Surface rights legislation back to drawing board

More consultation needed: economy minister

Saskatchewan agricultural leaders say they don’t know why the government pulled a bill last week that would have modernized surface rights legislation.

The province began consulting stakeholders in August 2013 on what they wanted in an updated act. The resulting bill was on the order paper last December but was never introduced, and economy minister Bill Boyd withdrew it March 9.

He said the issues are complex, and more “unique situations” were coming forward even after the extensive consultation.

“Trying to strike a balance between the (energy) industry and the interests of farmers and ranchers is very difficult,” Boyd said.

“Almost every (oil and gas) well is unique in Saskatchewan, whether they’re in close proximity to a livestock operation, industrial location, or a farming operation, someone’s home, small communities, rivers, all of those kinds of things make the legislation very complex and trying to make sure we cover off all of the situations as best we possibly can is going to be very challenging, I would say.”

Boyd said stakeholders continued to raise more issues, such as single well pads versus multi-well pads and horizontal versus vertical wells.

He said the best thing to do is take another look at the legislation, which was first enacted in 1968 and remains largely unchanged despite amendments over the years. The government can then consult again and re-introduce the bill.

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“In addition to that, we have to keep in mind as well that we’ve seen a pretty dramatic drop in oil prices,” Boyd said.

“There are a lot of jobs, a lot of families’ income that is in the balance here that we have to keep in mind.”

Norm Hall, president of the Agricultural Producers Association of Saskatchewan, said he thought the government had perhaps decided “not to rock too many boats” with oil prices dropping so steeply.

“We were quite happy with some of the (proposed) changes,” he said.

For example, the current bill allows for a maximum $1,000 in compensation to be paid for damages caused by an energy sector operator, which Hall said clearly doesn’t go far in 2015. The bill’s regulations were to establish a new maximum.

As well, additional compensation isn’t available to landowners for more than one well per pad, which is something APAS wants to see.

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Hall said the bill could have come forward as a framework, with details coming through regulations afterward.

Saskatchewan Stock Growers Association president Doug Gillespie said his group wanted to see land valued as industrial rather than agricultural when oil and gas development takes place. It also supported removing pipelines and flow lines from the surface rights act.

“By leaving them in under the jurisdiction of the surface rights act, it eliminates landowners’ ability to effectively negotiate with gas and oil operators,” he said.

“We strongly support an annual payment for pipelines and flow lines. Landowners need to be fairly compensated for ongoing use of the lines that are on their property.”

Gillespie said he hopes the government pulls the bill and undertake another round of consultation.

Boyd said another version might come forward next fall.

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Contact karen.briere@producer.com