Alberta regulator considers reducing liability of old wells before cleanup certified
(Source: Global News) The Alberta Energy Regulator is considering allowing oil and gas companies to reduce their environmental liabilities on old well sites before the cleanup is certified complete.
The regulator says the move would reward companies that remediate their old sites promptly, cutting the amount of environmental red ink on their books and making it easier for them to sell or buy old wells. It comes as Alberta tries to figure out what do with the tens of thousands of old wells that pock the provincial landscape.
But critics say the proposal weakens the ability of landowners to hold bad actors to account and depends on an audit system that many already question.
“They don’t audit,” said Daryl Bennett, a landowner with Action Surface Rights, which represents more than 1,000 landowners across the province.
“If they reduce these liabilities, they will reduce the flags for the (regulator).”
Oil and gas companies can reduce the amount of environmental liability on their books when they receive a reclamation certificate for an old well. Those certificates are normally granted after the cleanup is complete and appropriate plant cover is established.
The reduction makes transactions such as transferring a well licence easier. One factor the regulator considers before it transfers a licence is the financial health of the buyer and the likelihood of its being able to fulfil reclamation obligations.
But under the proposed reclamation liability reduction program, the regulator would immediately reduce that liability if the company says cleanup is complete, whether plants are healthy or not. That reduction would hold for five years or until a reclamation certificate is granted.
“The reduction would only be requested when all abandonment, remediation, and reclamation work has been completed and the only thing left to do is to re-establish vegetative cover,” says a program description on the regulator’s website.
“It may take several years before vegetation is fully established and the site becomes eligible for a reclamation certificate.”
Drew Yewchuk, a lawyer and researcher on Alberta’s regulatory system, said the proposed program would rely on company self-reporting on cleanups. The regulator’s record on auditing those reports, he said, is “horrible.”
“They rely on companies to have third-party inspectors to check if the reclamation has taken place correctly,” he said. “It often hasn’t.”
He points to a recent example of the regulator having to revoke at least five reclamation certificates last spring after one operator entered bankruptcy. The regulator’s website lists at least 30 previously granted reclamation certificates that were revoked in 2023.
“They’re trusting companies too much and they’re giving certificates that they shouldn’t,” said Yewchuck.
Bennett, who agrees the regulator is too lax in granting reclamation certificates, fears that reducing an environmental liability in advance would also reduce a company’s eagerness to finish the job.
“If they can sit and wait for the vegetation monitoring, they may not be as anxious to finish the work,” he said.
Surface reclamation is only part of the story, said Bennett. Wells may leak chemicals below ground for years and poor plant regrowth can be one signal of that.
As well, he’s concerned that giving companies one more way to reduce their environmental liability removes another regulatory checkpoint ensuring that old wells end up in financially secure hands.
“If they reduce these liabilities, they would reduce the flags for the (regulator),” Bennett said.
Bennett said if the government wants to give industry an advance break on its promises to clean up after itself, landowners should have a voice.
“If companies had to go and get a sign-off from the landowner, a lot of our concerns would go away,” he said.
Regulator spokeswoman Lauren Stewart said the program is still being designed and details are scarce, including an estimate of how much environmental liability would disappear under it.
She said the proposal grows from the current practice of allowing a producer to request a 50 per cent reduction in reclamation liability for an abandoned well or other facility.
“The (regulator) is encouraging industry to complete more reclamation work,” she said in an email.
Freedom of Information documents obtained by Yewchuk indicate industry has been asking for the change for years.
A 2022 document refers to a “liability reduction credit at reclamation stages” program under “Industry Feedback.” The regulator’s response is “project in progress.”
Alberta government figures say there are 459,000 oil and gas wells in the province. A 2022 report from the parliamentary budget officer says about two-thirds are inactive, although that category includes wells slated for cleanup as well as those that have been properly abandoned or suspended.
This report by The Canadian Press was first published Oct. 24, 2023.
Supreme Court of Canada rules environmental impact legislation largely unconstitutional
(Source: CBC News) Canada’s top court has delivered a highly anticipated judgment, writing in a majority opinion that Ottawa’s Impact Assessment Act (IAA) is largely unconstitutional.
The IAA, previously known as Bill C-69, allows federal regulators to consider the potential environmental and social impacts of various resource and infrastructure projects. It was enacted in 2019.
The IAA has long been controversial among conservative politicians in Alberta, including former premier Jason Kenney, who frequently referred to it as the “no more pipelines act.”
The ruling was part of a “reference case,” which involves the provincial and federal governments asking courts for advisory opinions.
