ARCHIVED - Update on the Modernization of the Act, Regulations, and Systems (MARS) - Volume 3, Issue 1

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IOGC Quarterly Newsletter

Reporting Period – April 1st to June 30th, 2013

As reported in the last newsletter, IOGC was pleased to announce the completion of all the Regulatory Drafting Instructions by the end of March, 2013. This involved the preparation of more than 6,600 pages of material for regulatory drafters to review and consider. Most of this material has already been made available for review by First Nations through their representatives on the Joint Technical Committee (JTC-1). The material is highly complex and technical, due to the nature of the oil and gas industry, and this has made the development of a complete set of new regulations by 2014 a considerable challenge. 

Therefore, the department has proposed a phased approach and updated its timelines for completion of the new regulations and is now looking to bring the entire IOGA, 2009 into force, along with a core set of amended and new regulations, towards the end of calendar year 2014. This would provide both the regulatory drafters and First Nations more time to review and consider the large volume of regulatory drafting material.

The new phased approach would include amendments cite> to make them compatible with the IOGA, 2009 plus new regulations in the areas of:

  1. Drainage and Compensatory Royalty;
  2. Sub-surface Tenure;
  3. First Nations' Audit (considered a component of Royalty Management);
  4. reporting requirements to facilitate royalty verification.

There would be immediate benefits to First Nations of bringing the entire IOGA, 2009 into force. These include providing clear authorities for IOGC:

  1. to audit companies operating on First Nation lands;
  2. to establish limitation periods for industry to maintain records for auditing purposes;
  3. to protect First Nation sites of cultural importance;
  4. to order companies to take remedial action under certain circumstances; and,
  5. to issue fines and penalties for offences under the Act or regulations.

After the first phase is completed, the expected sequence for the remaining regulatory modules are currently planned to be:

  1. the remainder of Royalty Management;
  2. Moneys Management;
  3. Surface Tenure;
  4. Exploration;
  5. Environment;
  6. Enforcement; and,
  7. Conservation.

How these modules are packaged and the timeframes for their coming into force will be announced soon.

IOGC is preparing to hold two symposiums with First Nations in the fall of 2013 – one in Alberta and one in Saskatchewan – to explain this new approach as well as the content of this initial set of new and amended regulations. IOGC continues to meet with Chiefs and Councils from individual First Nations when requested.    

The Joint Technical Committee (JTC-1) and the Indian Resource Council (IRC)'s continued support and leadership will be important in getting a more modern regime in place to optimize benefits to First Nations.  Consultation with the oil and gas producing provinces and with industry will continue.

The informatics enhancements to support changes as result of MARS activities continue. Currently, IOGC is preparing a business case for membership and data exchange with PETRINEX, the provincial and industry-recognized authoritative source on hydrocarbon volume and pricing data. Present PETRINEX members include industry, Alberta, and Saskatchewan, with Manitoba and Statistics Canada both in the process of joining.

As reported in the last newsletter, IOGC re-organized effective April 1, 2013 and, because of the amount of change happening at IOGC with the re-organization and the regulatory changes, IOGC recognizes the importance of effectively dealing with the "human" side of change. To that end, IOGC has hired an organizational change management advisor and is preparing to contract additional change management expertise.

IOGC is committed to working with our First Nation partners to modernize the oil and gas regime on First Nation lands and to continue development of new regulations until they are all completed and the Indian Oil and Gas Regulations, 1995 have been entirely replaced. 

Additional Information:

 

For further information, please contact IOGC at:

Indian Oil and Gas Canada
100 - 9911 Chiila Blvd.
Tsuu T'ina AB T2W 6H6
Phone: (403) 292-5625
Fax: (403) 292-5618

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