Indian Oil and Gas Regulations (SOR/2019-196)

Marginal note:Liability

• 26 (1) If the assignment is approved, the assignor and assignee are jointly and severally, or solidarily, liable for any obligation owing and any liability arising under the contract before the day on which the assignment is approved, even if the contract is subsequently assigned.

• Marginal note:Exception

  (2) Subsection (1) does not apply to an assignment that is approved before the coming into force of these Regulations.

Terms and Conditions To Be Included in Every Contract

Marginal note:Compliance with laws

• 27 (1) Every contract granted by the Minister under these Regulations includes the holder’s undertaking to comply with

  • (a) the Indian Act, and any orders made under that Act, as amended from time to time;

  • (b) the Act, and any regulations or orders made under the Act, as amended from time to time; and

  • (c) the laws of the relevant province, as amended from time to time, that relate to the environment or to the exploration for, or the exploitation, treatment, processing or conservation of, oil and gas, including equitable production, if those laws are not in conflict with the Act or any regulations or orders made under the Act.

• Marginal note:Inconsistency — Acts, regulations and orders

  (2) The provisions of any Act, regulation or order referred to in subsection (1) prevail over any terms and conditions of the contract, except for any terms and conditions respecting royalties that are the subject of a special agreement under subsection 4(2) of the Act, to the extent of any inconsistency. The provisions of any Act of Parliament, or any regulation or order made under an Act of Parliament, referred to in subsection (1) prevail over the laws of the province referred to in subsection (1), to the extent of any inconsistency.

• Marginal note:Inconsistency — interpretation

  (3) For the purposes of this section, provisions — whether legislative or contractual — are not inconsistent unless it is impossible for the holder to comply with both.

Exploration

Authorization

Marginal note:Authorization to explore

28 A person may carry out exploration work on First Nation lands if they

• (a) hold an exploration licence;

• (b) have obtained from the provincial authority any approval that is required to carry out exploration work in the province; and

• (c) are in compliance with the terms and conditions of the licence and the approval.

Application for Exploration Licence

Marginal note:Preliminary negotiation

• 29 (1) Before applying for an exploration licence, an applicant and the council must agree on the location of the proposed seismic lines and on the seismic rates, if those rates have not already been fixed in a related subsurface contract.

• Marginal note:Application for exploration licence

  (2) The application must be submitted to the Minister in the prescribed form and include

  • (a) the terms and conditions negotiated with the council;

  • (b) if the approval of the provincial authority is required to carry out exploration work, a statement that the approval has been received;

  • (c) a description of the proposed exploration program, including the licence area, the exploration work to be carried out, the equipment to be used, the name of the geophysical contractor to be engaged and the anticipated duration of the work;

  • (d) the results of an environmental review of the proposed exploration program that has been conducted by a qualified environmental professional who deals with the applicant at arm’s length; and

  • (e) the exploration licence application fee set out in Schedule 1.

• Marginal note:Environmental review

  (3) The results of the environmental review must be submitted in the prescribed form and include

  • (a) a site evaluation that is based on the site’s topography, soils, vegetation, wildlife, sources of water, existing structures, archeological and cultural resources, traditional ecological knowledge, current land uses and any other feature of the site that could be affected by the proposed exploration program;

  • (b) a description of the operations to be carried out during the proposed exploration program, the duration of each and its location on the site;

  • (c) a description of the short-term and long-term effects that each operation could have on the environment of the site and on any surrounding areas;

  • (d) a description of the proposed mitigation measures, the potential residual effects after mitigation and the significance of those effects; and

  • (e) a description of the consultations undertaken with the council and the First Nation members.

• Marginal note:Environmental protection measures

  (4) If the exploration program can be carried out without causing irremediable damage to the First Nation lands, the Minister must send the application to the applicant and the council, along with a letter that sets out the environmental protection measures that must be implemented to permit the licence holder to carry out their exploration program.

• Marginal note:Submission of documents

  (5) To obtain the exploration licence, the applicant must, within 90 days after the day on which the reviewed application is received, submit to the Minister three copies of the environmental protection measures letter and three original copies of the application signed by the applicant, along with a written resolution of the council approving the licence.

• Marginal note:Exploration licence

  (6) If the requirements set out in this section are met, the Minister must grant the exploration licence for a period of one year. The terms and conditions of the licence are those set out in the application and the environmental protection measures letter. The licence takes effect on the day on which it is signed by the Minister.

Operations Under Exploration Licence

Marginal note:Exercise of rights conferred by licence

30 An exploration licence holder may exercise the rights conferred by the licence in a subsurface contract area, but in doing so must not interfere with any operations carried out under the subsurface contract.

Marginal note:Priority

31 Every exploration licence is subject to

• (a) any surface rights or interests granted under an Act of Parliament; and

• (b) any rights or interests related to the exploration or exploitation of minerals other than oil or gas in the licence area.

