Author: Nigel Bankes Page 53 of 89

Nigel Bankes is emeritus professor of law at the University of Calgary. Prior to his retirement in June 2021 Nigel held the chair in natural resources law in the Faculty of Law.

Alberta Utilities Commission Approves the Proposed Sale of AltaLink’s Transmission Assets to the Berkshire Hathaway Group

By Nigel Bankes

On December 1, 2014

In Energy, Utility Regulation

By: Nigel Bankes

PDF Version: Alberta Utilities Commission Approves the Proposed Sale of AltaLink’s Transmission Assets to the Berkshire Hathaway Group

Decision Commented On: AUC Decision 2014-326, AltaLink Investment Management Ltd. and SNC Lavalin Transmission Ltd et al, November 28, 2014

AltaLink owns significant transmission assets in Alberta. AltaLink in turn is owned by SNC Lavalin. SNC Lavalin wanted to divest itself of these assets and found a wiling purchaser in the form of the US based Berkshire Hathaway Group. The transaction however requires the approval of federal foreign investment and competition authorities (already in place) and of the Alberta Utilities Commission (AUC).

The AUC ‘s approval is required under the terms of s.102 of the Public Utilities Act, RSA 2000, c. P-45 (PUA) which provides as follows:

Unless authorized to do so by an order of the Commission, the owner of a public utility designated under section 101(1) shall not sell or make or permit to be made on its books a transfer of any share of its capital stock to a corporation, however incorporated, if the sale or transfer, in itself or in connection with previous sales or transfers, would result in the vesting in that corporation of more than 50% of the outstanding capital stock of the owner of the public utility.

Alberta Releases the Carbon Capture and Storage Quantification Protocol for Public Comment

By Nigel Bankes

On November 28, 2014

In Carbon Capture and Storage

By: Nigel Bankes

PDF Version: Alberta Releases the Carbon Capture and Storage Quantification Protocol for Public Comment

Document Commented On: Quantification Protocol for CO₂ Capture and Permanent Storage in Deep Saline Aquifers, Version: DRAFT for public comment, November 2014 and associated commentary on changes made from the version released for technical review

The Government of Alberta (GoA) continues to make progress in putting together the legal and regulatory framework for commercial scale carbon capture and storage (CCS) projects in the province. Such a legal and regulatory framework needs to address four types of issues: (1) property issues including the ownership of pore space and a scheme for leasing or disposing of rights to pore space; (2) regulatory or permitting rules for reviewing the merits of particular projects and to establish the terms and conditions under which projects might proceed; (3) liability issues; and (4) greenhouse gas (GHG) accounting issues to ensure that CCS projects are fully integrated into regulatory approaches for managing greenhouse gas emissions – in the case of Alberta this means integrating CCS projects into the Specified Gas Emitter Regulation, Alta Reg 139/2007 (SGER).

The key elements of the province’s framework to date (with links to previous posts on the topic), are as follows:

Bill 1, Respecting Property Rights Act: A Damp Squib and a Good Thing Too

By Nigel Bankes

On November 20, 2014

In Property

By: Nigel Bankes

PDF Version: Bill 1, Respecting Property Rights Act: A Damp Squib and a Good Thing Too

Bill Commented On: Bill 1: Respecting Property Rights Act

The good news about Bill 1 for those with communitarian views is that Bill 1 does not change the law of Alberta one iota. The bad news about Bill 1 for those of a more libertarian persuasion is that Bill 1 does not change the law of Alberta one iota.

Here is the entire text of Bill 1 from its bizarre preambular provisions to its single operative clause:

Preamble

WHEREAS private ownership of land is a fundamental element of Parliamentary democracy in Alberta;

WHEREAS the Alberta Bill of Rights recognizes and declares the right of the individual to the enjoyment of property and the right not to be deprived thereof except by due process of law;

WHEREAS the Government is committed to consulting with Albertans on legislation that impacts private property ownership;

WHEREAS the Land Assembly Project Area Act was enacted by the Legislature in 2009 and was amended in 2011 but has not been proclaimed in force; and

WHEREAS the repeal of the Land Assembly Project Area Act reaffirms the government’s commitment to respect individual property rights;

THEREFORE HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Alberta, enacts as follows:

Land Assembly Project Area Act Repeal

The Land Assembly Project Area Act, SA 2009 cL-2.5, is repealed.

