Frontier and Offshore Regulatory Renewal Initiative

Background

FORRI Partners

FORRI is an intergovernmental partnership between Natural Resources Canada, Crown-Indigenous Relations and Northern Affairs Canada, the Nova Scotia Department of Natural Resources and Renewables and the Newfoundland and Labrador Department of Industry, Energy and Technology. The Canada-Nova Scotia Offshore Petroleum Board, the Canada-Newfoundland and Labrador Offshore Petroleum Board, and the Canada Energy Regulator (formerly the National Energy Board) are also participants in this initiative.

Past Work

FORRI oversaw the modernization of Canada Oil and Gas Drilling and Production Regulations (2009). It also led the development of three new regulations– Administrative Monetary Penalties, Cost Recovery, and Financial Requirements– to implement the federal Energy Safety and Security Act (2015), and the provincial Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act (Amended) – Bill 18 and the Canada-Newfoundland Atlantic Accord Implementation Act (Amended) – Bill 2.

Framework Regulations

Output

FORRI's current focus is to modernize and amalgamate five existing regulations (Drilling and Production; Geophysical Operations; Certificate of Fitness; Operations; Installations) into one set of operational requirements, known as the 'Framework Regulations'. The Framework Regulations will:

• Update safety and environmental protection requirements to ensure our regulations remain world-class
• Reduce multi-regulation redundancy
• Shift to a hybrid regulatory approach with a balance of prescriptive and performance-based requirements
• Support consistency across jurisdictions
• Ensure an effective and efficient regulatory regime

Scope

When completed, the Framework Regulations will apply to any entity authorized to explore, drill, produce, conserve, process and/or transport oil and gas in Canada's frontier and offshore areas. The requirements set out in the Framework Regulations will be the same across Canada, but the enabling legislation will differ depending on the location of the activity.

Changes made through FORRI must fall within the scope of the enabling legislation.

Regulatory Development Process

There are five major stages to regulatory development in Canada:

• Developing policy intent to inform the drafting of the regulations
• Drafting regulations
• Pre-publication in Canada Gazette I
• Public comment period on draft regulations
• Publication in Canada Gazette II

Guide to the Federal Regulatory Development Process

Early Engagement Through the Regulatory Development Process

The FORRI partners are committed to meaningful and transparent engagement with stakeholders, Indigenous groups, and the public. The policy intent and draft regulations were subject to a comprehensive engagement and consultation process.

Stakeholders were engaged at numerous stages in the regulatory development process. The objective of early engagement was to obtain input on the development of policy intent and on the proposed regulatory requirements.

Stakeholders included the oil and gas operators and employers; regulators; certifying authorities; drilling, geophysical/seismic and diving contractors; industry associations; and, companies engaged in the offshore service and supply sector. Indigenous groups in Atlantic Canada were also given opportunities to engage in the regulatory development process.

NRCan and its provincial partners held engagement opportunities in Spring and Summer 2016, and Summer 2017 on various topical areas to obtain input into the draft policy intent that would support the development of the regulations for both offshore areas. Engagement opportunities included written comment periods as well as in-person sessions held in both St. John’s, NL, and Halifax, NS. The input and advice received during these sessions helped to shape the final policy intent, which was presented at a follow-up engagement session in Spring 2018. This session provided an opportunity for government partners to demonstrate to stakeholders how feedback received in earlier engagements had been considered and incorporated into the consolidated policy intent, which would form the basis of the drafting instructions for the Regulations for each offshore area.

Past consultation and engagement activities that occurred can be found below.

Early Engagement on Policy Intent

The development of the policy intent for the Framework Regulations is complete. All documentation and feedback related to the policy intent is posted below.

Offshore Oil and Gas Management

Administrative Areas

Regulations developed through the FORRI apply to frontier and offshore oil and gas areas in Canada.

The provincial Governments of Nova Scotia (NS) and Newfoundland and Labrador (NL) have respective agreements with the federal government to jointly manage offshore administrative areas (the Accord Areas) in the Canada-NS and Canada-NL offshore areas. The federal Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act and the Canada-Newfoundland Atlantic Accord Implementation Act and their mirror provincial versions (NS, NL), known collectively as the Accord Acts, define the management regime of the Accord Areas and provide the legislative framework for the regulations developed through FORRI.

Outside of the Accord Areas, regulations are applied under the Canada Petroleum Resources Act (CPRA) and the Canada Oil and Gas Operations Act (COGOA) with powers as follows:

• Nunavut, and Arctic Offshore
  • Minister of Crown-Indigenous Relations and Northern Affairs
• The Pacific, James Bay, Hudson Bay, Hudson Strait, Ungava Bay, and the Gulf of St. Lawrence
  • Minister of Natural Resources

Regulators of Offshore Oil and Gas Activity

The Accord Acts and regulations are applied in the Accord Areas by the responsible governing Board – an independent joint agency of the federal and respective provincial governments.

• Canada-Nova Scotia Offshore Petroleum Board
• Canada-Newfoundland and Labrador Offshore Petroleum Board

The Canada Energy Regulator is responsible for regulating frontier and offshore oil and gas activities outside of provincial-federal Accord Areas.

Regulatory Approach

The offshore oil and gas industry operates as a permissive-based regime, meaning that any work or activity to be conducted in the offshore area must first be authorized by the Regulator. The Regulator must ensure the operation or activity would comply with the applicable legislation and regulations.

The regulatory modernization work under FORRI aims to create a regulatory framework that maintains the highest standards for operational safety, environmental protection and management of resources.