Saskatchewan Landowner Oilfield Rights

Oil & Gas Industry Rights



When the Oilpatch

Comes to Your Saskatchewan Backyard:

A Citizen’s Guide to protecting
Your Rights

Stefania A. Fortugno,
LL.B., LL.M.

May 2004

Saskatchewan Environmental Society

Box 1372
Saskatoon, Saskatchewan
Canada S7K 3N9
phone: (306) 665-1915
Fax: (306) 665-2128

Copyright © 2004 by Saskatchewan Environmental Society

Acknowledgements and Disclaimer

The author would like to thank and acknowledge the persons who have made the
publication of this citizens’ guide possible. The pembina Institute for Appropriate
Development in Alberta generously supported the effort to create a guide for
Saskatchewan citizens based on their own Alberta guide. pembina is known for innovative
and practical ideas – please see their website,, for other content related
to the energy industry. Ann Coxworth, volunteer program coordinator for the
Saskatchewan Environmental Society, supplied gracious guidance, encouragement and
support for this project. Karin Tate-penna provided excellent editorial and research
assistance. The patience of family and friends permitted the author to complete this work.

The author must also recognize the contribution of those individuals who were asked to
review the draft text, including:

patricia Farnese, Assistant professor University of Saskatchewan, Senior Law Fellow with
Centre for Studies in Agriculture, Law and the Environment (CSALE); Mary Griffiths,
Environmental policy Analyst, pembina Institute for Appropriate Development; Ralph
Leibel, Director of Community planning, Municipal Relations Division, Saskatchewan
Government Relations and Aboriginal Affairs (GRAA); Sharon Mascher, professor of Natural
Resources Law and Environmental Law, University of Saskatchewan; Lorne Veitch, Regional
Manager, South Regional office, Saskatchewan Agriculture, Food and Rural Revitalization;
and Rick Stilling, provincial Manager, Oil and Gas Development, Saskatchewan Environment

The following donors provided funding essential to the publication of this work: Centre for
Studies in Agriculture, Law and the Environment (CSALE) at the University of Saskatchewan;
Nexen Canada Inc.; and the Saskatchewan Environmental Society. Their support is deeply

The contents of this guide are the responsibility of the author and do not necessarily reflect the
views and opinions of those who are acknowledged above.

Every effort has been made to ensure the accuracy of the information contained in this guide.
However, the author cannot guarantee the information provided is complete or accurate and
advises that any persons relying on this publication do so at their own risk.

This guide has been developed to provide general guidance on the legal rights of Saskatchewan
citizens living in the oil patch. However, this guide does not provide legal advice and should
not be considered a substitute for legal advice from a lawyer.




Introduction _________________________________________________ 1

Chapter One: Legal Rights of Landowners and Occupants _________ 3

Who owns the Oil and Gas? — Crown versus private ownership of mineral rights
in Saskatchewan _______________________________________________________ 3

1. Mineral Rights______________________________________________________________ 3

a. Royalties and Taxes________________________________________________________ 4

b. Freehold Mineral (petroleum) Rights __________________________________________ 4

2. Surface Rights ______________________________________________________________ 5

a. Negotiating a Surface Rights Lease____________________________________________ 6

(i) Compensation Factors____________________________________________________ 7

(ii) Environmental and Liability Considerations ________________________________ 8

(iii) Surface Rights Lease Checklist __________________________________________ 9

b. proceedings before the Surface Rights Board of Arbitration________________________ 11

(i) Right of Entry/Compensation Orders _______________________________________ 11

(ii) Limited Damage Claims and Environmental Enforcement ______________________ 13

c. Surface Leases and Crown Owned Agricultural Land_____________________________ 14

What is involved in an oil or gas development project? ______________________ 15

1. Oil and Gas Reservoirs ______________________________________________________ 15

2. Seismic Exploration Activities_________________________________________________ 16

a. Consent Requirements _____________________________________________________ 17

b. Setbacks________________________________________________________________ 18
Minimum Distances to Structures in Seismic Explorations ______________________ 19

c. Damage and Compensation _________________________________________________ 19

d. Abandonment and Clean-Up of Shot Holes_____________________________________ 20

e. Refusals by Landowner or Occupant__________________________________________ 20

f. Exploration Access Agreement Checklist ______________________________________ 21

3. Drilling and Operation of Oil and Gas Wells _____________________________________ 23

a. Exploration Drilling_______________________________________________________ 23

b. Blowout preventer ________________________________________________________ 23

c. Development Drilling _____________________________________________________ 24

d. Drilling Equipment and Operations___________________________________________ 24

e. Oil Recovery Methods_____________________________________________________ 25

4. Flaring and Venting ________________________________________________________ 26

a. Sour Gas and Hydrogen Sulphide (H2S) _______________________________________ 26

b. “Sweetening” Sour Gas ____________________________________________________ 28

c. Flaring Operations ________________________________________________________ 28

d. Environmental and Health Effects of Flaring ___________________________________ 29

e. Eliminating or Reducing Flaring _____________________________________________ 30

f. Venting ________________________________________________________________ 31

g. Flaring Setback and Notification Requirements _________________________________ 31

(i) Setbacks _____________________________________________________________ 31

(ii) Flaring Notification Requirements ________________________________________ 32

5. pipelines__________________________________________________________________ 32

a. pipeline Route Selection and Construction _____________________________________ 33

(i) Surveys _____________________________________________________________ 33

(ii) Notification__________________________________________________________ 33

(iii) pipeline Easement Agreements __________________________________________ 34

(iv) Expropriation ________________________________________________________ 34

b. Negotiating an Easement Agreement _________________________________________ 35

(i) Compensation _________________________________________________________ 36



(ii) Arbitration __________________________________________________________ 37

(iii) Environmental Matters _________________________________________________ 38

c. Adjacent Landowners/Occupants ____________________________________________ 39

d. pipeline Easement Negotiation Checklist ______________________________________ 39

6. Batteries and Gas processing plants ___________________________________________ 41

a. Batteries________________________________________________________________ 41

b. Gas processing plants _____________________________________________________ 42

7. Waste Management _________________________________________________________ 42

a. SpIGEC Waste Management Guidelines_______________________________________ 42

b. provincial Regulators _____________________________________________________ 43

c. Waste Disposal Wells _____________________________________________________ 44

d. Drilling Waste Treatment and Disposal________________________________________ 45

(i) Drilling Waste Management plans ________________________________________ 46

(ii) Temporary Storage/Containment of Drilling Fluids ___________________________ 46

e. Land Application: Land Spreading, Land Treatment and Land Farming ______________ 47

8. Abandonment and Restoration of Well Sites _____________________________________ 48

a. Capping or plugging Wells _________________________________________________ 49

(i) Dry Hole Abandonment ________________________________________________ 49

(ii) production Well Abandonment Outside pools _______________________________ 50

(iii) production Well Abandonment Inside pools ________________________________ 50

b. Restoration of Well Sites___________________________________________________ 50

Chapter Two: Emergencies ___________________________________ 52

1. Oil or Gas Well Emergencies _________________________________________________ 52

a. What to Do in the Event of an Oil or Gas Well Emergency ___________________________ 53

b. Responsibilities of Well Operators/Owners in an Emergency _________________________ 53

(i) public Notice Requirements _______________________________________________ 53

(ii) Notice to Government Departments _________________________________________ 53

(iii) Liability for Costs of Clean-up and Harm to persons or property___________________ 54

2. pipeline Emergencies _______________________________________________________ 54

a. Signs of a Gas Leak _________________________________________________________ 54

b. What to Do in the Event of a Natural Gas pipeline Emergency________________________ 55

Chapter Three: Common Law Rights___________________________56

A. Nuisance _____________________________________________________________ 56

1. Vibration, Noise and Fumes as Nuisance _______________________________________ 57

2. Noise as a Nuisance ________________________________________________________ 58

B. Trespass _____________________________________________________________ 59

C. Negligence ___________________________________________________________ 59

D. Rule in Rylands v. Fletcher: Strict Liability for Non-Natural Land Use _________ 60

E. Breach of Contract ____________________________________________________ 62

Chapter Four: Differences between Alberta and Saskatchewan in the
Regulation of the Oil and Gas Industry _________________________ 63

A. Regulatory Oversight Differences ________________________________________ 63

1. Alberta Energy and Utilities Board (EUB) Compared to Saskatchewan Industry and
Resources (SIR) _________________________________________________________ 63

2. Saskatchewan Municipalities more powerful than Alberta Municipalities in Regulating Oil
and Gas Development _____________________________________________________ 65

a. Great Sand Hills: A Case Study _____________________________________________ 65


Chapter Five: Contacts and Other Resources ____________________ 68

A. Government Departments and Boards ____________________________________ 68

1. Saskatchewan Industry and Resources__________________________________________ 68

2. Saskatchewan Environment __________________________________________________ 69

3. Saskatchewan Agriculture, Food and Rural Revitalization__________________________ 71

4. Heritage Resource Branch – Department of Culture, Youth and Recreation____________ 72

5. Saskatchewan Surface Rights Board of Arbitration _______________________________ 73

6. National Energy Board ______________________________________________________ 73

B. Community and Environmental Groups___________________________________ 74

1. Federation of Saskatchewan Surface Rights Association ___________________________ 74

2. Saskatchewan Environmental Society (SES) _____________________________________ 74

3. Saskatchewan Eco-Network (SEN) ____________________________________________ 75

4. pembina Institute for Appropriate Development (pIAD)____________________________ 76

5. Canadian parks and Wilderness Society (CpAWS) ________________________________ 77

C. Industry Organizations_________________________________________________ 78

1. Saskatchewan petroleum Industry/Government Environment Committee (SpIGEC)_____ 78

2. Canadian Association of petroleum producers ___________________________________ 79

3. Small Explorers and producers Association of Canada ____________________________ 79

4. Canadian Association of petroleum Land Administration (CApLA) __________________ 80

D. Lawyers, Expert Witnesses or Technical Assistance _________________________ 80

1. Centre for Studies in Agriculture, Law and the Environment________________________ 80

2. Lawyer Referral Service _____________________________________________________ 81

3. Technical Consultants and Laboratories ________________________________________ 81

Bibliography _______________________________________________ 83



When the Oil patch Comes to your Saskatchewan Backyard:
A Citizens’ Guide to protecting Your Rights


A wide green expanse of pastureland dotted only by cattle and horses, an endless prairie sky
untouched by steel monoliths, a quiet and rhythmic existence passed from generation to
generation, until an oil or gas exploration company comes knocking at the door. Many
Saskatchewan farmers, ranchers and other landowners are only too familiar with the disruption
of a pastoral way of life by new industry and development in the oil and gas sector.

Over the last decade Saskatchewan has seen an explosive expansion of the petroleum industry.
Tax and investment incentives offered by the province have encouraged record numbers of
exploration and production ventures. The latest statistics for the year 2002 boast that
Saskatchewan has over 21,400 active oil wells. The province ranks as the second largest
petroleum producer in Canada after Alberta, supplying 21% of all oil production.
Saskatchewan also has over 10,000 natural gas wells, and is ranked as the nation’s third largest
natural gas producer.

In 2001 industry revenues were $5.5 billion from oil, natural gas and their by-products.1 For
the same year royalties, bonuses and fees paid to the province of Saskatchewan by producers
totalled $600 million. For 2002 this amount climbed to $1.0 billion.2 This figure represents
approximately 18% of total provincial revenues. Clearly this economic clout means that the
petroleum industry has a major voice in the province.

What can an individual or family do when faced with a large company that wants to enter their
land and blast dynamite underground to conduct seismic exploration or drill a “wildcat”
exploration well? How can they protect their health and the health of their livestock? How can
they ensure that their land, water and air are not polluted by the development? How can they
obtain fair compensation for the loss of use of land and any ill effects suffered? What are the
rights of neighbours and communities affected by oil and gas projects?

This Guide is designed to help you understand your legal rights and the rights and
responsibilities of oil companies operating in Saskatchewan and in your community. It is a
resource guide that seeks to make it easier for you to negotiate to protect your interests when
dealing with exploration companies and oil and gas producers.

This Guide is modelled on the Guide developed by the pembina Institute in Alberta for
Alberta citizens and has been adapted to the Saskatchewan context. It also points to some key
differences between the laws and regulatory activities in Alberta and Saskatchewan.

1 Canadian Association of petroleum producers (CApp), Industry Facts and Information: Saskatchewan (2001), CApp
website at
2 CApp, Industry Facts and Information: Saskatchewan (2003), CApp website at



Chapter one of this Guide provides an overview of the legal rights of landowners and
occupants, both legislated and common law, as they correspond to the different phases of an
oil or gas project. It also describes provincial legislation and regulation of the petroleum
industry.3 The four provincial ministries and their areas of responsibility are discussed here and
elsewhere in the Guide. These Departments include Saskatchewan Industry and Resources,
Saskatchewan Environment, Saskatchewan Agriculture Food and Rural Revitalization, and the
Heritage Resource Branch of the Department of Culture, Youth and Recreation.

Chapter two examines what to do in the event of an emergency. Chapter three outlines the
common law rights of persons affected by the oil and gas industry, including adjacent
landowners and others living in the oil patch.

Chapter four highlights some of the key differences between Alberta and Saskatchewan in
regulating the petroleum industry. Chapter five provides a list of contacts and other resources.

3 All Saskatchewan legislation (including regulations) can be viewed on the provincial Queen’s printer website at:



Chapter One: Legal Rights of Landowners and Occupants

Who owns the Oil and Gas? — Crown versus private ownership of
mineral rights in Saskatchewan
Many landowners do not realize that the Crown (government of Saskatchewan, or in some
cases the government of Canada) may own the minerals found beneath the surface of their
land. This is the case because at the turn of the 20th Century, when the Dominion of Canada
granted prairie land to homesteaders, it reserved the mineral rights for the Crown. In 1930 the
federal government transferred ownership of mineral resources to the province. However, the
federal Crown retained mineral rights to lands under federal jurisdiction. For example, the
federal government owns the mineral rights in national parks and First Nation reserves.

Currently, the provincial Crown holds approximately 78% of the total oil and gas rights in the
province. private individuals, corporations, First Nations bands and the federal Crown own
the remaining 22%. An oil or gas company normally acquires these mineral rights by leasing.
More rarely mineral rights are purchased through Saskatchewan Industry and Resources
(Crown rights) or from the private owner (freehold rights).

To determine who owns the minerals beneath any land, the title must be checked through the
provincial Land Titles system.

Mineral Rights
The Crown Minerals Act (1985) governs the granting of mineral rights by the province to oil and
gas companies. If preliminary geological studies point to a promising oil or gas field in a
specific area, the company will approach the Mineral Rights Branch of Saskatchewan Industry
and Resources and request that the mineral rights for the land be “posted for disposition” or
made available for lease. The mineral rights are sold by public tender and are called “petroleum
land sales.” These sales take place periodically throughout the year. Although a company may
request that mineral rights be posted, this does not guarantee that the company will be the
successful bidder. Other companies may also bid on the posted mineral rights.

The Crown Minerals Act defines mineral as “any non-viable [non-living] substance formed by the
processes of nature, irrespective of chemical or physical state and both before and after
extraction, but does not include any surface or ground water, agricultural soil or sand or
gravel”. The term “Crown disposition” refers to the rights granted under a Crown lease or any
other instrument under the Act (section 2(1)(b)). These rights include the right to explore or
prospect for any Crown mineral (oil and gas exploration licence), as well as the right to extract
or produce the mineral (Crown lease). Therefore, an oil or gas company will purchase the
mineral rights in the form of exploration licences and production leases.

Once a company or individual asks for the posting of mineral rights to oil and gas, the Mineral
Rights Branch investigates whether the land has any surface or subsurface restrictions.
possible surface access restrictions would relate to environmental, heritage or Treaty Land



Entitlements issues. For example, if the land is designated in The Wildlife Habitat protection Act,
it may mean that the amount of exploration or development that can take place on that land is

If Saskatchewan Industry and Resources decides not to post the oil and gas rights because of
such concerns, the company will be advised. Alternatively, the ministry will post the rights with
restrictions attached to each posted parcel. Therefore, the companies interested in the mineral
rights know up front about any possible surface access restrictions before bidding on the
posted parcels. Any inquiries about the restrictions can be made to the Departments listed
beside each parcel.4 Concerned landowners or citizens can inquire to these Departments to
understand the rights and responsibilities of the proposed developer where such restrictions

The public notices of the posted mineral rights and any restrictions are found on the
Saskatchewan Industry and Resources website by following the links under the heading of
“petroleum and Natural Gas Dispositions: public Offerings” to the heading “Sale Notice” at:

a. Royalties and Taxes
Once companies obtain mineral rights from the Crown through leasing, they must pay
royalties to the province. These royalties are calculated based on the price of crude oil and
natural gas, and on the amount of production from each wellhead. Where oil and gas rights are
leased from private owners (freehold) the companies must pay provincial taxes.

If a landowner or occupant seeks to prevent any oil and gas companies from exploring or
developing resources beneath their land by leasing or purchasing the Crown mineral rights
themselves, it must be kept in mind that annual royalties, rents or taxes may be payable to the
province. For instance, the Mineral Taxation Act provides that a mineral tax is to be levied
against all owners of mineral rights. However, there is an exemption for individuals for the first
five nominal sections of mineral rights owned (3,200 acres). In the case of a farm corporation,
a tax exemption applies where certain guidelines are met.

b. Freehold Mineral (petroleum) Rights
Where you as a landowner own the mineral rights relating to your property, you may dispose
of these rights under any terms and conditions you choose. Freehold petroleum rights are sold
or leased through a contract or agreement known as a “petroleum and natural gas lease.” Such
agreements are usually lengthy and complicated. Therefore it is strongly recommended that
you seek the advice of a lawyer experienced in oil and gas law before signing or negotiating a
mineral rights agreement with an oil or gas developer.

4 Business Services Improvement Branch Economic and Co-operative Development, The provincial Regulatory
Approval process in Saskatchewan for petroleum and Natural Gas Drilling and Seismic Exploration (Sept. 2001) at p.3.



2. Surface Rights
As suggested above, where mineral rights are Crown owned, a landowner or lessee does not
have exclusive control of his or her surface property. Under the common law (judge made
law), the mineral owner has the right to enter upon the land held by the surface owner or
occupant to work or recover the minerals. Therefore a landowner or occupant cannot refuse
entry or access to the minerals.

Before legislation was enacted in the province, the right of entry by mineral owners was
unrestricted. There was no requirement that the owner of the surface land receive any
compensation for entry or disturbance. However, in 1931, one year after the federal transfer of
resources to the province, the province enacted the first Mineral Resources Act. One of the most
important goals of the Act was to balance the rights of surface owners with the rights of
mineral owners. The Act established the right of compensation for surface rights holders and
provided for arbitration in the event of disagreement.

Today The Surface Rights Acquisition and Compensation Act of 1978 governs the relationship
between the surface owner or occupant and the mineral rights owner or lessee. Under this
legislation an owner or occupant is entitled to compensation for:

the initial right of entry for drilling and completion (based on the capital value of the
land), and

the continuing right of entry for production purposes.
Compensation for the initial right of entry usually takes the form of a one-time lump sum
payment, whereas compensation for the continuing right of entry is in the form of an annual
payment. The compensation is to be “just and equitable” as stated in section 3 of the Act,
which reads:

3. The purposes of this Act are:
(a) to provide for a comprehensive procedure for acquiring surface rights;
(b) to provide for the payment of just and equitable compensation for the
acquisition of surface rights;
(c) to provide for the maintenance and reclamation of the surface of land
acquired in connection with surface rights acquired under this Act.
The term “surface rights”, used in subsection 3(b), is defined in subsection 2(m) of the Act as
“the land or any portion thereof or any interest therein, except mines and minerals within the
meaning of The Land Titles Act,” or a right of entry onto the land “required by an operator for
the purpose of drilling for, producing or recovering a mineral.” The definition also includes
the right to condition, reclaim or restore the surface of the land where the land has been held in
connection with the drilling for or recovery of a mineral, or the laying, constructing, operating
or servicing of a flow line, service line or power line. The right of entry and the right to reclaim
or restore the surface of the land are the surface rights which mineral rights owners will seek to
acquire/lease from a surface rights owner.

Because a mineral owner has the legal right to develop and extract the minerals (oil and gas), a
farmer, rancher or other landowner cannot refuse surface access to the oil and gas. But the
landowner’s right to compensation for the exercise of the right of entry is clear. Therefore, the



formal settling of rights and responsibilities between the surface owner and the oil and gas
company is necessary. This can be accomplished either through private negotiation of a
written surface lease or through the Surface Rights Arbitration Board process.

In 1998 the University of Saskatchewan, Centre for Studies in Agriculture, Law and the
Environment (CSALE) published a detailed booklet outlining various considerations in the
negotiation of a surface lease with an oil or gas company. This helpful document entitled,
Negotiating Surface Rights, is available for downloading from the internet,5 from CSALE or from
Saskatchewan Agriculture’s regional offices. A contact number and address for CSALE have
been provided in Chapter Five of this Guide.

The CSALE publication strongly recommends that surface owners and occupiers attempt to
reach a voluntary agreement through private negotiations rather than relying on the adversarial
arbitration process. This recommendation is made because it is important to establish goodwill
and a positive working relationship with the oil and gas company that may be operating on
your property for a lengthy period of time. Nonetheless, any terms should be acceptable to you
and legal advice sought before signing any agreement.

Even where resort to the arbitration procedure is necessary when a dispute cannot be resolved,
it is helpful to establish, in writing, as many points of agreement with the oil and gas company
as possible before entering the arbitration process, to reduce both time and costs.

a. Negotiating a Surface Rights Lease
Often the negotiation of a surface lease or easement agreement begins when a landman acting
on behalf of an oil or gas company arrives on the doorstep. The company will have purchased
the mineral rights after conducting a successful seismic exploration program on or near your
land.6 The landman will request the right to conduct a survey of the parcel of land where oil or
gas development seems promising.7 Once the survey is complete, the landman will return with
the survey, showing the proposed well site and access road locations. Next the landman will
request the right to enter upon the land to develop and remove the oil or gas beneath the

To speed up the process of negotiation most companies will present a ready-made form of
lease to secure surface rights. However, as each person’s situation and concerns are unique,
such a lease contract must be carefully reviewed and negotiated before signing. Where you as
the landowner or occupant disagree with the terms, or important matters or concerns are not
dealt with, these items must be addressed through amendments or additions to the proposed
lease form. It must be kept in mind that the landman represents the interests of the lessee oil
and gas company, not the interests of the lessor landowner or tenant/occupant.

5 See
6 For a full review of exploration activities refer to section B2 below.
7 Centre for Studies in Agriculture, Law and the Environment (CSALE), Negotiating Surface Rights (Saskatoon:
University of Saskatchewan, 1998) at p.2.