This post addresses two questions. First, how is it that despite all the pomp and circumstance surrounding the introduction of this Bill, legally, it changes nothing? And second, why, at least in the opinion of this author, is that a good thing?

Judicial Supervision of the National Energy Board (NEB): The Federal Court of Appeal Defers to the NEB on Key Decisions

By Nigel Bankes

On November 11, 2014

In Administrative Law, Energy

By: Nigel Bankes

PDF Version: Judicial Supervision of the National Energy Board (NEB): The Federal Court of Appeal Defers to the NEB on Key Decisions

Cases Commented On: Forest Ethics Advocacy Association and Donna Sinclair v National Energy Board, 2014 FCA 245; City of Vancouver v National Energy Board, and TransMountain Pipeline ULC, Order of the Federal Court of Appeal, Docket 14-A-55, per Justice Marc Nadon, October 16, 2014, denying leave to appeal the NEB’s scoping decision, Hearing Order OH-001-2014, 23 July 2014.

The National Energy Board (NEB) has its plate full; so too does the Federal Court of Appeal which has been hearing both judicial review applications and leave to appeal applications in relation to a number of projects including the Northern Gateway Project (Enbridge), the Line B Reversal and Line 9 Capacity Expansion Project (Enbridge), and the TransMountain expansion Project (Kinder Morgan). Interested readers can obtain details of these projects as well as Board decisions on the NEB’s website. I provided an assessment of the state of play in the Northern Gateway applications in a comment published in the Energy Regulation Quarterly.

The term “judicial supervision” in this post is designed to encompass both the idea of judicial review and appellate review of NEB decisions by way of appeal to the Federal Court of Appeal (FCA) (with leave). The normal route for obtaining judicial supervision of the NEB is by way of appeal (with leave) but one of the most significant recent decisions we have seen in this area, the Forest Ethics and Sinclair case, came before the Court on an application for judicial review. The case is important because it establishes, at least in the circumstances of that case, that the Board did not err in ruling that it did not have to consider the larger environmental effects of a pipeline project including the contribution to climate change made by the Alberta oil sands and facilities and activities upstream and downstream from the pipeline project.

This post aims to do three things. First it explains the different ways in which a party may seek judicial supervision of an NEB decision. Second, it examines the Forest Ethics and Sinclair decision and finally it offers some brief commentary on one important practical and philosophical difference between the way in which the Federal Court of Appeal treats leave applications and the way in which it treats judicial review applications – reasons.

Gross Negligence and Set-off Rights under the 2007 CAPL Operating Procedure

By Nigel Bankes

On November 7, 2014

In Oil & Gas

By: Nigel Bankes

PDF Version: Gross Negligence and Set-off Rights under the 2007 CAPL Operating Procedure

Case Commented On: Bernum Petroleum Ltd v Birch Lake Energy Inc., 2014 ABQB 652; unreported transcript of reasons of Master Robertson, July 31, 2013

Bernum and Birch Lake held interests (60:40) in five sections of land (sections 3, 7, 8, 17 and 19) governed by the 2007 version of the CAPL operating procedure. Bernum was the operator. Birch Lake elected to participate in drilling two horizontal wells, the 4-3 well and the 6-19 well. The 4-3 well was a success and is still producing. The 6-19 failed and was subsequently abandoned. Birch Lake failed to meet cash calls under the authorizations for expenditure (AFEs) for the two wells; Bernum commenced an action and applied for summary judgement. Bernum also set off Birch Lake’s share of production against Birch Lake’s indebtedness.

Birch Lake defended Bernum’s application for summary judgement on the basis that Bernum had been grossly negligent in drilling the two wells. The 2007 CAPL provides that:

4.02 The Operator … will not be liable to any of the Non-Operators for any Losses and Liabilities resulting from or in any way attributable to or arising out of any act, omission or failure to act, whether negligent or otherwise, of the Operator or its Affiliates and their respective directors, officers, agents, contractors or employees in the performance of the Operator’s duties under this Agreement (including those in planning or conducting any Joint Operation), except insofar as:

(a) those Losses and Liabilities are a direct result of, or are directly attributable to the Gross Negligence or Wilful Misconduct of the Operator …;