National Energy Board says pipeline companies to set aside funds for abandonment

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09/09
For release at 2:30 p.m. (MDT)
26 May 2009

National Energy Board says pipeline companies to set aside funds for abandonment

CALGARY - The National Energy Board (NEB, the Board) today adopted a report on the financial issues of pipeline abandonment that will require companies to set aside funds to cover future abandonment costs.

The Report and Recommendations follows a January 2009 hearing held by three of the NEB Board Members into the financial matters of pipeline abandonment. By the Board's adoption of the report, all pipeline companies regulated under the NEB Act will be required to comply with the report's framework and action plan. This calls for companies to submit estimates of funds needed for abandonment as well as proposals for how they will collect and set aside those funds.

The NEB will host a technical conference this fall to discuss the assumptions that companies may use to help them determine the abandonment costs. The NEB's goal is to have companies begin setting aside funds for abandonment no later than the end of May 2014. It's the Board's view that no pipeline system is likely to be abandoned in the foreseeable future and therefore there is time to ensure the funding framework is established and implemented in a manner that considers all parties' interests.

The hearing and this report are part of the NEB's ongoing efforts to improve understanding and dialogue between companies, landowners and the NEB through the Land Matters Consultation Initiative (LMCI). The NEB outlined four streams for LMCI: company interactions with landowners, improving the accessibility of NEB processes, pipeline abandonment - financial issues, and pipeline abandonment - physical issues. The NEB handled the physical issues of pipeline abandonment by issuing a discussion paper and draft principles to guide planning for abandonment. The NEB continues its work on the remaining LMCI streams through an action plan and final report.

Celebrating 50 years of regulatory leadership, the NEB is an independent federal agency that regulates several parts of Canada's energy industry. Its purpose is to promote safety and security, environmental protection, and efficient energy infrastructure and markets in the Canadian public interest, within the mandate set by Parliament in the regulation of pipelines, energy development and trade.

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For further information:

Kristen Higgins (kristen.higgins@neb-one.gc.ca)
Communications Officer
National Energy Board
Telephone: 403-299-3122
Telephone (toll free): 1-800-899-1265
Telecopier: 403-292-5503
Telecopier (toll free): 1-877-288-8803
TTY (Teletype): 1-800-632-1663

Related documents:

• Land Matters Consultation Initiative Stream 3 - Pipeline Abandonment - Financial Issues - Reasons for Decision RH-2-2008 [Filing A21835]
• All Regulatory Documents under: Advisory, Land Matters Consultation Initiative [Folder 501473]

For a copy of documents

National Energy Board
library@neb-one.gc.ca
Ground Floor
444 Seventh Avenue SW
Calgary, Alberta
T2P 0X8
Telephone: 403-299-3561
Telephone (toll free): 1-800-899-1265
Telecopier: 403-292-5576
Telecopier (toll free): 1-877-288-8803
TTY (teletype): 1-800-632-1663