The template or backdrop for negotiating a surface lease or easement agreement is the Surface
Rights Acquisition and Compensation Act. Easement agreements are usually prepared to grant a
more limited right of way for pipelines or flowlines.

Section 24 of the Surface Rights Acquisition Act provides that an operator (oil or gas company)
may acquire from a land owner or occupant the right to enter upon, use and occupy specified
portions of the surface of the land for one or more of the following: the drilling for, recovery
or production of a mineral; establishment of a well site and roadway for drilling or production;
installation or operation of any listed equipment on a well site; the establishment of a battery
site; and, the construction of a power line.

(i) Compensation Factors
The details of compensation are covered in the Act. Section 28 says that the operator has to
pay compensation for any of the surface rights mentioned in section 23 acquired by the
company. Further, this compensation must be paid in accordance with section 29. Section 29
sets out the matters that the Board of Arbitration or private individuals must consider in
establishing equitable and just compensation. The factors include:

(a) the value of the land and the loss of the use of the land or interest acquired by the
(b) the area of land that is or may be permanently or temporarily damaged by the
(c) the nature, type and quantity of any machinery or equipment to be installed or
operated by the operator;
(d) payment or allowance for severance (that is, severing or separating part of your land
from the rest by the placement of access roads or well sites on your property);
(e) the adverse effect of the right of entry on the remaining land caused by the severance
(for example, placing of a well site and access road within cultivated land can severely
impede a farming operation and increase the costs of farming the remaining land)9;
(f) payment or allowance for nuisance, inconvenience, disturbance or noise to the
owner/occupant or to the remaining land that may be caused or is likely to be caused
by the operations;
(g) any other matter peculiar to each case, including the cumulative effect of surface rights
previously acquired by the operator or any other person; and,
(h) any other relevant factors.
Therefore, a surface owner is entitled to compensation for land value, loss of use, severance
and adverse effects, nuisance and general disturbance, damages and other factors. When
negotiating the surface lease terms, each of these areas of compensation should be dealt with

Where a farmer or rancher leases the land he or she is occupying, other than Crown land, both
the landowner and occupant must provide consent under the Act.10 Compensation is then
divided between the owner and occupant. Although it is up to the parties to decide how the



compensation will be split, a common approach is for the owner/lessor to receive
compensation relating to the value of the land and any damage to the land, while the
occupant/tenant receives compensation for the loss of use and severance or adverse effects.11
Compensation under the category of nuisance and general disturbance is divided according to
the specific circumstances.

For a detailed review of these compensation categories or factors, refer to the CSALE
publication, Negotiating Surface Leases, referred to above under section A2.

A local Surface Rights Association office may also provide valuable insights into the
negotiating process, including average compensation amounts for comparable lands in the
area. The Federation of Saskatchewan Surface Rights Associations has local offices
throughout the Saskatchewan oil patch. Speaking with other landowners who have well sites
on their property may also be helpful.

In order to best protect your interests, it is recommended that you seek legal advice when
negotiating a surface lease, particularly when dealing with a ready-made surface lease or
easement agreement.

(ii) Environmental and Liability Considerations
When a well site and access roads are installed on or near pastureland or cultivated lands, a
series of environmental impacts are possible. The potential impact on crops, livestock, land
and water should be understood to ensure the surface lease agreement attempts to minimize
them and provides for adequate compensation.

possible environmental problems include: the transport of noxious weeds; air pollution caused
by flaring; water pollution; waste management; loss or disturbance of topsoil; soil compaction
from equipment; flooding due to drainage disturbance; loss of shelterbelt; and the use of
chemicals on lease lands impacting on neighbouring organic crops. These environmental
matters are more fully discussed in section B of this chapter below.

Liability issues are also an important consideration. The surface lease agreement should ensure
that the oil and gas company takes full responsibility for any negative impacts or damages
suffered by the surface owner, neighbours and downstream/riparian rights owners.

Merely entering into an agreement with an oil or gas company can create liability on the part of
the landowner or occupant. Therefore, the surface lease agreement should state the company
clearly accepts responsibility for any negative impacts resulting from its operations or activities
and “indemnifies the owner/occupier of the land against any and all damage, claims or actions
that arise out of the company’s undertaking.” 12 The agreement should also state that the
company has complete control over everything that occurs on the lease premises. This latter
provision would help protect against a common law claim for damages caused by the escape of
anything relating to non-natural use of land. Under the common law rule, known as “the rule
in Rylands v. Fletcher”, any person who has control of a substance that escapes from their
property is strictly liable for any damages caused by the substance whether or not there has
been any negligence.




Connected to the issue of liability and indemnification is the financial stability and solvency of
the operating oil or gas company. A company without funds or assets cannot take
responsibility or indemnify the landowner, nor perform certain tasks or make certain payments
in the event of harm or operating problems. To address these concerns, the owner or occupant
should investigate the financial health of the company with whom they are negotiating, and ask
for evidence that the liability clauses will provide meaningful protection.13

(iii) Surface Rights Lease Checklist
Before signing a surface lease agreement with an oil or gas company, consider the following:

(1) Keep a log of time spent in negotiations and a diary of events, including phone calls. A
landowner should expect compensation for time lost in negotiating the agreement,
and any expenses incurred, as part of the initial compensation. 14 These items fall
under the heading of general disturbance.
(2) Take photographs of the site before work starts and of any damage that is done as the
operations progress.
(3) Read the CSALE document Negotiating Surface Rights (1998).
(4) Consider whether you wish to add any additional conditions to the lease agreement.
One Alberta landowner has drawn up an addendum with 27 conditions.15 It may be
helpful to review this list to determine which conditions are relevant to your situation.
(5) Consult with local Surface Rights Association and local landowners hosting existing
well sites.
(6) Review the location of the proposed well and access roads. Are they located to
minimize inconvenience to you or your neighbours and also to permit the company to
protect the environment?
(7) Discuss the location of any possible flowlines or pipelines if the well is successful.
13 CSALE, at p.7.
14 Mary Griffiths and Tom Marr-Laing, When the Oilpatch Comes to Your Backyard (Drayton Valley, Alberta: pembina
Institute, 2001) at p.16.
15 See Surface Lease Special Conditions Addendum found in Appendix 2 of Griffiths and Marr-Laing, When the Oilpatch
Comes to Your Backyard. See also the reaction of the Alberta Energy and Utilities Board (EUB) to these conditions,
in Decision 2002-020 at (at
pages 12-15).




(8) Set out in the agreement how the oil or gas well will be tested.
provide for
pre-notification by the company of any test flares if you have health concerns or have
sensitive livestock operations, including fear of being startled by the noise of a sudden
(9) Have your water well tested at the company’s expense prior to entry by the company
and arrange for the company to test it again after the oil or gas well is drilled.
(10)Ensure that the proposed well, as set out on the company’s survey, is set back at least
the minimum distances from buildings, water wells, and other significant features.
These distances are found in the Seismic Exploration Regulations, 1999. (See section B2b
(11)Arrange for the company to remove all drilling wastes from your land or to deal with
them in a manner that will not cause pollution.
(12)The agreement should require the company to notify you and promptly deal with any
leaks, spills, or accidental releases from its well and pay compensation for any related
(13)The lease agreement should set out each head of compensation found in the Surface
Rights Acquisition and Compensation Act and provide a separate calculation amount for
each. These heads include: land value, loss of use, severance and adverse effects,
nuisance and general disturbance, damages and other factors. For example, is the
proposed compensation enough to cover the loss of land and inconvenience that the
oil or gas well and access road will cause?
(14)Set out the amount of compensation the company will pay if your water well is
damaged either in terms of water quality or quantity.
(15)The lease should state that if the company causes any damage to the land or crop
outside of the lease area that additional compensation must be provided.
(16)The agreement must deal with all aspects of conservation and reclamation, ensuring
that the company will be held liable if any problems appear after the initial well site
reclamation has been completed. The surface lease should require the company to
meet your expectations as well as legislated requirements.
(17)Ensure that everything you have negotiated with the company is included in the
written agreement.
(18)Consult with a lawyer and your insurance company before signing the lease
agreement, to make certain that there is no liability for you as the



b. proceedings before the Surface Rights Board of Arbitration
In the event that a surface owner or occupant and a mineral rights holder cannot agree on a
mutually acceptable surface lease agreement, either party can apply to the Surface Rights Board
of Arbitration to settle the dispute. One of the main goals of the Board process is to speedily
and inexpensively resolve such disputes. At the same time the Board seeks to ensure: “that fair
compensation is paid, fair latitude is given to the operator to produce its mineral and that the
public interest in the environment is protected.”16

The Board of Arbitration consists of at least three members who are appointed by the
province. There is no requirement that land owners and oil and gas operators/companies be
equally represented on the Board. Currently the Board is made up of six members, including a
Chair and Vice-Chair. The members include practising lawyers with farm-related backgrounds,
farmers and former oil company executives.

The Board of Arbitration is headquartered in Kindersley. However, Board hearings may also
be held in any of the following oil patch centres: Lloydminster, North Battleford, Regina and
Swift Current. For a general overview of the operations of the Board, you can refer to its
website at Additional information is found
in the CSALE publication, Negotiating Surface Rights.

(i) Right of Entry/Compensation Orders
Oil and gas companies or “operators” most often apply to the Board of Arbitration for “right
of entry” orders or “immediate right of entry” orders, whereas landowners/occupants seek an
award of compensation. When a company seeks a right of entry order from the Board, it must
provide notice to the landowner/occupant of its application. The landowner or occupant then
has seven days from the date of mailing the notice to file a written objection to the right of
entry order sought. Once the Surface Rights Arbitration Board receives a written objection it
must hold a hearing to determine the rights of each party.

The Board may only grant a right of entry or immediate entry to a company subject to
compensation. However, if the amount of compensation is in dispute, the compensation
hearing is often held at a later date than the right of entry hearing. In these circumstances the
order issued by the Board is called an “immediate right of entry order.”

The Board relies on the evidence presented by the landowner/occupant and the company at
the hearing to make a decision. Therefore, it is important for a farmer, rancher or other
landowner to collect and present strong evidence to support his or her position.

For example, in its 1997 decision of Hector v. Oxbow,17 the Board of Arbitration stated that as a
minimum the following evidence must be presented by the landowner/occupant:

The municipal assessment of the parcel of land within which the oil installation
16 Surface Rights Board of Arbitration Website, “Board Hearings” at
17 C.C. 9/97.



is located (old and new assessment);

The farming practices and farming equipment (if cultivated), including:

the soil classification;

the crop rotation;

the actual yields from at least the last three years, preferably the last five

field size and cultivation patterns;

equipment size and habitual use; and

any special soil or crop conditions.

proposed farming plans and calculations of the financial effect on the planned
farming by the oil installation;

Changes in farming practices in the last five years;

If pasture, the number of livestock and grazing practices;

Changes in the oil field installation practice (if applicable) since drilled or last

A comprehensive description of oil field equipment on site and any changes in
By contrast, the operator (oil/gas company) is expected to provide evidence to:

address any of the evidence presented by the owner/occupant as set out above;

address changes in the oil field installation practice (if applicable) since drilled or last

provide a comprehensive description of oil field equipment on site and any changes in
activity; and,

provide future plans for the site.
It is extremely important to meet the timelines provided in the Surface Rights Board of
Arbitration process in order to protect your interests as landowner/occupant. The documents
filed by the oil company or by the landowner/occupant to commence the process set out the
various time limits. If you have any questions about the timelines or about the process in
general you can make inquiries to the Board staff at (306) 463-5447. Additional contact
information for the Board is set out in Chapter Five of this Guide.

The decision of the Board of Arbitration is binding on both parties. If a party disputes the
Board decision an appeal is available to the Saskatchewan Court of Appeal, but solely on a



question of law. Because of this restriction and the reality that most issues determined by the
Board involve questions of fact, fewer than ten appeals from the Board’s decisions have been
launched to the Court of Appeal in the past decade.

In order to be up to date with the latest surface lease agreement provisions and compensation
rates in Saskatchewan, the Board of Arbitration continually reviews new leases, easements and
amendments, and requires that such agreements between companies and farmers/ranchers in
the province be filed with it.

(ii) Limited Damage Claims and Environmental Enforcement
The Board also has the jurisdiction to hear claims by owners/occupants for limited damage.
These claims must be less than $1,000 and the damage must relate to off lease property or
activities. Certain off lease activities by operators and their contractors or employees can give
rise to damages. For example, soil compaction caused by heavy equipment or vehicle traffic
can hamper farming operations. This type of damage would come before the Board as a claim
in damages for trespass off lease.

Where damage is caused by petroleum and salt water spills off the leased premises, the matter
would be considered by the Board as a restoration claim. The Board’s literature states that its
“ability to monitor and enforce existing environmental standards is limited to acts of the
operator creating damage less than $1,000 and to the reclamation and restoration involved in
the abandonment of a well.”18

A damage claim by an owner must be lodged, in writing, within 30 days of the discovery of loss
or damage. The Board will then notify the company of the claim. If the matter is not settled,
the owner must apply for a hearing to the board within six months from the date of serving the
notice of complaint.

If damages to off lease property exceed $1,000 legal action must be taken in the Courts —
unless the surface lease agreement already states that full compensation will be paid for such
harm, and the oil/gas company agrees to the amount of compensation or the remedial action
sought. If damages occur on the leased property, the surface lease agreement provisions
should already state that the owner/occupant receives compensation.

Saskatchewan Industry and Resources (formerly Saskatchewan Energy and Mines) is
responsible for monitoring compliance with oil field operating standards during the working
life of an oil or gas well. On-site restoration matters are the responsibility of both SIR and
Saskatchewan Environment. The Environment Department has jurisdiction once a well site
has been abandoned,19 unless future problems are directly related to the operation of the well.
For example, if there is residual hydrocarbon (oil or gas) contamination on the site, SIR retains

18 Surface Rights Board of Arbitration, “Site Supervision”, website.
19 Abandonment is part of the well decommissioning/dismantling process, and involves the capping or plugging
of a well. The Oil and Gas Conservation Regulations, 1985 (sections 35 to 38) list the procedure to be followed when
a company abandons a well. For additional information refer to section 8 of this Chapter entitled,
“Abandonment and Restoration of Well Sites”.




c. Surface Leases and Crown Owned Agricultural Land
Most of Saskatchewan’s Crown agricultural land is currently leased to individual farmers or
ranchers. Saskatchewan Agriculture, Food and Rural Revitalization (SAFRR) administers this
Crown land under The provincial Lands Act (1978) and The provincial Lands Regulations.

If an oil or gas company seeks entry to leased Crown agricultural land it must contact the
farmer or rancher (agricultural lessee) to obtain consent to access the land. If the agricultural
lessee refuses to provide consent to the company to enter the land, Saskatchewan Agriculture
will step in to mediate the dispute to the mutual satisfaction of both parties. If a settlement
cannot be reached, the Department may nonetheless grant the company permission to enter.
However, in drafting the surface lease agreement (“petroleum and Natural Gas Surface Lease
Agreement”) the Department will set out conditions based on the legitimate concerns of the
farmer or rancher.

As compensation, Saskatchewan Agriculture provides a small one-time payment to the farmer
or rancher for each surface lease on an agricultural lease, and another payment for each
additional well drilled on an existing surface lease (The provincial Lands Regulations, part III,
s.3.1). The farmer or rancher also receives an annual rent reduction of $100 for each well. The
maximum annual agricultural lease rental reduction is 30% of the annual rent otherwise
payable for the agricultural lease. The annual rent reduction is applied for as long as the
surface lease is active. Notably, the farmer or rancher remains liable for the municipal taxes on
the land withdrawn from the agricultural lease for a surface lease (s.3.1).

The agricultural lessee is entitled to a one-time compensation payment for any damage to
growing crops on cultivated land that will be withdrawn from an agricultural lease.
Saskatchewan Agriculture will add the value of any crop damage to the rental and other
charges due with the issuance of the surface lease. The amount is collected by the Department
from the company and paid directly to the farmer (Regulations, part III, s.3.1(7) and s.4(5)).

The oil or gas company is also responsible for any damages to the facilities and other
improvements of the agricultural lessee that arise from the operation of the surface lease. Such
damages are payable directly by the company to the agricultural lessee.

If the company requires temporary workspace to facilitate construction, operation or
maintenance of the oil or gas project, the company must negotiate directly with the farmer or
rancher leasing the agricultural land and compensate for any crop loss suffered as a result.
Negotiations are required once the temporary workspace is authorized in a SAFRR surface
lease. The amount of compensation is to be negotiated with the farmer or rancher (Regulations,
part III, s.4(6)).

More detailed information on oil and gas surface leases on Crown agricultural land is found on
Saskatchewan Agriculture’s website Follow the site category
“Crown Lands/pastures” to the topic “petroleum and Gas Development on Crown land
Documents” and select the heading “petroleum and Gas Surface Lease policy”.



B. What is involved in an oil or gas development project?
An oil or gas development project usually involves four phases:

(1) exploration,
(2) development,
(3) production, and
(4) decommissioning.
Exploration may include the conducting of seismic operations, land surveys, and the creation
of access roads. Next if the exploration results look promising, the oil company sets up an
exploratory well, known as a “wildcat well.” Wastes in the form of drilling muds,
hydrocarbons, and drill cuttings must be stored or disposed of on the lease site or off the lease
site. After drilling a successful oil or gas well and establishing a flow to the surface, pumps may
be required to keep up the flow of oil or gas. Flowlines are set up to transport the raw oil from
the well to battery stations that separate the oil, gas and water found in a typical oil field.
pipelines may also be installed to transport the products to storage tanks or to oil and gas
processing plants. Finally, the project ends with abandonment and reclamation (cleaning up)
of the well sites and any other operating sites.

1. Oil and Gas Reservoirs
Ancient seas teeming with life, surrounded by lush vegetation, once dominated what is now
Alberta and Saskatchewan. As the vegetation and tiny aquatic organisms died, organic matter
was deposited on the sea floor in layers of silt. The seas eventually drained away, succumbing
to climactic shifts and geophysical events. The mud, clay and sediments of the former sea beds,
acted upon by heat and pressure, became porous sandstone and limestone (sedimentary rock).
Bacteria and chemicals also acted on the organic matter over millions of years, creating pockets
of oil deep below the earth’s surface in the sandstone formations.

Today crude oil and natural gas reservoirs are scattered throughout the southwest and
southeast regions of Saskatchewan. The Saskatchewan oil patch extends in a broad swath from
the Air Weapons Range (north of Lloydminster) on the western border, south through the
Kindersley area and east across the southern part of the province through Swift Current,
Weyburn and Estevan to the border with Manitoba.

The makeup of each oil or gas reservoir may vary due to the differing organisms and
conditions that formed each one.20 For example, a typical oil field may contain a mixture of oil,
gas and water in varying proportions. The oil normally floats on top of the water in the oil
zone. Above the oil, the lighter gaseous hydrocarbons (including natural gas) create what is
called a “gas cap.”

Each area of the province may also have different types of crude oil ranging from heavy sour
crude to light sweet crude. Heavy crude oil is dark, thick and sticky, similar to molasses. It also
contains more asphalt and sulphur. This type of oil is found in the Lloydminster and
Kindersley areas. Heavy crude requires enhanced recovery methods to extract and more

20 Stuart King, unpublished research paper (available through the Saskatchewan Environmental Society) at p.4.



intensive treatment to refine. By contrast, light crude oil is light golden brown in colour and
flows easily. It is considered “sweet” when it has low sulphur content. Light crude is found in
the Weyburn, Estevan and Kindersley regions. Medium crude, with qualities in between heavy
and light crude, may be found throughout southeast and southwest Saskatchewan.

The first commercial oil strike in Saskatchewan occurred in 1944, about 9 kms south of
Lloydminster. However, the largest pools in the province were discovered in the mid-1950s
and early 1960s near Kindersley and Estevan. Between 1944 and the end of 2002,
Saskatchewan produced 622.1 million cubic metres (3.9 billion barrels) of crude oil. In the year
2001 alone crude oil production was a record 24.8 million cubic metres (155.7 million barrels).
This figure declined slightly in 2002 to 24.4 million cubic metres (153.6 million barrels). At
December 31, 2000 remaining recoverable oil reserves in the province were estimated at 182
million cubic metres (1.1 billion barrels). At December 31, 2002 remaining reserves were
estimated at 1.15 billion barrels. Recoverable reserves are based on the total established
reserves as of a particular date. As exploration continues, new reserves are added to the total
reserves figure, minus the amount of crude oil produced in the same year.

The industry views the estimated 25 billion barrels of heavy oil-in-place in the west-central area
of the province as the greatest potential for future production. However, heavy oil recovery is
very resource intensive, requiring an enormous quantity of water and energy to extract.

Saskatchewan’s first commercial natural gas well was drilled near Lloydminster in 1934. Today
the principal natural gas reserves are along the province’s western border in the Beacon Hill,
Kindersley and Hatton areas. Most of the natural gas produced in Saskatchewan is dry (low in
liquid hydrocarbons) and sweet (low in sulphur) and requires limited processing.

In Saskatchewan, most natural gas is produced from gas wells. These wells usually tap into
shallow natural gas reservoirs, ranging from 275 to 760 metres (900 to 2,500 feet) deep.
However, natural gas is also found in oil reservoirs. It is therefore produced from oil wells
along with crude oil. This type of natural gas is called associated or solution gas. Sour gas (high
in sulphur), although more rare in the province, is also found in sour crude oil reservoirs and is
produced as sour solution gas.

Saskatchewan’s natural gas production peaked in 1995 at 8.7 billion cubic metres (309 billion
cubic feet). In 2002 gas production was at 8.4 billion cubic metres (300 billion cubic feet).
Estimated remaining recoverable reserves at December 31, 2002 were 76.8 billion cubic
metres (2.731 trillion cubic feet). This amount would provide about ten more years of natural
gas production. However, the National Energy Board estimates that Saskatchewan’s ultimate
natural gas potential is just over three times that amount at 253.6 billion cubic metres (9 trillion
cubic feet).

2. Seismic Exploration Activities
The lands that exploration companies select for seismic surveys are based on the studies and
maps developed by earth scientists in the petroleum industry. Geologists, geophysicists,
geochemists and paleontologists study rock formations and geological events to identify
potential oil and gas fields and traps. Traps are zones where oil and gas have accumulated
within rock formations. A trap must have three features:



(1) A porous reservoir rock that acts somewhat like a sponge to accumulate oil and gas.
This rock is usually sandstone, limestone or dolomite.
(2) An overlying impermeable rock that prevents the oil and gas from escaping; and,
(3) A source for the oil and gas, normally black waxy shales.
Exploration companies can use a variety of methods to locate the province’s oil and natural gas
reservoirs. The most common method used is seismic. Others include gravimetric, magnetic,
electrical, geo-chemical, radiometric, structure test hole, and well logging.