It doesn’t mean the law is now off the books — a ruling such as this from the Supreme Court of Canada is not necessarily binding, but is traditionally treated as being binding by governments, noted David Wright, an associate professor in the Faculty of Law at the University of Calgary.
“I think what we can expect is the federal government is going to get to work very quickly to put together a suite of amendments to bring the act into conformity with the law,” Wright said.
Writing for the majority in a 5-2 decision, Chief Justice of the Supreme Court of Canada Richard Wagner said the process set forth in Sections 81 to 91 of the IAA were constitutional and could be separated out.
Those sections involve projects carried out or financed by federal authorities on federal lands, or outside Canada, and therefore fall under federal jurisdiction. Those provisions were not challenged as unconstitutional.
However, Wagner wrote that the balance of the scheme, involving “designated projects,” was unconstitutional.
Under the IAA, designated projects are those projects that are set out in the regulations or are subject to a ministerial order.
“In my view, Parliament has plainly overstepped its constitutional competence in enacting this designated projects scheme,” Wagner wrote.
Wagner wrote that environmental protection remains one of today’s most pressing challenges, and Parliament has the power to enact a scheme of environmental assessment to meet this challenge.
“But Parliament also has the duty to act within the enduring division of powers framework laid out in the Constitution,” he wrote.
Dissenting Justices Andromache Karakatsanis and Mahmud Jamal wrote that they believed the act was constitutional in its entirety.
“Environmental protection requires action by all levels of government because each — whether by action or inaction — can affect the environment,” the dissenting opinion reads.
“This shared responsibility is ‘neither unusual nor unworkable’ in a federal state such as Canada. Rather, it reflects this Court’s flexible approach to federalism, which recognizes that overlapping powers are unavoidable and intergovernmental cooperation is essential.”
Alberta previously filed a constitutional challenge with the Alberta Court of Appeal, and was supported by the governments of Saskatchewan and Ontario, three First Nations and the Indian Resource Council.
Various environmental and legal groups, as well as other First Nations, supported Ottawa. In a 4-1 decision, the court called the law an “existential threat” when it came to Canada’s Constitution.
The federal government appealed that non-binding opinion, and the Supreme Court held hearings on the act in March. Today’s decision was keenly awaited by legal experts, who recognized its importance in providing clarity to an area of law that has long been under debate.
Wright, the associate professor in the Faculty of Law at the University of Calgary, said it wasn’t the outcome most of those who follow this area of law expected.
“This really does set the the legal landscape for federal impact assessment for decades to come,” said Wright, who was also an intervener on the case. “What we now know is that there are significant constraints on what the federal government may or may not do with respect to legislating in relation to environmental assessment.”
Though the decision of the majority was that the act was an instance of federal overreach, it did affirm that the federal government has the power to enact environmental assessment legislation, Wright noted.
“But in this case, the federal government went too far in exercising that power, or in trying to exercise the power that they thought they had,” Wright said.
During a press conference held Friday, Alberta Premier Danielle Smith said the decision marked a substantial win “for the protection of provincial rights in our province.”
“Today’s decision only strengthens our legal position. We work to protect Albertans, and all Canadians, from federal intrusion into our provincial jurisdiction,” Smith said.
In his decision, Wagner wrote that “the fact that a project involves activities primarily regulated by the provincial legislatures does not create an enclave of exclusivity.”
When asked what that would mean for the province, Smith said her government was working collaboratively.
“I guess we can keep on battling this out in the Supreme Court to find out exactly where the line is, but I’m asking for the [federal government] to accept that there is exclusive provincial jurisdiction under the Constitution … and to work with us on those areas of shared priority,” Smith said.
Smith also thanked former premier Kenney as part of her remarks.
“[He] tirelessly fought back against federal overreach during his term as premier,” Smith said.
In an interview, Kenney said he was “thrilled” with the decision, calling it a “historic win” for Alberta. He said he wasn’t surprised to learn of the decision and pointed to the Alberta Court of Appeal case.
“It was a 4-1 decision, with a very powerful majority by the Chief Judge, saying that the Trudeau Impact Assessment Act was a wrecking ball to the Constitution. So they used the strongest language I’ve ever seen,” Kenney said.
“I really think that set the tone, the parameters and the stakes for the Supreme Court of Canada. I also worked really hard at getting eight of the other provinces on-side.”
When asked about his view of Ottawa’s suggestion of adding amendments to the act, Kenney said that Ottawa was “maybe talking about some cosmetic face-saving.”
“It would be nice to have some actual darn humility here … it’s over, it’s done, stick a fork in it, and come back to the drawing board with an approach that collaborates with the provinces,” he said.
