Canada–Nova Scotia Offshore Petroleum Resources Accord Implementation and Offshore Renewable Energy Management Act (S.C. 1988, c. 28)

Marginal note:Application for unitization order

• 188.1 (1) One or more working interest owners who are parties to a unit agreement and a unit operating agreement and own 65% or more of the working interests in a transboundary pool may apply for a unitization order with respect to the agreements.

• Marginal note:Content and submission of application

  (2) The application shall be submitted to both the Regulator and the appropriate authority. It shall include the documents and statements referred to in subsection 180(1) and may be made by the unit operator or proposed unit operator on behalf of the working interest owners.

• Marginal note:Appointment of expert

  (3) The Regulator and the appropriate authority shall, for the purposes of section 188.11, appoint an expert in accordance with subsections 188.16(2) to (4).

• Marginal note:Appointment of expert

  (4) In respect of any transboundary pool extending into the jurisdiction of a foreign government, the Federal Minister shall, after consultation with the Provincial Minister, agree with the appropriate authority on the appointment of an expert in accordance with subsection 188.16(9).

Marginal note:Hearing

• 188.11 (1) Once seized of the application under section 188.1, the expert shall hold a hearing at which all interested persons shall be given an opportunity to be heard.

• Marginal note:Conclusion of hearing

  (2) On the conclusion of the hearing, the expert shall request that the Regulator and appropriate authority

  • (a) order that the unit agreement be a valid contract enuring to the benefit of all the royalty owners and working interest owners who have an interest in the unit area and binding on and enforceable against those owners, and that the unit operating agreement be a valid contract enuring to the benefit of all the working interest owners who have an interest in the unit area and binding on and enforceable against those owners; and

  • (b) include in the order any variations to the unit agreement or unit operating agreement determined necessary by the expert to allow for the more efficient or more economical production of petroleum from the unitized zone.

• Marginal note:Exception

  (3) Despite subsection (2), the expert shall end the hearing and request that the Regulator and the appropriate authority take the measures referred to in paragraph (2)(a) if the expert finds that

  • (a) on the day the hearing begins,

    • (i) the unit agreement and the unit operating agreement have been executed by one or more working interest owners who own 65% or more of the working interests in the unit area, and

    • (ii) the unit agreement has been executed by one or more royalty owners who own 65% or more of the royalty interests in the unit area; and

  • (b) the unitization order applied for would allow for the more efficient or more economical production of petroleum from the unitized zone.

• Marginal note:Measures

  (4) In respect of any transboundary pool extending into the jurisdiction of a foreign government, the interested persons referred to in subsection (1) are representatives of each country in question and, on the conclusion of the hearing, the expert shall request that the interested persons ensure that the Regulator and the appropriate authority take the measures referred to in subsection (2) or (3).

Marginal note:Unitization order

• 188.12 (1) The Regulator shall issue a unitization order in accordance with the expert’s request made under subsections 188.11(2) to (4).

• Marginal note:Effect of unitization order

  (2) The unit agreement and the unit operating agreement have the effect given to them by the unitization order.

• Marginal note:Equivalent order

  (3) A unitization order becomes effective only if the appropriate authority has issued an equivalent order.

• Marginal note:Joint approval

  (4) The issuance of a unitization order by the Regulator and of an equivalent order by the appropriate authority is deemed to be their joint approval of the unit agreement and the unit operating agreement.

• Marginal note:Effective date of unitization order

  (5) Subject to subsections (3) and (6), a unitization order becomes effective on the date established in the order, but that date shall not be less than 30 days after the day on which the order is made.

• Marginal note:Order revoked

  (6) The Regulator shall immediately revoke a unitization order varying a unit agreement or a unit operating agreement if, before the effective date of that order, the party who applied for a unitization order under subsection 188.1(1) files with the Regulator a notice withdrawing the application on behalf of the working interest owners or there are filed with the Regulator statements objecting to the order and signed

  • (a) in the case of the unit agreement, by

    • (i) one or more working interest owners who own in total more than 25% of the working interests in the unit area and are part of the group that owns 65% or more of the working interests as described in subparagraph 188.11(3)(a)(i), and

    • (ii) one or more royalty owners who own in total more than 25% of the working interest in the unit area and are part of the group that owns 65% or more of the royalty interests as described in subparagraph 188.11(3)(a)(ii); or

  • (b) in the case of the unit operating agreement, by one or more working interest owners who own in total more than 25% of the working interests in the unit area and are part of the group that owns 65% or more of the working interests as described in subparagraph 188.11(3)(a)(i).

