Alberta to Review Energy Oversight Structure
Fulfilling an election promise, the Canadian province of Alberta’s new government on September 6 launched a six- to eight-month review of the Alberta Energy Regulator (AER), which oversees the province’s oil, natural gas and coal industries.
“Alberta is competing for capital and investments with other jurisdictions, and frankly, we’ve heard that our regulatory framework is not competitive,” provincial energy minister Sonya Savage said. “Our project proponents need assurances that when they go to the provincial regulator with their plans and applications they can expect a reasonable turnaround.”
Created in 2013, the AER’s performance has declined over the last few years, Savage said, even as it hired more staff to deal with an increasing work load. Applications for non-routine projects, she said, can now take four times as long to move through the regulatory process as they do for a similar project in Texas.
“In a province with an innovative, fast-moving and forward-thinking energy sector, we simply cannot afford to be complacent,” Savage added. “In recent months there have been questions about operational efficiency, executive oversight and budgetary spending practices at the AER.”
During the election campaign, the United Conservative Party, which formed the new government under premier Jason Kenney, promised to review the AER’s operations within 180 days, and to install a new board of directors.
“We promised Albertans that we would conduct a review of the AER within 180 days, and I’m proud to move forward on this platform commitment,” said environment and parks minister Jason Nixon, who joined Savage in announcing the review at a Calgary news conference. “We must preserve Alberta’s reputation as an environmentally responsible resource producer – but we must also restore confidence with our investors and landowners as a leader in predictable and efficient regulation.”
Over the next six to eight months, the government will meet in workshops with industry, municipal and professional associations, government departments and indigenous groups. It will also meet with governance and regulatory experts, and has created a website where interested members of the public can leave their comments.
The government will release a report on its findings once the review is complete.
In the meantime, Savage and Nixon also announced the appointment of an interim board of directors that will carry out the general management and business of the AER while the review is being conducted.
Beverly Yee, current deputy minister of environment and parks, will chair the board. Other members include David Goldie, who has more than 30 years’ experience in the oil and gas industry, Georgette Habib, a former board member of Canada’s National Energy Board (now the Canada Energy Regulator) with more than 30 years’ experience in the regulation of oil and gas activities, and Sherri Brillon, who worked for oil and gas producer Encana for more than 30 years and filled key leadership roles with the company, including the C$22.5bn merger that created Encana in 2002 and the restructuring that transformed the company into a pure-play gas producer in 2009.