B.C. serves notice: A novel approach sees landowners in the province’s energy heartland informed prior to resource development

12/1/2008

Published in Alberta Oil Magazine, December 2008-January 2009
By Jodie Hierlmeier, Staff Counsel, Environmental Law Centre

Take note Alberta Energy: The province of British Columbia has broadened the notice given to surface owners before minerals are developed under private property. This change is notable for Alberta, as the province seeks ways to better integrate surface and subsurface rights under its Land-Use Framework planning initiative.

Similar to Alberta, the B.C. government owns most of the province’s mineral resources, including those under private property. B.C. may lease the minerals to companies or individuals through a competitive auction, where the successful bidder acquires the mineral tenure or the exclusive right to explore for and develop the minerals.

While the separation of surface and subsurface rights is typical across Canada – allowing governments to develop natural resources for the benefit of all citizens – B.C. has instituted a program to better align surface and subsurface matters.

In April 2008, the B.C. government launched the Landowner Notification Program. Under the program, surface owners in natural gas-rich northeastern B.C. are notified by mail five to six weeks prior to a mineral tenure auction affecting their land. Landowners are provided with information about the tenure process, a map of the parcels up for auction and a list of any development restrictions relating to the minerals up for sale. They are also asked to identify current land uses and any special features that the eventual mineral holder should be aware of when planning its resource recovery.

Following every mineral auction, the province mails the landowner a letter indicating whether the mineral tenure was sold or not, and to whom.

The purpose of the notification is to inform landowners about potential development as early on in the process as possible. To be clear, the program is limited to notification. It does not ensure that the landowner has input into the tenure process, nor does it attach any development restrictions to the mineral tenure.

Further, the program only operates in northeastern B.C., around Fort St. John, which is the heart of B.C.’s energy boom. The notification program is slated to continue until July 2009 when it will be re-evaluated by the government.

In contrast with B.C., Alberta currently provides no direct notice to landowners regarding mineral tenure sales in their area. Notices of parcels to be auctioned off are published on Alberta Energy’s website and in paper copy eight weeks prior to the auction. This process assumes that surface owners will be actively scanning the website or paper copies looking for their legal land description to find out if minerals are for sale in their area. Even if the minerals are for sale, there is no procedure for comment or consultation prior to mineral auction. The first interaction between the mineral holder and the landowner comes later on when the mineral holder is ready to explore and develop the minerals.

Under Alberta’s current system, subsurface mineral tenure is treated as completely separate from surface issues. Surface impacts are dealt with later in the process when the developer seeks approval from the Energy Resources Conservation Board for wells, pipelines or other surface structures.
From industry’s perspective, Alberta’s mineral tenure system is efficient and confidential, and the timely development of oil and gas resources in the province has resulted in significant economic benefits for Albertans. Critics allege that the tenure system provides no venue for consultation or public input and thus runs contrary to the public nature of Alberta’s oil and gas resources. Although Alberta’s mineral tenure system has seemed impervious to change, this may no longer be the case.

Earlier this year, the Alberta government released the Land-Use Framework, which is a new blueprint for land use management based on regional planning and setting thresholds for development. The Land-Use Framework includes a commitment to “review the current process for identifying major surface concerns prior to public offering of Crown mineral rights.”

It is clear that any type of planning process will have to address co-ordination of subsurface and surface rights. Although B.C.’s notification program does not provide a perfect solution to this issue, it offers an initial step in recognizing that surface owners are impacted by subsurface tenure decisions. If Alberta is serious about overhauling the way it makes decisions about land and resource use, the province may learn or thing or two from watching its neighbour to the west.