In a seismic survey, the exploration crew (geophysical contractors) sets out a line or several
lines of sensitive receivers (geophones or jugs) on the ground. 21 Then explosions or
mechanical vibrations are created on or below the surface. The vibrations are like small
earthquakes. The geophones record the seismic waves reflected back from rock layers at
varying depths. The time it takes for shock waves to travel down to the different rock layers
and back indicates how deep the formations are. The strength of the returning wave also
points to the type of rock reflecting the wave: strong wave, hard rock; weak wave, soft rock. As
each geophone receives the reflected shock waves an electric current is relayed to the
seismograph. The seismograph makes a record of the waves. With a number of seismic
records, a geophysicist can map the depth and shape of underground rock formations,
pinpointing potential oil and gas traps.

To reduce environmental impacts, many contractors use mechanical vibroseis to send energy
waves from a heavy vibrating vehicle into the earth. In forested areas, seismic crews can
further reduce environmental impacts by using narrower cut lines and improved clearing

In the province, seismic activities by exploration companies are regulated under the Seismic
Exploration Regulations, 1999. These regulations fall under The Mineral Resources Act, 1985, and are
administered by Saskatchewan Industry and Resources (SIR). The regulations replace The
Sedimentary Basin Geophysical Exploration Regulations, 1985, reviewed by CSALE in the publication
Negotiating Surface Rights (see section A2 above).

Under the Seismic Exploration Regulations a company must apply to SIR to obtain an exploration
licence. The application fee for a licence is $250. A licence is issued for a term of 5 years.

a. Consent Requirements
Before SIR will approve an exploration program, the exploration company must obtain the
consent of the owner or occupant of any land (Seismic Exploration Regulations, s.30). Unlike a
mineral rights owner, the exploration company does not have an automatic right of entry to
conduct its operations. Therefore, you as the owner or occupant can refuse access. If you are
renting land, you should consult the landowner before granting permission as seismic activity
could cause damage that lasts far beyond the lease period.

Notably, exploration companies can shoot seismic or other tests across road allowances

21 CApp, Finding Oil and Natural Gas, CApp website at



without consent. The company can even conduct tests on a road allowance that is being
farmed without consent. The only exception is where the road allowance is located on reserve
land, in that case the consent of the First Nations band is needed.

Before providing consent to an exploration company, ask the company to show you, on a map
and on an aerial photo of your land, exactly where they want to carry out their seismic

The consent must be in writing and should describe exactly where and when seismic activity is
to occur and the amount of compensation to be paid by the company. If you have any
concerns about damage that may be caused by the seismic work, you should discuss them with
the company before giving permission. Record any restrictions you wish to impose on the
company in the written access agreement before signing.

For example, the company should not be permitted to cut fences or trees on your property.
The agreement may also set out the type of equipment to be used and the width of the shot
lines to be cut. It should also ensure that the company would fill all shot holes. Shot holes are
holes drilled for the purpose of detonating explosive charges. Any shot holes that strike water
(flowing holes) must be plugged from bottom to top with bentonite clay, not just at the
surface. Landowners have experienced problems with flowing holes that have made the land
so wet that it was impossible to cut hay. In some cases it may be helpful to have a flowing hole
completed as a water well. If this is a desirable option, it should be set out in the access

b. Setbacks
The Seismic Exploration Regulations also provide minimum distance requirements for shot holes
and test holes. Test holes are any holes, other than shot holes, drilled for exploration purposes.
The setbacks are intended to prevent damage to buildings, water wells, or other sensitive
structures. However, for added security you may wish to provide for greater setbacks in the
access agreement. The following table outlines some of the minimum setback distances found
in the Regulations (Appendix, part I, Table I):



Minimum Distances to Structures in Seismic Explorations

Type of Structure Shot Hole Vibrator Surface Explosives
Residence, barn,
irrigation headworks,
or any building with
concrete base
180 m 50 m 180 m
Water well 180 m 100 m 180 m
Residential driveway,
gateway or buried water
10 m 10 m 12 m
Survey monument,
buried telephone line 2 m 2 m 2 m
High pressure oil or gas
pipeline, or an oil or gas
32 m 15 m 32 m
Irrigation canal more
than four metres wide 10 m 10 m 10 m

In spite of the setback requirements, the Regulations allow an exploration company to drill shot
holes or use a mechanical vibrator or surface explosives within the minimum distance from a
structure, where the owner of the structure gives prior written approval (see s.34(1) and
s.42(3)). Also, an exploration company cannot drill any shot holes or use surface explosives
within 180 metres of a water spring without the prior written approval of the owner of the land
through whose property the spring flows (s.34(3) and s.42(4)). Similarly, the use of vibrator
equipment is not permitted within 100 metres of a water spring without prior written approval.

However, for your own protection it is recommended that you do not permit a company to
operate its equipment or detonate explosives within minimum setback distances.

Although septic tanks are not listed in the Regulations, seismic operations should be located as
far as possible from them. Septic systems are highly sensitive to disturbance and are costly to
repair or replace.

c. Damage and Compensation
Any damage caused by the seismic operations to any land or structure must be repaired at the
expense of the company holding the exploration licence (Seismic Exploration Regulations, s.45).
The company must also take immediate action to prevent further damage and notify the owner
of the property of the location, nature and extent of damage.

When blasting is conducted in the vicinity of any building, other structure or inhabited area the
holder of the explosives permit must take adequate precautions to prevent harm to persons or
property (s.57). The company must limit the explosive charge to an absolute minimum, use
protective mats over the shot hole, close the approaches and thoroughfares to the shot-point,



and take other reasonable precautions that are required at the time. It must also ensure that all
persons are protected from the danger of falling or flying rocks and other debris.

d. Abandonment and Clean-Up of Shot Holes
The Regulations require that all shot holes drilled must be abandoned as soon as possible and no
more than 20 days after they are drilled (s.39(1)), unless the company has the written approval
of SIR (s.39(2)). Subsection 39(3) of the Regulations specifies how a shot hole must be
abandoned. The company must:

(1) fill the shot hole with drilling mud and material removed from the hole to a depth of
1.5 metres below the surface;
(2) insert above the drilling mud, to a depth of 50 cm below the surface, an approved
metal or plastic cap, or a wooden or cement plug one metre long;
(3) pull detonator wires tight and cut the wires off below ground level;
(4) fill the hole from the wooden or cement plug to the surface and tamp or compact the
fill material; and,
(5) spread any excess drilling mud and material obtained from the hole over the
surrounding ground.
The company may also follow any other method of abandonment approved by the minister or
SIR. Finally, the ground surrounding the abandoned shot hole must be restored as nearly as
possible to its original condition.

It must be noted that the spreading of excess drilling mud over the ground surrounding the
shot hole can cause pollution and harm to crops or livestock if the drilling muds are
contaminated with hydrocarbons such as diesel or other chemicals. Therefore you should not
agree to the disposal of any contaminated drilling muds on your property.

In the event that water or gas is released during the drilling of a shot hole, the company must
immediately stop drilling and plug the hole (s.38). Again it is strongly recommended that you
require the company to plug the hole from the bottom to the top with bentonite clay. The
company must also notify the Department of Industry and Resources within 72 hours of
completing the seismic operations of the location, elevation and depth of the hole, the depth
of the flowing horizon, and the action taken to control the flow.

e. Refusals by Landowner or Occupant
If you as owner or occupant have concerns about the exploration program and refuse to grant
permission to the company, the company has no right of entry or appeal. If a company
breaches the Seismic Exploration Regulations by entering your land without authorization, it can
be fined up to $1,000. If you have refused consent and the company enters your land, you
should treat it as an act of trespass and call the police.

If you occupy Crown owned land, the Crown has the right to permit or refuse entry to the



Even if you have refused access to an exploration company, there is still a chance that an oil
and gas company will return in the future wanting to drill a well on your land. It can still survey
the geological structure under your land from adjacent land or road allowances. It can also
undertake aerial surveys of your land.

f. Exploration Access Agreement Checklist
(1) Your right to refuse permission for entry to an exploration company should be
exercised until adequate guarantees are given by the company in writing to prevent or
address any potential problems.
(2) Ensure the exploration plan presented by the company is acceptable and review it
on-site with the company. Ask for a copy of a valid exploration licence, and a valid
explosives permit where explosives and shot holes are planned.
(3) Both on site and in the access agreement set out the point of entry, width and location
of the right-of-way, location of all hole sites and the route the company will be using
for the seismic lines.
(4) point out in person and in writing any special features or structures of concern, such as
fences, gates, livestock, wells, flowable holes, etc.
(5) Be sure the routes for the seismic lines or mechanical vibrator are setback the
minimum distances found in the Regulations or greater from water wells, buildings,
septic tanks and other structures.
(6) Have the company test your water well before and after seismic work and provide you
with the results.
(7) The access agreement should state that the company must clean up all wastes and
remove excess drill cuttings from the site. Drill cuttings can contaminate the soil with
unwanted salts and hydrocarbons. Livestock can die from eating ribbons or flags left
(8) Require the company to use wooden survey stakes and not wire pin flags to mark their
shot holes and operations. Farming activities such as making hay can shred pin flags
and kill livestock that eat the feed.
(9) Set out a penalty clause for any infractions. For instance, the company should be
required to complete their field-work within a specified time and to pay a fine for each
infringement of the agreement. In Alberta one landowner imposed penalties of $1,000
for cutting a fence and $100 for each piece of garbage or debris left behind. You may
also wish to include a penalty for any trespass on land outside the agreed limits of
(10)Agree on the time and dates for the exploration work to be done on the property.




(11)Agree on an adequate amount of compensation for granting a right of entry to the
(12)Do not agree to a future options clause, granting future rights to the company, unless
you fully understand such rights and find them acceptable.
(13)Ensure that everything that you negotiated with the company is in writing.
(14)Check up on the operations afterwards. When the shot holes are complete, ask if the
holes have been properly filled from bottom to top with bentonite clay, inspect the site
for tags or other wastes that could harm livestock, and check that water is not flowing
into or from any holes.



3. Drilling and Operation of Oil and Gas Wells22
The Oil and Gas Conservation Act (1978) regulates the drilling and production of oil and gas in
Saskatchewan. The purposes of the Act include preventing waste, developing and conserving
the province’s oil and gas resources, maximizing recovery of the resources by prudent and
proper operations and practices, and the protection of the environment (section 3).
Saskatchewan Industry and Resources is responsible for administering the Act. Therefore, any
inquiries or complaints about operations and practices by oil and gas companies in the
province should be directed to the Department.

a. Exploration Drilling
Once seismic exploration has been completed in an area, wildcat or exploration wells are
drilled to test the newly found reservoirs of oil or gas in an unproven area. Exploratory drilling
is very risky and expensive. The chances of finding oil and gas in a previously untouched area
are low; often only 20 to 30% of wildcat wells drilled actually find oil or gas. The chances of
finding commercial quantities of oil or gas are even lower. Thus, companies often drill the first
exploratory well in a new area strictly as a test. The well is not expected to produce commercial
quantities of oil or gas, but to provide information upon which the drilling of future wells can
be based.

As a landowner or tenant in the oil patch it is important to know that if the first wildcat well
finds oil or gas, more development wells will surely follow.

One of the first testing objectives of an oil company is to determine the flow potential of the
well. At this stage safety is a major concern, because the flow behaviour and the make-up of
the reservoir fluids are unknown. precautions must be taken to prevent blowout conditions
during the well test. A blowout is the “uncontrolled escape of fluid from a well” (The Oil and
Gas Conservation Regulations, 1985, s.2(e)). The uncontrolled flow of gas, oil or other well fluids
during drilling occurs when the formation pressure exceeds the pressure exerted by the
column of drilling mud. Sand production, for example, can contribute to a blowout, as can
corrosion causing compounds in the hydrocarbons, or other unexpected events.

b. Blowout preventer
Special equipment, known as a blowout preventer, can be used by a company to decrease the
chances of a blowout, such as a special casing head used in rotary drilling and well completion.
Hydraulically or mechanically operated high-pressure valves are installed at the wellhead to
control pressure within the well. If unexpected high pressure is encountered, the blowout
preventer system can quickly and effectively seal off and shut in the well.

The Oil and Gas Conservation Regulations require the operator of a well being drilled to install and
maintain blowout prevention equipment at all times (s.60).

22 The technical information for this section is largely drawn from The petroleum Resources Communication
Foundation, Our petroleum Challenge: The New Era (3rd ed.) (Calgary, 1985).



c. Development Drilling
If an exploratory well establishes the presence of producible quantities of oil or gas,
development wells will be drilled in order to define the size of the oil or gas field. In
development drilling the chances of success are higher. Seven or eight commercially producing
wells for every ten drilled is common. Newer technologies and enhanced recovery methods
also mean that a once “dry hole” can become a productive well.

A typical productive well in western Canada produces oil for twenty years.

In 2002, Saskatchewan Industry and Resources reports that 1,641 new oil wells were drilled in
the province. This number includes both exploratory and development wells. Similarly a total
of 1,872 natural gas wells were drilled in 2002. This record number of gas wells is a result of
higher prices and an expanded pipeline system.

d. Drilling Equipment and Operations
Drilling rigs can take different shapes and sizes. The size of the rig is directly related to its
depth capacity. The larger the steel derrick, the deeper it can drill. Smaller derricks mounted
on trucks and flatbed trailers are used to drill shallow wells. Most land operations use rigs made
up of several units, which are dismantled for transportation from site to site. Commonly used
rigs have cantilever or jack-knife masts.

No matter the planned depth of the well, drilling involves the penetration of rock by a bit
attached to lengths of steel pipe. The most common length of drilling pipe is 9 metres or 30
feet. Sections of this steel pipe threaded together are called a drilling string. The pieces of pipe
are added one length at a time, as the bit moves deeper. The bit is located at the bottom of the
drill string. In rotary drilling the bit is turned by a rotating platform at the surface.

Before a rig can begin normal drilling, the well must be “spudded” or started. Surface casing,
made up of lengths of steel pipe, is cemented into place to keep the wall of the well bore from
caving in and to control the return of the drilling fluid or mud. The length of surface casing
varies from site to site, from 60 metres to 1,200 metres, and is dependent on soil and rock
conditions near the surface. The surface casing also helps prevent contamination of fresh
groundwater with substances found in the well.

The rotating bit grinds and cuts its way through rock formations; different types are used to
drill through different formations. For instance, a bit studded with rows of industrial diamonds
is used to cut through hard rock formations. The bit is changed as different types of rock
formations are encountered or as the bit is worn down.

Every time the bit is changed, the entire length of pipe in the hole must be brought up (most
often three lengths at a time), disconnected and stacked upright inside the derrick. This
procedure is called “making a trip.” After the bit has been changed, the drill pipe is threaded
back on, section-by-section, and drilling resumes.

Drilling fluid or mud is usually made of water or oil mixed with clay or chemicals and serves



several functions. Its primary use is to lubricate and cool the bit. Drilling mud is also circulated
under pressure down the drill string’s pipe and through the bit to the bottom of the well bore.
The mud then returns to the surface by travelling up between the outside of the pipe and the
inside wall of the well bore. By this method the drilling fluid carries the rock cuttings and
fossils from the bottom of the hole to the surface, where they can be examined and identified.
The weight and composition of the drilling mud also counterbalances the formation pressures
in the hole. This helps to keep a well under control when high-pressure hydrocarbon or water
zones are entered. The mud also reduces friction on the drill string, and its composition is
changed to suit the formation being drilled.

If the drilling mud contains traces of oil, the drill crew knows that the bit is nearing an
oil-producing zone. Once the bit strikes oil, the drill string is pulled from the hole. Only the
casing remains. Next the drill crew installs an additional casing, known as an oil string or
production string, to protect the oil-producing zone from sand and other materials exposed
during drilling. If the oil string ends above the production zone, a long piece of pipe called a
liner may be installed. The liner runs from the bottom of the casing to the production zone.
The liner is perforated with many holes. As a final step, a smaller pipe called the tubing is
lowered into the well. The tubing extends all the way from the liner to the surface of the
ground above. Oil travels through the holes in the liner, up the tubing to the surface.

e. Oil Recovery Methods
Crude oil is recovered from underground reservoirs in the province using three recovery
methods known as primary, secondary and tertiary.23

primary recovery is the simple pumping of oil from the reservoir to the surface through the
wellbore drilled into a reservoir. Almost 95% of all oil wells in North America use an artificial
lift (pump) to assist oil production. Most wells use the familiar beam type sucker-rod pumping
unit. primary recovery typically produces 12-15% of the original oil found in a reservoir.

Secondary recovery involves the injection of fluids into a neighbouring well to force out
more oil than can be produced by primary pumping. The use of water is referred to as
“waterflooding.” Secondary recovery can produce an additional 15-20% of the original oil in

Tertiary recovery methods are usually referred to as “enhanced oil recovery”24 methods,
although waterflooding is also an enhanced oil recovery method. Tertiary recovery involves
the injection of steam, gases or chemicals into reservoirs to flush out oil that cannot be
recovered by primary or secondary methods. Nearby injection wells may be drilled to deliver
the steam or chemicals. Tertiary recovery produces a further 20% of the original oil in place.
Thermal recovery methods are normally used to recover heavy oil or bitumen (tar sands). Two
current thermal systems include cyclical steam stimulation and steam-assisted gravity drainage.
The application of heat makes the heavy oil or butimen less viscous, allowing it to flow more

23 Saskatchewan Industry and Resources, Crude Oil in Saskatchewan (2003), SIR website at
24 Enhanced oil recovery is defined as “the increased recovery from a pool achieved by artificial means, including
injection of fluids, chemicals or heat” (petroleum Communication Foundation, Our petroleum Challenge: Exploring
Canada’s Oil and Gas Industry, p.93).



easily towards the production well. Another thermal method being proposed is THAI (toe-to
heal air injection). This method uses air to stimulate underground combustion of some of the
bitumen to warm nearby areas for extraction. Research is also being conducted into the use of
solvents for in-situ bitumen recovery (the VApEX process).

Out of the approximately 21,400 operating oil wells in Saskatchewan, SIR statistics for 2002
show that 250 producing wells involve waterflood projects (secondary recovery), 8 involve
steam injection, 2 involve solvent injection, and one involves carbon dioxide injection. The
latter three are tertiary recovery methods.

4. Flaring and Venting
a. Sour Gas and Hydrogen Sulphide (H2S)
In a natural gas reservoir usually most of the gas present is methane.25 Methane is an odourless
and colourless hydrocarbon made up of four hydrogen and one-carbon atoms. A reservoir’s
gas mixture can also include other hydrocarbon gases, carbon dioxide, nitrogen and water
vapour. Unfortunately, natural gas reservoirs can also contain hydrogen sulphide, H2S. Natural
gas that contains hydrogen sulphide is called “sour gas”. It is sour gas that creates the rotten
egg smell when test wells are flared. Apart from its noxious smell, sour gas is a corrosive and
very toxic gas. Hydrogen sulphide is also found in sour crude oil, mineral hot springs, manure,
sewage, marshes and rotting plants.

When people are exposed to sour gas or other sources of hydrogen sulphide, they can suffer
effects ranging from mild discomfort to death. The amount or concentration of hydrogen
sulphide will determine the effects on people and animals. In lower concentrations exposure
can cause eye irritation, a sore throat and cough, shortness of breath, and fluid in the lungs.
These symptoms normally go away in a few weeks. Long-term, low-level exposure may lead to
fatigue, loss of appetite, headaches, irritability, poor memory and dizziness. In high
concentrations (400-700 parts per million), hydrogen sulphide can seriously harm or kill in

Hydrogen sulphide is dangerous because it interferes with cell respiration, just like carbon
monoxide or hydrogen cyanide. It combines with haemoglobin (the protein found in red
blood cells used to transport oxygen) and with cytochromes (enzymes), thus rapidly stopping
oxygen from accessing cellular metabolism. Hydrogen sulphide is also an irritant of the
mucous membranes such as the eyes and respiratory tract. Although it is very foul smelling,
H2S can very quickly paralyse the sense of smell. As a result it can go on to overcome the
victim and eventually cause death. The following chart shows the effects of hydrogen sulphide
on people.26

25 Stuart King, unpublished research paper at p.4.
26 Sources: Saskatchewan Labour, Occupational Health & Safety, Transferring and Transporting Liquid Manure
(October 2001) at p.4; petroleum Communication Foundation, Flaring: Questions + Answers (Calgary, 2000).



Hydrogen Sulphide Exposure Levels and Health Effects

Exposure Level Expected Health Effect or Symptom
1 – 10 ppm Moderate to strong odour. Eye irritation,
nausea, headaches or loss of sleep following
prolonged exposure. Effects are reversible
and not considered serious for the general
population. More susceptible individuals may
have a more severe reaction.
10 ppm This is the workplace 8 hour contamination
limit found in the provincial Occupational
Health and Safety Regulations,1996.
20 ppm for more than 20 minutes Eye, nose, throat and lung irritation. Loss of
appetite after prolonged exposure.
50 to 100 ppm Burning sensation in the eyes and throat,
headaches. Vomiting nausea and diarrhea.
Some may temporarily lose sense of smell.
100 ppm This is the Immediately Dangerous to Life or Health
(IDLH) concentration level as found in the
Occupational Health and Safety Regulations (s.2(ii)).
At this level the atmosphere is so dangerous
that anyone not wearing an approved
respirator will not be able to escape, or will
suffer irreversible health effects if they do not
leave the contaminated atmosphere within 30
200 ppm Dizziness, nervous system depression,
increased susceptibility to pneumonia. Fluid
may accumulate in the lungs with prolonged
500 ppm Nausea, excitement, unconsciousness. If
breathing stops and no immediate rescue
death will result.
600 ppm and above paralysis of respiratory system and rapid
Note: 1 part per million (ppm) of hydrogen sulphide is the same as 1.42 milligrams of
hydrogen sulphide per cubic metre of air (mg/m3).



Approximately one-third of the natural gas produced in Alberta and British Columbia is sour.
Most of Saskatchewan’s natural gas is “sweet”, containing little or no hydrogen sulphide.
However, some sour solution gas is produced with sour crude oil in the province.

b. “Sweetening” Sour Gas
Sour gas must be “sweetened” to remove hydrogen sulphide and other impurities before it can
be used commercially. Sweetening is done at gas processing plants located near natural gas
fields. First the hydrogen sulphide is removed with “sulphur recovery” technology, and then
the remaining natural gas mixture is separated into different components such as methane,
propane and butane. The sweetening process produces methane (natural gas fuel used to heat
homes) and elemental sulphur. Methane is also used as a raw material to produce
petrochemicals. In turn petrochemicals are used to make plastics and other products. Sulphur
is used to make fertilizers, drugs, pulp and paper, matches and plastics.

