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Indian Oil and Gas Regulations (SOR/2019-196)

Regulations are current to 2019-08-28 and last amended on 2019-08-01. Previous Versions

Subsurface Rights or Interests (continued)

Continuation of Subsurface Contracts (continued)

Marginal note:Non-productivity — oil and gas

  •  (1) If a contract that is continued in respect of lands on the basis of paragraph 63(1)(a), (b), (d) or (e) ceases to be eligible for continuation on that basis, the Minister must send the holder a notice of non-productivity that describes those lands and indicates the basis on which the contract has ceased to be eligible.

  • Marginal note:Non-productivity — expiry

    (2) A contract referred to in subsection (1) expires with respect to the lands described in the notice of non-productivity one year after the day on which the notice is received.

  • Marginal note:Non-productivity — continuation

    (3) Before the expiry of a contract with respect to lands described in a non-productivity notice, the holder may apply under section 64 to have the contract continued with respect to those lands on the basis of any of paragraphs 63(1)(a) to (e) other than the basis mentioned in the notice.

  • Marginal note:Application for continuation

    (4) Before the expiry of a contract continued under subsection 65(3) or section 66, the holder may apply under section 64 to have the contract continued on the basis of any of paragraphs 63(1)(a) to (e).

Marginal note:Inadequate productivity — bitumen

  •  (1) In the case of a contract continued under paragraph 63(1)(c), if the annual minimum level of production of bitumen from the lands that are subject to the bitumen recovery project is not achieved in any three years, whether or not the years are consecutive, the Minister must send the holder a notice of inadequate productivity with respect to those lands.

  • Marginal note:Termination and expiry

    (2) If the annual minimum level of production of bitumen from the lands that are subject to the bitumen recovery project is not achieved in any year following the day on which the notice of inadequate productivity is received,

    • (a) the project terminates on the final day of that year; and

    • (b) the contract expires on the final day of that year, unless it is continued under subsection (3).

  • Marginal note:Minister’s determination

    (3) When the Minister becomes aware that the annual minimum level of production of bitumen from the lands that are subject to a bitumen recovery project will not be achieved in a year and the contract may expire under paragraph (2)(b), he or she must determine, as soon as the circumstances permit and on the basis of the information in his or her possession, whether the contract is eligible for continuation under any of paragraphs 63(1)(a), (b), (d) or (e) and, if so, must continue the contract on that basis.

Marginal note:Transitional provision — continuation

  •  (1) Sections 63 to 68 apply to the continuation of any subsurface lease that was granted under the Indian Act or the Act before these Regulations came into force.

  • Marginal note:Transitional provision — non-productivity

    (2) Section 69 applies to a subsurface lease that was continued under the Indian Act or the Act before these Regulations came into force if the lands in the lease area cease to be eligible for continuation on the basis on which the lease was continued.

  • Marginal note:Transitional provision — inadequate productivity

    (3) Section 70 does not apply if the lands that are subject to the bitumen recovery project are the subject of an authorization under section 42 of the Indian Oil and Gas Regulations, 1995.

Surface Rights or Interests

Marginal note:Authorization

  •  (1) A person may carry out surface operations on First Nation lands for the purpose of exploiting oil and gas if

    • (a) in the case of operations that require crossing over or going through First Nation lands, they hold a right-of-way in those lands; and

    • (b) in the case of operations that require the exclusive occupation and use of the surface of First Nation lands, they hold a surface lease in respect of those lands.

  • Marginal note:Right of entry

    (2) A person that intends to apply for a surface contract in respect of First Nation lands to carry out operations referred to in subsection (1) may, with the authorization of the council and any First Nation member in lawful possession of those lands, enter on the lands to determine the location of proposed facilities, conduct surveys and carry out any operation necessary to submit an application under section 75.

Marginal note:Preliminary negotiation

  •  (1) Before applying for a surface contract, the applicant must provide the council, and any First Nation member in lawful possession of lands in the proposed contract area, with a survey sketch of that area and must reach an agreement with them on the following:

    • (a) the lands to be included in the contract area;

    • (b) the operations that will be carried out on those lands;

    • (c) the surface rates, if they have not already been fixed by the Minister in a related subsurface contract; and

    • (d) if a service well is to be drilled or an existing well is to be used as a service well, the permitted uses of the well and the amount of compensation to be paid in respect of the well.

  • Marginal note:Surface rates — right-of-way

    (2) In the case of a right-of-way, the surface rates consist of

    • (a) a right-of-entry charge of $1,250 per hectare, subject to a minimum charge of $500 and a maximum charge of $5,000; and

    • (b) initial compensation based on the fair value of lands that are similar in size, character and use.

  • Marginal note:Surface rates — surface lease

    (3) In the case of a surface lease, the surface rates consist of

    • (a) the right-of-entry charge referred to in paragraph (2)(a);

    • (b) initial compensation based on the fair value of lands that are similar in size, character and use, the loss of use of the lands, adverse effects and general disturbance; and

    • (c) the annual rent for subsequent years, based on the loss of use of the lands and adverse effects.

Marginal note:Negotiation breakdown

 If an agreement cannot be reached on the amount of the initial compensation or annual rent to be paid, the Minister must, at the request of the applicant, the council or a First Nation member in lawful possession of lands in the contract area, determine the amount in accordance with subsection 73(2) or (3).

Marginal note:Application for surface contract

  •  (1) The application for a surface contract must be submitted to the Minister in the prescribed form and include

    • (a) the terms and conditions negotiated with the council and any First Nation member in lawful possession of lands in the contract area;

    • (b) a survey plan of the lands to be included in the contract area;

    • (c) the results of an environmental review of the operations to be carried out in the contract area that has been conducted by a qualified environmental professional who deals with the applicant at arm’s length; and

    • (d) the surface lease or right-of-way application fee set out in Schedule 1.

  • Marginal note:Environmental review

    (2) The results of the environmental review must be submitted in the prescribed form and include

    • (a) a site evaluation that is based on the site’s topography, soils, vegetation, wildlife, sources of water, existing structures, archeological and cultural resources, traditional ecological knowledge, current land uses and any other feature of the site that could be affected by the proposed uses of the lands in the contract area;

    • (b) a description of the operations to be carried out on the lands, the duration of each and its location on the site;

    • (c) a description of the short-term and long-term effects that each operation could have on the environment of the site and on any surrounding areas;

    • (d) a description of the proposed mitigation measures, the potential residual effects after mitigation and the significance of those effects; and

    • (e) a description of the consultations undertaken with the council and the First Nation members.

  • Marginal note:Environmental protection measures

    (3) If the application meets the requirements of subsection (1) and the proposed operations can be carried out without causing irremediable damage to the First Nation lands, the Minister must send the applicant and the First Nation a copy of the contract that includes

    • (a) the terms and conditions negotiated with the council and any First Nation member in lawful possession of lands in the contract area; and

    • (b) the environmental protection measures that must be implemented to permit the holder to carry out operations under the contract.

  • Marginal note:Granting of contract

    (4) The Minister must grant the contract if he or she receives the following:

    • (a) four original copies of the contract, signed by the applicant;

    • (b) a written resolution of the council approving the contract and the written consent of any First Nation member in lawful possession of lands in the contract area; and

    • (c) the right-of-entry charge and initial compensation owed under the contract.

  • Marginal note:Compliance with measures

    (5) The holder must ensure that all environmental protection measures included in the contract are implemented and complied with.

 
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