Tundra Oil and Gas sues company for $5M after 2015 oil spill

A Winnipeg-based energy company is seeking $5 million in damages from the corporations it paid to design and install a pipeline that later was the source of an oil spill near Waskada, Man., in 2015.

In a statement of claim filed on Jan. 31, Tundra Oil and Gas a subsidiary of Winnipeg-based James Richardson and Sons alleges the Texas- and Calgary-based businesses failed to properly inspect the system they had designed and, once aware of the leak, failed to take action to repair the pipeline or notify Tundra of the problem.

On Feb. 4, 2015, the company says it discovered an oil-water spill from a 20-centimetre steel pipeline near Waskada, about 275 kilometres southwest of Winnipeg.

• Crude oil, salt water contaminate Waskada-area farmland after Tundra Oil spill

At the time, the company told CBC the spill was caused by internal corrosion in a line underneath farmland. The spill amounted to about 200 cubic metres roughly 1,200 barrels of a mixture of crude oil and salt water.

Up to a hectare of farmland in the area was contaminated as a result, the company said.

Poor construction caused problem, Tundra claims

Tundra claims the problem was caused by the design of the pipeline itself. The pipeline was too large for the amount of liquid flowing through it, Tundra alleges, allowing fluids carrying wax from hydrocarbon piping to settle in low points.

According to the statement of claim, the companies responsible for the pipeline's design and installation EOG Resources Inc., EOG Canada Oil and Gas, EOG Resources Canada andEOGR Investments should have known about the problem.

The statement also accuses the pipeline installers of hiring "incompetent and unlicensed employees," using poor materials and failing to warn Tundra about the need for a program to prevent and deal with wax buildup.

EOG declined to speak with CBC about the lawsuit.