Gas processing plants convert on average more than 97% of the hydrogen sulphide in sour gas
into sulphur. The remaining or excess hydrogen sulphide is burned off or flared. When
hydrogen sulphide is incinerated or flared, the heating process produces sulphur dioxide,
which is a major cause of acid rain. Acid rain is formed when sulphur dioxide reacts with
moisture in the air, producing sulphuric acid. High levels of sulphuric acid can harm crops and
trees, eat away buildings and metal, and pollute water bodies.

c. Flaring Operations
Flaring is the burning of unwanted gases from a well or processing facility. It disposes of the
unwanted gas and releases emissions into the atmosphere. For example, a gas processing plant,
where water, hydrogen sulphide, carbon dioxide and natural gas liquids are separated before
the gas is shipped to market, will flare or incinerate excess H2S. A flare system usually includes
a “flare stack”, a nozzle and an igniter. The flare stack is a metal pipe that carries gas to the top
of the stack. The nozzle or “burner tip” is found at the top of the stack. A pilot light or
automatic igniter ignites the gas.

Flaring may be routine or occur as a safety measure when there is an emergency, power failure,
equipment failure or other upsets in processing.

The most common types of flaring are solution gas flaring and well test flaring. In Alberta
routine solution gas flaring accounts for more than 75% of the total volume flared.27 Other
types of flaring include gas plant flaring and pipeline flaring.

Solution gas28 flaring is used to dispose of natural gas produced along with crude oil and
bitumen. It occurs at facilities called “batteries” where production from one or more oil wells
is processed, separated and stored. While the oil is underground, the pressure of the reservoir
holds the gas in the oil. When the oil is pumped to the surface the pressure is reduced and the

27 See e.g., Energy and Utilities Board, Upstream petroleum Industry Flaring and Venting Report: Industry performance for
Year Ending December 31, 2002 (2003) found at
28 “Solution gas” is any natural gas found in crude oil.



gas bubbles out of the oil. This is like the release of carbon dioxide bubbles in a soda when the
lid is removed. If the volumes of natural gas processed in a battery are small or the facility is in
a remote area, the natural gas not consumed as fuel is flared. Solution gas flares burn
constantly, accounting for the high volume of gas flared.

Gas plant flaring is used to dispose of unmarketable gases or as a safety measure. All gas
plants have flares to burn off gas safely during emergencies, power failures or equipment
failures. Some smaller plants are licensed to flare hydrogen-sulphide-rich gas after it is
removed from the natural gas.

Well test flaring occurs during drilling and testing of new wells. It is considered standard
practice in the oil and gas industry. The flare is used to determine the types of fluids the well
can produce, the pressure and flow rates, and other characteristics of the reservoir. A new type
of drilling known as “underbalanced drilling” has required increased flaring. Underbalanced
drilling speeds up drilling and thus reduces damage to producing formations caused by drilling
fluids. This type of drilling increases the amount of gas that is brought to the surface. The
average duration of well-test flares is 2.5 days, although some may burn longer.

pipeline flaring is most often temporary flaring used during maintenance operations or when
internal pressures reach unsafe levels.

Since 1996 efforts have been made to reduce the amount of natural gas flared in Canada.
Targets have been set by industry and government to reduce flaring. Less flaring means more
natural gas is recovered and sold, and fewer emissions are released into the environment.

d. Environmental and Health Effects of Flaring
Flaring of waste gases is one of the major concerns among people living in the oil patch. Flares
can release over 250 hazardous air pollutants, including cancer-causing agents such as benzene
and other poisonous gases. Where there is incomplete combustion,29 shown by tell-tale black
smoke, products may include BTEX aromatics, polycyclic aromatic hydrocarbon compounds,
carbon monoxide, methane and, where the gas is sour, hydrogen sulphide. BTEX aromatics
include benzene, toluene, ethyl benzene and xylenes. All are potentially harmful to the health
of humans and livestock. The effects depend on the level, duration and frequency of exposure.
Some of these harmful substances are known to cause cancer, affect reproduction or cause
respiratory and cardiovascular disease.

In the past, it was assumed that flares burned at close to 99% efficiency. Complete combustion
of methane and other hydrocarbons would in theory produce only water vapour and carbon
dioxide. Sour gas flares would similarly convert hydrogen sulphide into water vapour and
sulphur dioxide. However, recent research at two sites in Alberta has shown that efficiency
levels under actual operating conditions are much lower than expected. At one site, a sweet
solution gas well, efficiency varied between 62 per cent and 71 per cent. At the second site, a
sour solution gas site, efficency was estimated at 82 to 84 per cent.30 These low efficiency rates

29 Incomplete combustion can be caused by wind, water, impurities in the fuel, or poor mixing with the air.
30M. Strosher, Investigation of Flare Gas Emissions in Alberta (Calgary: Alberta Research Council, 1996) at p.4. See



mean that there are numerous products of incomplete combustion being released into the air
with any flaring.

Apart from the harmful by-products of flaring, nearby residents and livestock may be
disturbed by the odours, smoke, bright light and noise from flares.

In Saskatchewan, a recent study of oil and gas wells by the Department of Industry and
Resources found alarming air pollutant emission levels.31 A large number of wells in the
province produced hydrogen sulphide (H2S) at levels of 30,000 parts per million (ppm). Some
clusters produced levels in excess of 100,000 ppm. Hydrogen sulphide may be lethal after a
30-minute exposure to concentrations of only 100 ppm. Some areas such as Halbrite exceed
the hydrogen sulphide ambient level on a 24-hour basis. According to the Manager of
Ecological Monitoring for Saskatchewan Environment this particular finding means that: “in
some circumstances, such as low-lying topography and venting of solution gas, the levels could
become toxic.”32

e. Eliminating or Reducing Flaring
Flaring can be eliminated or reduced by different methods. For example, solution gas can be
collected and piped to natural gas facilities rather than being flared. In some cases solution gas
is re-injected underground to maintain reservoir pressure. A third option is the use of new
gas-fired mini-turbine generators to produce electricity from waste gas. Well test flaring can
also be reduced by the use of improved well-logging instruments and the use of existing
reservoir data from previous well tests to greatly reduce the period of testing.

In Saskatchewan, a pilot project was started in 2002 partnering the Crown utilities, Saskpower
and SaskEnergy, with an oil company to develop flare gas microturbine technology. 33
Low-grade natural gas produced as a by-product of oil drilling (solution gas) is being used in
the turbines to produce electricity.

The pilot project is located at an oil treatment and processing site near Carlyle. Flare gas is
being used to run two micro-turbines that will generate approximately 60 kilowatts of
electricity (enough electricity to power 20 households over a one-year period).34 The electricity
will be fed into the provincial utility grid. The micro-turbines burn the flare gas at a
temperature of 800 degrees Celsius, so that most flare gas pollutants are burned off rather than
being released into the atmosphere. The turbines are also able to combust gas containing up to
7% hydrogen sulphide. Gas with a content of 1% or greater H2S is considered sour gas. As
well, the turbines may be able to use methane from other sources such as hog-barns, forestry
operations, and hospitals.

In future, regulations developed to implement the Kyoto protocol may prohibit gas flaring
altogether. Therefore, the micro-turbine technology is considered a more environmentally

31 Tod Han of Saskatchewan Industry and Resources conducted the study.
32 Terry Hanley as quoted in “Association of professional Engineers and Geoscientists of Saskatchewan Annual
Meeting Seminar: Air Issues in Saskatchewan”, The professional Edge (June/July 2003) at p.15.
33 Charlton Communications, “Technology With a Flare”, The professional Edge (February/March 2003) at p.6.
34 Ibid.




sound option, particularly for smaller oil and gas companies.35

f. Venting
Venting is the direct release of solution gases into the atmosphere without burning or flaring.
Venting may occur from oil wells, batteries, tanks, compressor vents, instrument gas stations,
pneumatic devices, dehydrators and storage tanks. When pipelines are being serviced, the
gases in the line may first be purged and then flared or vented. Vented gases are a source of
concern and complaints among nearby residents because they present odours, the exposure to
potentially harmful air pollutants (including hydrogen sulphide and benzene), and a risk of
explosion. Venting solution gases is also a waste of non-renewable resources.

In Saskatchewan The Oil and Gas Conservation Regulations, 1985 require an operator of an oil well
to burn or flare any “significant volume of gas” that is vented to the atmosphere (section 72).
What amount of gas is a “significant volume” is not spelled out in the regulations. This
requirement is aimed at reducing the amount of solution or waste gas that is directly vented to
the atmosphere.

g. Flaring Setback and Notification Requirements
In Alberta, the Energy and Utilities Board (EUB) has established a series of detailed rules to
regulate flaring operations in that province, including notification requirements for
landowners and adjacent communities when an oil well will be tested or sour gas flared.36

In July 1999 the EUB issued Guide 60: Upstream petroleum Industry Flaring Requirements and a
follow-up to the Guide called, Guide 60: Updates and Clarifications (December 1999). For
example, section 3 of Guide 60 requires that a company notify the local EUB field centre, the
local municipality, and all rural residents within a particular radius of the well before testing an
oil well or using a sour gas well flare for more than four hours in a 24-hour period.

By contrast, Saskatchewan does not have a detailed set of rules and regulations for flaring
operations. Instead there are a few minimal requirements scattered in The Oil and Gas
Conservation Regulations and in an Environmental Guideline issued by Saskatchewan Energy and
Mines (now SIR) in 2002 called, Minimum Standards for Flare Tanks during Drilling and Servicing

(i) Setbacks
The Oil and Gas Conservation Regulations require that flares in the province be setback a minimum
of 75 metres from any structures, unless the Department of Industry and Resources otherwise
approves. Subsection 72(2) reads:

35 Ibid. at pp. 6 and 8.
36 The EUB is the main regulatory body for the oil and gas industry in Alberta. It reports to the Minister of
Resource Development, but works at “arm’s length” from the provincial government.



72 (2) No flare or end of flare line is to be located closer than 75 metres to any:

(a) road allowance, surveyed road, railway, pipeline, power line or other right
of way;
(b) aircraft runway or taxiway; or
(c) dwelling, industrial plant, military building, permanent farm building,
school or church;
unless otherwise approved.

Similarly, no flare pit or open end of a flare line is to be located within 45 metres of a well or oil
storage tank, or within 23 metres of any oil or gas processing equipment, unless SIR otherwise
approves (s.72(3)).

(ii) Flaring Notification Requirements
Oil and gas companies are not legally required to notify neighbouring residents or
communities prior to starting flaring operations. They are, however, required to provide the
local SIR field office with 24 hours notice of a planned gas well test, so that the minister’s
representative may witness the test (Oil and Gas Conservation Regulations, s. 73(4)).

If you would like notification of any planned flaring on your land, it must be spelled out in the
surface lease agreement you reach with the oil and gas company. If you do not have a surface
lease agreement or you live or work on land neighbouring the well site, you can contact the
local field office of SIR and ask that they provide you with notice of any planned flaring (see
Chapter Five for contact information). Another option is to approach the oil and gas company
and ask them to provide you with reasonable notice of any planned flaring, including the
duration of the flaring operations. If the oil and gas company is holding any public meetings or
information sessions prior to starting drilling in your area, it is important to attend and raise
any concerns you may have and request details about the planned operations.

5. pipelines
According to the petroleum industry pipelines are the safest and most economical way of
transporting oil or gas to processing facilities or customers. A number of underground pipeline
systems for oil and natural gas begin in and cross through the province. These pipelines deliver
crude oil, natural gas, natural gas liquids and refined petroleum products. provincial pipelines
that begin and end in the province are regulated under the provincial pipelines Act,1998.
Inter-provincial or international pipelines fall under the federal government’s jurisdiction and
are regulated by the National Energy Board.

TransGas Limited, a subsidiary of SaskEnergy, transports most of the natural gas produced by
provincial oil and gas companies from the producing fields. It collects and transports the gas to
SaskEnergy’s distribution system for distribution to Saskatchewan consumers or to
inter-provincial or international pipeline systems run by TransCanada pipelines Ltd., Foothills
pipe Lines Ltd., and Williston Basin Interstate pipeline.37

37 Saskatchewan Industry and Resources, Fact Sheet – Gas in Saskatchewan (2003) at p.3, SIR website



The Enbridge pipline system transports most of the crude oil in the province. The Enbridge
system begins in Edmonton and stretches across Saskatchewan en route to the eastern
provinces and the United States.38

a. pipeline Route Selection and Construction
(i) Surveys
The pipeline company must survey the proposed route prior to construction of a licensed
pipeline. Under The pipelines Act, 1998 a pipeline company has the right to enter any land on the
intended route of the pipeline in order to conduct its survey (section 13). Thus, even if you
disagree with the intended route and refuse to provide consent, the company may enter your
land. The company, however, must first obtain the consent of the Minister of Industry and
Resources to enter the land and prove that it has made a reasonable effort to obtain the
consent of the owner and/or occupant (section 13(2)).

(ii) Notification
Before breaking the ground to begin construction of the pipeline, the company must apply for
a licence from the Department of Industry and Resources. Certain conditions must be met
before a licence will be issued, including contacting and obtaining easement agreements from
surface owners along the route. An easement agreement must be written for each parcel of
land the pipeline route crosses.

Section 4 of The pipelines Regulations, 2000 lists the individuals and government bodies that must
be notified of the planned pipeline:

all municipalities that the pipeline crosses or is located within;

the Department of Environment (Environmental Assessment Branch);

the Department of Government Relations and Aboriginal Affairs (Community
planning Branch) if the pipeline is located within 1.5 kilometres of the boundaries of
an urban municipality;

the Heritage Branch of the Department of Government Relations and Aboriginal
Affairs if there are any archaeological sites along the pipeline right of way;

the Saskatchewan Water Corporation if the pipeline is for fresh water transportation;

the operator of any utility or pipeline located within 30 metres of the proposed

all surface landowners whose property the pipeline crosses or is located within; and

all Indian bands whose reserve the pipeline crosses or is located within.
38 Saskatchewan Industry and Resources, Fact Sheet – Oil in Saskatchewan (2003) at p.3, SIR website.



(iii) pipeline Easement Agreements
A pipeline easement is a right of way granted by the landowner to a pipeline company. The
right of way is the strip of land in which the pipeline is buried. The width of the right of way
usually ranges from 15 to 30 metres (m) for the full length of the pipeline.

The easement agreement is a written contract that sets out the rights and responsibilities of the
landowner and pipeline company, including the amount of compensation to be paid the
landowner and/or occupant. According to section 2 of the public Utilities Easements Act (1978)
a registered owner of a parcel of land may grant a pipeline company the following rights or

right to construct its pipes through, under or across the land;

right of access to and egress from its pipes; and,

any other rights with respect to the land that may be required.
Once an easement agreement has been finalized, the pipeline company can register the
easement as an interest in land with the Land Titles Registry. Therefore the easement attaches
to the parcel of land and binds the current owner and any and all future owners of the land.
The land remains subject to the easement agreement until the company removes the easement
from the Land Titles Registry.

(iv) Expropriation
Unfortunately if you do not want a pipeline to cross over or through your land and refuse to
provide your consent to grant an easement, the pipeline company can expropriate the
easement. In other words, the pipeline company can without your consent enter your land and
do anything necessary to construct and operate the pipeline. Section 15 of The pipelines Act,
1998 allows a licenced pipeline company to expropriate the pipeline easement.

The expropriation procedure the pipeline company must follow is spelled out in The
Expropriation procedure Act (1978). This legislation requires the company to compensate the
owner for the easement.

To begin the process, the expropriating authority (the pipeline company) must serve the
registered owner of the land and any other interested person with a “notice of compulsory
acquisition” (section 20(1)). The notice must include:

a description of the land;

the interest in land (easement) and purpose for which it is required;

the day on which possession was taken or is required;

the address to which claims may be forwarded; and

the time within which an action for compensation must be commenced.
Within four months of entry on the land, the pipeline company must serve the owner with an
offer in writing stating the amount of compensation offered for the easement (section 20(2)).
At any time after the service of an offer of compensation the landowner may demand an



evaluation report from the pipeline company by notice in writing (section 22(1)). The evaluation
report must show all the facts taken into account by the expropriating authority (pipeline
company) in arriving at the amount of compensation.

If the landowner does not bring a court action for compensation within two years from the
day on which notice of compulsory acquisition (expropriation) was served, the amount
offered in compensation by the pipeline company is deemed accepted (section 28).

There is always a possibility that the judge hearing an action for compensation can decide to
award compensation that is less than the amount originally offered by the pipeline company.
To avoid the expense and uncertainties of the court process and the inconvenience of the
expropriation procedure, it is recommended that you negotiate an easement agreement with
the pipeline company. A negotiated agreement will allow you to protect your interests more

b. Negotiating an Easement Agreement
The easement agreement should list all the things the company must do when constructing,
operating and eventually abandoning the pipeline.

An easement agreement will usually cover matters such as:39

the land that will be subject to the easement;

the size and location of the right of way;

indemnity (protection from liabilities, damages, etc. caused by the company);

how the land will be used;

terms of compensation payment (lump sum or periodic payments);

the legal responsibilities of the pipeline company and the landowner; and

any restrictions placed on the use of the land.
When negotiating you may wish to ask about the type, size and flow pressure of the planned
pipeline. For instance, pipelines with a small diameter have the highest failure rate. You will
also want to know where shut-off valves will be located. If there is an emergency and the
shut-off valve is far away, it will take longer to stop the flow.

If you disagree with the planned location of the pipeline, you can suggest an alternative route.
If, for example, you have future plans for the land such as a new building or subdivision, you
will need to alert the pipeline company and have them locate the pipeline far enough from the
planned building sites to meet your needs and ensure safe setback distances. Keep in mind that
the company will always need access to its line for inspection and maintenance purposes.

Helpful information on pipelines is found in the following National Energy Board documents
online at under the heading “Safety publications”:

39 National Energy Board, pipeline Regulation in Canada: A Guide for Landowners and the public (Calgary:
National Energy Board, 2003) p.15.



pipeline Regulation in Canada: A Guide for Landowners and the public (June 2003);
Report of the Inquiry – Safety-Stress Corrosion Cracking on Canadian Oil and Gas pipelines –
Summary and Recommendations – MH-2-95 (November 1996); and,
pipeline Abandonment: A Discussion paper on Technical and Environmental Issues (November
(i) Compensation
The amount of compensation for an easement is negotiated between the company and the
landowner/occupant. Many companies hire qualified appraisers to determine the market value
of the land. The market value provides a basis for calculating the amount of compensation to
be paid for the use of the land. Compensation is also payable for:

an entry fee;

the use of any temporary work space;

any inconvenience or nuisance caused by the construction of the pipeline, including
time spent in negotiating the agreement;

loss of use of the land (based on market value of the land and number of acres affected
by the construction disturbance); and,

adverse effects and damages caused by construction, maintenance or operation of the
Before installation of the pipeline begins, the company should pay in advance an amount for
the entry fee and loss of use (based on the market value of the land). Once the pipeline is
complete, you should be paid compensation for such items as adverse effects and
inconvenience. Adverse effects can include loss of crops and loss of land use during
operations and while vegetation is being re-established above the buried pipeline. The cost of
moving livestock to another site during construction would be an example of inconvenience.
You may also wish to wait to finalize compensation until a crop has been grown near the
disturbed land so that the full extent of any damage can be assessed.

Once the pipeline is operating and a spill, leak or accident occurs, you should claim
compensation for any losses or damage to property. A clause setting out the pipeline
company’s obligation to compensate you for any loss or damage caused by an accident, leak or
spill should be included in the easement agreement. There should also be an arbitration clause
in the agreement, so that if there are any outstanding claims relating to damages caused during
pipeline construction or operation they can be dealt with by arbitration rather than having to
go to court.

Compensation for a pipeline easement is often a one-time payment. In certain cases, however,
you may wish to ask for annual or periodic payments. For example, where there may be
long-term damage, the company should be required to make annual payments until the



damage is rectified. Another situation may be where above ground facilities, such as
compressors, will be installed on the right-of-way. In this case, an annual rent for loss of use
and adverse effects is fitting.

(ii) Arbitration
If the surface owner and the pipeline company cannot agree on the amount of compensation
for the proposed easement, the pipeline company can submit the matter to arbitration (public
Utilities Easements Act, s.7). Under the public Utilities Easements Act, the arbitrator is a judge of the
Court of Queen’s Bench. The arbitration proceeds after all persons who have an interest in the
land are notified of the arbitration. After hearing the submissions of all the parties, the
arbitrator decides the amount to be paid as compensation for the proposed easement. There is
no right of appeal from the arbitrator’s award.

Where the pipeline falls under the jurisdiction of the National Energy Board (inter-provincial
or international pipeline), and you cannot agree on the amount of compensation you should
receive for the easement, either you or the company can ask the federal Minister of Natural
Resources for help in settling the dispute. You can send a letter to the Minister and ask to have
the matter settled either by negotiation or arbitration. You must also send a copy of the request
to the company as well. If the company writes to the Minister, they must send you a copy.
Requests can be forwarded to:

Minister of Natural Resources

580 Booth Street
Ottawa, Ontario K1A 0A6
phone: (613) 996-2007; Fax: (613) 996-4516

If you request negotiation, the Minister will appoint a negotiator to meet with you and the
company in an informal manner in your area. However, neither party is bound by the
negotiation process. Either you or the company can end the negotiation process at any time
and ask to have the issue settled by arbitration instead.

If you or the company requests arbitration, the Minister will appoint an arbitration committee
made up of three people. The committee will set a time and place for the hearing and notify
you and the company. At the arbitration hearing the committee members can take into
account any or all of the following factors:40

the market value of the land taken by the company;

where payments are made annually or at regular intervals, any changes in the market
value of the land since the easement agreement was signed, or since the last time the
payments were reviewed or adjusted;

your loss of use of the land;

the adverse effect on the rest of your land;
40 NEB, pipeline Regulation in Canada: A Guide for Landowners and the public at p.58.



the nuisance, inconvenience and noise caused by the company;

damage to lands in the area of the pipeline that might be reasonably caused by the
company’s operations;

loss of, or damage to livestock or other personal property that has been caused by the
operations of the company;

any special difficulties in relocating your property or yourself; and/or

any other factors the arbitration committee consider appropriate.
Environmental Matters
The pipeline company should identify possible environmental concerns when assessing the
site prior to construction and take precautions to minimize the amount of remedial work
needed after construction.