Reaction from across the country came swiftly on Friday, including from Ontario Premier Doug Ford, who said his province welcomed the decision.
“The federal impact assessment process needlessly duplicated Ontario’s rigorous and world-leading environmental assessment requirements,” Ford is quoted as saying in a statement.
“At a time when it’s never been more important to build critical infrastructure, including highways, transit, and critical mineral projects, we now have the certainty we need to get shovels in the ground.”
Speaking in Vancouver, Conservative Leader Pierre Poilievre called the decision “good news.”
“A Poilievre government will repeal this law entirely and replace it with one that consults First Nations, protects our pristine environment, but gets jobs approved so that we can bring home beautiful, powerful paycheques to this country,” he said.
The Canadian Association of Petroleum Producers (CAPP), an intervener in the process, also said it was pleased with the decision.
“In the spirit of the court’s call for co-operation, CAPP looks forward to collaborating with both the federal and provincial governments to ensure that projects in the national interest — those reinforcing energy security, providing lower emissions energy, and maintaining affordability to Canadians — will proceed in a timely manner,” wrote Lisa Baiton, CAPP president and CEO, in a statement.
Joshua Ginsberg with Ecojustice, an environmental law charity, said it was disappointing to hear that an “important environmental law had been weakened” due to constitutional problems. Ecojustice was also an intervener in the process.
“In the end, I’m positive and hopeful that we’re going to come out of this with a clearer and effective environmental assessment process,” Ginsberg said.
Federal Environment Minister Steven Guilbeault and Energy and Natural Resources Minister Jonathan Wilkinson held a joint virtual media availability on Friday morning to respond to the ruling.
During that event, Guilbeault said Ottawa respected the role of the Supreme Court and would follow the court’s guidance, and work to improve the legislation through Parliament.
“We accept the court’s opinion. It provides new guidance on the Impact Assessment Act, while explicitly affirming the right of the government of Canada to put in place impact assessment legislation and collaborate with provinces on environmental protection,” he said.
“We developed the Impact Assessment Act to create a better set of rules that respect the environment, Indigenous rights and ensure projects get assessed in a timely way. We remain committed to these principles.”
There are currently 23 projects in the federal impact assessment process under the IAA, according to the Impact Assessment Agency of Canada. Eight final decisions have been issued by the minister or the agency allowing those projects to move forward.
BC environmental assessment certificate granted for Cariboo Gold
A B.C. environmental assessment certificate has been issued to Osisko Development Corp. for the Cariboo Gold project in central British Columbia, following a joint decision by provincial ministers.
George Heyman, Minister of Environment and Climate Change Strategy, and Josie Osborne, Minister of Energy, Mines and Low Carbon Innovation, made their decision after carefully considering the environmental assessment by B.C.’s Environmental Assessment Office (EAO).
Cariboo Gold is a proposed underground gold mine in Wells. It was the first project entirely assessed under the new 2018 Environmental Assessment Act.
The project assessment involved extensive consultation with technical experts, First Nations, provincial agencies, local governments, a community advisory committee and the public. In making their decision, the ministers listened to and considered the concerns brought forward that the Cariboo Gold project could result in potential adverse effects on residents in Wells, First Nations access to land and the Barkerville woodland caribou herd.
As a result, the ministers included 22 legally binding conditions in the environmental assessment certificate, intended to prevent or reduce potential adverse environmental, economic, social, cultural and health effects from Cariboo Gold.
With these legally binding requirements, and Osisko Development Corp.’s project design features that will reduce Cariboo Gold’s impacts on the community of Wells and the environment, the ministers determined that significant adverse effects can be prevented or mitigated.
Key requirements include:
- a plan to minimize impacts on the local community and tourism, through: a limit on the maximum allowable noise from the project; performing blasting only during the day; using vegetation to screen buildings and other facilities to minimize visual impacts for residents and visitors; limiting truck traffic near residential areas; strict policies around work camps, including to prevent gender-based violence and restrict use of tourist accommodations by workers; hiring 75% of workers from the region (if qualified); a strategy developed with the District of Wells to mitigate pressures on recreation and tourism; and supporting community events to promote arts and culture. Osisko also must hold regular community meetings and ensure timely response to concerns;
- establishing a new, clean drinking water supply for the District of Wells;
- mitigation and monitoring measures to reduce emissions and maintain air quality;
- managing effects on the environment, in particular to mitigate impacts to wildlife, habitat and bodies of water, overseen by an independent environmental monitor;
- working with the Province to support remediation in the District of Wells and along the shore of Jack of Clubs Lake, contaminated by a previous mine’s tailings containing arsenic, cobalt, cadmium, lead and other contaminants; and
- a specific plan to minimize impacts to the Barkerville woodland caribou herd, including monitoring, mitigation measures and offsets for habitat disturbance.
