New Amendments to the BC Fee,
Levy and Security Regulation
For the second time this year, the Fee, Levy and Security Regulation, B.C. Reg. 8/2014, has been amended by the British Columbia Oil and Gas Commission (the "OGC"). The stated intention of the amendments is to make the fee structure "better reflect the complexities of consultation, advice and reviews required for major oil and gas projects". The OGC began consulting with industry on these amendments last fall.

The amendments can be grouped into two sets. The first concerns the fees related to Class C pipelines and LNG facilities. These are the largest projects of their kind, being pipelines with outside diameters of 609.6 mm or more and facilities with a capacity to process more than 5.6 million m³/day. The second concerns fees for other aspects of the operation of LNG facilities.

Previously, a basic fee of $370,000 was required on application for a permit for Class C pipelines more than 50 km in length and $650,000 was required on application for a permit to construct or operate a Class C LNG facility. Post-amendment, these have been split. The changes result in the permitting fees for major projects being divided into a "review and consultation" phase and a "permit application" phase. This division affects only the Class C facilities as these are the ones requiring lengthy pre-application work including environmental assessments. Read the full article by Rick Williams and Timothy Bottomer with the law firm Borden Ladner Gervais.   

"Game Changer": Gas Company Offers
$1-Billion to First Nations Band in BC
The proponent of a liquefied natural gas plant on British Columbia's north coast is offering more than $1-billion to obtain the consent of a First Nations community, a groundbreaking proposal that could establish the new price for natural resource development in traditional aboriginal territories.

In a province where resource projects have stalled and sometimes foundered over aboriginal opposition, the tentative deal between the Prince Rupert-based Lax Kw'alaams band and a joint venture led by Malaysia's state-owned Petronas sets a new benchmark for sharing the wealth from energy extraction.

If approved by band members, the agreement will transfer roughly $1-billion in cash to the Lax Kw'alaams band over the span of the 40-year deal, while the BC government is putting more than $100-million worth of Crown lands on the table. For the 3,600 members of the Lax Kw'alaams community, the total package works out to a value of roughly $320,000 per person. Read The Globe and Mail article.

Voters Taking Action on Climate Change v British Columbia
(Energy and Mines), 2015 BCSC 471
A recent British Columbia Supreme Court decision concerned a coal handling and storage facility located on Texada Island. The petitioner, an environmental advocacy group named Voters Taking Action on Climate Change ("VTACC"), challenged two provincial government decisions concerning a 2014 permit amendment granted to Texada Quarrying Ltd. ("TQL"), a subsidiary of Lafarge Canada Inc. Since 1990, TQL and its predecessors had been receiving and shipping coal from other corporations at TQL's facility on Texada Island. The Minister of Energy and Mines ("MEM") granted a permit amendment to TQL setting its coal storage capacity at 800,000 tonnes. TQL sought the amendment in connection with an expansion of its transshipment operations due to additional coal exports from Fraser Surrey Docks in Port Metro Vancouver. The stated basis for VTACC's challenge to this decision was jurisdictional. VTACC maintained that the Chief Inspector of Mines was not empowered to grant the permit amendment in question because TQL did not actually operate a coal mine on Texada Island, but rather acted only as a storage and handling facility, an activity VTACC alleged was outside of the scope of the Mines Act, RSBC 1993, c. 293 (the "Mines Act"). In the alternative, VTACC argued that the Chief Inspector of Mines breached the duty of procedural fairness it owed to VTACC regarding the consultation process giving rise to permit amendment in question. Lastly, VTACC also challenged a related Ministry of Environment ("MOE") decision to refrain from exercising its statutory discretion to require TQL to obtain a permit for its transshipment activities under the Environmental Management Act, SBC 2003, c. 53 ("EMA"). Read the full article by Dionysios Rossi and Jessica Duhn of Borden Ladner Gervais LLP. 

BC Court Allows Environmental Approvals
Delay Claim to Proceed
In Carhoun & Sons Enterprises Ltd. v. Canada (Attorney General), the British Columbia Court of Appeal allowed a lawsuit to proceed against the federal government by a private developer for losses caused by delays in the environmental approvals process. While the suit may not ultimately succeed, the court confirmed that the government could be liable and that the review of applications for environmental approvals may entail a consideration of the proponent's (business) interests, especially in circumstances where the legislated goal includes the promotion of economic development.

