As of November 30, 2013, the Alberta Energy Regulator (AER) will take over administration of the Public Lands Act and the exploration provisions of the Mines and Minerals Act insofar as the legislation applies to energy resource activities. This announcement, which was accompanied by new regulations, was made by Order in Council on November 6, 2013.
The AER's enabling statute, the Responsible Energy Development Act (REDA), provides that the AER will eventually be responsible for administering essentially all regulatory aspects of energy resource projects in Alberta; however, it is being implemented in a staged approach. The changes effective November 30, 2013 will mark the first significant shift towards establishing a one-window regulatory approach for energy projects in Alberta.
To assist with this change, the new regulations provide guidance regarding the scope of the AER's powers to administer public lands and environmental legislation as it relates to energy resource activities. Most notably, the regulations provide that the AER will soon be responsible for:
- issuing geophysical approvals for exploration under Part 8 of the Mines and Minerals Act;
- issuing public lands dispositions under the Public Lands Act related to energy resource activities for oil, natural gas, oil sands and coal; and
- enabling landowners to register private surface agreements that the regulator is then able to enforce.
In addition, the regulations establish certain areas of jurisdiction that are to remain within the Province's authority (such as the administration of public lands in relation to federal pipelines) and those which will be areas of shared jurisdiction (such as certain enforcement provisions under the Public Lands Act). The regulations also provide clarity regarding the environmental responsibilities that will be transferred to the AER, which include granting approvals under the Environmental Protection and Enhancement Act and issuing licences and approvals under the Water Act. These changes are not expected to take effect until the spring of 2014.
The transitional provisions of the regulations provide that existing approvals, orders, directions and decisions made pursuant to public lands and environmental legislation are deemed to have been made by the Regulator and remain in full effect. With respect to ongoing applications, proceedings or other matters that are commenced prior to the regulations (and associated portions of the REDA) coming into effect, the regulations provide that the matters are deemed to be applications, proceedings or other matters under the REDA and that they are to be continued and completed by the AER.
The regulations provide important information that will assist energy resource players in understanding the evolving regulatory regime in Alberta and how it affects their operations. However, despite this increased clarity, there remains some ambiguity as to how these changes will fit within the AER's current regime for making decisions on applications, which can, at the AER's discretion, be made with or without holding public hearings. In addition, the potential shift in decision-making authority mid-application review gives rise to significant uncertainty regarding the timelines and processes that will apply to new and existing applications. Despite these challenges, we expect that in the long term, the consolidation of regulatory oversight in a single regulator should reduce inefficiencies in the regulatory approval process. We also anticipate the issuance of further guidance and direction from the AER to clarify regulatory processes prior to full implementation of the REDA.
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