• Marginal note:Technical defects in unitization order

  (7) A unitization order is not invalid by reason only of the absence of notice or of any irregularities in giving notice to any owner in respect of the application for the order or any proceedings leading to the making of the order.

• Marginal note:Production prohibited except in accord with unitization order

  (8) After the date on which a unitization order comes into effect and while the order remains in force, no person shall carry on any operations within the unit area for the purpose of drilling for or producing petroleum from the unitized zone, except in accordance with the provisions of the unit agreement and the unit operating agreement.

• Marginal note:Not statutory instruments

  (9) The unitization order is not a statutory instrument for the purposes of the Statutory Instruments Act.

Marginal note:Amending unitization order

• 188.13 (1) A unitization order may be amended on the application of a working interest owner submitted to both the Regulator and the appropriate authority.

• Marginal note:Appointment of expert

  (2) The Regulator and the appropriate authority shall, for the purposes of this section, appoint an expert in accordance with subsections 188.16(2) to (4). In the case of any transboundary pool extending into the jurisdiction of a foreign government, the Federal Minister, after consultation with the Provincial Minister, shall agree with the appropriate authority on the appointment of an expert in accordance with subsection 188.16(9).

• Marginal note:Hearing

  (3) Once seized of the application, the expert shall hold a hearing at which all interested persons shall be given an opportunity to be heard.

• Marginal note:Conclusion of hearing

  (4) On the conclusion of the hearing, the expert may request that the Regulator amend the unitization order in accordance with the proposed amendment and include in the order any variations to it determined necessary by the expert to allow for the more efficient or more economical production of petroleum from the unitized zone. If the expert makes such a request, the expert shall also request that the appropriate authority amend its equivalent order in the same way.

• Marginal note:Exception — short hearing

  (5) If the expert finds that, on the day on which the hearing begins, one or more working interest owners who own 65% or more of the working interests and one or more royalty owners who own 65% or more of the royalty interests in the unit area have consented to the proposed amendment, the expert may end the hearing and request that the Regulator amend the unitization order in accordance with the amendment. If the expert makes such a request, the expert shall also request that the appropriate authority amend its equivalent order in the same way.

• Marginal note:Transboundary pools

  (6) In respect of any transboundary pool extending into the jurisdiction of a foreign government, the interested persons referred to in subsection (3) are representatives of each country in question and, on the conclusion of the hearing, the expert shall request that the interested persons ensure that the Regulator and the appropriate authority take the measures referred to in subsections (4) and (5).

Marginal note:Tract participation ratios

188.14 No amendment shall be made under section 188.13 that will alter the ratios between the tract participations of those tracts that were qualified for inclusion in the unit area before the commencement of the hearing, and, for the purposes of this section, the tract participations shall be those indicated in the unit agreement when it became subject to a unitization order.

Marginal note:Determination — percentages of interests

188.15 The percentages of interests referred to in subsections 188.1(1), 188.11(3), 188.12(6) and 188.13(5) shall be determined in accordance with section 187.

Referral to Expert

Marginal note:Notice

• 188.16 (1) The party that intends to refer a matter to an expert under subsections 45(10), 143(9), 188.04(2) and 188.07(3) shall notify the other party of their intention.

• Marginal note:Appointment — single expert

  (2) Within 30 days after notice is given under subsection (1), or of the application made under subsection 188.1(1) or 188.13(1), the parties shall agree on the appointment of an expert who shall be seized of the matter.

• Marginal note:Appointment — expert panel

  (3) If the parties do not agree on the appointment of a single expert, they shall, within 30 days after the day on which the period to jointly appoint an expert under subsection (2) ends, each appoint one member to an expert panel and those experts shall, in turn, jointly appoint an additional expert as chairperson. If the members fail to agree on the appointment of a chairperson within a period of 30 days after the day of the last appointment, the chairperson shall be appointed by the Chief Justice of the Federal Court within 30 days after the end of that period. Once the chairperson is appointed, the expert panel shall be seized of the matter.

• Marginal note:Conditions for appointment of expert

  (4) An expert shall be impartial and independent and have knowledge or experience relative to the subject of disagreement between the parties.

• Marginal note:Decisions

  (5) In the case of an expert panel, decisions shall be made on the basis of a majority vote of the members. The chairperson’s vote is the deciding vote in the case of a tie.