When negotiating the easement agreement with the company, a number of environmental
issues should be taken into account. These include:

protecting water supplies. Locating the pipeline at a greater distance from a water
well or surface water will reduce the chance of contamination if there is a leak.
Safeguarding surface drainage. Ask the company to locate the pipeline where it
will not disturb surface drainage. If you later find that natural drainage is affected
ask the company to solve the problem.
protecting topsoil. The agreement should state how the topsoil will be removed
and later replaced when the land is to be restored to its original state. Ask what the
company will do to minimize soil compaction along the right of way and
anywhere that heavy vehicles will be travelling during construction.
Selecting pipeline installation methods that reduce environmental harm. Will the
company be using the trenchless plow method, rather than excavation with a
backhoe or chain trenchers? The trenchless plow method uses a plow tractor to
install the pipeline. Advantages include: minimal clean-up because the pipe is
installed and backfilled as the plow equipment moves along; shallow wet areas can
be plowed through by winching the plow tractor across, possibly causing less
disturbance; and installation rates are faster (for example, installation rates depend
on pipe size and average between 3,000 and 6,000 metres per day with the plow
tractor method).
protecting shelterbelts or environmentally sensitive areas. Ask the company to use
directional bore drilling to avoid destroying shelterbelts or ecologically important




or sensitive areas in the proposed right of way. Ask the company to avoid these
areas entirely if possible.

preventing weeds. How will the company prevent the spread of weeds? Require
the company to wash track equipment before moving it to a new parcel.
Site clean up after pipeline installation. The agreement should state the company
will remove construction material, spread and level the topsoil, cultivate to deal
with compaction, prepare a seedbed and reseed the land where desired. If this is
not done to your satisfaction, ask the company to deal with any problems.
Leaks. Find out what to do if there is a leak and how the company will deal with it.
Monitoring for leaks and corrosion, which could lead to pipeline failure. Ask how
the pipeline will be monitored. Will there be external inspections, including by
plane? How often will internal checks be done? pipelines must meet Canadian
Standards Association (CSA) operating standards. These standards are
enforceable by Saskatchewan Industry and Resources (provincial pipelines) and
the National Energy Board (international or inter-provincial pipelines).
Ask if the pipeline will be cathodically protected and if there is a corrosion
mitigation program in place. A cathodically protected pipeline has a low voltage
current running through it to reduce the risk of corrosion.
Heat. pipelines transporting hot substances can cause nearby crops to ripen early,
which can make harvesting more difficult.
Adjacent Landowners/Occupants
Owners or occupants of adjacent lands can request compensation from the pipeline company
if they can show that they have incurred costs due to damages caused by the pipeline

pipeline Easement Negotiation Checklist
When negotiating the easement agreement with the pipeline company consider:

Is the pipeline setback far enough from any dwellings? Would you have time to
escape if there is a leak or emergency? Will the location of the pipeline affect your
future plans such as new buildings, expansion or subdivision?
Is the pipeline in the best possible location when you consider surface water
drainage, water wells, and other environmental concerns?
If the pipeline is close to a water well, have the company test it before and after the
pipeline is installed.




If the company needs any temporary work space while it builds the pipeline have
this put into writing and ask for additional payment including payment for any
damage to your property. Temporary work space is needed when the pipeline
crosses under a road or stream, or where extra space is needed to store topsoil or
Include a clause that protects you from all liabilities, claims or suits caused by the
company’s operations.
Include a clause that you will be compensated for all damages caused by the
The easement agreement should state that the company will quickly clean up the
right of way and deal with any problems that arise later such as damage to surface
drainage, a sinking trench, compaction of the right of way, or an exposed pipeline.
Require the company to immediately notify you if there is a leak or spill and to
inform you about how the leak or spill is being contained and cleaned up.
How will the pipeline be decommissioned and abandoned in the future? Will the
pipe be left in the ground after abandonment? The agreement should set out how
the pipeline will be abandoned and the land reclaimed once the line is no longer in
If you do not want additional pipelines to be constructed along the right of way in
the future, you can ask for a clause limiting the right of way agreement to one
Is the amount of compensation enough to cover the costs, damage, and
inconvenience that will occur while the pipeline is being installed? Compensation
should include the time you have spent negotiating and the time you will spend
working around the construction activities. You can also ask for reasonable costs
to review the easement agreement before signing.
Include an arbitration clause to allow any disputes to be settled under the
provincial Arbitration Act (1992) rather than going to court.
Read the National Energy Board document, pipeline Regulation in Canada: A Guide for
Landowners and the public (June 2003), before negotiating an easement agreement for
the planned construction of an inter-provincial or international pipeline. The NEB
requires a hearing before the Board if the proposed pipeline is longer than 40 kms
or the Board considers a hearing necessary for any other reason. As a landowner or
occupant you have an opportunity to participate in the hearing by making a
submission in person or in writing.
Ensure that everything that you have negotiated with the company is included in
the written agreement.



6. Batteries and Gas processing plants
a. Batteries
Batteries are facilities where oil and gas are collected from one or more wells and separated
into oil, gas, water and impurities before further transport. A battery may consist of a number
of tanks and separators and a dike or dikes to collect any run-off fluids. Battery sites are located
near producing wells and connected to the wells by flowlines or pipelines.

potential problems associated with batteries are emissions, spills, containment dike failures,
and flaring operation difficulties. These problems can impact nearby residents or

Saskatchewan Industry and Resources (SIR) regulates batteries under the Oil and Gas
Conservation Regulations, 1985. The Regulations define a battery as “common storage facilities
receiving production from a well or wells and includes equipment for separating the fluid into
oil, gas and water and for measurement” (subsection 2(d)).

Batteries must be setback a minimum of 75 metres from any:

(a) road allowance, surveyed road, railway, pipeline, power line or other right of way;
(b) aircraft runway or taxiway; or
(c) dwelling, industrial plant, military building, permanent farm building, school or
unless the Minister of Industry and Resources considers a shorter distance is justified by special
circumstances (Regulations, s. 51(1)). Similarly, the minimum distance a battery can be located
from a well-site is 45 metres (s.51(2)).

Section 52 of the Oil and Gas Conservation Regulations sets out the maintenance and housekeeping
requirements for battery sites. The operator of a battery cannot allow salt water, waste oil or
refuse to flow over the surface land (s.52(2)). To prevent such escapes, a dike must be installed
around the entire battery site (s.50(2)). If liquid escapes from a battery storage tank, a dike is
needed to provide secondary containment. The dike surrounding the tank or battery of tanks
must have a capacity greater than that of the largest tank or as required by SIR (s.50(2)). The
dike must also be maintained in good condition and kept free from tall grass, weeds or
combustible material.

Any rubbish or debris must be removed from the battery site (s.52(3)). All waste oil and refuse
is to be drained into approved containers or receptacles and immediately removed from the
battery site (s.52(4)). The receiving containers must be located no less than 45 metres from any
battery site or tank.

When an oil spill or salt water spill occurs at a battery site (or at a well site) the operator must
take immediate steps to contain and clean up the spill. The operator must also ensure that the
spilled material and any contaminated soil or water is processed in the operator’s own facility,



or sent to an approved waste processing facility, or disposed of in another manner that is
acceptable to the department (s.52(6)).

To minimize fire hazards, all battery piping is to be laid out properly and equipped with control
valves to shut off oil or gas flows in the event of fire (s.53(7)).

Because battery facilities can pose hazards equal to or greater than oil or gas wells, special
provisions should be included in a surface lease agreement to address such facilities and their
risks. Additional compensation should be paid for the installation and operation of a battery
site on your land.

b. Gas processing plants
Gas processing plants remove impurities from the gas before it is piped to market. The natural
gas purchased by consumers for home heating or cooking is methane. In a gas reservoir,
methane is typically found in a mixture with heavier hydrocarbons such as ethane, propane,
butane and pentane, as well as water vapour, hydrogen sulphide (H2S) if the gas is sour, carbon
dioxide, nitrogen and other gases. Most of these substances are removed from the gas at
processing plants located near production areas. As with batteries, potential problems that can
affect neighbouring residents are emissions, spills and flaring operations.

7. Waste Management
Waste management involves the storage, treatment and disposal of oil patch wastes. Under
provincial waste management guidelines oil patch wastes are referred to as “upstream
petroleum wastes”. The word “upstream” means that the wastes have been generated by the
exploration, development or production phase of oil and gas projects. Midstream oil and gas
projects are those involving the processing, storage or transport of oil and gas. Downstream
oil projects involve the refining of crude oil into various chemicals and products such as
gasoline, asphalt or plastics.

Oil patch wastes include wastes from wellsites, batteries, gas plants, compressor stations, crude
oil terminals, pipelines, gas gathering systems, drilling and service rigs.

a. SpIGEC Waste Management Guidelines
The 1996 Waste Management Guidelines for the Saskatchewan Upstream Oil and Gas Industry provide
detailed waste management guidelines for the oil and gas sector. These guidelines were the first
set of guidelines developed by the Saskatchewan petroleum Industry/ Government
Environmental Committee (SpIGEC).41 SpIGEC was formed in 1992 to bring industry and
government together to address provincial environmental management concerns.

Although the Waste Management Guidelines are not legally binding, if a company follows the
guidelines they will meet or exceed provincial regulatory requirements (which are legally

41 See Chapter Five for additional information on SpIGEC. binding).



 The guidelines attempt to synthesize in one document the principles and practices oil
and gas companies should follow. Failure to follow the guidelines means a company has fallen
below accepted industry standards and is at high risk for legal liability if sued.

The SpIGEC Waste Management Guidelines can be downloaded from the Saskatchewan Industry
and Resources website at Follow the links starting with
“Saskatchewan’s Oil & Gas Resources” to “Guidelines and Miscellaneous Information” to
“Environmental Guidelines.”42

b. provincial Regulators
Both Saskatchewan Industry and Resources (SIR) and Saskatchewan Environment (SE) are
responsible for regulating oil patch wastes. Jurisdiction is divided between the two
departments, but in certain cases there is an overlap of jurisdiction or responsibility. Both
regulators have an administrative and enforcement role in their areas of responsibility.

SIR is the primary regulator of oil patch wastes. The department has exclusive jurisdiction over
any wastes or waste management facilities specifically listed in the Oil and Gas Conservation Act
or Regulations and the pipelines Act. Thus the wastes or facilities regulated under this legislation
are exempt from other environmental protection legislation. For example, upstream wastes
generated and stored on-site at wells or at oil or gas processing facilties, are regulated by SIR.
These would include crude oil, natural gas, produced water and associated oily wastes.

In general, once upstream wastes are removed from site to more permanent facilities, such as
hazardous waste management facilities, landfills or commercial landfarms, the wastes are
regulated by Saskatchewan Environment. If wastes or chemicals are spilled on-site both SIR
and SE may have jurisdiction.

Saskatchewan Environment regulates oil patch wastes under the following pieces of

Environmental Assessment Act – certain waste treatment and storage schemes require
approval under the Act.

Environmental Management and protection Act, 2002 and Regulations – industrial effluent permits

are issued under the Act. The following Regulations created under the Act provide for the

management of specific categories of wastes or facilities:

Environmental Spill Control Regulations – outline required spill reporting and
response actions by persons responsible for releases (upstream oil and gas
spills are exempt from these regulations).
(b) Hazardous Substances and Waste Dangerous Goods Regulations – regulate waste
storage facilities and sites.
pCB Waste Storage Regulations – require pCB wastes to be managed and
stored in an environmentally safe manner.
42 The SpIGEC Guidelines are referred to by the abbreviated title SpIGEC 1 Upstream Waste Management Guidelines
on the SIR website.



The following table outlines the division of responsibility between SIR and SE for the
regulation of oil patch wastes.43

Saskatchewan Industry and Resources Saskatchewan Environment

on-site storage of produced water and
crude oil (tanks and batteries)

drilling fluid waste management

oily byproducts storage and disposal

land treatment and land farming

oilfield waste processing facilities

waste disposal wells

on and off lease spills of produced
water, emulsion and crude oil

storage of hazardous substances and
waste dangerous goods


hazardous waste management

commercial land farms

commercial waste contractors

hazardous waste disposal wells

spills of refined products

c. Waste Disposal Wells
Section 76 of the Oil and Gas Conservation Regulations, 1985 regulates the planned on-site disposal
of oil and gas wastes, salt water and other wastes.

If a company wishes to dispose of wastes below the ground in subsurface formations (waste
disposal well) it must obtain the written consent of all owners, including private mineral rights
owners (freehold), who may be adversely affected by the disposal (s.76(1)(a)). The company’s
disposal plan must be submitted to Saskatchewan Industry and Resources for approval. The
written disposal plan must be accompanied by the land and mineral owners’ consents.

Once every two years a disposal well requires inspection by SIR to ensure there are no
production casing, tubing or packer failures, and that the casing annulus is sufficiently
protected by a corrosion inhibiting fluid (s.76(4)).

Wastes placed in a disposal well cannot constitute a public health or safety hazard or
contaminate fresh water or arable lands. The company operating a disposal well is required to
prevent such problems (s.76(3)). Compliance with an approved written disposal plan does not
relieve a company from its obligation to protect the public and the environment.

Any plans to dispose of oil and gas wastes other than by subsurface disposal requires prior
written approval from SIR (s.76(2)).

43 SpIGEC, Waste Management Guidelines for the Saskatchewan Upstream Oil and Gas Industry (1996), s.3.2, at p.9.



d. Drilling Waste Treatment and Disposal
Often, the largest volume of wastes created by oil and gas companies are drilling wastes,
including drilling fluids or muds and drill cuttings. Drilling fluids are liquids used in drilling to
manage the wellbore. Drilling mud is usually made of water or oil mixed with clay or chemicals.
Drilling muds lubricate and cool the bit and counterbalance underground formation pressures.
The muds become contaminated with formation material and the result is a large volume of
liquid and solid waste that need disposal. Spills and leaks of drilling fluid, hydrocarbons and
formation water can also contaminate soil and water and create waste.

In some cases, the drilling mud can be reused or recycled, but most often it is disposed of on
the lease site or on nearby agricultural land such as stubble fields and cultivated lands. SIR
prohibits off-lease disposal on vegetated land (pasture, native grass or forested land), except in
very rare cases.

In 1999 Saskatchewan Energy and Mines (now SIR) issued the Saskatchewan Drilling Waste
Management Guidelines.44 The Guidelines replace and consolidate previous guidelines dealing with
drilling wastes. They also outline comprehensive methods and criteria for the handling and
disposal of drilling wastes. If a company uses disposal methods other than those found in the
guidelines, it does so at its own risk. Ultimately, a company is responsible for the proper
disposal of its own wastes.

The type of drilling mud system determines what treatment and disposal options may be used
by a company. SIR identifies three categories of drilling mud systems and their wastes:
freshwater based, salt water based, and hydrocarbon based.

Freshwater based drilling mud systems use fresh water as the base and include fresh water
gel, gypsum water, nitrate gypsum water, or fresh water polymer systems.

Hydrocarbon based drilling mud systems include oil only systems, or fresh or saline water
emulsified in the oil. The oil used includes crude oil, diesel oil (invert mud) and mineral oil.
Canola oil or mineral oil systems are slightly more costly, but less toxic than diesel oil.

Salt water based drilling mud systems use salt water and saline inhibitive muds. The salts
commonly used in the muds are potassium chloride, potassium sulphate, or diammonium

Four types of disposal methods for drilling wastes are accepted in the province:

On Lease Disposal – including landspreading and residual solids disposal;
Off Lease Disposal – including landspraying while drilling and landspraying
disposal after completion of drilling;
Land Treatment Disposal; and,
44 The Saskatchewan Drilling Waste Management Guidelines are numbered Information Guideline GL 99-01. The
Guidelines are available on the SIR website.



Alternative Disposal Options – including roadbed incorporation, encapsulation or
mixing with a solidifying agent, solids washing to pre-treat wastes, and
treatment and disposal at waste processing facilities.
For additional information on these disposal methods, including technical details, refer to the
1999 Saskatchewan Drilling Waste Management Guidelines.

(i) Drilling Waste Management plans
A drilling waste management plan must be submitted to the appropriate SIR field office when
applying for a well licence and 3 days prior to spudding or starting a well. A waste management
plan must address storage, processing, handling, treatment and disposal of drilling wastes. A
waste management plan is not required where freshwater mud systems are proposed.
However, a plan is required when the mud system is salt based or hydrocarbon based, or where
a company proposes underbalanced drilling.

Underbalanced drilling is drilling an oil well with a lighter drilling mud. For example,
high-pressure nitrogen provides a low density drilling fluid that allows a lower downhole
hydrostatic pressure. The lighter hydrostatic pressure of the drilling fluid results in a wellbore
pressure that is less than the formation pressure at all times. The lower pressure in the wellbore
encourages oil and gas flow out of the formation and into the well, and virtually eliminates the
flow of drilling fluids into the formation (preventing formation damage). Lighter drilling fluids
mean faster drilling time.45 As a result, underbalanced drilling increases the amount of oil and
gas that can be recovered in a shorter period.

(ii) Temporary Storage/Containment of Drilling Fluids
During the period of drilling, drilling fluids or muds must be contained in a safe manner.
Various storage or containment methods are possible depending on the types of muds or
fluids involved and other site-specific conditions or circumstances. However, upon
completion of drilling, all drilling fluids must be disposed of in a timely manner (Saskatchewan
Drilling Waste Management Guidelines, s.1.2). Sump closure must be completed within 12 months
of drilling rig release, unless permission is otherwise obtained from the appropriate SIR field
office. placing hazardous wastes, waste dangerous goods or garbage in drilling sumps/tanks is
prohibited. Additional details on drilling fluid storage and management are found in the 1996
Waste Management Guidelines for the Upstream Oil and Gas Industry.

possible containment methods for drilling fluids include: earthen sumps, synthetically lined
earthen sumps, mud tanks, closed drilling fluid handling systems, and remote sumps.

Earthen sumps or pits may only be used for the storage of freshwater drilling fluids. The
bottom of the pit must also be separated from the groundwater table by at least one metre of

45 For instance, in Venezuela a well was drilled underbalanced in 17 days, whereas the estimated drilling time for
the same well using conventional methods was 43 days. See John E. Boyle, Underbalance Drilling Service – Think
Value, Not Cost, Weatherford International website at



continuous, impermeable subsoil. Earthen pits may be used for the storage of salt water only in
an emergency.

Synthetically lined earthen sumps may be used to hold freshwater drilling fluids where
containment using native soils is not feasible. The liner must be compatible with the fluid
being stored, and must be strong and durable.

Mud tanks must be used for salt or hydrocarbon based mud systems, or where soil conditions
are unsuitable or a high groundwater table exists.

Closed drilling fluid handling systems are required where there is an explosion hazard
and/or dangerous gases may be emitted as a result of drilling activities. For example, when
drilling underbalanced, drilling through a sour oil or gas formation, or drilling with petroleum
distillates or diesel drilling mud, a closed system may be required by SIR. A closed drilling fluid
handling system normally includes a rotating blow-out preventer, a mud-gas separator, and
enclosed tanks, connected to a gas flaring unit.

Remote sumps may be used where drilling fluids cannot be contained on lease or where
multiple wells are planned. A remote sump requires prior approval from SIR. To obtain
approval a company must provide to SIR: a letter of application describing the type of drilling
wastes to be stored in the sump; the length of time the sump is to be used; a survey plan
showing the location of the remote sump; and a written consent from the landowner. The
approval from SIR may contain a number of site-specific conditions.

Land Application: Land Spreading, Land Treatment and
Land Farming
As a landowner or occupant you may be asked by an oil or gas company to permit the use of
your land for waste treatment or disposal. It is recommended that you exercise caution in
agreeing to any land application schemes such as land spreading/ spraying, land treatment or
land farming. The land application of drilling wastes can pollute soils and surface waters.

Drilling mud wastes may contain potentially toxic additives such as bactericides, emulsifiers,
de-emulsifiers, corrosion inhibitors, foaming agents, lubricants, polymer stabilizers, polymer
breakers, shale control inhibitors and surfactants. Heavy metals found in these substances can
accumulate in the soil and in the food chain.

Land application is a form of waste bio-remediation where wastes are spread or mixed into or
onto the soil surface. Bio-remediation uses the activity of micro-organisms to break down
contaminants found in water, soil or waste constituents. Bio-degradable wastes such as
hydrocarbon contaminated soils can be treated with bio-remediation.

Land application uses the soil or vegetation system to degrade, transform and assimilate waste.
The method may be used as a treatment or final disposal method.

Land Spreading/ Spraying is a one-time application of drilling waste to soil. This
practice is based on maximum loading to the soil or application rates. Land spreading or



spraying relies on dilution of contaminants in the environment rather than actual treatment
of wastes. Waste contaminants added to the soil can be transported from the disposal site
into ground and surface waters.

Land Treatment is a one-time application of waste to soil and periodic reworking with
organic amendments. This method of disposal is used for hydrocarbon based mud wastes. If
the wastes have a high salt content, management practices must deal with both the salt and the
hydrocarbon. Safer alternatives to land treatment for wastes with high salt content include
composting, leachate bed reactors and bioreactors.

Land treatment requires frequent tillage and application of nutrients to break down the
hydrocarbons. Organic amendments such as manure or straw are added to increase biological
activity and soil aeration. periodic soil sampling and analysis are needed to monitor the
progress of remediation. Several years of active remediation may be needed to achieve closure.

Land Farming involves the repeated application of waste material at a dedicated site or
facility. Land farms are larger, longer-term land spreading operations. They typically receive
petroleum-contaminated wastes such as gasoline, diesel, used oil and solvents. Land farming
operations require environmental review by Saskatchewan Environment under the
Environmental Assessment Act.
One of the problems or risks associated with all three types of land application is the presence
of soluble salts, metals and soil sterilants in the wastes. These contaminants can damage soil,
contaminate groundwater, and harm livestock or wildlife.

Environmentally safer methods of treating and disposing of drilling wastes exist. For invert
and hydrocarbon-contaminated muds, options include oilfield waste treatment facilities,
thermal destruction and disposal in licenced hazardous waste landfills.

8. Abandonment and Restoration of Well Sites
The construction and management practises used during the life of a well or other upstream
facility can impact greatly on the level of clean up and remediation needed at the time of
abandonment. A pre-site assessment is recommended to record the site conditions for
comparison after restoration.

Abandonment is part of the well decommissioning/dismantling process, and involves the
capping or plugging of a well. The term remediation refers to the decontamination of the soil
or water. Decontamination is needed if there have been spills or leaks of drilling fluids,
hydrocarbons or wastes. Restoration refers to the physical reclamation process and involves
re-contouring, replacing topsoil and re-vegetating to restore the surface of the land to as close
to original conditions as possible.

When a company plans to abandon a well site it must serve the landowner and any occupant
with a notice of its intention under section 54 of the Surface Rights Acquisition and Compensation
Act. A copy of the notice of intention to abandon must also be filed with the Surface Rights
Compensation Board. proof of service of the notice on the owner and occupant must also be
filed with the Board within 30 days of filing the notice (s.54(2)).



a. Capping or plugging Wells
Specific requirements must be met when an oil or gas company plans to shut down and cap a
dry well or a completed well that is no longer productive. The Oil and Gas Conservation
Regulations, 1985 list the procedure to be followed when a company abandons a well.

