Energy and Mines News:

Environmental Appeal Board Revokes
Company Water Licence
On September 3, 2015, the British Columbia Environmental Appeal Board (the "EAB") reversed a water licence issued to Nexen due to serious technical flaws in the scientific evidence upon which the licence was granted, as well as defects in the consultation process with the Fort Nelson First Nation (the "FNFN"). Nexen applied for the licence on April 6, 2009 under s. 12 of the British Columbia Water Act, R.S.B.C. 1996, c. 483. The Ministry of Environment (the "Ministry") granted the licence on May 11, 2012. The licence authorized Nexen to divert water from the North Tsea Lake into storage dugouts for the purpose of oilfield injection and storage. The term of the licence was from May 11, 2012 to December 31, 2017. Prior to being granted the licence, Nexen was diverting water from the North Tsea Lake based on short-term approvals, and had constructed works for that purpose. Due to drought conditions and extremely low river water levels in 2012, on April 18, 2013 the Ministry issued an order imposing conditions on the licence. The EAB found it did not have jurisdiction to review that order and only reviewed the decision to issue the licence. Read the full article by Rick Williams, Sean Jones and Dionysios Rossi with the firm Borden Ladner Gervais LLP.

BC to be Lead Regulator of LNG Terminals,
Even on Federal Port Lands
A provincial oil and gas agency will be the lead authority over huge new liquefied natural gas plants if they are built in BC, even on federal port lands, under proposed federal regulations. Ottawa's plan to delegate authority to the BC Oil and Gas Commission covers four proposed plants in the Prince Rupert area in northwest BC on port lands or waters, including the Petronas-led $11.4-billion Pacific NorthWest LNG plant. In introducing the proposed LNG regulation in June, Stephen Harper's Conservative government said it has no comparable regulatory system to BC's and it would save tax dollars, resources and time to adopt the provincial regulatory system. Read the full article at The Vancouver Sun website.

BC Government to Exempt Two Projects from BCUC Review
in Response to Load Growth from Upstream Natural
Gas Operations in the Peace Region
Following a stakeholder consultation this summer, the BC Ministry of Energy and Mines is planning to exercise its authority under the Utilities Commission Act (British Columbia) (the "UCA") to exempt two transmission projects, the North Montney Power Supply ("NMPS") project (proposed by Alberta-based ATCO) and the Peace Region Electricity Supply ("PRES") project (proposed by BC Hydro), from review by the BC Utilities Commission (the "BCUC") under Part 3 of the UCA. Among other things, this exemption would relieve BC Hydro and ATCO from the requirement under section 45 of the UCA to obtain a Certificate of Public Convenience and Necessity from the BCUC for each of the projects. In a report issued on April 27, 2015 (available here), BC Hydro describes the PRES project as intended to resolve the "upstream" constraints in the transmission system supplying the Peace Region in Northeast BC. In the same report, BC Hydro describes its need to "serve some of the most dramatic, single industry load (demand for electricity) growth in a discrete area that it has experienced over the past 50 years". Plans are underway in the Peace Region for natural gas producers to power their compression facilities using electricity drawn from BC Hydro's grid, rather than their own gas, to generate the requisite power. Read the full article by Sebastian Nishimoto, Sven Milelli and Robin Sirett with McCarthy Tetrault LLP. 

BC to Develop Response System for Land-Based Spills
The B.C. government is canvassing industry leaders in hopes of developing a coordinated spill response system for the province by 2016. Jim Hofweber, executive director of the spill response regime project, said the idea is to have a one-call response system for land-based spills, similar to what is done now by the Western Canada Marine Response Corp., which responds to all spills in B.C. waters. The federal government has jurisdiction over spills in Canadian waters, while the provinces are responsible for dealing with land-based spills, including those that wash up on shore. The province is expected to bring enabling legislation in next spring, with hopes of issuing regulations in February 2017, Hofweber said. Read more of The Vancouver Sun article. 

Environmental Appeal Board Decisions
There were two  Environmental Appeal Board decisions released in the month of September:

Water Act

• Chief Sharleen Gale in her own right and on behalf of the members of the Fort Nelson First Nation v. Assistant Regional Water Manager (Nexen Inc., Third Party) [Final Decision – Appeal Allowed; Application for Costs – Denied]
• Lothar Vollmer v. Muhammed A. Sabur, Regional Hydrologist [Consent Order – Appeal Dismissed]

Visit the Environmental Appeal Board website for more information.