North of 60 - Aboriginal Land and Resource Development Conference
Gaétan Caron, Chair and CEO
National Energy Board (NEB)
Aboriginal Land and Resource Development Conference
27 May 2014
Slide 1 speaking notes (click to view)
Energy development in the far North is an important area for discussion. Given devolution of responsibility for the regulation of oil and gas activities in the Northwest Territories this spring, our regulatory focus is largely on preparing for anticipated offshore applications, which I will discuss further in a few minutes. In addition, we remain committed to supporting the Government of the Northwest Territories and the Government of Canada where we can to facilitate the seamless transition of oil and gas regulatory responsibilities in the Northwest Territories.
The National Energy Board continues to value and place high priority on our relationship with Northerners and Aboriginal communities in the North – we remain committed to engagement across the North.
As some of you may be aware, over the past year the Board has continued to expand Northern engagement activities through meetings with Northern communities, youth, governments, environmental non-government organizations, regulatory agencies, land claim institutions and the energy industry involved in, or interested in, the North.
Through these meetings the Board continues to hear from those who would be most affected by oil and gas activities in Canada’s North so that we may achieve our shared objectives for safety and environmental protection.
The National Energy Board continues to take all available actions to protect the environment and the public. No work or activity proposed for the exploration of oil or gas under the Canada Oil and Gas Operations Act (COGOA) will occur unless the Board is satisfied that company’s plans are safe and will protect the environment. Processes for environmental screening or assessment under the various land claim agreements must also be respected.
Slide 2 speaking notes (click to view)
At the National Energy Board, we understand that meaningful engagement is based on listening, respect, and sharing of knowledge and expertise. Meaningful engagement is a cornerstone of business operations. One of our four goals, as outlined in our Strategic Plan, is ensuring “the rights and interests of those affected by NEB regulated facilities and activates are respected”.
Our Northern engagement activities foster environmental and socio-economic assessment and regulatory processes in the North that are responsive to the aspirations of Northerners for a sustainable future; clear and coordinated and have predictable timelines and minimal duplication.
- The Board continues to offer the knowledge and expertise of our staff related to energy exploration, development and transportation as well as performance-based approaches to regulation.
- We are doing this through, for example, our Service Agreement with the Government of the Northwest Territories and ongoing support for the Environmental Impact Review Board’s review of Imperial Oil Resources Ventures Limited’s Beaufort Sea Exploration Joint Venture. The National Energy Board is committed to ongoing coordination with the Environmental Impact Review Board. We will work together to make the review of the Project as efficient as possible.
It is clear that Northerners know what they want and - within our mandate, capacity and knowledge - we are working to help. We remain committed to having Northerners included in our processes and their cultural values understood and respected.
Slide 3 speaking notes (click to view)
Over the past year, Board Members, Staff and I held over 50 meetings across the North. These meetings have involved, among other things, listening to Northerner's talk about their ways of life and how important it is to them to preserve it, hearing their key concerns around oil and gas exploration and development, explaining the Board’s role, and getting feedback on guidelines the National Energy Board developed to clarify its expectations of regulated companies.
Slide 4 speaking notes (click to view)
From Herschel Island (Yukon) to Pangnirtung (Nunavut), we have shared meals with local people, visited traditional harvesting sites, participated in dancing, throat singing, fishing, snowmobiling and spent time in the communities. This is critical for not only building capacity, awareness and understanding, but also in terms of building trust between all involved. We are held accountable for the work we do in the North, by those who live in the North.
Some key examples of engagement include:
- meeting with the Sahtu Dene and Metis in the Sahtu Settlement Area on possible effects of hydraulic fracturing in their area;
- meeting with the Inuit of Baffin Island on the potential of marine seismic programs in Baffin Bay and Davis Strait and possible effects of such activities on marine animals and traditional way of life;
- meeting with the Inuvialuit on safeguards and protection envisioned from possible effects of offshore drilling in the Canadian Beaufort Sea; and,
- meeting with many northerners on their interests associated with financial responsibility amounts and instruments for any authorized activity.
In addition, we have an expectation that companies seeking to explore and develop northern oil and gas will work collaboratively with Northerners and Northern institutions. By listening to one another, respecting one another and sharing knowledge and expertise, improved safety and environmental protection outcomes can be achieved.
The proposed amendments to the COGOA and the Canada Petroleum Resources Act (CPRA), introduced by the Government in the Energy Safety and Security Act (Bill C-22) in early 2014, add further openness and transparency. If passed by Parliament, the proposed Bill would enable the Board to conduct a public hearing under COGOA and reduce the scope of privileged information under CPRA. The changes would also allow the Board to establish and manage a participant funding program for project reviews where CEAA 2012 applies. It proposes increases to offshore absolute liability amounts and imposes new financial requirements.