Section 35 of the Regulations requires that a well be plugged after it is no longer used for its
original purpose. If the operations at a well have been discontinued or delayed for an
unreasonable period of time, SIR can provide the owner with 30 days notice to abandon the
well (s.35(2)). The well owner can dispute the notice, if it can show cause why the well should
not be abandoned. If the well is not abandoned or the notice disputed after 30 days, the
Minister of Industry and Resources can instruct the department to abandon the well at the
owner’s expense (s.35(3)).

Three types of abandonment procedure are set out in the Regulations:

(1) dry hole abandonment;
(2) production well abandonment outside pools; and,
(3) production well abandonment inside pools.
(i) Dry Hole Abandonment
Dry holes are non-productive wells in which only the surface casing has been set. Dry holes
require fewer steps to abandon than producing or completed wells. Before any work to
abandon a dry hole begins, SIR must be notified of the intention to abandon the well and the
details of the abandonment program (s.36(1)). Under subsection 36(2) of the Regulations, a dry
hole is to be abandoned by:

(1) isolating each porous or water-bearing zone with a 15 metre cement plug;
(2) filling the interval between the plugs with an approved, heavy, mud-laden fluid;
(3) placing cement in the hole by pumping through tubing, pump and plug, or any other
approved method;
(4) placing a cement plug of a minimum of 30 metres across the surface casing shoe;
(5) cutting off the surface casing one metre below ground level; and,
(6) welding a steel plate over the end of the casing at the surface to completely plug the
open end.
Once the cement plugs have hardened for a certain number of hours, the company
abandoning the well must test the strength of the plugs. The plugs must be able to
withstand 18 kilonewtons of force (s.36(2)(g)). If the plugs fail this test, they must be reset.
Any plugs that have been displaced and fail to seal off porous zones must also be reset

The goal of the abandonment procedure is to ensure that there is no flow of oil or gas to
water zones. Thus, the cement plugs must be of sufficient number and length to protect
groundwater. Downhole plugs are also designed to prevent the flow of any substance
between the zones.



(ii) production Well Abandonment Outside pools
A production well or completed well has production casing set in place in the wellbore. The
abandonment procedure for a production well located outside an oil or gas pool is found in
section 37 of the Oil and Gas Conservation Regulations. The operator must:

(1) set a mechanical bridging plug immediately above the perforations or open hole
(deep in the wellbore) and place a 3 metre long cement plug on top of the bridging
plug; or, set a cement plug extending at least 15 metres above the perforations or
the casing shoe from the bottom of the hole;
(2) allow the cement to harden for 8 hours and test it to withstand a force of 18
(3) test the bottom plug for proper shut-off;
(4) fill the casing to the surface with an approved fluid;
(5) cut off the surface casing and the production string one metre below ground level;
(6) weld a steel plate to completely close off the annulus between the surface casing
and production casing; and,
(7) weld a steel plate to completely close off the end of the production casing.
(iii) production Well Abandonment Inside pools
If the production well is located inside a pool or the well has been producing enough gas to be
classified a gas well, an additional step is required to abandon the well. Section 38 of the
Regulations sets out the abandonment procedure. A cast iron retainer must be set immediately
above the highest perforated interval or open hole, then cement is squeezed into the pool or
fluid bearing formation until a satisfactory pressure is obtained indicating proper shut off.
Section 38 also requires the well operator to follow the same abandonment procedure found in
section 37 for production wells outside a pool.

If a production well is located in a depleted pool the department of Industry and Resources can
approve a modified abandonment program on application (s.38(2)).

b. Restoration of Well Sites
After final abandonment and plugging of a well, the operator of a well site and access road
must clean up and restore the surface of the site (Oil and Gas Conservation Regulations,

As noted above, surface restoration involves recontouring, replacing topsoil and
re-vegetating. The end result of a successful restoration will be a suitable depth of topsoil
or rooting zone, soil texture similar to that found off-site, no restriction to rooting or
movement of water through the re-established soil profile, and soil capable of supporting



vegetation.46 Revegetation may be carried out by the operator or left to the landowner or

Under section 44 of the Regulations the oil or gas company must:

(1) remove all refuse from the well site and access road;
(2) drain and fill all excavations or holes;
(3) remove concrete bases, machinery and materials;
(4) level the surface; and,
(5) restore the land as close to its original condition as possible.
The company must also submit to SIR a written release from the landowner stating that the
operator has restored the surface to his/her satisfaction (s.44(e)). If the landowner refuses to
provide such a release to the company, the company must submit a certificate from the Surface
Rights Compensation Board issued pursuant to subsection 56(2) of The Surface Rights Acquisition
and Compensation Act. SIR will not refund any deposits paid by the company until it receives the
written release or a Board certificate.

Where a company has served a landowner and occupant with a notice of intention to abandon
a well site under s.54 of the Surface Rights Act, the company must “forthwith restore the surface
of the land involved as nearly as possible to its original condition” (s.55).
If you as a landowner or occupant are dissatisfied with the state or condition of the restoration,
you have five years from the date of service of notice of abandonment to apply to the Board
for an order compelling the company to restore the surface of the land in compliance with
section 55. If no such application has been made within the five-year period, the company will
receive a certificate from the Board under subsection 56(2).

Alternatively, you may agree to a cash payment by the company in lieu of restoration (s.55).
Thus you would undertake your own restoration of the land surface. The cash payment
operates as a complete release of the company from its obligations under section 55 of the
Surface Rights Acquisition and Compensation Act to restore the surface of the land. This option is
not recommended. Accepting a cash payment in lieu of restoration is not an
environmentally-friendly practice and could leave you as landowner with legal liability for any
contamination problems arising in the future. Oil or gas companies should not be relieved of
their restoration responsibilities.

For additional information on surface restoration refer to SpIGEC Guideline No.2, Restoration
of Well Sites and Associated Facilities on Cultivated Lands in Saskatchewan (1999) and SpIGEC
Guideline No.3, Restoration of Spill Sites on Saskatchewan Agriculture and pasture Lands (1999). All
SpIGEC guidelines can be viewed and downloaded from the Saskatchewan Industry and
Resources website at:

http//,3620,3384,2936, Documents.

46 SpIGEC Guideline No. 2: Restoration of Well Sites and Associated Facilities on Cultivated Lands in Saskatchewan (1999)
at page 2.



Chapter Two: Emergencies

Emergencies in the oil patch can include well blowouts, oil or gas spills, pipeline leaks, fires or
explosions, and uncontrolled sour gas (hydrogen sulphide) release. Any of these emergencies
can pose a threat to humans, livestock and the environment.

In Alberta oil and gas companies must prepare an emergency response plan for each critical
sour gas project and submit it to the Alberta Energy and Utilities Board, the petroleum
industry regulator. By contrast, in Saskatchewan written emergency response plans are not
mandatory. However, the larger oil and gas companies operating in the province normally
have a written emergency response plan that they file with the Department of Industry and
Resources (SIR). Smaller companies usually do not have their own individual plans but they
will join an Emergency Response Cooperative or Unit where a joint emergency response plan
is created. The companies in the Unit pool their money to buy proper equipment and provide
specialized training for their employees.

1. Oil or Gas Well Emergencies
Before being granted a drilling licence by the province, each oil or gas well operator must join
an Emergency Response Unit or show that they have the trained personnel and equipment
necessary to respond in the case of an emergency. Saskatchewan companies operating oil or
gas wells in the province contract with specialized firms to deal with any emergencies.

For example, Western Canada Spill Services (WCSS) holds annual oil spill response training
exercises in each Cooperative area in the oil patch. These annual training exercises are
considered an important part of a preventative maintenance program. The exercises help build
and maintain response team skill levels. The goal of spill response is to minimize risk to the
public, employees, property and the environment by ensuring rapid and effective response to
any emergency. All personnel who may be involved in spill response are trained in
containment and recovery methods and equipment use.

A well blowout is the uncontrolled escape of gas, oil, water or other fluids. Blowouts happen
when the underground formation pressure is greater than the pressure exerted by the column
of drilling mud placed in the well. Oil gushing into the sky from a drilling rig was once
considered normal industry practice. Today conservation legislation in Saskatchewan and
elsewhere makes blowout prevention equipment mandatory. Nevertheless blowouts can still
occur as a result of accident or equipment failure. When a blowout does occur the well
operator will contact a company such as Safety Boss Inc., an Alberta specialist in responding to
fires, blowouts and pipeline ruptures.

Following the first Gulf War in 1991, Canadian emergency specialists, including Safety
Boss, were called in to respond to the series of devastating oil well fires set by Saddam



Hussein’s Iraqi forces as they retreated from Kuwait.47 These same companies may be
called on to respond to emergencies in Saskatchewan.

a. What to Do in the Event of an Oil or Gas Well Emergency
If you notice any serious problem with an oil or gas well, including a blowout, an oil or gas leak,
or water flow, you should immediately call the company field office. If you are unable to
contact the company, call your local emergency services such as the RCMp or 911.

In a typical emergency response situation the company field office will contact the local
Emergency Response Unit to deal with the emergency. As part of their response the company
or the Response Unit will contact the RCMp and emergency measures organizations.
Government offices are also contacted, including Saskatchewan Industry and Resources,
Saskatchewan Environment, and if the impacted land is Crown owned pasture, Saskatchewan
Agriculture and Food.

b. Responsibilities of Well Operators/Owners in an Emergency
(i) public Notice Requirements48
Oil and gas companies are expected to hold public information sessions on a regular basis to
keep the public informed about their operations, their emergency response plans, and where
emergency response equipment is stored. When there is an emergency the company whose
well or pipeline is affected is responsible for notifying area residents and evacuating them if
necessary. The public has a right to be notified and should be notified if emergency response
procedures are followed.

(ii) Notice to Government Departments
The Oil and Gas Conservation Regulations,1985 state that in the event of a fire, blowout, break or
leak involving an oil or gas well, pipeline or storage tank the operator must notify the
Department of Industry and Resources immediately (section 106). If the emergency involves a
blowout, leak or equipment malfunction, this notification requirement only arises where oil,
salt water, condensate or product escapes beyond the operator’s property or lease area, or the
escape exceeds a volume of 1.6 cubic metres within the property or lease area (section
106(1)(d)). Where gas escapes as the result of an emergency the Department must be notified
only where the loss exceeds 28,000 cubic metres of gas (s.106(1)(f)).

Within thirty days of notifying the Department of such an emergency or accident, the operator
must submit a written report to the Department setting out:

the exact location of the spill;

the details of any remedial clean up steps taken or proposed;
47 In a 7-month period crews from Safety Boss safely extinguished and capped 180 wells out of the total of 727
wells set ablaze in Kuwait, gaining worldwide recognition for their achievement.
48 These public notice requirements were garnered from personal communication with SIR staff.



an estimate of the initial amount of oil, salt water, condensate, product or gas lost and
an estimate of any recovery; and,

an estimate of the extent of the pollution to the air, land, underground water and any
water-covered area (section 106(2)).
Liability for Costs of Clean-up and Harm to persons or
Where the owner of a well does not take action to deal with an emergency, accident, or other
risk to life or property posed by the well, the Department of Industry and Resources can, at the
expense of the owner, take any remedial measures necessary, including hiring persons and
equipment (Oil and Gas Conservation Regulations, section 81(1)).

Ultimately the operator and owner of the well, pipeline or storage facility are legally
responsible for the costs of clean-up and remediation, and for any loss or harm to people,
property or the environment caused by an emergency or accident. However, in order to collect
damages for any health effects or losses to your business or livestock as a result of an
emergency or accident, you may have to file a civil law suit.

pipeline Emergencies
A pipeline emergency is any uncontrolled or unplanned release of natural gas (leak) that may or
may not catch fire or explode.

Signs of a Gas Leak
Methane, the natural gas used to heat homes is naturally odourless and colourless. To alert
homeowners to any leaks, natural gas is pre-treated with a strong-smelling additive. For
example, when cooking with a natural gas stove you may notice a distinctive smell. However,
natural gas that is piped through transmission pipelines is often sweet and odourless. If there is
a leak, there may be no smell. But if you notice any of the following signs, there may be a
pipeline leak.

What you may see:

Discoloured or dead plants in an area;

Frost on the ground but the ambient temperature is above zero; or

Bubbles in freestanding water such as sloughs.
What you may hear:

A loud whistling sound.



What to Do in the Event of a Natural Gas pipeline
Natural gas is flammable and can be explosive if exposed to a source of ignition. If you come
across a damaged pipeline or damage one accidentally, you should:

Shut off any power equipment and motors and leave the area immediately. Do not
use your car or any equipment that could be a possible ignition source — not even
your cell phone.
Extinguish all flares, lanterns, fires, cigarettes, etc. in the area.
Keep people and livestock away from the area.
If it is a TransGas pipeline (the company will have posted signs in the area)
immediately contact TransGas’ 24-hour emergency telephone number at:
1-306-777-9800 collect.

If it is a TransCanada pipeline call the TransCanada Emergency Number at:


Call 911 or your local emergency number.



Chapter Three: Common Law Rights

In many cases, if you are a person living or working in the oil patch the only legal rights you
may have to deal with problems caused by oil and gas development are your rights under the
common law. Common law rights are those rights that have evolved over time through cases
brought before the courts. The common law is sometimes called judge-made law, as opposed
to statute law made by parliament or the provincial Legislature.

For example, if you live next to an oil or gas well, but the well is not on your land, you will not
be able to negotiate a surface rights agreement with the oil company. Therefore, to address any
problems or complaints you may have, or if the company refuses to compensate you or settle
the matter amicably, you may have to rely on your common law rights in court. Even if you
have a surface rights or easement agreement with a company, you may have to go to court to
enforce your rights under the contract if the company breaches a term of the agreement.

Depending on the facts you are dealing with, you may be able to rely on one or more of the
following common law actions in court to be compensated for any harm you suffer:




Rule in Rylands v. Fletcher (strict liability for non-natural land use); or

Breach of Contract.
The first four legal actions listed are called “torts”. Torts are private or civil wrongs or injury.
If a tort has been committed the court will provide a remedy in damages (money award) to the
injured party (plaintiff). Either a wrongful act or an omission can result in a tort action.

Normally, three elements must be present in a tort action: a legal duty from the defendant
(person being sued) to plaintiff, a breach of that duty; and damage as a result.

The role of tort law is to allow an injured person to obtain compensation from the person who
caused the injury. Tort law also serves as a deterrent by holding persons (including companies)
responsible for their actions, and educating the community as to what is unacceptable conduct.

An action for breach of contract is different from a tort and is subject to a different set of rules.
The law of contract governs compensation sought for a breach of a duty owed to you as a
result of a private agreement between you and the oil or gas company.

The following sections briefly outline these five possible court actions.

A. Nuisance
Each landowner, tenant or lessee has the right to “quiet enjoyment” of his or her land. By law
a nuisance occurs when any industrial or other activity interferes with the quiet enjoyment of
property. For example, in the oil patch a nuisance can occur as a result of water or air pollution



from a spill or accident, or from routine well test flaring, or from excessive noise and
vibrations that affect nearby residents.

In a private nuisance lawsuit, one individual with a proprietary right to land sues a company or
neighbouring landowner for loss of “quiet enjoyment” or interference with ordinary use and
enjoyment of land. In these cases the remedy for nuisance is often the payment of damages. If
the nuisance is ongoing and very disruptive, then the person bringing the action in court
(plaintiff) will also ask for an injunction to stop the activity or nuisance.

If the nuisance affects many people, the nuisance may be a public nuisance and the
government can bring an action for public nuisance. The company or landowner would then be
ordered to stop the operation to bring an end to the public nuisance. However, because the
government has licensed the oil or gas operations it is not likely that the government will bring
a public nuisance suit unless the public applies strong pressure. The government may also seek
other avenues for dealing with the public nuisance including issuing an order for the company
to modify its operations to reduce or eliminate the nuisance. A class of people specifically
affected by a nuisance may also bring a public nuisance action and they need not have a
proprietary right in any property or land to do so.

When a nuisance action is brought to court, the judge will normally consider the following

the type and reasonableness of an activity;

the nature, frequency, duration and intensity of the interference with quiet enjoyment;

the seriousness of the harm;

any unusual sensitivity of the plaintiff (person bringing the action);

the utility or need for the defendant’s conduct or operations;

the character of the neighbourhood;

the choice of location of the activity; and,

the effect of issuing an injunction against the defendant.
1. Vibration, Noise and Fumes as Nuisance
One of the early nuisance cases in Saskatchewan was the 1938 decision by the Court of King’s
Bench in Cubbon v. White.50 In that case the plaintiff, a woman living near an electrical plant,
brought an action in nuisance for an injunction and damages. She had been a resident of her
home in the village of Manor since 1918. An electrical plant was later built on lots adjoining her
home. After a period of closure the plant was re-opened by the defendant White in March
1937 and operated continuously. The plant provided electricity for the entire village.

The plaintiff and her family suffered as a result of the constant vibrations, noise and fumes
emanating from the electrical plant. The operation of the plant produced a constant vibration
in the dwelling house that caused damage to the home. The noise from the plant’s exhaust pipe
could be heard up to one mile away and disturbed the family, located less than 100 feet away, in

49 Centre for Studies in Agriculture, Law and the Environment, Environmental Law and the Farmer (Saskatoon:
public Legal Education Association of Saskatchewan, 2000) p.10.
50 [1938] 2 W.W.R. 257.



their sleep. There was no stack or chimney on the plant, and the smoke and fumes from the
burnt fuel oil were discharged into the air at ground level. As a result fumes from the plant
blew into the plaintiff’s home and saturated her curtains with oil. The family also suffered from
lung and bronchial problems attributed to the fumes. The Court rejected the defence argument
that the discharge was only carbon dioxide and harmless.

The plaintiff argued that the operation of the plant was a nuisance and interfered with the
health, comfort and convenience of the plaintiff and her family. The Court decided that the
facts established “a substantial interference with the ordinary comfort and enjoyment of the
plaintiff’s dwelling house” and depreciation in its saleable value. Thus the plaintiff was entitled
to an injunction and damages. Damages were awarded in the amount of $100.

The Court also ruled that it could not restrain the defendant from operating an electrical
generating plant because that was a lawful use of the premises. However, the Court restrained
the defendant from operating the plant in a manner that caused the land and dwelling of the
plaintiff to vibrate, that resulted in exhaust smoke at the level of the home, and created noise
that disturbed anyone occupying the home in their ordinary enjoyment at any time. Therefore,
the Court granted the defendant thirty days to build a chimney stack and muffler to eliminate
the fumes and noise, and to hire an engineer to control the vibration in the soil.

2. Noise as a Nuisance
In the 1992 decision of Joyce v. Yorkton Gun Club Inc.51 the Saskatchewan Court of Appeal
reviewed the lower court’s decision to grant a permanent injunction to restrain the defendant
Yorkton Gun Club from operating its shooting range. The Court of Appeal upheld the
permanent injunction awarded for nuisance caused by noise and vibration.

The plaintiffs lived in a farm house located across the road from the Gun Club’s property.
They brought an action seeking to stop the nuisance caused by the use of the premises as a
shooting range. The noise level was the plaintiffs’ main concern.

The Court of Appeal stated that the primary role of the trial judge was to make the finding of
fact “as to whether the noise in question in this case was of such a character, frequency and
intensity as to constitute a nuisance.” The Court of Appeal could not intervene unless it was
obvious that the trial judge’s conclusion was based on an error in law or that he made a
palpable or overriding error of fact.

After reviewing the evidence, the Court of Appeal found that the trial judge properly took into
account the frequency, spasmodic nature and startling effect of the sound created by the
gunfire. The evidence also supported the trial judge’s conclusion that a nuisance was created by
the gunfire at the range. One compelling piece of evidence was a tape recording of the
operating shooting range.

The Court also commented on the possibility of amending the injunction to impose certain
conditions on the Gun Club that would allow for the range to be operated again. However,
the lack of evidence and the all or nothing nature of the trial meant that the Court of Appeal

51 (1992) 97 Sask. R. 243.



could not identify reasonable terms for such an amendment. As a result, the appeal by the
Yorkton Gun Club was dismissed and the permanent injunction was upheld.

B. Trespass
Trespass is the unlawful interference with another’s person, property or rights. Under the
common law anyone who enters another’s property without consent or lawful authority will be
liable in trespass. Similarly, anyone who permits the escape of a substance under his control
onto another’s property may be liable in trespass, whether or not any damage results. For
example, if a pipeline bursts and oil spills across the right of way onto neighbouring farmland,
the pipeline company could be liable in trespass for the spill. The Court will award damages for
lost crops, clean-up costs or any other direct losses suffered by the landowner or occupant. If
the spill does not cause any damage to the land or other harm, the award of damages for the
trespass would be nominal (small).

A flagrant case of trespass would be where a seismic exploration company enters your land
when you have refused to grant them access. By contrast, if you have refused access to an oil or
gas company to drill a well they can enter your land without your consent, but only after they
have obtained a right of entry order from the Surface Rights Arbitration Board. Any entry onto
your land without such an order would also be trespass.

Similarly, if you have granted a company access to a designated area to conduct its operations,
and a crew deliberately drives heavy equipment outside of the surface lease area and damages
crops or environmentally sensitive lands, that would be an instance of trespass. If the crew
mistakenly believed they were driving on the lease area, the case would be one of trespass or

C. Negligence
Negligence is considered the most important area of tort law, because it governs most
activities of modern western society. Modern Canadian negligence law evolved from British
court rulings.

In 1856 the British Court of Exchequer stated:

Negligence is the omission to do something which a reasonable man, guided upon
those considerations which ordinarily regulate the conduct of human affairs, would
do, or doing something which a prudent and reasonable man would not do. The
defendants might have been liable for negligence, if, unintentionally, they omitted to
do that which a reasonable person would have done, or did that which a person taking
reasonable precautions would not have done. (Blyth v. Birmingham Water Works)

This definition of negligence still applies today.

Under the common law, companies and their employees or agents have the duty to conduct
their activities in a way that does not harm others. This duty is called a duty of care. Where a
company operates in such a way that it endangers the life, health or property of others and



injury occurs, it may be liable for negligence.

An oil and gas company must operate in a reasonable manner according to standards
established by the industry or by statute. If the conduct falls below that of a reasonable person
in similar circumstances, the court will find negligence. For example, if a company breaches a
provision of a statute such as The Oil and Gas Conservation Act and harm results, the court would
likely make a finding of negligence and award damages to the injured party.

To establish negligence, the plaintiff must show: (a) a duty of care exists between the person
injured and the person responsible for the inury; (b) the conduct of the defendant fell below
that duty of care (whether an act or omission); and (c) damages resulted from the act or
omission of the defendant.

If the defendant oil company proves in court that it followed industry standards or normally
accepted practises it may not be liable in negligence. However, if the company fails to comply
with an order issued by the government or has been the subject of numerous complaints, the
court will more readily find negligence.

