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.
PDF version: Summary Judgment to Recover Monies Owing Under a Unit Operating Agreement
Case considered: Canada Capital Energy Corporation v Barracuda Energy Ltd, 2013 SKQB 134
This is a nice, straightforward case in which the court granted summary judgment for amounts owing under a unitization agreement.
Award commented on: Mobil Investments Canada Inc. and Murphy Oil Corporation v Canada, ICSID Case No ARB(AF)/07/4. Decision on Liability and Principles of Quantum, dispatched to the parties, May 22, 2012, redacted version released in the fall of 2012. Both the majority award (206pp) and a partial dissenting award (Professor Philippe Sands QC) are available here.
Case commented on: Hibernia Management and Development Company Ltd. v Canada-Newfoundland and Labrador Offshore Petroleum Board, 2008 NLCA 46 (CanLII)
In this Award a NAFTA Tribunal (by a Majority) found that Canada was in breach of the prohibition on domestic performance requirements of Article 1106 of NAFTA when the Canada Newfoundland Offshore Petroleum Board (CNOPB or Board) established and imposed a research investment target (the 2004 Guidelines) on operators working on the Newfoundland continental shelf. In doing so the Majority of the Tribunal ruled that Canada could not rely upon its country specific reservation. While Canada’s reservation protected the performance requirements that were in place at the time that NAFTA was entered into it did not protect the 2004 Guidelines. In reaching this conclusion the Majority severely constrains the ability of the host state to adopt new subordinate measures (e.g. regulations, guidelines and policies) to give effect to a reserved power. In effect, the Majority has adopted a one-way ratchet in which any subordinate measure adopted by a state that does not fully exploit the entire space offered by the text of a reservation may make it impossible for the host state to recover the lost ground. This, as the Dissent lucidly demonstrates, is an unreasonably narrow construction of the power of each NAFTA state to take a reservation to its general commitment not to impose domestic performance requirements on investors.
By: Nigel Bankes
PDF version: Time to Proclaim the Compulsory Unitization Provisions of the Oil and Gas Conservation Act
Decision Commented On: Butte Energy Inc Application for Special Oil Well Spacing, Chigwell Field, 2013 ABERCB 005
Regular readers of this blog will know that this is not the first time that I have used this forum to call for the proclamation of the compulsory unitization provisions of the Oil and Gas Conservation Act (OGCA) RSA 2000, c O-6 (see here) but the facts surrounding this decision of the Energy Resources Conservation Board (ERCB, or Board) present a particularly compelling case for compulsory unitization to deal with holdouts which might convince even the sceptics.
PDF version: The interaction of the offset well and default clauses of an oil and gas lease
Case commented on: 1301905 Alberta Ltd v Sword Energy Inc, 2013 ABQB 113.
In this case the Court granted summary judgement for breach of the offset well obligation in an oil and gas lease. Assessment of damages was referred to a referee.
Case commented on: Talisman Energy Inc v Esprit Exploration Ltd, 2013 ABQB 132
Talisman purchased Canadian 88’s interest in the East Crossfield Conditioning Plant in 2000. Did it also purchase the sulphur block and the liabilities associated with ownership of the block? In this case, and after undertaking an extensive and detailed contractual paper trail, Justice Sal LoVecchio concluded that the answer was no. The ‘elephant in the room’ was C88’s draft purchase and sale agreement (PSA) (which Talisman elected not to use) which, had it been executed, would have dictated the opposite result.
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