• Marginal note:Time limit

  (6) The expert’s decisions shall be made no later than 270 days after the day on which they were seized of the matter.

• Marginal note:Decision is final and binding

  (7) Subject to judicial review, a decision made by an expert is final and binding on all parties specified in the decision from the date specified in it.

• Marginal note:Records to be kept

  (8) An expert shall cause records to be kept of their hearings and proceedings and shall deposit their records with the Regulator when their activities to which the records relate have ceased.

• Marginal note:Expert — international treaty

  (9) In the case of a transboundary pool extending into the jurisdiction of a foreign government, the appointment of an expert and the making of decisions by them are to be made in accordance with any applicable international treaty respecting the exploration and exploitation of transboundary pools, as amended from time to time.

• Marginal note:Costs

  (10) In the circumstances described in subsection (9), Canada and the foreign government shall share equally both the expert’s fees and costs and the costs of the expert’s proceedings. With respect to the portion of those costs and fees to be paid by Canada, the governments of Canada and of the Province are to share the expert’s fees and costs equally and, unless otherwise agreed, the costs of the proceedings are also to be shared equally.

• Marginal note:Expert’s powers

  (11) An expert has the powers necessary to carry out their functions under this Act.

DIVISION II.1Regulation of Operations — Offshore Renewable Energy

Debris

Marginal note:Definition of debris

• 188.17 (1) In sections 188.18 to 188.2 and 188.23, debris means

  • (a) any facility or structure that was put in place in the course of any work or activity required to be authorized under subsection 142.011(1), other than a site assessment activity, and that has been abandoned without an authorization that may be required by or under this Part, or that has been abandoned in a way that did not comply with such an authorization; or

  • (b) any material that has broken away or been jettisoned or displaced in the course of any of that work or activity or from an abandoned facility.

• Marginal note:Definition of actual loss or damage

  (2) In section 188.19, actual loss or damage includes loss of income, including future income, and, with respect to any Indigenous peoples of Canada, loss of hunting, fishing and gathering opportunities. It does not include loss of income recoverable under subsection 42(3) of the Fisheries Act.

Marginal note:Debris prohibited

• 188.18 (1) No person shall cause or permit debris to be left in any portion of the offshore area.

• Marginal note:Duty to report debris

  (2) If there is debris in any portion of the offshore area, any person carrying on any work or activity required to be authorized under subsection 142.011(1) in the area in which the debris is left shall, in the manner prescribed, report the debris to the Chief Conservation Officer.

• Marginal note:Duty to take reasonable measures

  (3) Every person required to report debris under subsection (2) shall, as soon as feasible, take all reasonable measures consistent with safety and the protection of health and the environment to prevent any further debris from accumulating, to repair or remedy any condition resulting from the debris and to reduce or mitigate any damage or danger that results or may reasonably be expected to result from the debris.

• Marginal note:Taking emergency action

  (4) The Chief Conservation Officer may take any action that is necessary, or direct that it be taken by any person, if the Chief Conservation Officer is satisfied on reasonable grounds that

  • (a) there is debris in any portion of the offshore area and immediate action is necessary in order to effect any reasonable measures referred to in subsection (3); and

  • (b) the action is not being taken or will not be taken under subsection (3).

• Marginal note:Taking over management

  (5) For the purposes of subsection (4), the Chief Conservation Officer may authorize and direct any person whose services are necessary to enter the area where the debris has been left and take over the management and control of any work or activity being carried on in that area.

• Marginal note:Managing work or activity

  (6) A person authorized and directed to take over the management and control of any work or activity under subsection (5) shall manage and control that work or activity and take all reasonable measures referred to in subsection (3) in relation to the debris.

• Marginal note:Costs

  (7) Any costs incurred under subsection (6) shall be borne by the person who obtained an authorization under subsection 142.011(1) in respect of the work or activity from which the debris originated and, until paid, constitute a debt recoverable by action in any court of competent jurisdiction as a debt due to the Regulator.

• Marginal note:Recovery of costs

  (8) If a person, other than a person referred to in subsection (7), takes a measure or an action under subsection (3) or (4), the person may recover from His Majesty in right of Canada the costs and expenses reasonably incurred by that person in taking the measure or action.

• Marginal note:Personal liability

  (9) No person required, directed or authorized to act under this section is personally liable either civilly or criminally in respect of any act or omission in the course of complying with this section unless it is shown that the person did not act reasonably in the circumstances.