Background
Carhoun & Sons Enterprises Ltd. (Carhoun) applied for an authorization under section 35(2) of the Fisheries Act from Fisheries and Oceans Canada (DFO) to fill in ravines for a private commercial development. In considering the application, DFO was required to conduct an environmental assessment screening under the Canadian Environmental Assessment Act (CEAA). The DFO initially advised Carhoun that the authorization would not be issued because it would result in unacceptable harm to fish habitat and as a result, the DFO would not be conducting the CEAA screening. After two further requests, DFO reconsidered its decision, undertook the screening and eventually issued the Fisheries Act authorization. It took 993 days between the initial application and the receipt of the authorization. However, by the time the authorization was issued, financing for the project had collapsed.

Read the full article by Janice Walton, Tony Crossman and Nardia Chernawsky (Student-at-Law) with Blake, Cassels & Graydon LLP (Blakes). 

U.S.-Style Shipping Regulations Could Help
Patch Canada's Leaky Laws: Critics
Detractors of federal government's response to English Bay oil spill point to mandatory safety measures and closer involvement with citizens' groups south of the border
In all his years as a recreational sailor, it was something Rob O'Dea says he'd never seen before: thousands of globules of oil, suspended in the water of Vancouver's English Bay.

"The water was thick with oil, pea-sized, up to fist-sized gooey clumps," said O'Dea, who was sailing with a friend on the evening of April 8. "As soon as we realized we were in an oil spill we turned around. The jib sheet dropped into the water, and it was immediately covered with this black goo."

Following a relatively small fuel oil spill from a ship anchored at the entrance to Burrard Inlet, critics are taking aim at federal oil spill response measures. They're pointing to the United States as an example of how Canada can do better, in terms of holding oil-transporting companies to account, involving local communities and providing more reassurance to the public.

Canada should learn from states such as Alaska and Washington, which strengthened regulations after the Exxon Valdez oil spill in 1989, said Karen Wristen, executive director of Living Oceans.

"They cautioned that we should not be relying on any voluntary measures on the part of the oil companies," Wristen said, referring to comments made at a 2013 oil spill response symposium hosted by the BC government. "The advice from the United States was quite strong: legislate the requirements down to the last boom and skimmer." Read the full article on the Business in Vancouver website.

Province Needs Better Count on 600,000
Kilometres of Resource Roads: Report
BC Forest Practices Board says inventory essential to manage access, environmental impacts
BC's independent forest-industry watchdog said [April 22^nd] that the province still doesn't have a good handle on the management of the thousands of kilometres of resource access roads carved into the back country, a decade after it first warned the province about the looming liabilities they pose.

In its 2015 report, the BC Forest Practices Board estimates the province has 600,000 kilometres of resource roads on Crown land, with 10,000 kilometres added per year, but the government's "information about and management of these roads remains inadequate," the report said.

Resource companies build the roads to access timber, establish natural-gas drilling sites or mining operations, but the province doesn't have an accurate inventory of them, the report said. Often the most current information about them comes from permits issued approving their construction, not reports on how many were actually built. Read more on The Vancouver Sun website. 

Environmental Liability and the Commercial Lease –
Who Pays the Cost to Remediate Contaminated Land
In the paper "Environmental Liability and the Commercial Lease – Who Pays the Cost to Remediate Contaminated Land", Una Radoja and Kora Paciorek of Harper Grey LLP discuss responsibility for remediation of contaminated land and the liability for the costs of the remediation in the context of a commercial lease. The first part of the paper provides an overview of the applicable regulatory regime and how it can give rise to environmental liability. In the second part, the available strategies to identify, minimize and/or allocate the environmental liability risks are discussed. Read the paper here.

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

Environmental Management Act

• Seaspan ULC (formerly Seaspan International Ltd.) v. Director, Environmental Management Act [Application for Board Costs – Declined]

Water Act

• John Vlchek, doing business as Cariboo Water Wells Ltd. v. Regional Water Manager [Final Decision – Appeals Allowed]

Visit the Environmental Appeal Board website for more information.