 mln for 1,600 duck deaths

* Syncrude’s fine money to fund environmental programs

* Sentencing follows June conviction

* Green groups call fine a slap on the wrist
(Adds company, environmentalists’ comments)

By Jeffrey Jones

CALGARY, Alberta, Oct 22 (BestGrowthStock) – Oil producer Syncrude
Canada Ltd will pay a C$3 million ($2.9 million) penalty for
negligence in the deaths of 1,600 ducks in a toxic waste pond,
a case that fueled international concern about the
environmental impact of developing Canada’s oil sands.

Most of the money will be contributed to wildlife and
habitat conservation programs in northern Alberta.

Alberta Provincial Court Judge Ken Tjosvold found Syncrude,
one of Canada’s largest oil sands producers, guilty in the
deaths of the birds last June. He accepted the C$3 million
sentencing proposal on Friday.

He had ruled that Syncrude failed to take necessary steps
to keep waterfowl away from the tailings pond at its Aurora
mine in northern Alberta in April 2008. Many of the ducks
became coated with sludge and sank.

Syncrude had argued that a spring snowstorm prevented it
deploying the sound cannons and scarecrows that are used to
keep birds away from the ponds, which are filled with
wastewater, clay, heavy metals and residual oil, byproducts of
the oil sands extraction process.

“The incident has haunted us and it’s something we’ll never
forget. We sincerely regret that it happened,” Syncrude
spokeswoman Cheryl Robb said. “But we’ve learned a lot from it
and we’ve made significant changes to our system.”

Syncrude fought the charges in a nine-week trial, saying
convictions would have implications throughout the oil sands
mining industry.

Environmental groups have been highly critical of oil sands
development. They said the fines amounted to a slap on the
wrist for Syncrude, a joint venture of several international
oil companies that can generate revenues of more than C$20
million a day at current oil prices.

Mike Hudema, tar sands campaigner for Greenpeace, said
governments should also be held to account for what he believes
to be lax regulation.

“The government has never looked into its own fault in this
event and continues to allow multinational companies to monitor
and enforce themselves and continues to allow tar sands giants
to poison and destroy large swaths of this province,” Hudema
said in a statement.

Since the incident, Alberta’s energy regulator has imposed
more stringent rules for new tailings ponds, forcing the
industry to develop new technologies for reducing and
reclaiming them.

Syncrude’s penalty includes C$300,000 under Canada’s
Migratory Birds Convention Act, as well as C$500,000 under
Alberta’s Environmental Protection Act. Half of the latter will
be used to create a program for bird protection and monitoring
at a Fort McMurray, Alberta, college.

As for the rest, C$1.3 million will go to the University of
Alberta for bird protection research and C$900,000 will fund
the purchase of lands near Edmonton for conservation.

Robb said one major change Syncrude has made since the
incident is the implementation of year-round bird deterrents
and installation of a radar system that is similar to those
used at airports.

Syncrude’s partners include Canadian Oil Sands Trust
(COS_u.TO: ), Imperial Oil Ltd (IMO.TO: ), Suncor Energy Inc
(SU.TO: ), Sinopec Corp (600028.SS: ), Nexen Inc (NXY.TO: ), JX
Holdings Inc (5020.T: ) unit Mocal Energy and Murphy Oil Co
(MUR.N: ).

($1=$1.03 Canadian)
(Reporting by Jeffrey Jones; editing by Peter Galloway)

UPDATE 2-Syncrude Canada fined C$3 mln for 1,600 duck deaths