Slide 5 speaking notes (click to view)
We have continued to expand our Northern engagement program because circumstances have required high-level engagement. There were a number of things in particular, and some continue to be, factors in this:
- The Deepwater Horizon spill in the Gulf of Mexico. This incident prompted us to take a look at what happened, review the lessons learned, and determine how this could be prevented. Within days of the incident, we announced that we would review the safety and environmental requirements for offshore drilling. This included extensive community engagement in 2010-11 and a week-long Roundtable in Inuvik in 2011 so participants could have a face-to-face dialogue. The objective was to gather information and knowledge through meaningful engagement and dialogue, and it resulted in the development of our Filing Requirements for Offshore Drilling.
Slide 6 speaking notes (click to view)
Devolution. The transfer of responsibility for the regulation of most onshore oil and gas activities in the Northwest Territories to the Government of the Northwest Territories on April 1, 2014, was a change. However, we continue to support the Government of the Northwest Territories with the regulation of oil and gas. This includes;
- Providing compliance advice on existing facilities like Cameron hills, work on a significant discovery applications and Operation Authorizations and maintaining the Frontier Information Office until the records are completely transferred.
- Meeting regularly with GNWT staff to review issues and work through existing files.
- Providing technical expertise and training to GNWT on our COGOA application and compliance processes.
We have a Service Agreement in place with the Government of the Northwest Territories which provides the opportunity for the Government of the Northwest Territories to call on the National Energy Board to provide technical services and advice to support projects, and transfer records.
Onshore oil and gas activity in the Northwest Territories is being regulated by both the National Energy Board and Government of the Northwest Territories , under their respective mandates, using similar legislation which provides a consistent seamless transition for regulated companies. Any oil and gas activity now under the Government of the Northwest Territories jurisdiction will require a similar regulatory review as was previously required under National Energy Board jurisdiction (OA’s, ADW, SDD’s etc.).The National Energy Board and Government of the Northwest Territories are committed to provide consistent and similar regulatory approaches and maintain a strong working relationship for many years to come.
Slide 7 speaking notes (click to view)
Slide 8 speaking notes (click to view)
There are two proposed offshore projects that we are expecting to receive applications for in the coming years:
- Imperial Oil Resources Ventures Limited, as the operator of a joint venture between Imperial, ExxonMobil and BP, referred to as the Beaufort Sea Exploration Joint Venture, has indicated its interest in drilling one or more offshore exploratory wells about 175 km north-northwest of Tuktoyaktuk, in the Northwest Territories, on its exploratory licenses where water depths range from 60 to 1,500 m.
- On September 9, 2013, Imperial filed its Project Description with the Inuvialuit Environmental Impact Screening Committee. This has since been referred to the Environmental Impact Review Board.
- On April 24, 2014 the NEB received a letter from Imperial requesting the Board to consider and provide a ruling on the approach Imperial will propose to meet the intended outcome of the NEB’s Same Season Relief Well Policy. The NEB has reviewed the company’s request and has asked for additional information to be submitted by June 6, 2014 before it will make a decision on the request.
- Chevron, which also holds an exploration licence in the Beaufort Sea, more recently submitted a similar request to the NEB.
- ConocoPhillips is in the initial planning phase for development of the Amauligak offshore oil and gas field. The Amauligak Field, located approximately 75 km northwest of Tuktoyaktuk in 30 m of water depth, is the largest oil and gas discovery in the Beaufort Sea.
It is worth noting that there are currently 13 active exploration licences issued by Aboriginal Affairs and Northern Development Canada for the offshore totaling roughly $2 billion dollars in work bid commitments. However, no applications for operations authorizations have yet been submitted to the Board for Arctic offshore drilling.
Multi Klient Investment AS (MKI) has applied for a Geophysical Operation Authorization to conduct a large 2D offshore seismic survey program in the Baffin Bay and Davis Strait. The Board’s report and decision on the application are pending.
Slide 9 speaking notes (click to view)
As we prepare for the future, it is our hope that Northerners will continue to see the National Energy Board as a trusted and credible organization that holds the companies we regulate accountable for addressing the environmental and safety concerns of communities.
As I said during the Arctic Review “The journey will continue. We will see each other again. We do not know exactly when or where. But on behalf of the National Energy Board, we are giving you our commitment that the dialogue will continue”.
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