2nd Session, 43rd Legislature

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Bill 11

THE OIL AND GAS AMENDMENT ACT

(Assented to                                         )

HIS MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:

C.C.S.M. c. O34 amended

1   The Oil and Gas Act is amended by this Act.

2   Subsection 1(1) is amended

(a) by adding the following definition:

"hydrogen" means hydrogen, with or without associated gases, that is formed by natural processes; (« hydrogène »)

(b) by replacing the definitions "lease" and "oil and gas facility" with the following:

"lease", unless the context otherwise requires, means a lease issued under Part 4; (« bail »)

"oil and gas facility" means a battery, flow line, pipeline, drilling or service rig, vehicle, gas plant or other installation or equipment that is used to process, convey or store oil, gas, helium or hydrogen or water produced from a well, but does not include equipment used in connection with the underground storage of gas; (« installation gazière et pétrolière »)

(c) in the definition "oil and gas resources", by striking out "helium and oil shale" and substituting "helium, hydrogen and oil shale";

(d) in the definition "refined petroleum products", by adding "or natural gas" at the end;

(e) in the definition "reservoir", by striking out "gas or helium" and substituting "gas, helium or hydrogen"; and

(f) in the definition "well",

(i) in clause (a),

(A) in subclause (i), by striking out "potash or helium" and substituting "potash, helium or hydrogen", and

(B) in subclause (iii), by striking out "salt or helium" and substituting "salt, helium or hydrogen", and

(ii) in clause (b), by striking out "helium or salt" and substituting "salt, helium or hydrogen".

3   Clauses 2(1)(a) and (b) are amended by striking out "helium and oil shale resources" and substituting "helium, hydrogen and oil shale resources".

4   Clauses 3(1)(a) and (b) are amended by striking out "helium or oil shale" and substituting "helium, hydrogen or oil shale".

5   Subsection 14(1) is replaced with the following:

Duties of registrar

14(1)   The registrar must

(a) keep records of and, where applicable, register

(i) Crown oil and gas rights, dispositions and transfers of dispositions,

(ii) instruments,

(iii) agreements authorizing exploration or drilling for, or production of, helium, hydrogen or oil shale,

(iv) salt water disposal agreements,

(v) licences and permits issued or transferred under this Act,

(vi) unit agreements,

(vii) the proceedings of a hearing under section 26, including documents, exhibits and reports, and

(viii) any order made under this Act;

(b) generally maintain the records of the branch; and

(c) perform any other duties specified in this Act or the regulations.

6   The following is added after section 18:

Inspection programs

18.1(1)   The director may establish one or more programs for the inspection of geophysical operations, wells or oil and gas facilities.

Geographical restrictions, frequency of inspections

18.1(2)   An inspection program may

(a) apply to one or more specified areas in Manitoba; and

(b) specify the frequency of inspections to be carried out under the program.

Requirements may be prescribed

18.1(3)   An inspection program must meet the prescribed requirements, if any.

Inspection fee

18.1(4)   The director may charge the prescribed fee for an inspection carried out under an inspection program.

Other inspections

18.1(5)   This section applies even though the terms and conditions of a licence or permit issued under this Act may also require one or more inspections.

7   Clause 62(b) is amended by adding "or failure to submit a record or other document under this Act" after "a false statement".

8(1)   Subsection 64(1) is replaced with the following:

Abandonment of well or facility

64(1)   Unless otherwise authorized by the director in writing, the lessee of oil and gas rights that are subject to a lease from a freehold owner of oil and gas rights or the holder of a disposition must abandon, in accordance with this Part, any well or oil and gas facility within the lease area or reservation area within 180 days after the lease or disposition expires or is cancelled or surrendered.

8(2)   Subsection 64(2) is amended

(a) by striking out "Where a holder" and substituting "If a lessee of freehold oil and gas rights or a holder of a disposition"; and

(b) by striking out everything after "section 182".

8(3)   Section 64 is further amended by renumbering it as section 124.1.

