Topic: Canada

Subscribe to Canada RSS feed

Alberta Chief Justice keeps fracking lawsuit against environmental regulator alive

The Honourable Neil Wittman, Alberta’s Chief Justice of the Court of Queen’s Bench, has ruled that a landowner is entitled to carry on her lawsuit against Alberta’s Environment and Sustainable Resource Development Department (ESRD) for allegedly being negligent in monitoring and regulating EnCana Corporation (EnCana) in the hydraulic fracturing of a well, and negligent in investigating the alleged contamination of her water well.

The landowner, Jessica Ernst, originally sued EnCana, ESRD and the Energy Resources Conservation Board (ERCB) in 2007. Recently, the case against the ERCB was thrown out on the grounds that the ERCB did not owe her a … Continue Reading

Alberta Court confirms regulatory immunity

The Court of Appeal of Alberta has confirmed that the Energy Resources Conservation Board (now known as the Alberta Energy Regulator) is immune from a negligence lawsuit by a landowner claiming that hydraulic fracturing caused hazardous amounts of methane, ethane and chemicals to contaminate her water well.

The appellant, Jessica Ernst, owns land near Rosebud, Alberta. She sued EnCana Corporation for damage to her fresh water supply allegedly caused by EnCana’s activities, notably construction, drilling, hydraulic fracturing and related activities in the region. The Energy Resources Conservation Board had regulatory jurisdiction over the activities of EnCana, and the appellant has … Continue Reading

Environmental groups lose court challenge over fracking water use

The British Columbia Supreme Court has dismissed a legal challenge to decisions of the B.C. Oil and Gas Commission (OGC) to grant successive, short-term approvals to EnCana Corporation to withdraw fresh water from B.C.’s lakes, rivers and streams for use in hydraulic fracturing operations. Under B.C.’s Water Act, all surface water is owned by the government and diversions are only allowed pursuant to a two year approval or a long-term license. A two year approval application is subject to less regulatory scrutiny than a long-term license application, and does not require the same public notice requirements.
The OGC granted various … Continue Reading

Web seminar: Legal lessons learned in shale plays in North America

With North America leading the way in shale oil and gas production, interest is mounting globally in the unconventional hydrocarbon sector. On Wednesday, September 17th , we will host a web seminar on Legal lessons learned in shale plays in North America, which will look at the key legal issues that have arisen in North America related to shale development, the lessons learned, and the implications for countries where shale development is still in the early stages.

This web seminar will be broadcast in two separate sessions for Asia/Australia audiences (session 1) and Europe/South Africa audiences (session 2) respectively. … Continue Reading

Report cites “multitude of factors” for Lac-Megantic train derailment

The Transportation Safety Board of Canada (“TSB”) released an investigation report on August 19 on the Lac-Megantic, Quebec train derailment that resulted in fires and explosions, destroyed much of the town and left 47 people dead. Citing 18 factors that contributed to the incident, TSB is now calling for additional safety measures to prevent runaway trains and more thorough audits of rail companies’ safety management systems.

The report cited Montreal, Maine & Atlantic Railway (“MMA”), the company operating the runaway the Lac-Megantic train, for having a weak safety culture without built-in systems to manage risks. In addition, the report found … Continue Reading

Canada’s TSB determines crude oil in train derailment to be unaffected by fracturing fluid additives

On July 6, 2013, shortly before 1:00 am, a Montreal, Maine & Atlantic Railway freight train which was parked for the night on a hill seven miles above Lac Megantic, Quebec started to roll. The unit train carrying approximately 48,000 barrels of crude oil produced from the Bakken oil fields in North Dakota in 78 DOT Class III tank cars reached a speed of 65 mph and 63 of the tank cars derailed in the centre of the Town, spilling approximately 37,000 barrels of crude oil and causing fires and explosions which destroyed 40 buildings, 53 vehicles and killed 47 … Continue Reading

Federal regulators propose new rules on oil trains

After a series of accidents involving oil trains in the US and Canada, the US Department of Transportation proposed new safety standards for oil trains on July 23. The proposed standards target older tank cars, requiring companies shipping flammable liquids to replace tank cars prone to rupturing or retrofit them to meet tougher design requirements. New design requirements include thicker steel shells, better brakes and rollover protection, which would make the tank cars safer in the event of an accident.

According to the Department of Transportation, the transportation of oil by rail has increased significantly in the past several years, … Continue Reading

Alberta experiments with “play-based” regulation

The Alberta Energy Regulator (“AER”) will pilot a “play-based” regulatory framework for unconventional oil and gas development in part of the Duvernay shale play in west-central Alberta this fall.

The Duvernay shale play is a large, developing shale play covering much of western and northern Alberta and eastern British Columbia. It is particularly rich in light oil and petroleum liquids such as propane and butane. Hydraulic fracturing has been key in developing the vast underground rock formation that covers an area the size of South Korea.
“Play-based” regulation involves implementing a single application and decision-making process for multiple wells, pipelines … Continue Reading

Three railroad employees charged with criminal negligence in Quebec train derailment

The prosecutor’s office for the province of Quebec filed criminal negligence charges relating to the July 6, 2013 derailment of an unattended 72-car freight train in the town of Lac-Mégantic. The derailment caused tank cars carrying Bakken crude oil to rupture, explode, and burst into flame, resulting in the deaths of forty-seven people and environmental contamination.

