|Authors:||Duncan Kenyon, Nikki Way, Andrew Read, Barend Dronkers, Benjamin Israel, Binnu Jeyakumar, Nina Lothian|
|Publish Date:||October 2016|
|PDF Download:||[Landowners' Guide] [Landowners' Primer]|
Project Initiation and Consultation
Negotiating and Leasing
Disputes and Concerns
Landowners and Media Outreach
|Pipelines and Other Infrastructure|
|Abandonment and Reclamation|
|Compensation, Rights, and Hearings|
When researching and discussing this guide with Albertans, we heard some key pieces of advice. We heard this advice from landowners, industry, regulators, etc and was informed from their experiences and lessons learned from discussions that went well and those that didn’t go well. These nuggets of advice may help ensure you are ready when the land agent comes knocking.
Building and maintaining relationships with company representatives, AER staff, and neighbours who are also affected and interested may help ensure you are informed about any upcoming activities. After a project is underway, it is helpful to get to know your local AER field inspector, to build trust and familiarity and to help ensure that they can investigate promptly when issues arise.
The relationship with your neighbours can be a great asset. If your neighbours have experienced oil and gas development on their land, they may be able to help you understand what types of impacts or changes you might expect with similar activities, what additional information you should ask the oil and gas companies for, and what to consider when signing your surface lease agreement. Neighbours can act as an early notification network so you are aware of the activity in the area, or they can keep you updated about what a company has proposed to them, so you can compare notes if the company approaches you. Additionally, if you haven’t already engaged a third party to help in your negotiations, neighbours can attend any discussions with the company and provide an additional perspective about what the company representative told you. While neighbours often shy away from discussing topics of money and compensation, it might be worth breaching that subject. The company is already aware of what compensation has been negotiated for similar projects nearby, so unless you are communicating with your neighbours who have negotiated similar agreements, the company representative will know more than you about the range of compensation that could be offered. Compensation and Surface Rights Access also provides insight into negotiating compensation, and we’ve included an example cost chart in Appendix D.
The best time to influence the details of a project is well before the company is ready to submit their application to the AER. It is often difficult to find out about specific projects that may be proposed in your area until the projects are well underway and you begin to see the stakes in the ground. However, if you begin seeing development in a nearby b of land, it may indicate that broader development is planned for your area. You should take the time to reach out to company representatives, talk to your neighbours, and contact the AER to find out more details about the project and potential oil and gas activity in your area. If you believe the project may affect you, make your concerns known to the company as soon as you can, and contact the AER and submit a pre-application concern so that the issue is flagged with the Regulator (see Addressing Your Concerns Before the Application and When the Application is Filed: Submitting a Statement of Concern).
If you don’t make your concerns known to the company, and the company is not aware of any outstanding concerns, they are permitted to submit an expedited or routine application to the AER. This may result in you losing the opportunity to submit a statement of concern, as the AER is not obligated to set and wait for a filing deadline to lapse before making a decision on an application.
When you go into negotiations or consultations, make sure to “tie up your horse”, even if you feel like negotiations have gone well and you have developed a good deal of trust with the company representatives. Move to get the outcomes from good discussions put down on paper and included in your surface lease. If a company commits to an additional measure, confirm with the company the extent of that commitment and the consequences for lapsing on their commitment, and put that it writing as well. Also consider that, while things may be going well now, it is important that there is an established process for conflict resolution (what will both parties do if negotiations break down). Get this included in the surface lease as well.
Don’t feel shy about asking as many questions as you can to better understand the company’s position, and make it a habit to follow up and fact check what they tell you. Make sure to ask:
Many sections throughout this guide contain questions that you should ask, but these are just a handful to get you started. The more questions you ask, the better positioned you are to negotiate. There are other sources of information if you don’t understand something that a company has told you and if this Landowners’ Guide or a neighbour doesn’t have the answer for your questions. The Farmers’ Advocate Office (see Farmers’ Advocate Office) and the AER’s stakeholder engagement team (see Alberta Energy Regulator offices) may be able to help address your questions.
Contact any local groups in the area, such as a nearby synergy group (see Synergy Alberta), and ask if best practices have been developed for the area that you can encourage the company to abide by. Throughout this guide, we have also described additional measures you can discuss with the company that act as best practices. The AER may also be able to walk you through some additional best practices. If a company agrees to follow a best practice, again: put it in writing.