Rule in Rylands v. Fletcher: Strict Liability for Non-Natural Land
The rule in Rylands v. Fletcher is the basis for the modern principle of strict liability for the
escape of dangerous substances.52

Rylands v. Fletcher is an English case from the Court of Exchequer dating back to 1866. In this
case the defendant millowners built a water reservoir on their land for the purpose of
supplying water to their factory. Due to negligence on the part of the engineers hired by the
defendant millowners, the defendant did not know that the site chosen for the water reservoir
held an abandoned mineshaft. The plaintiff owned an adjoining mine that was flooded when
the water broke into the old shaft on the defendant’s land and travelled through connecting
passages to the plaintiff’s mine. The millowners were cleared of personal negligence because
they had been ignorant of the existence of the old mineshaft. However, even though they were
not negligent, the millowners were still liable for the damage caused by the escape of water.

The Court of Exchequer ruled that the millowners were liable on the principle that:

… [a] person who for his own purposes brings on his lands and collects and
keeps there anything likely to do mischief if it escapes, must keep it in at his
peril, and, if he does not do so, is prima facie answerable for all the damage
which is the natural consequence of its escape.53

The decision was appealed to the House of Lords, the equivalent of the Supreme Court of
Canada, and in 1868 the ruling was upheld. However, the House of Lords placed a

52 See, for example, Fondrick v. Gross, QB03285, July 8, 2003 (Sask.Q.B.) where strict liability was found against
the defendants for the aerial drift of herbicides onto the plaintiffs’ land, damaging the farmstead shelterbelt and
homestead vegetation.
53 per Blackburn J., (1866) L.R. 1 Ex. 265, 279-280.



qualification on the rule; namely, strict liability applied only to damage from non-natural use of

The distinction between natural and non-natural use of land has since been the focus of many
lawsuits in England and Canada. What has developed is the view that “non-natural” refers to
the level of risk created by the particular use of land, rather than that a particular use of land is
unnatural. The question is also asked: who should bear the risk of escape? Should it be the
landowner or occupant who brings or collects the substance onto their land, or the
surrounding neighbours who may be harmed if the substance escapes? The courts look at the
entire circumstances including the time, place, manner and purpose of the land use.

Strict liability is imposed when the court feels the landowner or occupant has created a
particular danger and is in a better position to absorb the loss caused by the escape. For
example, the aerial spraying of herbicides next to sensitive crops on neighbouring land
presents too great a danger from drift to qualify as “normal” use, no matter how accepted or
normal the general practice of applying herbicide.

Thus under the rule a person is liable for the escape of all inherently dangerous substances
brought or collected on his/her land, even if he/she used the utmost care and diligence to
prevent their escape. The absence of negligence is not a defence. The only excuse from liability
is if the escape is caused by an act of God or the unforeseeable and deliberate act of a stranger.

In the 1964 Saskatchewan decision, Lawrysyn v. Town of Kipling,54 the plaintiff brought an action
for damages when his land was flooded by sewage from the town’s sewage lagoon. The solids
in the effluent contained high levels of salt, permanently destroying the fertility of the
plaintiff’s impacted land. The Court held that the town was liable for the damages caused by
the escape of effluent onto the plaintiff’s land on the basis of the rule in Rylands v. Fletcher.
Under the rule the plaintiff was not required to establish negligence. The Court also rejected
the municipality’s argument that it was not liable because its lagoon was constructed under
statutory authority and of benefit to the community. The Court could find no statutory
authority to absolve the town from its liability under the rule.

The rule in Rylands v. Fletcher has been used to enforce environmental claims for damages where
a nuisance, trespass or negligence action might have failed.

The provincial Environmental Management and protection Act, 2002 has modified the rule in Rylands

v. Fletcher by referring to the discharge of a “substance that may cause or is causing adverse
effects” rather than a “non-natural” use of land. If a person suffers personal or property
damages as a result of the discharge of a pollutant, they can sue without proof of fault,
negligence or wilful intent (section 13(3)). In court, the person harmed must only prove he or
she suffered damages as a result of the discharge of a polluting or harmful substance owned or
controlled by the defendant.55
54 (1964) 50 W.W.R. 430.
55 See, e.g., Busse Farms Ltd. v. Federal Business Development Bank , CA98108, December 1, 1998, (Sask.C.A.) at para.
22. E. Breach of Contract




Contracts are agreements by which persons voluntarily create obligations for themselves. In
exchange for money or other benefits one party agrees to provide a service, right, product, or
benefit to another party.

The existence of a contract does not necessarily relieve a person of liability under tort law
to the other contracting party unless the contract specifically says so. For example, a surface
rights contract might include a clause stating that compensation for any spills or leaks from the
oil or gas project is limited to $5,000 maximum. If a landowner signs the contract, he or she
could not then sue the company in tort for any damages to the property exceeding $5,000.

A breach of contract arises when one party refuses or neglects to carry out a promise made
under contract. When the refusal occurs, it creates new rights for the injured party. The injured
party is entitled to sue for damages suffered as a result of the breach. One example might be
where a company has agreed to repair any fences that have been cut down to make way for
equipment and then neglects to make the repair. If cattle escape from the fenced area and are
injured or killed as a result, the landowner could sue the company for breach of contract and
collect damages for the repair and the losses related to the cattle. Another example is where a
company abandons a well and fails to carry out restoration activities agreed to in the surface
rights lease. The company’s failure is a breach of contract and damages could be recovered for
the cost of carrying out the reclamation and restoration of the land.

In certain circumstances, a breach of contract may also permit the injured party to treat the
agreement as being at an end, and to be free from further obligations under it. This situation is
called a fundamental breach of contract. However, where a contract has been substantially
performed before the breach, the courts will not permit an injured party to take unfair
advantage of the party in breach. Thus, the contract could not be considered at an end. Instead
the injured party is bound to perform the agreement subject only to a deduction for damages
suffered as a result of the breach by the other party.



Chapter Four: Differences between Alberta and Saskatchewan in the
Regulation of the Oil and Gas Industry

As the nation’s leading oil and gas producer, Alberta has developed the most complex oil and
gas regulatory structure in Canada. This Chapter attempts to highlight the key differences
between the regulation of the petroleum industry in Saskatchewan and Alberta, and the
implications for Saskatchewan citizens.

It must be noted, however, that regulators in both provinces have incorporated similar
common law principles, management practices, and industry standards into their provincial
schemes. Thus, there is a great deal of similarity between the two provinces. This convergence
becomes evident if you compare the regulatory framework detailed in this Guide with that
found in the Alberta Citizens’ Guide published by the pembina Institute.56

Regulatory Oversight Differences
Alberta Energy and Utilities Board (EUB) as Compared to
Saskatchewan Industry and Resources (SIR)
One of the key differences between Alberta and Saskatchewan in overseeing the activities of
the oil and gas industry is the existence of the Energy and Utilities Board (EUB) in Alberta.
The EUB is the main regulatory body for the oil and gas industry in Alberta. It reports to the
Alberta Minister of Resource Development, but works at “arm’s length” from the provincial
government. By contrast, the main regulatory body in Saskatchewan is the government
ministry, Saskatchewan Industry and Resources (SIR).

The Alberta EUB is a quasi-judicial independent body. The Board has a government
appointed Chair and members who attend at hearings. It also has a staff of close to 750 located
at the head office in Calgary and at field centres across the province. The EUB has extensive
powers set out in several pieces of legislation. It has the power to conduct investigations,
hearings and inquiries, issue orders, and develop regulatory standards with which oil and gas
companies must comply.57 The Board must approve each oil and gas project before it can
proceed. It is required to listen to any objections to proposed developments and decide
whether or not a project is in the public interest.

Notably, Saskatchewan legislation allows for the establishment of an arm’s length regulatory
body similar to the EUB. Under section 7 of the Oil and Gas Conservation Act, the Lieutenant
Governor in Council (provincial cabinet) may establish a board known as the Oil and Gas
Conservation Board. The board would have a designated chair and vice-chair and several
members, as appointed by cabinet. The board’s powers would include the conduct of
investigations, hearings or inquiries into any matters arising pursuant to the Oil and Gas
Conservation Act or Regulations, or any orders made under the Act (section 7.11). The Minister of

56 See Chapter Five for more information on the pebmina Institute and the Alberta Citizen’s Guide.
57 For additional information consult the Alberta EUB website at



Industry and Resources and any interested party could bring a disputed matter before the

The Saskatchewan government, however, has not yet appointed a board. A likely reason for
this delay is the additional cost to the province to fund a new board. According to the Act,
where a board has not been established, the powers, role and responsibilities of the board can
be delegated to an official of SIR.

From a citizen’s point of view, several advantages are attached to an independent regulatory
body such as the EUB.

One benefit of a formal regulatory system is greater transparency. A regulatory body makes
decisions in a more public and open manner. The information and materials that form the
basis of EUB decisions are presented in a public forum (hearings) or are largely available for
public scrutiny and review. By contrast, in Saskatchewan less formal decision-making channels
through SIR mean that the public is not privy to decisions and has less input into licensing
decisions by the regulator.

An independent regulatory body also allows for greater public participation in
decision-making. The public’s role and ability to participate in EUB hearings, inquiries and
investigations are clearly stipulated in the EUB authorizing legislation and rules of practice. By
comparison, when government official make licensing and enforcement decisions, individual
citizens may or may not be heard on an ad hoc basis. The concerns of one individual or
community may be addressed in one case, while the concerns of another individual or
community may be ignored in similar circumstances in another case.

Disadvantages also exist when a more formal regulatory system is in place. From an industry
point of view, oil and gas companies must jump through more hoops before being licensed to
operate in Alberta as compared to Saskatchewan. This extra layer of regulation may discourage

From a public point of view, the criticism has been made in Alberta that the EUB has a
pro-development perspective. Although the Board does concern itself with public health and
safety and environmental protection, these are not the main criteria for decision-making. It is
only rarely that the EUB will reject a proposed oil or gas development project. Instead certain
conditions may be imposed. This reflects the Board’s mandate to facilitate the orderly
development of energy resources.

A similar criticism has been made in Saskatchewan. SIR has a dual mandate to promote and
regulate the petroleum industry. This dual role can easily result in a conflict of interest. Thus,
oil and gas projects that ought to be rejected due to great public concern or threats to
environmentally sensitive lands are nonetheless permitted to proceed with conditions. The
pro-development model often prevails over a precautionary model.

Citizens with no funds or expertise are often at a disadvantage when attempting to oppose a
multi-million dollar venture before the Alberta EUB. The Board hearings involve the right to



make submissions, cross-examination and argument.58 The average citizen may not be able
participate effectively in the hearings without a lawyer or agent.

Saskatchewan Municipalities more powerful than Alberta
Municipalities in Regulating Oil and Gas Development
In Alberta municipalities have little or no say in proposed oil and gas development projects.
Alberta’s energy legislation specifically exempts oil and gas projects from being subject to
municipal zoning regulation. Thus, municipalities are restricted to participation as interveners
in the EUB hearings process.

By contrast, Saskatchewan municipalities provide another layer of government that regulate oil
and gas producers. Thus, a proposed developer must deal with municipal authorities as well as
provincial departments. It must contact the local rural municipality affected by the proposed
oil or gas development to find out if a development permit is needed, or if there are other
municipal requirements or concerns to be addressed. For example, the company may be
required to enter into a road maintenance agreement with the municipality. If the rural
municipality has a development plan and zoning bylaw in place, the company will need a
development permit

One advantage from a citizens’ perspective is that a municipal government can be politically
pressured by residents to enact zoning bylaws to restrict or prohibit oil and gas development
that is considered undesirable for environmental, heritage or other reasons.

A disadvantage associated with a strong municipal regulatory role is that a municipal
government can be pressured by economic interests from outside the community to
encourage oil and gas development projects, even when there is strong local opposition.
Individual council members may not reflect community sentiment. An unwelcome project
may be fully underway before the next election call.

Great Sand Hills: A Case Study
The role of municipal governments in regulating the oil and gas industry in Saskatchewan is
evident in the Great Sand Hills development debate.

The Great Sand Hills region is a unique environmentally sensitive area located in southwest
Saskatchewan, right in the heart of the oil patch. The Hills span 1,900 square kilometres and
are characterized by high, stabilized (vegetated) sand dunes, saline lakes, and prairie
landscapes. The Hills contain the largest remaining contiguous area of native prairie grasslands
in the province. The Hills are also home to a variety of rare plants and wildlife species. They are
considered an irreplaceable natural heritage site with local, provincial and national significance.
The Hills are also culturally significant to First Nations communities. Traditional folklore
speaks of the “little people” who live in the sacred Hills.

58 The EUB may provide funding for those individuals or groups who are directly affected by a proposed oil or
gas development project and have legitimate concerns. A pre-hearing may be held to determine who may get
funding including advance funding.



Local ranchers have lived in harmony with the local environment over the past century. By
contrast, oil and gas projects in the region have left a heavy footprint. For instance, local
residents have witnessed exploration crews tearing up sand dunes with utility vehicles,
oblivious that the dunes may never recover from the disturbance.

The Hills are downwind from concentrated Alberta oil and gas development projects. The
Manager of Ecological Monitoring for Saskatchewan studied acid rain data related to oil and
gas development and other industrial activity. He found that 43 per cent of the soil areas in the
Great Sand Hills have dangerously high levels of pollutants. As a result, 15 to 20 per cent of the
ecosystems in the area could be lost within the next decade or two.59

Environmental groups have similarly identified a series of threats to the environmental
integrity of the Great Sand Hills created by oil and gas developments in the area:

multiple access roads and trails that destroy native prairie;

regular vehicle access and traffic that bring noise, chemicals and invasive plants into
the area;

drilling, operation and maintenance operations that directly impact the landscape;

new pipeline construction that increases environmental impacts over a wide area;

accidental releases of gas, fluids and chemicals that occur on a regular basis with
pipeline breaches, equipment malfunctions and maintenance activities.60
As a result, there is great public concern about recent proposals to expand oil and gas
development activity in the area into a protected zone. There is a clash between oil and gas
development proponents (including a single rural municipality) and local ranchers, citizens and
environmental groups.

In 1991 a Land Use Strategy was devised for the Great Sand Hills region, lead by the efforts of
the ranching community. The province, municipalities, the petroleum industry, ranchers, local
citizens, and environmental interest groups each contributed to the Land Use Strategy. The
goal was to arrive at protection and sustainable land use for the Hills. An outgrowth of the
Strategy was the Great Sand Hills planning District formed by four rural municipalities:
Clinworth, Fox Valley, pittville and piapot. The planning District and a new joint planning
Commission (created in 1993) developed a land use plan (Development plan) for the District.

In 1994 similar bylaws were passed in the four municipalities to implement the Development
plan, and amendments were made to the bylaws in 1998. The bylaws mapped out three zoning
districts that outlined areas open to development, those sensitive to development, and those
off-limits to new developments. The zoning designations are:

ES1 – environmentally sensitive (off-limits to new ranches, farms or oil and gas

ES2 – environmentally sensitive (oil and gas development permitted with restrictions);
59 “ApEGS Annual Meeting Seminar: Air Issues in Saskatchewan,” The professional Edge (June/July 2003) at p. 14.
60 Alan G. Appleby, Canadian parks and Wilderness Society Conservation Director, Saskatchewan Chapter, letter
to Great Sand Hills Land Use Strategy Review Committee (January 3, 2003).



AR – agriculture reserve (open to development).
Recently the Rural Municipality of piapot elected to leave the planning Commission, having
identified a new focus for its future development.

Concurrently, the R.M. of piapot also announced its plans to rezone areas currently zoned ES1
and ES2, to permit new oil and gas ventures. ES1 lands with current oil and gas permits in the

R.M. would be de-classified to ES2. ES2 lands would similarly be de-classified to AR and
thereby open to most land uses. This could affect 100 sections of land now zoned ES2 and 75
sections now zoned ES1. prior to rezoning, piapot must amend its current bylaws. As with any
municipality in the province, piapot has the authority to make amendments to its bylaws to
accommodate or restrict development activities.
In Saskatchewan, oil and gas projects must meet both development plan and zoning by-law
requirements to proceed. Under the provincial planning and Development Act, if a
proposed development is denied a company can appeal to the local Development Appeals
Board (section 96). However, the Appeal Board cannot overturn Development plan
policies. Thus, a company could not appeal the zoning designations in the Great Sand Hills
planning District. But if the R.M. of piapot pulls out of the District and changes its zoning
by-laws, a company would be free to pursue its development plans, subject to approval
from other provincial regulators such as Saskatchewan Industry and Resources (SIR) and
Saskatchewan Environment (SE).

The decision by the R.M. of piapot has fuelled a new debate that has galvanized local and
national opposition to the planned zoning changes. Interventions by concerned citizens and
groups have stalled the rezoning process, but the future of the fragile eco-system is



Chapter Five: Contacts and Other Resources

A. Government Departments and Boards
1. Saskatchewan Industry and Resources
The Saskatchewan Department of Industry and Resources (SIR) is charged with the
management of the province’s oil and natural gas resources. SIR regulates the full life cycle of
oil and gas development, including exploration, drilling, completion, production and
abandonment of operations. It also administers and leases Crown mineral rights (subsurface).
SIR regulates the petroleum industry through the following legislation:

The Crown Minerals Act

The Mineral Resources Act, 1985
The Seismic Exploration Regulations, 1999

The Oil and Gas Conservation Act
The Oil and Gas Conservation Regulations, 1985

The pipelines Act, 1998
The pipelines Regulations, 2000
All Saskatchewan legislation (including regulations) can be viewed on the provincial
Queen’s printer website at:

If you have any concerns about the oil and gas operations taking place on or near your land or
community you can contact one of four Field Offices with the petroleum Development
Branch of SIR. The Field Offices include:

Area 1: Lloydminster Field Office

4815 – 50th Street
Lloydminster SK S9V 0M8
phone: (306) 825-6434 (24 hours); Fax: (306) 825-6433

Area Manager: Gary Ericson
phone: (306) 825-6436 E-mail:

Area 2: Kindersley Field Office

113 – 2nd Avenue East

p.O. Box 850
Kindersley SK S0L 1S0
phone: (306) 463-5400 (24 hours); Fax: (306) 463-5405
Area Manager: Kirk Hogarth
phone: (306) 463-5402 E-mail:



Area 3: Swift Current Field Office

350 Cheadle Street West
Swift Current SK S9H 4G3
phone: (306) 778-8252 (24 hours); Fax: (306) 778-8256
Swift Current Acting Area Manager: Ron Dolter
phone: (306) 778-8252 E-mail:

Area 4: Estevan Field Office

1302 – 3rd Street
Box 5000 – 120
Estevan SK S4A 0Z1
phone: (306) 637-4541 (24 Hours); Fax: (306) 637-4547

Area Manager: Jim Wysminity
phone: (306) 637-4541 E-mail:

The area manager for each Field Office may change over time. To ensure that you are dealing
with the correct individual you can contact the Field Office general number or check the SIR
website at:

If you wish to speak with the head of the petroleum Development Branch of SIR contact:

Brian Mathieson
Director, petroleum Development Branch

7th Floor, 2101 Scarth Street
Regina, SK S4p 3V7
phone: (306) 787-2593 Fax (306) 787-2478

2. Saskatchewan Environment
Saskatchewan Environment (SE) has the responsibility “to manage, enhance and protect
Saskatchewan’s natural and environmental resources – fish, wildlife, lands, forests, parks and
protected areas, air water and soil – for conservation, recreation, social and economic purposes
and to ensure they are sustained for future generations.”61 Field officers and staff deliver field
operations through the Compliance and Field Services and Resource Stewardship Branches.

The following environmental legislation administered by SE is most relevant to oil and gas

The Environmental Assessment Act

The Environmental Management and protection Act

The Wildlife Habitat protection Act

The Wildlife Act
Wild Species at Risk Regulations
61 Saskatchewan Environment website at: .



The Department administers the surface of Crown resource lands in northern Saskatchewan
and Crown surface lands in southern Saskatchewan such as provincial parks and recreational
sites. Therefore all proposed oil and gas projects on Crown land (including Crown agricultural
land) require Saskatchewan Environment’s approval before going forward.

The Department undertakes an initial evaluation of the environmental impact of new
proposals on Crown land and determines if they require a more comprehensive environmental
review such as an Environmental protection plan (Epp) or Environmental Impact
Assessment (EIA). An Epp or EIA is required for well-known environmentally sensitive areas
such as the Great Sand Hills, Cypress Hills or the Manitou Sand Hills. These are areas where
there is significant environmental and public concern regarding industrial development.

Oil and gas activities on private land, such as drilling or the installation and operation of
pipelines, flowlines, batteries and compressor stations, usually do not require approval from
Saskatchewan Environment, unless there is a direct impact on a public resource such as a rare
species, a stream or water body. A private Land Environmental Evaluation Checklist was
created by SE to assist companies in self-screening their oil and gas projects. Only those
projects that trigger one or more of the environmental issues listed must be reviewed and
cleared by Saskatchewan Environment before proceeding. The private land environmental
checklist is available for viewing on the Saskatchewan Environment website at:

More detailed information on the environmental review process for oil and gas development
projects is found under the heading “Review process: Oil and Gas” on the Department’s
website at:

Saskatchewan Environment is also responsible for waste management sites and may become
involved with abandoned oil or gas well sites or other facilities.

If you have any concerns about the environmental impacts of any oil and gas developments in
your area contact the closest field office of Saskatchewan Environment:

Saskatchewan Environment Field Contacts
(Oil and Gas Exploration and Development proposals):

(1) Meadow Lake
Randy Slater
Oil and Gas Co-ordinator
Unit 1, 101 Railway place
Meadow Lake SK S9X 1X6
phone: (306) 236-7553; Fax: (306) 236-7677

(2) prince Albert
pat Springinotic
Oil and Gas Co-ordinator
800 Central Avenue
Box 3003
prince Albert SK S6V 6G1



phone: (306) 953-2878; Fax: (306) 953-2502

(3) Swift Current
Wayne Luchenski
Oil and Gas Co-ordinator
Box 5000
350 Cheadle Street W
Swift Current SK S9H 4G3

(4) Saskatoon
Lorne Sullivan
Oil and Gas Coordinator

112 Research Drive
Saskatoon SK S7K 2H6
phone: (306) 933-6532; Fax: (306)

(5) Melville
Rick Wright
Oil and Gas Coordinator

Box 2170
(256 – 2nd Ave. W)
Melville SK S0A 2p0
phone: (306) 728-7494; Fax: (306) 728-7447

Saskatchewan Environment also hosts the Saskatchewan Environmental Directory on its
website at: The Directory lists
community organizations, government, labour, industry, sources of scientific and technical
information, and other groups connected with environmental matters and activities. The
Directory is updated and maintained by Saskatchewan Environment’s Inquiry Centre.