9   Section 67 is replaced with the following:

Agreements on helium, hydrogen and oil shale

67   The minister may, by agreement, authorize exploration or drilling for, or production of, helium, hydrogen or oil shale in an area where the Crown holds the rights to helium, hydrogen or oil shale. The authorization may be subject to

(a) any terms and conditions that the minister considers necessary or advisable; and

(b) the payment of any prescribed fee, rent or other charge.

10   Subsection 74(1) is amended by striking out "section 177" and substituting "section 426".

11   The following is added after subsection 84(3):

Additional terms and conditions

84(3.1)   The director may, after giving written notice to the licensee, do one or both of the following:

(a) impose additional terms and conditions on a geophysical licence after it is issued;

(b) rescind or vary terms and conditions that are not prescribed by regulation.

12   Subsection 94(1) is replaced with the following:

Additional terms and conditions

94(1)   The director may, after giving written notice to the licensee, do one or both of the following:

(a) impose additional terms and conditions on a well licence after it is issued;

(b) rescind or vary terms and conditions that are not prescribed by regulation.

13   Subsection 100(3) is amended

(a) in the section heading, by striking out "Registrar to" and substituting "Director may"; and

(b) by striking out "the registrar shall" and substituting "the director may".

14(1)   The following is added after subsection 109(2):

Application if Crown oil and gas rights

109(2.1)   If the application relates to the disposal of salt water into an underground formation in a spacing unit in which oil and gas rights are owned by the Crown, the director must not issue the permit unless

(a) the licensee enters into an agreement with the minister, in a form approved by the minister, authorizing the disposal of the salt water into the formation; and

(b) if the oil and gas rights owned by the Crown are not the subject of a disposition, the licensee pays any prescribed fee, rent or other charge.

14(2)   Subsection 109(3) is replaced with the following:

Director may issue permit

109(3)   The director may issue a salt water disposal permit on such terms and conditions as the director considers necessary or advisable.

Additional terms and conditions

109(4)   The director may, after giving written notice to the holder of a salt water disposal permit, do one or both of the following:

(a) impose additional terms and conditions on a salt water disposal permit after it is issued;

(b) rescind or vary terms and conditions that are not prescribed by regulation.

15   The following is added after subsection 111(4):

Additional terms and conditions

111(4.1)   The director may, after giving written notice to the holder of a battery operating permit, do one or both of the following:

(a) impose additional terms and conditions on a battery operating permit after it is issued;

(b) rescind or vary terms and conditions that are not prescribed by regulation.

16   The following is added after subsection 113(4):

Additional terms and conditions

113(5)   The minister may, after giving written notice to the holder of a gas plant permit, do one or both of the following:

(a) impose additional terms and conditions on a gas plant permit after it is issued;

(b) rescind or vary terms and conditions that are not prescribed by regulation.

17   The following is added after subsection 116(2):

Additional terms and conditions

116(3)   The minister may, after giving written notice to the person approved to undertake a project of enhanced recovery, do one or both of the following:

(a) impose additional terms and conditions on an approval;

(b) rescind or vary terms and conditions that are not prescribed by regulation.

18   The following is added after subsection 146(4):

Additional terms and conditions

146(4.1)   An inspector may, after giving written notice to the holder of a flow line licence, do one or both of the following:

(a) impose additional terms and conditions on a flow line licence after it is issued;

(b) rescind or vary terms and conditions that are not prescribed by regulation.

19   The following is added after subsection 149(4):

Additional terms and conditions

149(4.1)   The minister may, after giving written notice to the permittee, do one or both of the following:

(a) impose additional terms and conditions on a pipeline construction permit after it is issued;

(b) rescind or vary terms and conditions that are not prescribed by regulation.

20(1)   Subsection 152(3) is amended

(a) in the English version, by striking out "pipeline operating permit" and substituting "pipeline operating licence"; and

(b) by adding "on such terms and conditions as the minister considers necessary or advisable" at the end.