On May 13, 2014, the bankrupt Montreal Maine and Atlantic Railroad, Ltd. (MMAR) and three of its employees (the train engineer, the railway traffic controller, and the train operations manager) were each charged with 47 counts of criminal negligence. In Canada, criminal negligence that … Continue Reading

Canadian Council of Academies releases major research paper of the environmental impacts of shale gas development in Canada

A multi-disciplinary panel of experts assembled by the Canadian Council of Academies has released a major study on the environmental impacts of shale gas development in Canada. The Council is an independent research organization of the Royal Society of Canada, the Canadian Academy of Engineering and the Canadian Academy of Health Sciences. The Council is funded by the Canadian federal government.

The Study was commissioned in 2012 by the federal Environment Minister to provide an evidence-based and authoritative assessment of the following question:

What is the state of knowledge of potential environmental impacts from the exploration, extraction and development of Continue Reading

Canada’s Ministry of Transport orders phase out or retrofitting of DOT-111 tank cars

On April 23, 2014, in response to recommendations made after the Lac-Mégantic train derailment in July 2013, Canada’s Ministry of Transport issued Protective Direction No. 34 requiring the immediate phase out of the least crash-resistant DOT-111 tank cars from dangerous goods service. There are approximately 5,000 DOT-111 tank cars without continuous bottom reinforcement that must be immediately removed from transporting dangerous goods such as crude oil and ethanol.

As for any tank cars on the move on the date of the Direction, these cars must reach their final destination within 30 days and then be immediately removed from service. All … Continue Reading

Study indicates that methane emissions may exceed EPA estimates

A study conducted by a Stanford University associate professor of energy resources engineering and other scientists evaluated more than 200 scientific papers relating to methane emissions in the United States and Canada.

The results of the study entitled “Methane Leakage from North American Natural Gas Systems” are published in the February 14th edition of the journal Science.

According to the scientists, organizations such as the U.S. Environmental Protection Agency have underestimated methane emissions generally as well as those from the natural gas industry specifically.

“Atmospheric tests covering the entire country indicate around 50% more than EPA estimates.” The study … Continue Reading

Environment Canada reviews oil and gas industry reporting

Environment Canada is reviewing the National Pollutant Release Inventory (NPRI) reporting requirements for oil and gas activities in Canada, including the reporting of substances released during hydraulic fracturing.

The NRPI is a legislated, publically accessible inventory of pollutant releases to air, water and land. It captures data on over 300 substances of concern, including many substances declared as toxic under the Canadian Environmental Protection Act, 1999 (CEPA).

Under CEPA, the federal Minister of Environment issues a notice each year to require facilities to report information for the purpose of creating the inventory of data. The data is then … Continue Reading

Emergency order requires testing and classification of crude oil transported by rail

On February 25, 2014, the US Department of Transportation (DOT) issued an emergency order requiring rail shippers of crude oil to test the crude’s makeup before shipping it and to classify the crude as Packing Group I (high danger) or Packing Group II (medium danger) hazardous material until further notice.

The DOT’s emergency order recognizes that the misclassification of petroleum crude oil as a Packing Group III (low danger) material is an “imminent hazard . . . that presents a substantial likelihood that death, serious illness, severe personal injury, or a substantial endangerment to health, property, or the environment may … Continue Reading

Court finds Alberta Regulator has statutory immunity from hydraulic fracturing suit

Alberta’s Court of Queen’s Bench has ruled that the Energy Resources Conservation Board (ERCB) has statutory immunity to a claim by a landowner that it was negligent in protecting the landowner’s water supply from hydraulic fracturing. The ERCB, or the Alberta Energy Regulator as it is now known, is responsible for regulating Alberta’s oil and gas industry.

Jessica Ernst, an activist well known in Canada for opposing hydraulic fracturing, alleged that between 2001 and 2006 oil and gas company undertook shallow drilling to extract coal bed methane and, in doing so, used hydraulic fracturing, which included the use of toxic … Continue Reading

Nova Scotia appoints expert panel

Nova Scotia has named nine independent expert panelists to consider the effects of hydraulic fracturing in the Province. The eight men and one woman on the panel are mandated to examine the social, economic, environmental and health impacts of hydraulic fracturing. They include a geologist, medical specialist, environmental scientist, a water quality expert, and a member of a Nova Scotia First Nation, among others.

The province previously abandoned its own internal review of hydraulic fracturing after claims its staff were not independent. That work, which included identifying and analyzing environmental and health issues as well as best practices, was handed … Continue Reading

US DOT discuss transport safety issues with oil and rail industry leaders

With the recent December 30, 2013 derailment of tanker cars carrying oil in Casselton, North Dakota, as well as other 2013 incidents  in western Minnesota, Baltimore, Alabama, and at three sites in Canada (Gainfield, Landis, and Lac-Mégantic, where 47 people were killed when  an unattended 72-car freight train derailed in the center of town), the US Department of Transportation (DOT) met with representatives from the oil and railroad industries to discuss transport safety issues relating to crude oil.

