By: Drew Yewchuk
Decision Commented On: AER Administrative Penalty 202304-03, Ovintiv Canada ULC
PDF Version: Administrative Penalties at the Alberta Energy Regulator: A Gentle Slap on the Wrist for Ovintiv
I recently turned my mind to the subject of how the Alberta Energy Regulator (AER) makes decisions on financial penalties to companies that contravene the conditions of their project approvals. This post is the first in what may become a series of blogs on the question.
Regulatory Documents Commented on: Auditor General of Alberta, “Liability Management of (Non-Oil Sands) Oil and Gas Infrastructure”, March 2023
By: Drew Yewchuk, Shaun Fluker, and Martin Olszynski
PDF Version: Polluter Pays Principle at Risk: Auditor General Finds Alberta’s Oil and Gas Liability Regime Still Badly Deficient
Late last week, the Auditor General of Alberta released a scathing report that concludes that, notwithstanding some ongoing reforms, the management and regulation of end-of-life oil and gas liabilities by the Alberta Energy Regulator (AER) remains seriously deficient in several key areas. This assessment of the AER is one of four components of the Auditor General’s March 2023 report, and is set out as Section 2 Liability Management of (Non-Oil Sands) Oil and Gas Infrastructure (AG AER Report). The AG AER Report audited AER operations to assess (1) whether the AER’s current liability management system effectively mitigated the risks associated with the closure of oil and gas infrastructure and (2) whether the AER appropriately identified the risks and gaps in the previous liability management system and prepared an implementation plan for changes to effectively mitigate those risks and gaps. This comment focuses on the findings that the AER’s oil and gas liability management regime remains deficient in key areas.
By: Nigel Bankes
Matter commented on: Deferred Shell/Pieridae Licence Transfer Application: Amended Notice of Hearing, Proceeding 410, Shell Canada Limited and Pieridae Alberta Production Ltd., Caroline, Waterton, and Jumping Pound, and 2022 ABAER 001.
PDF Version: What is the Status of the Shell /Pieridae Deal and What is the AER Doing?
In 2019, Shell Canada, an international major, entered into a purchase and sale agreement (PSA) with Pieridae Alberta Production Ltd. The PSA contemplated that Shell would sell Pieridae its interests in what are known as Shell’s ‘Foothills Natural Gas Assets’ in Alberta: the Waterton, Jumping Pound, and Caroline fields. These assets are all sour gas assets meaning that they are rich in hydrogen sulphide, thus their development and continuing production pose considerable risks to human health as well as technical risks to the integrity of facilities that must be carefully managed.
Regulatory Documents Commented on: Directive 088: Licensee Life-Cycle Management (February 2023) and Manual 23: Licensee Life-Cycle Management (February 2023)
By: Drew Yewchuk
PDF Version: Updates to the Oil and Gas Liability Management Framework: The New Closure Nomination and The Renamed Closure Quotas
The Alberta Energy Regulator (AER) continues to work towards implementing the Government of Alberta’s new Liability Management Framework. This post goes into the details of this implementation, on the assumption the reader is familiar with the ongoing reforms. For some background, see ABlawg’s post from February 2021 here, and my 8 November 2022 post. This post covers the February 2023 updates from the AER: a new Directive 088: Licensee Life-Cycle Management, a new Manual 23: Licensee Life-Cycle Management, responses to an engagement survey on Directive 088, and the Fall 2022 Engagement Session Q&A on Closure Nomination. The AER also released a new explanatory video.
By: Nigel Bankes
Decision commented on: PrairieSky Royalty Ltd v Yangarra Resources Ltd, 2023 ABKB 11
PDF Version: The Legal Status of a Gross Overriding Royalty Carved out of a Crown Lease
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