IPAC-CO2 TO CEASE OPERATIONS THIS WEEKEND

Tamar Hallerman
GHG Monitor
3/29/13

A prominent carbon sequestration-focused nonprofit based in Saskatchewan will be closing its doors this weekend after five years of operation. The Regina-based International Performance Assessment Centre for the Geologic Storage of Carbon Dioxide (IPAC-CO2) will cease operations March 31, CEO Carmen Dybwad said in an e-mail to colleagues March 28. In her farewell remarks, Dybwad acknowledged the media coverage the small nonprofit had received in recent weeks surrounding a conflict-of-interest claim, but said the shutdown had more to do with the economic woes that have plagued the organization for years. “More significant was the non-renewal of funding by our principle funders. This coupled with the slow-down in CCS activity created an insurmountable financial problem for IPAC-CO2, one that no matter our skills and hard labor we were able to surmount,” she said.

In an interview earlier this week, Dennis Fitzpatrick, the University of Regina’s Vice President for Research who also serves as IPAC’s board chairman, said the organization was a victim of bad timing, having been established at the beginning of the economic downturn in 2008. “In some ways, IPAC was in the wrong place at the wrong time because had the global economy not tanked at the time that it did, I think that IPAC would have landed on incredibly fertile ground and found the kind of support for it out of the industry community that was anticipated from day one,” he said. “If timing is everything, IPAC’s timing was nothing, to be perfectly honest.”

The nonprofit, established with seed money from Royal Dutch Shell and the federal and provincial governments and in-kind support from the University of Regina, was required to secure its own external sources of funding when its initial five-year contracts expired. But the organization was not able to shore up much additional funding as many government and industry groups cut back on outside contracts and other groups abandoned the prospects for carbon capture and storage altogether in the wake of the economic recession.

Group Had Trouble Raising Money

IPAC is perhaps best known for formulating what it says are the world’s first consensus-based standards for the geologic sequestration of CO2 with the Canadian Standards Association, unveiled last November. The group, which is housed in a building on the edge of the University of Regina’s campus, also conducted CCS public outreach efforts and completed an independent investigation of an alleged CO2 leak on a private farm near the Weyburn-Midale enhanced oil recovery site in southeast Saskatchewan in 2011. “We are all proud of the contribution that we have made to the provincial, national and international CCS community,” Dybwad said in the e-mail.

Saskatchewan Premier Brad Wall surprised many last month when he said the province would not be renewing its $5 million grant for the project, which expires March 31. He told reporters at the time that IPAC had completed the job the province had wanted it to do. “We wanted IPAC to develop standards for CO2 storage … that work is completed, and that’s why I think it’s reasonable to say it can be wound up,” Wall said, referring to the consensus CO2 storage standards. When Shell and the federal government indicated that they would not be renewing their millions in funding for the organization, it became clear that the nonprofit would have to close its doors.

IT Contract Raised Concerns

The news comes weeks after IPAC became the center of a local media firestorm after it was alleged that the organization in its startup days gave a sole-source, $2.9 million IT contract to a company that two members of its executive team sat on the board of at the time. The reports said that the university officials who were running IPAC at the time, Ian Bailey and Malcolm Wilson—now CEO of the Petroleum Technology Research Centre—contracted the organization’s computer systems with the group Climate Ventures Inc. when they had helped found that organization and sat on its board at the time. Wilson’s lawyer has argued that there was no conflict of interest because Wilson’s involvement with the two companies did not overlap. Meanwhile, an external investigation commissioned by IPAC in 2011 concluded that the IT contract did not adhere to the University of Regina’s contract management policies and that a conflict of interest likely occurred, but that Wilson did not appear to benefit from the agreement financially.

Fitzpatrick this week said he is concerned that the recent media coverage and conflict of interest allegations have overshadowed much of the work done at IPAC over the last five years. “Coming up with standards that are robust and meet industry needs is a yawner. Going out and showing at the farm [near the Weyburn-Midale site] that it’s not leaking CO2—this is not sexy stuff,” he said. “We love intrigue and questions of money, but I am concerned that a couple of names have overshadowed the good work of IPAC-CO2.”

University Subject of Provincial Audit

IPAC’s announcement came days after University of Regina President Vianne Timmons said that Saskatchewan’s provincial watchdog will be scrutinizing the University’s research policies and relationships with outside companies as part of a new audit. “Given the public attention in recent months regarding our research operations, we worked with the Provincial Auditor to fast-track an examination of our policies and processes in the research portfolio, and have in fact welcomed this examination,” Timmons said in a March 25 statement. She said the University is working with the auditors in an attempt to “ensure that the policies and procedures we have in place to safeguard public funds are adequate and effective.” But Fitzpatrick said it is misleading to link the audit with the recent media coverage surrounding the handling of IPAC and that the audit has been planned for months. “It’s unfortunate that this is happening at the same time as IPAC-CO2 and all these other things. It’s confusing as hell, I think, for most people,” he said.