FortisBC sues after 2017 fire at Tilbury LNG plant

FortisBC Energy Inc. is suing a group of insurers and the designers of an incinerator that failed after a fire at the Tilbury liquefied natural gas plant in Delta in 2017.

FortisBC filed two notices of civil claim in BC Supreme Court on November 22, one lawsuit naming AIG Insurance Co. of Canada, Liberty Mutual Insurance Co., Royal & Sun Alliance Insurance Co. of Canada, Starr Insurance & Reinsurance Ltd., Temple Insurance Co., Zurich Insurance Co. Ltd., Ironshore Canada Ltd., XL Specialty Insurance Co., Catlin Canada Inc. and Lloyd’s Underwriters as defendants.

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The other lawsuit, along with co-plaintiffs Bechtel Canada Co. and Bechtel Oil, Gas and Chemicals Inc., names Chart Energy & Chemicals Inc., Chart Energy Services Inc. and Thermo Design Engineering Ltd. as defendants.

In its case against the insurance companies, FortisBC alleges the firms wrongfully denied a $16 million claim under a builder’s risk policy for delay costs and other expenses. FortisBC claims that a fire in August 2017 damaged the gas plant during construction work on an expansion project, shutting down the facility until it could be repaired. As part of the shutdown process the plant’s thermal oxidizer, also called a thermal incinerator, was turned off.

But FortisBC claims the unit suffered a mechanical breakdown when the system was started up again in November 2017. The company claims the oxidizer’s breakdown “significantly delayed” operations at the Tilbury plant, causing “losses of revenue and profits.”

In the second case, FortisBC and contractor Bechtel claim Chart Energy and subcontractor Thermo Design were retained as designers for the incinerator, which failed due to alleged “design defects, oversights and deficiencies of the Incinerator.”

FortisBC and Bechtel seek unspecified damages for negligence, breach of contract and breach of duty of care. The allegations in both lawsuits have not been tested or proven in court, and none of the defendants had filed responses by press time.

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