Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act

Definition of shortfall of petroleum deliveries in the Province

• 39 (1) In this section, shortfall of petroleum deliveries in the Province means deliveries of petroleum that are inadequate to supply, on commercial terms,

  • (a) the end use consumption demands of all consumers in the Province;

  • (b) feedstock requirements of industrial facilities that are in place in the Province on January 31, 1986; and

  • (c) the feedstock requirements of any refining facility located in the Province that was not in place on January 31, 1986 where the feedstock requirements required to satisfy the demand of industrial capacity, as of January 31, 1986, in the Provinces of Nova Scotia, New Brunswick, Prince Edward Island and Newfoundland have been met.

• Marginal note:Notice by Provincial Minister to holders of production licences

  (2) Where there is a shortfall of petroleum deliveries in the Province, the Provincial Minister may, after consulting with the Federal Minister, give notice to holders of production licences in the offshore area that the consumers and facilities referred to in paragraphs (1)(a), (b) and (c) that are specified in the notice have, during the term of the notice, the first option to acquire, on commercial terms, petroleum produced in the offshore area unless a sales contract with respect to that petroleum has been entered into prior to the giving of the notice.

• Marginal note:Later contracts subject to notice

  (3) Notwithstanding any other provision of this Act, any contract entered into after the giving of the notice referred to in subsection (2) shall be deemed to be varied or suspended to the extent necessary to give effect to that notice.

• Marginal note:Term of notice

  (4) The term of a notice given under subsection (2) is the period during which a shortfall of petroleum deliveries in the Province continues to exist.

• Marginal note:Arbitration in case of dispute whether shortfall exists

  (5) Where the Federal Minister or a holder of a production licence to whom a notice has been given under subsection (2) does not agree with the Provincial Minister that a shortfall of petroleum deliveries in the Province exists or continues to exist, the matter shall be referred to arbitration in the manner prescribed.

• Marginal note:Notice ceases to have effect

  (6) Where it is determined pursuant to arbitration that a shortfall of petroleum deliveries in the Province does not exist or continue to exist, the notice given under subsection (2) shall be deemed to be revoked and ceases to have effect on the date on which the determination is made.

• Marginal note:Regulations

  (7) Subject to section 6, the Governor in Council may make regulations for carrying out the purposes and provisions of this section and, without limiting the generality of the foregoing, may make regulations

  • (a) defining the expression commercial terms or providing for arbitration to establish commercial terms in any particular case;

  • (b) governing, for the purposes of this section, arbitration and the making of arbitration orders and governing the enforcement of arbitration orders and appeals from those orders; and

  • (c) prescribing the manner of exercising a first option to acquire that is granted pursuant to a notice given under subsection (2).