Compensation for your time and energy should be in the agreement from the start. Keep track of the time spent researching, negotiating with company representatives, visiting the well site, or fixing damages. We’ve included example cost trackers in Appendix D, which should give you an idea of what records to keep.
Even if a land agent hasn’t yet knocked on your door, you should be prepared with an understanding of what your future plans are for your land. For example, if you have plans to subdivide your land for your children when they inherit your land, understanding how a well or pipeline may affect these plans is crucial. Wells and pipelines have setbacks that may limit the locations where you can build a residence (see Setbacks and Site Selection and Setbacks), so you may be surprised to find out that when it comes time to build, your ideal location for a new home is not an option. Or, the proposed house location may be outside a setback, but be located downwind of one of the oil or gas facilities on your land.
Taking some time to even preliminarily determine what your plans are will allow you to identify and communicate how development may impact your future plans. If you are committed enough to the idea of subdividing, it might be worth approaching your municipality now to get the process started and on paper. In general, the more details you can provide about your situation, the more strongly you can make your case when negotiating with a company or submitting a statement of concern. In a statement of concern, it is crucial to clearly explain how a proposed development directly and adversely affects you, so it is not enough to state that you are concerned because you may one day subdivide your land or build a home. For example, explain that the proposed project location limits where you have already assessed you’ll put a future house, and show the potential locations you are left with and why they are not satisfactory. As one person put it, “If you’re talking about a pig, you need to take a picture of your pig.”
In negotiating theory, it is important to know your best alternative to a negotiated agreement. In other words, you need to understand the best you can do if a company isn’t cooperative with you, and the best the company can do if you don’t cooperate with them. This outlines your bargaining power when negotiating a surface lease or in consultations with a company proposing a project nearby.
The more you prepare for negotiations with this in mind, the better the outcomes you are likely to achieve. If your demands to the company don’t compare to a company’s alternatives, negotiations are likely to fail. In practice, that may mean the company will seek a right-of-entry order from the Surface Rights Board and compensation may be set in a compensation hearing. However most companies are likely interested in negotiation first — they could be inclined to ensure the relationship with you is on good terms, and it saves them time and money. Understanding when your demands pass this threshold where it is no longer beneficial to continue negotiating helps ensure they stay at the table.
Clarity on your own alternatives is important. Unless you are a freehold mineral rights owner, you are negotiating with little control over access to the Crown-owned oil and gas beneath your feet. You need to understand what alternatives you are left if negotiations break down.
You may need to be contact with several government departments or agencies related to development nearby to you. The roles of these and other government bodies are described in Appendix A. Here we provide a quick reference list, in alphabetical order, of some of the government bodies you may want to contact and the most important phone numbers. The table indicates the section where each board, department, etc. is described, but they are referred to in many sections throughout the guide.
|Alberta Energy Regulator (AER)||Alberta Energy Regulator|
Regulates oil and gas wells, provincial pipelines and facilities (does not deal with compensation
Handles conservation, reclamation and contaminant remediation for oil and gas development
Energy/Environmental Emergency & Operational Complaint Number (24 hrs)
|Alberta Environment and Parks (AEP)||Alberta Environment and Parks|
Conducts environmental monitoring and develops environmental policies (NOT responsible for regulating oil and gas development).
|Farmers’ Advocate Office (FAO)||Farmers’ Advocate Office|
Provides advice on lease agreements and negotiations, and offers water well restoration or replacement program
|National Energy Board (NEB)||Alberta Geological Survey|
Regulates interprovincial and international pipelines
|General Inquiries||1-800-899-1265 or 403-292-4800|
For a pipeline emergency, Transportation Safety Board's 24-hour hot line
All other emergencies related to a NEB-regulated company's operations, facility or activity
|Registrar of Land Agents||Alberta Labour|
Handles questions about land agents (housed within Alberta Labour)
|Surface Rights Board (SRB)||Surface Rights Board and Land Compensation Board|
Addresses compensation issues and right-of-entry orders
All Government of Alberta staff and Members of the Legislative Assembly (MLAs) can be reached toll-free from anywhere in the province by first dialling the Alberta Government RITE line at 310-0000, then entering the area code and number you wish to reach. If you do not know who to call, you can dial 310-0000 and then press “0” to get the operator. Tell the operator the subject you are calling about and ask to be connected to the right person. If you do not have a touch-tone telephone, stay on the line. The Government of Alberta publishes a telephone directory of staff and MLAs as well as department information.