At the meeting on January 15, 2014, representatives from the American Petroleum Institute (API) and the Association of American Railroads (AAR) reportedly … Continue Reading

Environmental groups sue the British Columbia Oil and Gas Commission for granting water usage rights for hydraulic fracturing

The Sierra Club of British Columbia Foundation and the Western Wilderness Committee have sued the British Columbia Oil and Gas Commission (OGC) and EnCana Corporation (EnCana) to stop the OGC issuing short-term fresh water withdrawal approvals under British Columbia’s Water Act to oil and gas companies engaged in hydraulic fracturing operations.
The OGC is responsible for the regulation of oil and gas activities in British Columbia and has authority to issue approvals for the withdrawal of surface water for up to two years.

The OGC regularly grants these approvals to oil and gas companies to enable them to undertake hydraulic … Continue Reading

The Petroleum Services Association of Canada agrees to a hydraulic fracturing code of conduct

The Petroleum Services Association of Canada (“PSAC”) is a national trade association representing about 260 companies which provide goods and services to the Canadian oil and gas exploration and production industry. PSAC members include virtually all of the hydraulic fracturing service companies.

PSAC has released a Hydraulic Fracturing Code of Conduct under which its members providing hydraulic fracturing services will focus their efforts in five key areas, including:

  • water and the environment;
  • fracturing fluid disclosure;
  • technology development;
  • health, safety and training; and
  • community engagement.

PSAC consulted with over 100 community members in four provinces to gather community input into the … Continue Reading

Canada’s National Energy Board asks companies to voluntarily publically disclose frac fluids

Canada’s National Energy Board (NEB) regulates oil and gas exploration of certain Canadian frontier lands and offshore areas, including the Northwest Territories, the Arctic, the west coast offshore and the Gulf of St. Lawrence. The NEB has announced that it will begin to request companies drilling in such areas to voluntarily publically disclose the chemicals used in hydraulically fracturing on, the Canadian version of

Presently, under the Canadian Petroleum Resources Act, certain well-related information, including the composition of hydraulic fracturing fluids, is protected from public disclosure for up to two years. NEB-regulated companies will be asked … Continue Reading

Canadian regulatory board approves application for hydraulic fracturing in northwest territories

On October 30, 2013, the Canadian National Energy Board (“NEB”) approved an application for exploratory horizontal drilling and hydraulic fracturing in the Northwest Territories. The decision marks the first time such activity will be allowed in the remote region, which straddles the Arctic Circle. The authorization will remain in effect until October 2018.
Specifically, NEB has approved two wells, which were granted land and water permits earlier this year, to be drilled in Norman Wells, located in the Canol Shale Play and approximately 100 miles south of the Arctic Circle. NEB’s approval was based, in part, on the operator’s risk … Continue Reading

Shale Gas and Other Unconventional Resources: A Practitioners Guide

Barclay R. Nicholson, a partner in the Houston office of Norton Rose Fulbright, was chosen to co-author the US and Canada chapter in Global Law and Business’ book entitled “Shale Gas: A Practitioner’s Guide to Shale Gas & Other Unconventional Resources.”

The book provides a timely analysis of the development and regulation of shale gas extraction and the technical and commercial considerations applicable to shale gas production around the world. Specifically, Nicholson co-authored the chapter comparing shale gas development and hydraulic fracturing regulations in the United States and Canada.

The chapter provides practical insight on unconventional gas … Continue Reading

ERCB Releases Investigation Report Into Hydraulic Fracturing Blowout

On January 13, 2012 in the rural Garrington, Alberta field Midway Energy Ltd. hydraulically fractured a horizontal well bore at a depth of 6,069 feet (1850 m) which caused a surface blowout of a nearby Wild Stream Exploration Inc. vertical oil well also completed at 6,069 feet. Alberta’s Energy Resources Conservation Board (ERCB) investigated the incident and has publicly released its investigation report.

The ERCB noted that segments of the Midway wellbore where four fracture stages were conducted were only 423 feet (129 m) apart. The Board determined that the four fracture treatments took place between 12:08 pm and 1:17 … Continue Reading

CAPP Releases Hydraulic Fracturing Operating Practice on Anomalous Induced Seismicity: Assessment, Monitoring, Mitigation and Response

In November 2012 the Canadian Association of Petroleum Producers (CAPP) released it’s seventh Hydraulic Fracturing Operating Practice, entitled Anomalous Induced Seismicity: Assessment, Monitoring, Mitigation and Response.

The Operating Practice outlines the requirements for CAPP member companies to assess the potential for anomalous induced seismicity—also known as earthquakes—and where necessary, establish appropriate monitoring procedures and procedures to mitigate and respond to anomalous induced seismicity in shale gas and tight gas development areas.

CAPP is the industry association representing members which account for about ninety percent of Canada’s natural gas and crude oil production.

Under the Operating Practice, companies are required … Continue Reading