Acts and Regulations

2012-78 - Oil and Natural Gas Act

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NEW BRUNSWICK
REGULATION 2012-78
under the
Oil and Natural Gas Act
(O.C. 2012-269)
Filed August 23, 2012
1New Brunswick Regulation 2001-66 under the Oil and Natural Gas Act is amended by adding after section 8 the following:
Redistribution of exploratory work expenditures
8.1An application under section 21.01 of the Act for a redistribution of the expenditures required for exploratory work shall
(a) be on a form provided by the Minister, and
(b) be submitted no more than once in a calendar year.
Renewal of on-shore licence to search
8.2(1)For the purposes of this section, “force majeure” means one or more of the following events:
(a) an act of God or action of a natural element;
(b) war, revolution, insurrection, riot, disturbance, blockade or other similar unlawful acts against public order or authority;
(c) a strike, lockout or other labour disturbance;
(d) a direction, order or injunction of a court, other than a direction, order or injunction resulting from an unlawful act of a licensee;
(e) a direction, order or law made by government authority, other than a direction or order resulting from an unlawful act of a licensee;
(f) the refusal of any person to permit a licensee to have access to lands on commercially reasonable terms or within a reasonable period of time; and
(g) any other event in the nature of those events referred to in paragraphs (a) to (f).
8.2(2)An application for renewal of an on-shore licence to search shall be on a form provided by the Minister.
8.2(3)The Minister may renew an on-shore licence to search only if the following conditions are met:
(a) the Minister is satisfied that the licensee has done or caused to be done exploratory work equal to or in excess of the amount prescribed in Schedule B on each hectare of the licence area;
(b) the Minister is of the opinion that, during the term of the licence, a force majeure has resulted in the licensee being unable to do or cause to be done exploratory work equal to the tendered value of the work for that licence; and
(c) the Minister is satisfied that the licensee did not contribute to the force majeure by negligence, misconduct or a failure to act.
2Section 10 of the Regulation is amended
(a) by repealing subsection (1) and substituting the following:
10(1)If the value of the exploratory work performed during the term of a licence to search, or during the term of a licence renewed under section 8.2, is satisfactory to the Minister, on receipt of a report that is acceptable to the Minister, the Minister shall return to the licensee that portion of the deposit specified in the call for tender.
(b) by repealing subsection (2) and substituting the following:
10(2)If, in the opinion of the Minister, a licensee has not done or caused to be done exploratory work during the term of the licence to search, or during the term of a licence renewed under section 8.2, equal to the amount tendered as a deposit under paragraph 4(2)(a), the portion of the deposit that is equal to the deficiency is forfeited to the Crown.
3The Regulation is amended by adding after section 18 the following:
Expiry date of consolidated lease
18.1A consolidated lease expires on the expiry date of the most recently granted lease that is included in the consolidated lease.
Annual rental fee for a consolidated lease
18.2The annual rental fee prescribed in Schedule A in respect of the lease area included in a consolidated lease is due and payable in the second and subsequent years of the term of the consolidated lease at least 30 days before the anniversary date of the granting of the lease.
Work deposit for a consolidated lease
18.3In the second and subsequent years of the term of a consolidated lease, on or before the anniversary date of the granting of the lease, the lessee shall deposit with the Minister of Finance an amount at least equivalent to the work requirement prescribed in Schedule D for that year.
Report requirements under a consolidated lease
18.4(1)No later than 90 days after each anniversary date of the granting of a consolidated lease, the lessee shall submit to the Minister a report containing a statement with respect to the total expenditures made by the lessee during that year and any other geophysical, geological, engineering and other data and information that the Minister requires.
18.4(2)A statement of expenditure submitted under this section shall be accompanied by an affidavit of the lessee attesting to its accuracy and correctness.
18.4(3)Geological, geophysical, engineering or other data or information submitted under this section shall be attested to by an engineer or a geoscientist as to its accuracy.
18.4(4)A report submitted under this section shall include three copies of the following documents:
(a) a geological report with respect to the lease area, including geological maps showing the location of wells drilled on the lease area, cross-sections and stratigraphic data;
(b) a geophysical report with respect to the lease area, including gravity, seismic and magnetic data, and
(c) reports of geophysical surveys that were conducted, including well logs and well tests data resulting from exploratory wells that were drilled in the lease area.
Shortfalls and credits
18.5(1)If the expenditures made by the lessee exceed the amount required to be expended under the consolidated lease for that year, the lessee shall bank any remainder for use as a credit towards subsequent years of the lease term.
18.5(2)If the expenditures made by a lessee, including any amount credited from previous years, are less than the amount required to be expended under the consolidated lease for that year, the lessee shall do the following:
(a) pay an amount equal to the deficiency to the Minister of Finance; and
(b) abandon and release to the Crown a portion of the lease area determined in accordance with section 18.6.
Portion of lease area to be abandoned and released
18.6The portion of a lease area to be abandoned and released under section 18.5 shall be computed using the following formula:
p
=
a
×
c
b
where
p = the portion of the lease area to be abandoned and released;
a = the amount owing to the Minister of Finance under paragraph 18.5(2)(a);
b = the amount required to be expended under the consolidated lease for the term of the lease; and
c = the total number of hectares of the lease area.
Application for well licence
18.7(1)An application for a well licence shall be accompanied by the following information:
(a) a map and a description of the location of the well or wells; and
(b) any other information the Minister requires.
18.7(2)If a person other than a licensee or lessee applies for a well licence, the person shall provide the Minister with the written permission of the licensee or lessee, as the case may be.
4Subsection 20(1) of the Regulation is amended
(a) in the portion preceding paragraph (a) by striking out “17 and 18” and substituting “17, 18 and 18.4”;
(b) in paragraph (b) of the English version by striking out “or” at the end of the paragraph;
(c) by adding after paragraph (b) the following:
(b.1) one year after the expiry of a consolidated lease, its cancellation or surrender, or
5Section 21 of the Regulation is amended by adding after subsection (2) the following:
21(3)The fee for an application for a well licence, for amending a well licence or for obtaining approval of the transfer of a well licence is prescribed in Schedule A.
21(4)The security deposit to accompany an application for a well licence or for obtaining approval of the transfer of a well licence is prescribed in Schedule A.
6Schedule A of the Regulation is amended
(a) in section 1 by adding after paragraph (c) the following:
(d)redistribution of exploratory work under section 21.01 of the Act, per licence to search
$100
(e)well licence
$200
 
(f)amendment of a well licence
$  50
 
(g)obtain approval of the transfer of a well licence
$  50
(b) by adding after section 3 the following:
3.1Security deposits to accompany well licence applications are as follows:
(a)one well
$  3,000
 
(b)two wells, if applications submitted together
$  6,000
 
(c)three wells, if applications submitted together
$  8,000
 
(d)four wells, if applications submitted together
$10,000
7The Regulation is amended by adding after Schedule C the following:
Schedule D
For the purpose of the Act and this Regulation, the minimum expenditure required for exploratory work to be completed during the term of a consolidated lease is prescribed as follows:
(a)first year
$10 per hectare
 
(b)second year
$20 per hectare
 
(c)third year
$30 per hectare
 
(d)fourth year
$40 per hectare
 
(e)fifth year
$50 per hectare
8This Regulation comes into force on September 15, 2012.