Canada Energy Regulator’s 2020–21 Annual Report of activities under the Northwest Territories Oil and Gas Operations Act
30 July 2021
Honorable Caroline Wawzonek
Minister of Industry, Tourism and Investment
Government of the Northwest Territories
P.O. Box 1320
Yellowknife, NT X1A 2L9
Dear Honorable Minister Wawzonek:
- Canada Energy Regulator’s 2020–21 Annual Report of activities under the Northwest Territories Oil and Gas Operations Act
The Canada Energy Regulator (CER) is pleased to present the 2020–21 Annual Report of activities under the Oil and Gas Operations Act (OGOA). The CER is required to submit this annual report to the Minister of Industry, Tourism and Investment (ITI) of the Government of the Northwest Territories pursuant to the OGOAFootnote 1. The 2020–21 Annual Report of activities under the Northwest Territories Oil and Gas Operations Act, is one of three Annual Report documents that summarize the Canada Energy Regulator’s activities for the fiscal year.
The CER, supported by 500+ public servants, regulates oil and gas exploration and production under the OGOA in the onshore portion of the Inuvialuit Settlement Region (ISR) in the Northwest Territories. The CER’s main office is located in Calgary and its Northern Regional Office is located in Yellowknife. Additional CER regional offices are located in Vancouver and Montreal.
The Commission of the CER (Commission) is an independent entity within the governance structure of the CER, whose primary role under the OGOA is to adjudicate oil and gas exploration and production projects. In 2020, the Commission was comprised of six full-time Commissioners appointed by the Governor in Council, including the Lead Commissioner and Deputy Lead Commissioner. In January 2021, a seventh appointee was added to the Commission.
In 2020, the COVID-19 pandemic changed the daily lives of everyone. The CER maintained its regulatory operations, including those undertaken pursuant to the OGOA, even as our employees transitioned to working from their homes. In a typical year, CER staff would often travel to and within the Northwest Territories (NWT) for meetings, inspections and conferences. This year, due to COVID-19 travel restrictions, meetings, forums and conferences were attended virtually.
Designations / Appointments
Prior to the beginning of the 2020–21 fiscal year, the CER’s Acting Chief Executive Officer made the following appointments under the OGOA:
- Dr. Iain Colquhoun, Professional Leader, Engineering, was re-designated the Chief Conservation Officer and Ms. Paula Futoransky, Vice President of Energy Adjudications, was appointed to act in his absence.
- Keith Landra, Professional Leader, Safety, was re-designated the Chief Safety Officer and Claudine Bradley, Technical Leader, Research and Innovation, was appointed to act in his absence.
Delegations
On 17 of August 2020, the Commission delegated certain powers under the OGOA (see Appendix 1) including the authority to issue operating licences, authorizations and well approvals to:
- Dr. Iain Colquhoun, Chief Conservation Officer and Ms. Paula Futoransky, Vice President Energy Adjudication who will act in Mr. Colquhouns’ absence.
Applications
The Commission reports that the Inuvialuit Petroleum Corporation (IPC) filed a submission on 17 March 2021 in support of a Development Plan Approval application for their proposed Inuvialuit Energy Security Project. Following direction from the Commission, the IPC refiled a Development Plan Approval application on 9 July 2021. Updated project information can be found on the CER website.
Operating Licences Issued
The Commission reports that seven companies renewed their annual operating licences under the OGOA during 2020–21. All current operating licences can be found on the CER website and in Appendix 2. Operating licences are administrative documents that do not permit any activity on their own, instead they are a prerequisite prior to performing any work or activity under the OGOA. The following is a table of active companies in the ISR and the facilities they operate:
| Company Operating in the ISR Regulated under the OGOA |
Associated Facilities |
|---|---|
| Utilities Group Facilities Inc | Ikhil Gas Production Field |
| MGM Energy | Nine suspended wells |
| Canadian Natural Resources Limited | One suspended well |
OGOA Compliance Verification Activities
The CER’s commitment to keeping people safe is at the core of what it is and the work it does. Regulated companies are required by the CER to anticipate, manage, and mitigate any potential harm to safety and the environment that may occur through the full lifecycle of their energy facilities. As a part of this, the CER uses a risk-based approach in planning and conducting compliance verification activities (CVAs). When the activities of regulated companies have the potential to pose greater harm to people or the environment, the CER focuses increased oversight through engagement, inspections, investigations, audits, and enforcement, when necessary.
In 2020–21 the CER conducted the following compliance verification activities under the OGOA:
- two general operational information exchange meetings;
- one annual facilities and operations meeting;
- three annual safety report reviews;
- one environmental report review; and
- one production report review.