The ministers also noted in their decision that Cariboo Gold will provide benefits to the province, the local community and First Nations. Local and First Nations employment and procurement also has the potential to advance reconciliation through employment and economic benefits. The project will employ an average of 200 workers during construction, peaking at close to 300 workers, and will employ almost 500 during operations.
Under the 2018 Environmental Assessment Act, First Nations participating in the process have the opportunity to provide consent or lack of consent for the project. All three Nations in whose territory project activities will occur participated in the environmental assessment. Lhtako Dené Nation and Williams Lake First Nation provided notices of consent, and Xatśūll First Nation advised the ministers that they did not object to the project.
Every project that undergoes an environmental assessment is assessed thoroughly on the specific and individual aspects of that particular project, including its potential environmental, economic, social, cultural and health effects, and impacts on First Nations and their rights.
Documentation ministers considered in making their decision: https://www.projects.eao.gov.bc.ca/api/public/document/652595359019250022e37ae0/download/Cariboo%20Gold%20Assessment%20Report_September%202023.pdf
For more information on the environmental assessment process, visit: https://www2.gov.bc.ca/gov/content/environment/natural-resource-stewardship/environmental-assessments
A backgrounder follows.
Cariboo Gold mine marks first project reviewed under new act
- The proposed Cariboo Gold mine is the first project assessed from start to finish under the revitalized 2018 Environmental Assessment Act.
- The new act, developed with input from First Nations, stakeholders, other provincial agencies and the public, was modernized to enhance public confidence, transparency and meaningful participation, to advance reconciliation with First Nations, and to deliver stronger environmental protections, while supporting sustainable economic development.
- Highlights of the new process include deeper participation by First Nations, enhanced citizen engagement and modern enforcement tools. During a new early engagement phase, issues and concerns can be identified early and addressed before the formal assessment begins, streamlining the process.
- Reconciliation with First Nations was established as a key purpose of the Environmental Assessment Office (EAO), supported through consensus-seeking at each phase of the assessment process, with a dispute-resolution mechanism if needed.
- A range of potential impacts from a project are now considered, including direct, indirect and cumulative effects. The EAO reviews how a project will affect the environment, economy and First Nations and their rights, as well as social, cultural and health effects. Groups disproportionately affected by a project are specifically considered, as are a project’s effects on current and future generations, and greenhouse gas emissions.
- The modernized environmental assessment process is expected to generally take three to five years, but this will vary depending on complexity and the effectiveness of proponent planning and engagement.
- Proposed projects, such as mines, oil and gas pipelines and facilities, large infrastructure projects and resorts, that exceed the thresholds set in regulation must be reviewed to assess potential impacts on people and the environment. As a neutral regulatory agency, the EAO works with and gets input from technical experts, First Nations, companies, the public, local governments, and federal and provincial agencies to assess these projects.
Cariboo Gold mine
- The assessment process for the Cariboo Gold project began in May 2020 and concluded when the environmental assessment certificate was issued on Oct. 10, 2023.
- Subject to receiving all required permits, Osisko Development Corp. will build and operate the underground gold mine in the District of Wells. It is expected to produce about 25 million tonnes of ore over 16 years.
- Construction costs are expected to contribute an estimated at $588 million to the economy over four years, and operations an $466 million. The project will employ an average of 200 workers during construction and almost 500 during operations.
- A 200-person work camp will be built at the project site, which is about the same number as the number of permanent residents in Wells, currently.
First Nations engagement
- The EAO achieved consensus at key milestones with the three First Nations participating in the assessment process – Lhtako Dené Nation, Xatśūll First Nation and Williams Lake First Nation. Under the new act, First Nations participating in the process may consent or not consent to the project. The three First Nations notified the EAO that they did not object to Cariboo Gold being issued an environmental assessment certificate.
- Nazko First Nation and Tsilhqot’in National Government were notified at key milestones.
- The EAO sought extensive public feedback throughout its review, with almost 500 comments received during five public comment periods. Comments and concerns were incorporated into the final assessment report sent to decision-makers.
- Due to the mine’s location in the town of Wells and potential substantial changes for the local residents, a community advisory committee was formed to give residents deeper participation in the review process. The committee met regularly.