Marginal note:Maximum drilling depth

• 32 (1) An exploration licence holder must not drill to a depth of more than 50 m, unless authorized to do so by their licence.

• Marginal note:Holder’s obligations

  (2) The holder must

  • (a) ensure that all environmental protection measures included in the licence are implemented and complied with;

  • (b) identify and mark the location of every test hole and shot hole that is drilled under the licence;

  • (c) repair and recondition any roads or road allowances that are damaged as a result of the exploration work as soon as the circumstances permit after the damage occurs;

  • (d) as soon as the circumstances permit, plug any hole that is drilled under the licence and that, during or after completion of the exploration work, collapses or emits gas, water or another substance;

  • (e) within 90 days after the day on which the exploration work is completed, pay compensation for the exploration work that was carried out, based on the rates specified in the licence or a related subsurface contract; and

  • (f) within 90 days after the day on which the exploration work is completed, submit to the Minister and the council

    • (i) a mylar sepia copy and a legible paper copy of a map, on a scale of not less than 1:50 000, that shows the location and ground elevation of every vibrating equipment station, test hole and shot hole,

    • (ii) summaries of any geologist’s and driller’s logs, indicating the depth and thickness of formations bearing water, sand, gravel, coal and other minerals of possible economic value, and

    • (iii) all technical information obtained from the drilling of each test hole.

Marginal note:Exploration report

• 33 (1) An exploration licence holder must submit an exploration report to the Minister within 90 days after the day on which the exploration work is completed.

• Marginal note:Content of exploration report

  (2) The report must comply with any exploration reporting requirements of the relevant province and must include, in addition to the documents and information referred to in paragraph 32(2)(f),

  • (a) a copy of every aerial photograph taken during the period of exploration;

  • (b) two copies of a geological report on the explored area, including stratigraphic data and structural and isopach maps on a scale of not less than 1:50 000; and

  • (c) a geophysical report on the explored area.

• Marginal note:Content of geophysical report

  (3) The geophysical report must include

  • (a) if seismic work has been carried out,

    • (i) a mylar sepia copy and two legible paper copies of a map, on a scale of not less than 1:50 000, that shows contour lines drawn on the corrected time value at each source point for all significant reflecting horizons explored, with a contour line interval of not more than 10 m,

    • (ii) a mylar sepia copy and two prefolded paper copies of each stacked seismic cross-section, including migrated displays if that process has been carried out, with all significant reflecting horizons clearly labelled at both ends on one of the copies, and

    • (iii) two microfilm copies of all basic recorded data, including survey notes, chaining notes and observer reports;

  • (b) if a gravity survey has been carried out, two legible copies of a map, on a scale of not less than 1:50 000, that shows the location and ground elevation of each station, the final corrected gravity value at each station and gravity contour lines drawn on that value, with a contour line interval of not more than 2.5 µm/s²; and

  • (c) if a magnetic survey has been carried out, two legible copies of a map of the explored area, on a scale of not less than 1:50 000, that shows the location of the flight lines or grid stations and magnetic contour lines, with a contour line interval of not more than 5 nT.

• Marginal note:Exception

  (4) The holder may include maps at contour line intervals or scales other than those specified in subsections (2) and (3) if the alternative intervals or scales would enhance the interpretability of the maps.

• Marginal note:Information available to council

  (5) The Minister must make the information submitted under subsections (2) to (4) available to the council.

• Marginal note:Information to be kept

  (6) In addition to the information submitted under this section, the holder must keep any information that was obtained as a result of the exploration work carried out in the contract area, including any printout, or magnetic digital display, of raw seismic data or interpreted seismic data, and must make it available for review by the Minister at the holder’s office during business hours after the later of

  • (a) if the holder also holds a subsurface lease or permit in lands in the licence area, 90 days after the day on which the lease expires or is continued, the initial term of the permit expires or, in the case of a permit issued under the Indian Oil and Gas Regulations, 1995, the permit is converted to one or more leases, and

  • (b) one year after the day on which the exploration work is completed.

Marginal note:Remediation and reclamation

34 When exploration work under an exploration licence is no longer being carried out, whether or not the licence has ended, the licence holder must ensure that all the lands on which the work was carried out are remediated and reclaimed.

Subsurface Rights or Interests

Grants of Subsurface Rights or Interests

General Rules

Marginal note:Subsurface contracts

• 35 (1) Oil and gas rights or interests in First Nation lands may be granted by the Minister under one of the following subsurface contracts:

  • (a) an oil and gas permit;

  • (b) an oil and gas lease.

• Marginal note:Process

  (2) A subsurface contract must be granted in accordance with the public tender process set out in sections 39 to 42 or the negotiation process set out in sections 44 to 46, as chosen by the council. The negotiation process may be preceded by a call for proposals in accordance with section 43.

• Marginal note:No splitting of rights

  (3) When granting a subsurface contract, the Minister must grant all the rights to the oil and gas in each zone included in the contract area.