Fast Forward into Hanky Panky at the top of the AER:
After expense hanky panky by AER’s top executive Jim Ellis is publicly commented on by Diana Daunheimer, Alberta farmer and mother of two, he steps down: “Good riddance, bring in the next dickhead.” Indeed! Third AER executive paid to commute from BC (air & water too polluted in Alberta?)
Alberta Energy Regulator completes transition to a single regulator Press Release by AER, March 31, 2014
The Alberta Energy Regulator (AER) has completed its transition to become the single regulator of energy development in Alberta. “This is a momentous time for Alberta and for energy development in the province,” says Alberta Energy Minister Diana McQueen. “The final integration of the Alberta Energy Regulator is the realization of our goal: to provide strong regulatory oversight, while also balancing the needs of our environment. Under the AER, industry will have regulatory certainty, the rights of landowners will be protected, and our environment will remain a top priority.” [Why does Diana McQueen not say lands and water will be protected? Why only rights? Why does she not say Alberta’s environment will be protected? Remaining a top priority does not equal protection.]
The AER was launched on June 17, 2013, with proclamation of portions of the Responsible Energy Development Act. The AER now has expanded authority, which includes aspects of the following acts as they relate to energy development: the Public Lands Act, Part 8 of the Mines and Minerals Act, the Environmental Protection and Enhancement Act, and the Water Act.
“Our province has been working hard to strike the balance between responsible development and environmental protection,” says Environment and Sustainable Resource Development Minister Robin Campbell. “The Alberta Energy Regulator is one piece of an integrated resource management system that will help achieve that balance.”
“The AER is now a full life-cycle regulator: from application and exploration, to construction and development, to abandonment, reclamation, and remediation,” said AER president and CEO Jim Ellis. “We take our responsibility for protecting our air, land, water, and biodiversity very seriously as we regulate the development of our vast energy resources delivering economic benefits to all Albertans.”
Public safety and environmental protection are among the AER’s top priorities. The AER will continue to work closely with ESRD to ensure that the province’s environmental goals are upheld [And what goals are those? Why not say “protection” instead of “goals”?], cumulative effects are managed [Why not say “mitigated” instead of “managed”? What does managed mean?], public safety is protected, and rules and requirements are enforced. “We will continue to hold industry accountable. We have more enforcement options available to pursue companies that fail to comply with requirements,” said Ellis. “We have embarked on the next era of energy regulation—one that is efficient, responsive, transparent, and accountable.” [And gives the oil and gas industry Alberta’s fresh water]
The Alberta Energy Regulator ensures the safe, efficient, orderly, and environmentally responsible development of hydrocarbon resources over their entire life cycle. This includes allocating and conserving water resources, managing public lands, and protecting the environment while providing economic benefits for all Albertans. [Ernst’s water being contaminated with dangerous concentrations of methane and other toxics after Encana fractured the fresh water aquifer that supplies the well, has provided no economic benefit to Ernst. The explosive water has provided many losses, including the loss of career and business, loss of legal right to quiet enjoyment and safety on the Ernst property and in home, and cost hundreds of thousands of dollars.]
The Alberta Energy Regulator is now officially the province’s single regulator of energy development, with expanded authority over oil, gas, and coal projects. Launched in June 2013, the AER now has expanded authority, which includes aspects of the following as they relate to energy development: the Public Lands Act, part 8 of the Mines and Minerals Act, the Environmental Protection and Enhancement Act and the Water Act. The AER was established in June 2013 and ensures the safe, efficient, orderly, and environmentally responsible development of hydrocarbon resources over their entire life cycle.
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Slide from Ernst presentations
Watching the Watchdog, Think the restructured Alberta Energy Regulator is toothless? Just meet its new CEO by Geoffrey Morgan, March 17, 2014, Alberta Oil Magazine
[Changing names to the AER is just another industry rerun to con Albertans, except under this name change, the government gives the oil and gas industry total control of Alberta’s fresh water, complete regulation of itself, approving its own applications and abandonments, 100% funded by itself to ensure nothing gets in the way of unmitigated tarsands and frac developments, and waste dumping. When the EUB was morphed into the ERCB, Albertans were promised the same baloney being promised with the AER.
