Canada Oil & Gas Operations Act

 

The Canada Oil and Gas Operations Act governs the exploration, production, processing, and transportation of oil and gas in marine areas off the coast of BC controlled by the federal government.  These areas include the ‘territorial sea’ (12 nautical miles beyond the low water mark of the outer coastline), and the ‘continental shelf’ (beyond the territorial sea).  They do not include areas controlled by the provincial government (‘internal waters’ such as the Strait of Georgia the Strait of Juan de Fuca).  

 

The Minister of Indian Affairs and Northern Development and the Minister of Natural Resources jointly administer the statue.  The purpose of the Act is to promote safety, protection of the environment, the conservation of oil and gas resources, and joint production agreements.  The Act does not regulate the transfer of federal subsurface oil and gas rights; a separate lease of oil and gas rights is required under the Canada Petroleum Resources Act.

 

Under the Act, an oil and gas company requires a licence from the National Energy Board before it can lawfully explore for oil or gas, or produce oil and gas.

 

When granting a licence, the National Energy Board may require a damage deposit for liability, or require the company to carry out environmental programs or studies.  To protect offshore waters, advocates can persuade National Energy Board regulators to use their power and require companies to post damage deposits and carry out environmental programs.

 

In the event of a spill, the licence holder is liable, without proof of fault or negligence, for all actual loss, damage or clean-up costs—up to a limit of between 25 and 40 million dollars (depending on where the spill occurs) [see Oil and Gas Spills and Debris Liability Regulations]

 

Related Guide Pages:

·          Oil & Gas Extraction

·          Canada Petroleum Resources Act

For more information on the Canada Oil and Gas Operations Act:

·          Electronic text of the Canada Oil and Gas Operations Act

·          Electronic text of regulations and guidelines

·          Northern Oil and Gas Program of the Department of Indian and Northern Development