Many of these compliance verification activities, in addition to routine daily production report reviews, represent the ongoing regulatory oversight of Utility Group Facilities Inc’s Ikhil gas production operations. The CER did not receive any well inspection reports this year as well inspections were either deferred or scheduled for 2022.
Incident Response
Companies must be prepared to respond to an emergency. The CER makes sure that a company can respond effectively by evaluating emergency response exercises and assessing contingency plans, including emergency response procedures and associated training, and confirming that plans provide for coordination with relevant territorial and federal emergency response plans.
The CER is a signatory to the NWT-Nunavut Spills Working Agreement. CER staff attended both the spring and fall 2020 bi-Annual NWT-Nunavut Spills Working Group meetings to promote response coordination and continuous improvement of pollution preparedness activities in the Northwest Territories and Nunavut.
The CER did not receive any incident reports in the ISR during the 2020–21 fiscal year.
Sampling Requests and Requests for information
The CER received two sampling requests for well materials (cuttings, fluid samples and/or core samples) related to wells located in the Mackenzie Delta. Well materials are located at the Geological Survey of Canada (GSC) core facility in Calgary, Alberta. The GSC supervises the removal of samples. Researchers, companies, and academics use these historical well materials or samples in various studies and analysis. Copies of reports generated from the study or analysis of well materials are later sent to the CER and can be obtained by the public.
One request for information related to a Significant Discovery Declaration in the Mackenzie Delta was received.
The CER library received and responded to 17 OGOA-related public information requests.
Relationships with Other Regulators
The CER recognizes the importance of maintaining strong working relationships with regulators and other partners in the North. Working from our Northern Regional Office, our Professional Leader for Northern Engagement meets regularly with the Northwest Territories Regulator of Oil and Gas Operations, and with staff from ITI’s Mineral and Petroleum Resources Division in Inuvik to examine opportunities for improving regulatory coordination and efficiency. In addition, CER and the Office of the Regulator of Oil and Gas Operations (OROGO) staff hold monthly bilateral information exchange meetings to examine opportunities for joint compliance verification and emergency management exercises, as well as discuss regulatory initiatives such as the development of new regulations and guidance materials under the OGOA. CER staff also regularly engage in informal and formal meetings and forums relating to our regulatory responsibilities in the ISR. The following are some of the organizations with whom CER staff maintain close working relationships:
- NWT Board Forum
- Inuvialuit Game Council
- Inuvialuit Regional Corporation
- Inuvialuit Water Board
- Inuvialuit Joint Secretariat
The CER attended the following virtual events this year:
- Arctic Oil and Gas Symposium
- ArcticNet Arctic Change Conference
- Wellbeing and the MVRMA: Making good resource co-management decisions in the Mackenzie Valley Workshop
- NWT Geoscience Symposium
OROGO-CER Memorandum of Understanding
In March 2021, the CER renewed its Memorandum of Understanding (MOU) with OROGO. The MOU promotes collaboration and cooperation with respect to the exercise of the OROGO’s and CER’s respective regulatory responsibilities. The renewed MOU included a new Annex on emergency management cooperation between the two regulators.
The CER is pleased to submit its inaugural OGOA annual report and looks forward to sharing information about its OGOA activities in the years to come.
Best regards,
Original signed by
Gitane De Silva
Chief Executive Officer
Appendix 1: Powers Delegated to Iain Colquhoun and Paula Futoransky under the OGOA in 2020
| OGOATable Note a | Description of delegated powers (paraphrased) |
|---|---|
| s. 10 | Issue, renew, vary, suspend or revoke operating licences and authorizations for each work or activity |
| s. 12 | Consider safety prior to issuing authorizations for work or activity |
| s. 13 | Ensure compliance to financial requirements prior to issuing authorizations for work or activity |
| s. 15 | Receive declarations that equipment and installations, operating procedures, and personnel qualifications are appropriate prior to issuing authorizations for work or activity |
| s. 16 | Ensure prescribed certificates for equipment and installations are received prior to issuing authorizations for work or activity |
| s. 64 | Proof of financial responsibility |
Appendix 2: 2020–21 Operating Licences issued under the OGOA by the Commission (via a delegation of s. 10)
| Operating Licence (OGOA) | Company |
|---|---|
| 1411 | Explor Geophysical Ltd. |
| 1410 | MGM Energy |
| 1409 | Utility Group Facilities Inc. |
| 1404 | Imperial Oil Resources Limited |
| 1403 | ExxonMobil Canada Ltd. |
| 1402 | Canadian Natural Resources Limited |
| 1401 | ConocoPhillips Canada Resources Corp |
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