Encana submitted to the new and fiercely improved ERCB, a non-compliant “crap” application to drill under the already dangerously methane contaminated Ernst property. The ERCB granted Encana approval for their non-compliant application in less than a day.]
An industry insider who held executive positions with Encana Corp. and Cenovus, Protti is also founding president of the Canadian Association of Petroleum Producers (CAPP). Critics are concerned he is too close to industry and therefore incapable of overseeing a tough, transparent and efficient regulator. Those were actually the reasons for the creation of the AER. The previous regulatory structure headed by the Energy and Resources Conservation Board (ERCB) was internationally criticized as being weak, opaque and woefully slow to act. Could reorganizing the ERCB and other government bodies into a single regulator, the AER, and giving it new powers, change that?
Shortly after Protti’s appointment, he and the AER’s board of directors hired Jim Ellis as chief executive.
And Ellis, at a downtown luncheon put on by the University of Calgary in December 2013, told a room of oil patch attendees that the industry had submitted so many applications in November that the system had become clogged. Ellis said the ensuing slowdown in issuing development permits was their fault – not the AER’s – and that many of the applications were unsatisfactory. “We’ve got a whole bunch of what the French would call ‘crap,’ ” he said.
Producers had gotten nervous that there was going to be a big change with the AER, Ellis said and, as a result, a large number of applications were filed early in the hope of grandfathering their projects. “This is the big change that you’re going to see: the AER is going to fix this because we’re going to put all of the emphasis right where it should be, which is in your organizations,” he said. “You need to be producing outstanding applications.” The tone of Ellis’s comments, made while Protti sat smiling nearby, indicate that perhaps the critics were wrong about the fox-in-the-henhouse sneer. The nervousness that many within the industry felt in late November may have been warranted.
“We’ve got a whole bunch of what the French would call ‘crap.’ ”
There were major changes underway at the AER, which was at that point in the second of three reorganization phases. The final phase of that reorganization is set to take effect in March 2014 and is likely to excite the same nervousness as the second phase did in November. This time around however, the industry should know, as Ellis said, “If you don’t give us good applications, we’re going to chuck them back over the fence and you’re going to pick them up.” Under Protti and Ellis, the province’s energy regulator will expect more from energy companies, just as the energy sector will expect a more efficient, streamlined regulatory process [aka deregulated] – though how the new regulator will become more efficient has yet to be explained.
It’s clear the overhaul was a large and sometimes frustrating undertaking. During his talk, Ellis didn’t immediately stand up and call for the end of “crap” applications; he began by likening the realignment of the regulatory bodies to “changing the tires on a moving vehicle.” It started by renaming (and rebranding) the ERCB as the AER, then giving it the regulatory functions of the provincial government departments of Alberta Energy and Alberta Environment and Sustainable Resource Development (ESRD). Finally, this month the AER will take over the regulatory responsibilities stipulated in the Environmental Protection and Enhancement Act (EPEA) and the Water Act.
When the regulatory overhaul was first announced, media raised a laundry list of questions that could ultimately be summarized as: why make these changes now? A major reason for the changes was a report published by the International Energy Agency during then-premier Ed Stelmach’s royalty review that criticized Canada’s energy regulatory structure for being opaque and inefficient. Shortly thereafter, the province launched a “competitiveness review” of its energy regulation. “This is the big change that you’re going to see: the AER is going to fix this because we’re going to put all of the emphasis right where it should be, which is in your organizations.”
Energy Minister Diana McQueen oversaw that review while she was parliamentary assistant to former energy minister Ron Liepert and chaired the committee responsible for putting together Enhancing Assurance, the resulting report published in May 2011 that provided six suggestions for improving the province’s regulation. Those suggestions included a call to create a single energy regulator for oil, gas and coal developments. McQueen says that under the previous system, a large oil sands development would be required to submit applications between the ERCB, Alberta Energy and ESRD. “It moved through all three regulators,” she says, but now projects – large and small – only need to move through one.
PTI Big box
As to whether that would shorten the approval process or lessen the number of applications a producer would need to submit, McQueen says there is still no defined time frame in which the AER is required to process applications. She claims the overall process will be improved by what she calls “performance reporting,” though it’s unclear what those reports might contain and whether they will be issued quarterly or annually. “We’re sitting down with the regulator on that piece,” McQueen says. “We’ve given them time to get set up.”