- The technical advisory committee for the project’s assessment included representatives from the City of Quesnel, Cariboo Regional District and District of Wells, as well as technical experts and representatives from First Nations and the provincial government.
- Key concerns raised by First Nations, community members and the technical advisory committee, which design changes and conditions of the environmental assessment certificate are intended to address, included:
- water quality;
- air and light pollution;
- truck traffic through town;
- residents’ peaceful enjoyment of the community of Wells;
- impacts on tourism;
- impacts to caribou habitat; and
- how concerns that arise during construction and operations will be addressed.
Compliance and enforcement:
- Osisko Development Corp. is required to comply with 22 legally enforceable requirements established as a condition of receiving the environmental assessment certificate, and to build and operate the project in accordance with the certified project description.
- EAO compliance and enforcement officers monitor compliance with all environmental assessment certificate requirements in co-ordination with other regulatory agencies.
- Monitoring and inspection of the Cariboo Gold mine project will begin before construction starts.
For an Environmental Assessment Office factsheet, visit: https://www2.qa.gov.bc.ca/assets/gov/environment/natural-resource-stewardship/environmental-assessments/commenting-on-projects/eao_fact_sheet_jan2023.pdf
CCME: Public Review and Comment: Canadian Water Quality Guidelines for the Protection of Aquatic Life: Perfluorooctanoic Acid
Draft Canadian Water Quality Guidelines for the Protection of Aquatic Life: Perfluorooctanoic Acid, its scientific criteria document and appendices are available for public review and comment until November 30, 2023. The documents are available in English and French.
Perfluorooctanoic acid (PFOA) is an anthropogenic substance belonging to the broader class of per- and polyfluoroalkyl substances (PFAS). PFAS are a large group of over 4,700 substances used as surfactants, lubricants and repellents in applications such as firefighting foams, cosmetics, food packaging and textiles. Although PFOA is not known to have been manufactured in Canada and is currently prohibited from being manufactured, it can enter through the importation of manufactured items. Releases to the environment can occur directly via industrial or consumer use of products containing PFAS, including from the application of firefighting foams, from wastewater effluents and landfill leachates, or via the long-range transport of PFOA or its precursors that then transform to PFOA.
Please submit comments to:
Canadian Council of Ministers of the Environment
360 – 123 Main Street
Winnipeg, MB R3C 1A3
Email: [email protected]
New ESAA Members
ESAA welcomes the following new members. If you are not a member of ESAA you can join now via: https://esaa.org/join-esaa/
Environmental Monitoring Solutions & Consulting Inc.
1453 McMillian Way SW
Edmonton, AB T6W 1V6
Phone: (780) 490-9389
Chad McFadyen, Principal
Environmental Monitoring Solutions is an Ocupational Hygiene / Environmental Consulting firm specializing in providing asbestos, mould, hazardous materials, indoor air quality (IAQ) and industrial hygiene consulting services to all public and private sectors throughout Alberta.
MBC Engineering Group Inc.
Unit 100, 666 Kirkwood Avenue
Ottawa, ON K1Z 5X9
Phone: (438) 499-0516
Sequoia Environmental Remediation Inc
3611 – 48th Avenue SE
Calgary, AB T2B 3N8
Phone: (403) 862-4309
Upcoming Industry Events
Canadian Environmental and Engineering Executives Conference (CE3C)
January 24-25, 2024
Wosk Centre for Dialogue, Vancouver
The Canadian Environmental and Engineering Executives Conference (CE3C) was specifically created as an exclusive forum for executives at the highest level of the environmental engineering and consulting industry in Canada. Since the inaugural conference in October 2018 demand has been high for this event; Presidents, CEOs, COOs, CFOs, senior executives, and owners from across the country have attended.
The panel discussions provide a comprehensive overview of the current trends and challenges within the environmental and engineering consulting domain, strategic business development, and the evolving landscape of Human Resources, particularly in enhancing employee engagement. These sessions are designed to equip attendees with practical insights and strategies to effectively navigate the intricacies of the industry.
On the second day, the conference agenda highlights the “Keynote Forum” where notable figures, Michael Campbell and Nik Nanos, will examine the economic, political, and international factors impacting Canadian business, with a specific focus on the environmental and engineering consulting industry.
CE3C is not merely a congregation of professionals, but rather a catalyst for industry evolution, and an incredible platform for networking and collaboration. Witness the confluence of ideas, strategies, and professional camaraderie, all set against the serene backdrop of Vancouver. Join us and be part of the narrative driving the future of the Environmental and Engineering Consulting sector in Canada.
Detailed program at: https://ce3c.ca/program/.
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