20(2)   The following is added after subsection 152(3):

Additional terms and conditions

152(3.1)   The minister may, after giving written notice to the licensee, do one or both of the following:

(a) impose additional terms and conditions on a pipeline operating licence after it is issued;

(b) rescind or vary terms and conditions that are not prescribed by regulation.

20(3)   Subsection 152(5) is replaced with the following:

No alteration of activity without consent

152(5)   Except with the prior written consent of the minister, a licensee must not

(a) suspend the operation of the pipeline;

(b) discontinue use of the pipeline; or

(c) where the use of the pipeline has been discontinued, resume operation of the pipeline.

Form of application

152(5.1)   To obtain the minister's consent, the licensee must apply in the form and manner approved by the minister.

No consent required

152(5.2)   Consent of the minister is not required under subsection (5)

(a) to comply with a shut down order made under this Act;

(b) if, in the opinion of the licensee, an emergency requires operation of the pipeline to be suspended; or

(c) if operation of the pipeline is suspended for repairs or maintenance or in the ordinary course of operating the pipeline and the suspension will not interrupt the supply of refined petroleum products in the province.

21   The following is added after section 152 and before the centred heading that follows it:

Notice of suspension for emergency

152.1   If a licensee is of the opinion that an emergency requires that operation of a pipeline be suspended, the licensee must

(a) notify the minister, in the form and manner approved by the minister, within 24 hours after the suspension; and

(b) provide as soon as reasonably possible any additional information or records requested by the minister.

22   Section 158 is amended by striking out "Subject to subsection 100(3), a licence" and substituting "A licence".

23   The following is added after subsection 162(3):

Additional terms and conditions

162(4)   The minister may, after giving written notice to the holder of a storage permit, do one or both of the following:

(a) impose additional terms and conditions on a storage permit after it is issued;

(b) rescind or vary terms and conditions that are not prescribed by regulation.

24   Subsection 188(2) of the English version is amended by striking out "(helium and oil shale)" and substituting "(helium, hydrogen and oil shale)".

25   Subsection 217(1) is amended

(a) by adding the following after clause (f):

(f.1) prescribing requirements for inspection programs established under section 18.1;

(b) by repealing clause (p); and

(c) by replacing clause (hh) with the following:

(hh) respecting disposal of salt water produced from a well, including the form and content of agreements under subsection 109(2.1);

TRANSITIONAL

Salt water disposal

26   A person must not dispose of salt water into an underground formation in a spacing unit in which oil and gas rights are owned by the Crown after the day that is one year after the day that subsection 14(1) of this Act comes into force unless the person

(a) holds a salt water disposal permit that allows for the disposal of salt water into the formation;

(b) has entered into an agreement with the minister, in a form approved by the minister, authorizing the disposal of the salt water into the formation; and

(c) if the oil and gas rights owned by the Crown are not the subject of a disposition, has paid any prescribed fee, rent or other charge.

CONSEQUENTIAL AND CONDITIONAL AMENDMENTS

C.C.S.M. c. B91 amended

27   Subsection 37(5) of The Builders' Liens Act is amended by striking out "oil, gas, helium or oil shale rights" and substituting "oil, gas, helium, hydrogen or oil shale rights".

S.M. 2024, c. 20 (unproclaimed provision amended)

28   The definition "mineral" in subsection 1(1) of The Captured Carbon Storage Act, as enacted by S.M. 2024, c. 20, is amended by striking out "gas, helium, peat" and substituting "gas, helium, hydrogen, peat".

C.C.S.M. c. C340 amended

29   The definition "mineral" in section 1 of The Crown Lands Act is amended by striking out "gas, helium, peat" and substituting "gas, helium, hydrogen, peat".

Conditional amendment, S.M. 2024, c. 20 (unproclaimed)

30   If clause 2(b) of this Act comes into force before section 94 of The Captured Carbon Storage Act, S.M. 2024, c. 20, comes into force, section 94 of that Act is repealed.

COMING INTO FORCE

Coming into force

31   This Act comes into force the day it receives royal assent.