That could soon be clarified. In March 2014, 10 months after the reorganization process began, the government and the regulator will outline guidelines on AER performance reporting. It is unclear what, if anything, will change. Representatives from both CAPP and the Explorers and Producers Association of Canada (EPAC) say that, since the integration process is incomplete, it is impossible to determine whether the regulator has truly become more efficient.
Critics might at least give the AER credit for becoming more demanding and more transparent in the first two phases of the process. The first step in the process was in June 2013, when the ERCB was renamed the AER. There were a number of important changes that happened at that time, not including the name change. For one, the AER included daily incident reporting on its website, which garnered a lot of attention when Canadian Natural Resources Ltd. was dealing with its bitumen emulsion seepage issues near Cold Lake. For another, the AER acted on an earlier recommendation from the Orphan Well Association to update and increase the estimated cost of well abandonment and reclamation work in Alberta, which affected the Licensee Liability Rating (LLR) – a financial solvency ranking that identifies companies who risk not being able to pay for orphan well costs.
Changes to the LLR inspired outrage from executives at some of the province’s smaller producers, like Blackdog Resources Ltd., who grouped together with Danielle Smith and the Wildrose Party to demand the “government stop its attack on the energy sector.” Other small- to medium-sized producers, including all of EPAC’s member companies, have managed to remain above the minimum requirements of the LLR, says EPAC president Gary Leach, though the changes did represent a bigger challenge to natural-gas-weighted producers. “The LLR program attempts to strike a balance between not imposing unduly harsh solvency parameters while at the same time delivering on the early warning function,” Leach says, adding that industry is in ongoing talks with the AER over the LLR program.
In March 2014, 10 months after the reorganization process began, the government and the regulator will outline how AER performance reporting will be done. The next step in the AER’s reorganization occurred in November 2013, when it took over the regulatory responsibilities of Alberta Energy and the ESRD – though both of those government departments will continue to exist and function as legislative bodies, and ESRD will continue to regulate forestry and other non-energy resource industries. In the middle of that process, the Alberta government also established a new aboriginal consultation office, which will oversee energy companies’ consultations with First Nations. The establishment of this new office means that energy regulation will still be divided between two organizations; the AER will regulate everything relevant to the environment and the consultation office will regulate everything relevant to First Nations consultation.
It was immediately before this second step occurred that companies filed an unusually high number of winter drilling season applications, which Ellis said was done in the hope of having their applications grandfathered. CAPP’s vice-president of operations David Pryce says the resulting slowdown in issuing permits was “challenging,” though both he and EPAC’s Leach say that the AER has worked to fix the problem. “To its credit, the AER put a lot of resources into clearing the application backlog, which has been substantially reduced,” Leach says.
There may be more challenges to come as the AER begins juggling the responsibilities outlined in EPEA and the Water Act.It may still be too early for Minister McQueen, CAPP or EPAC to determine whether the single regulator has become more efficient than the previous system. Changes to the LLR, Ellis’s comments on filing “crap” applications and the AER’s new incident reporting system would suggest, however, that it has at least become more demanding and more transparent. [Emphasis added]
[The EUB is now the AER. Refer also to:
The Canadian Charter of Rights and Freedoms steadfastly defends the rights of any citizen to a free voice without fear of the democratic process being eroded by any level of government. Meddling, or censorship, that taints these sacred rules creates suspicion, dissension, and a cry to right things that may have gone wrong. No government in Canada is above the charter. [The provincial AER thinks it is, and to prevent a flood of litigants dressed in their Charter Clothes, Chief Justice Neil Wittmann of the Alberta Court of Queen’s Bench agreed.] Any allegations made by citizens of being ill-afforded the freedom of speech, or deprived of the charter’s rules by the government, demands full investigation. The Alberta Energy and Utilities Board (AER) has come under the microscope of the province’s privacy commissioner after allegations the EUB, at the blessing of the provincial government, hired spies to eavesdrop on citizens…. [Emphasis added]
Source of above quote: 2006 Trouble in our Fields. Is Our Water Safe?