The Inquiry Centre can be reached at:

3211 Albert Street
Regina, SK S4S 5W6
phone toll-free in Saskatchewan 1-800-567-4224 or (306) 787-2700

3. Saskatchewan Agriculture, Food and Rural Revitalization
Saskatchewan Agriculture administers the surface of Crown agriculture lands, most of which
are currently under lease to individual farmers and ranchers. The Agriculture Department’s
mandate in relation to these lands is to promote their sustainable and integrated use.

Oil and gas projects on Crown agriculture lands require approval from both Saskatchewan
Agriculture and Saskatchewan Environment. The Agriculture Department provides modest
one-time cash payments to agricultural leaseholders when a new surface lease is issued to an oil



or gas company or when additional wells are drilled on an existing surface lease. Agricultural
lessees (farmers or ranchers) also receive annual rent reductions for as long as the surface lease
is active.

Before drilling on agricultural Crown land, a project proposal and restoration plan must be
submitted to both Saskatchewan Agriculture and Saskatchewan Environment. If the regional
office of Saskatchewan Environment decides that the project raises significant environmental
concerns an Environmental protection plan or Environmental Impact Assessment will be
required. Where an Epp or EIA is needed Saskatchewan Environment will withhold the right
of entry until the environmental concerns are addressed.

Saskatchewan Agriculture completes its own review within ten days of receiving SE’s
environmental conditions. Saskatchewan Agriculture then prepares a petroleum and Natural
Gas Surface Lease agreement to be signed with the company. The agreement includes
conditions from both Saskatchewan Agriculture and Saskatchewan Environment. Once the
agreement is finalized, drilling may begin subject to compliance with all other requirements.

For additional information contact:

Saskatchewan Agriculture, Food and Rural Revitalization

3085 Albert Street
Regina, SK S4S 0B1
phone: (306) 787-5140

Heritage Resource Branch – Department of Culture, Youth
and Recreation
An oil or gas company must contact the Heritage Resource Branch of the Department of
Culture, Youth and Recreation to review possible heritage restrictions before applying for a
drilling licence or altering the land surface. The Division examines the potential effects on
heritage sites located on the proposed development site, whether private or Crown land. If the
Heritage Resource Branch identifies any heritage concerns it will make the company undertake
a heritage impact assessment to assess the potential impact of the project. Any
heritage-resource conflicts must be resolved to the satisfaction of the Branch before the
project can proceed. The Branch can impose a series of restrictions and conditions on the oil
or gas project.

The company must also contact the local rural municipality affected by the oil or gas
development to find out if a development permit is needed or if there are other municipal
requirements or concerns to be addressed. For example, the company may be required to enter
into a road maintenance agreement with the municipality. If the rural municipality has a
development plan and zoning bylaw in place, the company will need a development permit.



For additional information contact:
Saskatchewan Culture, Youth and Recreation

4th Floor – 1919 Saskatchewan Drive
Regina, SK S4p 3V7
phone: (306) 787-5729; Fax: (306) 798-0033

Municipal Relations Division
Government Relations and Aboriginal Affairs

1855 Victoria Avenue
Regina, SK S4p 3V7
phone: (306) 787-2635

5. Saskatchewan Surface Rights Board of Arbitration
The Saskatchewan Surface Rights Board of Arbitration was established to resolve disputes
between a landowner or occupant and the mineral rights holder (oil, gas or potash company).
The Board process is aimed at quickly and inexpensively resolving conflicts if a surface lease
agreement cannot be negotiated. It is also aimed at balancing the needs of agricultural
producers, petroleum producers, environmental protection and the public interest.

The Board of Arbitration consists of at least three members who are appointed by the
province. The Board holds hearings to determine the rights of each party, such as a just
amount of compensation and issuing right of entry orders. The Board relies on the evidence
presented by the landowner/occupant and the company at the hearing to make a decision.

The Board of Arbitration is headquartered in Kindersley. However, Board hearings may also
be held in any of the following oil patch centres: Lloydminster, North Battleford, Regina and
Swift Current.

For a general overview of the operations of the Board, refer to its website at or contact:

Surface Rights Board of Arbitration

Box 1597
113 – 2nd Ave. East
Kindersley, SK S0L 1S0
phone: (306) 463-5447
Fax: (306) 463-5449

6. National Energy Board
The National Energy Board (NEB) is an independent federal agency established by parliament
in 1959 to regulate the inter-provincial and international aspects of the oil, gas and electric
utilities industries. It is responsible for promoting safety, environmental protection and
economic efficiency in the public interest in the regulation of pipelines, energy development,



and trade in oil, gas and electricity. The NEB is accountable to parliament through the Minister
of Natural Resources Canada.

The NEB holds public hearings and makes decisions on any major applications it receives.
For instance, when a company seeks to build or expand an international or interprovincial
pipeline the Board can hold oral public hearings. The Board sits as a tribunal with three
Members. The procedures used are similar to a civil court. Applicants and other interested
people, such as landowners and nearby residents, can participate in these public hearings. The
public hearings are normally held at locations where there is a specific interest in the
application. More rarely the Board will conduct public hearings in writing.

For additional information on the National Energy Board, visit the NEB website at:

You can also contact the Board at:

National Energy Board

444 Seventh Avenue SW
Calgary, Alberta T2p 0X8
phone: 1-800-899-1265 or (403) 292-4800
Fax: (403) 292-5503

B. Community and Environmental Groups
1. Federation of Saskatchewan Surface Rights Association
The Federation of Saskatchewan Surface Rights Association provides help to surface rights
owners dealing with reclamation, compensation, or environmental issues having to do with oil
and gas development, rail lines, pipelines and other industrial land use. The Federation also
lobbies government. Local surface rights organizations can be contacted through the

Box 53
Lone Rock, SK S0M 1K0
phone: (306) 387-6650
Fax: (306) 387-6650

2. Saskatchewan Environmental Society (SES)
The Saskatchewan Environmental Society was incorporated as a non-profit organization in
1981. Its mandate is to address environmental issues of concern to the people of
Saskatchewan. The Society grew out of the Saskatoon Environmental Society, founded in
1970. The Saskatoon Society was formed to respond to development issues in the City. The



Saskatoon Society was soon asked to address environmental issues from various corners of
Saskatchewan. Today SES’ membership is drawn from across the province.

Over its history SES has earned respect as a leading provincial environmental group. When
government, media or industry want an environmental perspective on an issue SES is normally
contacted. The Society has participated in a number of multi-stakeholder groups, advisory
committees, and environmental review hearings. SES also provides information and assistance
to citizens concerned with local environmental issues.

SES conducts research, develops policy and runs various environmental education projects
and initiatives. For example, SES was instrumental in the development of this Citizens’ Guide
for residents of the oil patch.

SES has a resource library in downtown Saskatoon located at 203 – 115 2nd Avenue North.
The library has information on a variety of topics including water pollution, sustainable
development, energy efficient housing, community action, nuclear energy, World Watch
papers and more. The resource library is set up for in-house use.

Teachers’ resource materials are available for various grade levels and subjects. These materials
are loaned out as requested.

SES also has a dedicated group of volunteers who can give talks or presentations on specific
issues. The speakers have considerable expertise on a number of environmental topics such as:
climate change and energy, oil and gas, energy conservation, forests, environmental
assessment, hazardous waste, livestock manure management, environment and health.
Contact the SES office to request a speaker.

Saskatchewan Environmental Society:

Resource Centre: 203 – 115 2nd Avenue North

Saskatoon, SK S7K 2B1

phone: (306) 665-1915

Fax: (306) 665-2128
Mailing Address: Box 1372

Saskatoon, SK S7K 3N9


3. Saskatchewan Eco-Network (SEN)
The Saskatchewan Eco-Network is an umbrella group for Saskatchewan-based environmental
groups. It is a non-profit, non-governmental organization with membership open to any
provincial ENGOs – non-governmental organizations that are concerned with environmental
issues. SEN is affiliated with the Canadian Environmental Network (CEN) as are other
provincial and territorial networks and the First Nations Environmental Network.



SEN connects environmentalists with each other, both in Saskatchewan and across Canada, by
promoting active networking among its members. To facilitate diversity and dialogue among
its member groups, the SEN does not take a position on specific issues. Thus the network is
not an advocacy coalition or lobby organization, but a communications structure that
facilitates the work of its member groups.

Through SEN, members can share information, skills, publicity and other resources. SEN
general membership meetings and working group meetings allow people to meet face to face.
The SEN publishes a quarterly newsletter, Network News, and sends out information by e-mail
and fax. SEN also works as a clearinghouse to help members, media, government workers, and
the public connect with other individuals or groups who have the information or skills they

Currently the SEN has over forty member groups. Individuals can subscribe to the SEN
e-mail information service and newsletter. More information on the SEN and its member
groups is available from:

Saskatchewan Eco-Network

Room 203 – 115 2nd Avenue North
Saskatoon, SK S7K 2B1
phone: (306) 652-1275
Fax: (306) 665-2128


4. pembina Institute for Appropriate Development (pIAD)
The pembina Institute is an independent non-profit organization focused on environmental
policy research and education. It is a citizen-based environmental think-tank that specializes in
the areas of energy and environment, climate change and environmental economics.

The Institute was founded in Drayton Valley, Alberta in 1986 by six high school teachers in
response to the Lodgepole sour gas blowout. This blowout was one of Canada’s largest
industrial accidents, killing two people and fouling the air in central Alberta for weeks. The
Institute’s response to the accident led to dramatically improved safety standards and a
permanent change in the manner in which oil and gas companies conduct business.

Today the Institute has a staff of approximately forty people drawn from various fields and
backgrounds. It has corporate offices in Drayton Valley, Calgary and Ottawa, and research
offices in Vancouver and Toronto. The Institute has major policy research and education
programs in the areas of sustainable energy, climate change, and environmental governance
among others.



The Energy Watch program is a key advocacy branch of the Institute that focuses on:

the environmental impacts of conventional energy and oil sand development;

air quality issues in Alberta, including acidifying emissions, ground level ozone,
particulate matter and air toxics; and

the development of provincial and national energy and air quality protection standards
and regulations.
The pembina Institute published the following citizens’ guide upon which this Guide is based:

When the Oilpatch Comes to Your Backyard: A Citizens’ Guide to protecting Your
Rights by Mary Griffiths and Tom Marr Laing (February 2001).

To order the guide or to obtain other information or assistance regarding the oil and gas
industry contact:

pembina Institute Head Office
pembina Institute Calgary Office

Box 7558 #517, 604 – 1st Street, SW
Drayton Valley, Alberta T7A 1S7 Calgary, Alberta T2p 1M7
phone: (403) 542-6272 phone: (403) 269-3344
Fax: (403) 542-6464 Fax: (403) 269-3377

Website: E-mail:

5. Canadian parks and Wilderness Society (CpAWS)
CpAWS is one of Canada’s oldest conservation groups, founded in 1963. The non-profit
organization has over 20,000 members, and almost 400 volunteers working with eleven
regional Chapters in the Yukon, North West Territories, B.C., Alberta, Saskatchewan,
Manitoba, Ontario, Quebec and Nova Scotia. CpAWS promotes wilderness protection by
campaigning for protected areas across Canada. It works to have the government put nature as
the first priority in protected areas management. The group also advocates for a wise use of
land and resources outside of parks and other protected areas.

The CpAWS Saskatchewan chapter is dedicated to the protection of boreal forest and
grassland wilderness in the province. The chapter has been active since 1976 and has focused
on establishing new protected areas, improving the management of existing parks and other
protected areas, and legislative and policy reform. The local chapter has fought for the
protection of the Great Sand Hills in southwest Saskatchewan threatened by oil and gas
development, and for the establishment of Grasslands National park. It has also campaigned
for boreal forest ecosystem protection. The group works with Aboriginal people, scientists,
educators, communities, industry and government to establish widely supported protective
land use policies. CpAWS Saskatchewan has also earned respect for its science-based and
solution-oriented approach.



For additional information contact:
Canadian parks and Wilderness Society – Saskatchewan Chapter

#203 – 115 2nd Avenue North
Saskatoon SK S7K 2B1
phone: (306) 586-3863; Fax: (306) 586-3863
Website: E-mail:

Industry Organizations
Saskatchewan petroleum Industry/Government
Environment Committee (SpIGEC)
As its name reveals, the Saskatchewan petroleum Industry/Government Environment
Committee is not strictly an industry organization. Rather, it is an organization that brings
industry and government together to address provincial environmental management concerns.
SpIGEC was formed in 1992 with a goal of ensuring the expansion of the oil and gas industry,
while minimizing adverse environmental effects.

provincial government Departments represented on the Committee include:

Saskatchewan Environment

Saskatchewan Industry and Resources

Saskatchewan Agriculture, Food and Rural Revitalization

Saskatchewan Government Relations and Aboriginal Affairs

Saskatchewan Watershed Authority, and

Other agencies on an issue-specific basis.
Federal Departments represented on the Committee include:

Environment Canada

Fisheries and Oceans Canada

prairie Farm Rehabilitation Administration

Northern Oil and Gas Division of Indian and Northern Affairs.
Industry associations represented include:

Canadian Association of petroleum producers

Small Explorers and producers Association of Canada

Canadian Association of Oilwell Drilling Contractors

Canadian Association of Geophysical Contractors

petroleum Services Association of Canada.
Representatives of individual companies are also involved as Committee members.

The Committee meets about six times per year. Environmental protection issues are identified
and practical measures and actions are developed. For instance, SpIGEC has developed a
series of environmental protection guidelines. The government uses the guidelines to direct



the petroleum industry and requires that the identified procedures will be followed in
Saskatchewan oil and gas operations.

The SpIGEC guidelines issued to date include:

SpIGEC 1 Upstream Waste Management Guidelines (1996)

SpIGEC 2 Restoration of Well Sites on Cultivated Lands Guidelines (1999)

SpIGEC 3 Restoration of Spill Sites on Agriculture and pasture Lands (1999)

SpIGEC 4 Upstream Contaminated Site Remediation Guidelines (1999)

SpIGEC 5 Environmental Site Assessment Guidelines (1999)

SpIGEC 6 Required Qualifications: Field Environmental Monitors for Oil and
Natural Gas Exploration and Development projects (2002)

Environmental Operating Guidelines for the Upstream petroleum Industry (2001)
The SpIGEC guidelines can be viewed and downloaded from the Saskatchewan Industry and
Resources website at:
http//,3620,3384,2936, Documents.

Additional information on SpIGEC is found at:

2. Canadian Association of petroleum producers
The Canadian Association of petroleum producers (CApp) is the most influential voice of the
oil and gas industry in Canada. It represents 140 member companies who develop over 97% of
the nation’s oil, gas and elemental sulphur. CApp works closely with its members,
governments, communities and stakeholders to address key oil and gas issues. It seeks to
reach consensus on industry codes of practice and operating guidelines that meet or exceed
government standards. CApp is committed to promoting the oil and gas industry in a “socially,
environmentally and technically responsible and safe manner.”

The CApp website at provides detailed information on the oil and gas
industry in Canada and includes links to other relevant websites.

Canadian Association of petroleum producers

Suite 2100
350, 7th Avenue SW
Calgary, Alberta T2p 3N9
phone: (403) 267-1100 Fax: (403) 261-4622

3. Small Explorers and producers Association of Canada
The Small Explorers and producers Association of Canada (SEpAC) is a volunteer
organization that represents almost 400 small oil and gas companies in Canada. Approximately
one quarter of its members operate in Saskatchewan. SEpAC lobbies on behalf of its members



to government, regulatory bodies, and other sectors of the oil and gas industry. It also educates
the public about its membership’s role in resource development and investment opportunities.
The small producers represented by SEpAC produce up to 10% of conventional oil and gas in

The organization can be contacted at:


1060, 717 – 7th Avenue SW
Calgary, Alberta T2p 0Z3
phone: (403) 269-3454 Fax: (403) 269-3636

Canadian Association of petroleum Land Administration
The Canadian Association of petroleum Land Administration hosts a website that provides a
more complete list of petroleum industry organizations and links to their websites. The list can
be viewed at the following web address:

Lawyers, Expert Witnesses or Technical Assistance
Centre for Studies in Agriculture, Law and the Environment
The Centre for Studies in Agriculture, Law and the Environment (CSALE) is a
multi-disciplinary research centre located at the University of Saskatchewan in Saskatoon. The
Centre was established in 1996 and brings together scholars and researchers in the areas of
agriculture, law, economics, and science.

CSALE conducts research on issues such as food safety, greenhouse gases, land use and the
interplay of environmental and agricultural law and policy.

The Centre has published a series of books and pamphlets to assist farmers and ranchers in
dealing with various legal issues and environmental matters. These include:

A Farmer’s Guide to production Contracts in Saskatchewan (2003)

The Economics of Conservation Cover programs (2001)

Agricultural Research policy For Crop Improvement in Western Canada: past Experience and
Future Directions (2001)

Transforming Agriculture: The Benefits and Costs of Genetically Modified Crops (2001)

Climate Change Handbook for Agriculture 2000

Environmental Law and the Farmer (2000)

Negotiating Surface Rights (1998).


The above books or pamphlets are available from the CSALE offices. In some cases the
documents are available on-line at the Centre’s website at:

CSALE can be contacted at:

Centre for Studies in Agriculture, Law and the Environment

University of Saskatchewan
51 Campus Drive
Saskatoon, SK S7N 5A8
phone: (306) 966-8893 Fax: (306) 966-8894

2. Lawyer Referral Service
The Law Society of Saskatchewan (the governing body for lawyers) has set up a lawyer referral
service for the province. Members of the public who contact the service are given the name
and address of a lawyer in their area with whom they can discuss their legal matters. When
contacting the service request a lawyer experienced in oil and gas law, natural resources law, or
environmental law and contract law.

To contact the Lawyer Referral Service call:

1-800-667-9886 (toll free) or (306) 359-1767.

An alternative way to find a lawyer to assist you in negotiating a surface rights agreement with
a company, or if you are appearing before the Surface Rights Board of Arbitration, or bringing
a civil law suit, is to ask friends or others in your area about a lawyer who has been helpful in
similar situations.

3. Technical Consultants and Laboratories
Saskatchewan Environment hosts the Saskatchewan Environmental Directory on its
website at: The Directory lists
community organizations, government, labour, industry, sources of scientific and technical
information, and other groups connected with environmental matters and activities. The
Directory is updated and maintained by Saskatchewan Environment’s Inquiry Centre.

Be sure to hire an accredited laboratory if you need any water, soil or other testing services.
The Standards Council of Canada accredits laboratories on the advice of the Canadian
Association of Environmental Analytical Laboratories (CAEAL). Each laboratory is inspected
and evaluated at regular intervals by CAEAL.



The CAEAL website lists all laboratories in the prairies that are CAEAL members at: Accredited labs have an “A” designation next to their
names on the list.

The Canadian Association for Environmental Analytical Laboratories can be reached at:

Suite 300 - 265 Carling Avenue
Ottawa, ON K1S 2E1
phone: (613) 233-5300 Fax: (613) 233-5501

The following accredited Saskatchewan labs are found on the CAEAL list:

Enviro-Test Labs (Saskatoon)
General purpose Building
124 Veterinary Road
Saskatoon, SK S7N 5E3
phone: (306) 668-8370 Fax: (306) 668-8383

Saskatchewan Research Council, petroleum Technology Research Centre (pTRC)
6 Research Drive
Regina, SK S4S 7J7
phone: (306) 787-5091 Fax: (306) 787-8811

Saskatchewan Research Council, Analytical Laboratory
422 Downey Road
Saskatoon, SK S7N 4N1
phone: (306) 933-5204 Fax: (306) 933-7922





Appleby, Alan G. Canadian parks and Wilderness Society Conservation Director,
Saskatchewan Chapter. Letter to Great Sand Hills Land Use Strategy Review Committee
(January 3, 2003).

“Association of professional Engineers and Geoscientists of Saskatchewan Annual Meeting
Seminar: Air Issues in Saskatchewan.” The professional Edge (June/July 2003).

Boyle, John E. Underbalance Drilling Service – Think Value, Not Cost. Weatherford International
website at

Business Services Improvement Branch Economic and Co-operative Development. The
provincial Regulatory Approval process in Saskatchewan for petroleum and Natural Gas Drilling and
Seismic Exploration. (September 2001).

Canadian Association of petroleum producers (CApp). Finding Oil and Natural Gas. CApp
website at

CApp. Industry Facts and Information: Saskatchewan (2001). CApp website at

CApp, Industry Facts and Information: Saskatchewan (2003). CApp website at

Centre for Studies in Agriculture, Law and the Environment. Environmental Law and the Farmer.
Saskatoon: public Legal Education Association of Saskatchewan, 2000.

Centre for Studies in Agriculture, Law and the Environment. Negotiating Surface Rights.
Saskatoon: University of Saskatchewan, 1998.

Charlton Communications. “Technology With a Flare.” The professional Edge (February/March

CpAWS and SES. pamphlet: protecting Sensitive Landscapes in the Great Sand Hills (2003).

Denner, M.J. and p.L. Reeves. “Crude Oil and Natural Gas.” Mineral Resources of Saskatchewan.
Regina: Saskatchewan Mineral Resources, 1979.

Dunstan, Lynne. “The Fires of Kuwait.” Report on Safety Boss presentation by Mark Badic.
Found at

Griffiths, Mary and Tom Marr-Laing. When the Oilpatch Comes to Your Backyard. Drayton Valley,
Alberta: pembina Institute, 2001.

Harper, W.B. “petroleum.” The World Book Encyclopedia. Toronto: Field Enterprises
Educational Corporation, 1970.



King, Stuart. Unpublished research paper. Saskatoon, April 2000. Available through the
Saskatchewan Environmental Society.

National Energy Board, pipeline Regulation in Canada: A Guide for Landowners and the public

petroleum Resources Communication Foundation. Our petroleum Challenge: The New Era (3rd
ed.). Calgary: petroleum Resources Communication Foundation, 1985.

petroleum Communication Foundation. Flaring: Questions + Answers. Calgary: petroleum
Communication Foundation, 2000.

petroleum Communication Foundation. Sour Gas: Questions + Answers. Calgary: petroleum
Communication Foundation, 2000.

Saskatchewan Industry and Resources. Crude Oil in Saskatchewan (2003). SIR website at

Saskatchewan Industry and Resources. Fact Sheet – Gas in Saskatchewan (2003). SIR website.

Saskatchewan Industry and Resources. Fact Sheet – Oil in Saskatchewan (2003). SIR website.

Saskatchewan Labour, Occupational Health & Safety. Transferring and Transporting Liquid
Manure. Regina: Saskatchewan Labour, October 2001.

Surface Rights Board of Arbitration. “Site Supervision.” Surface Rights Board of Arbitration
website at

TransCanada. “Natural Gas pipelines: public Safety.” Calgary, 2002. Website:

TransGas. “Emergency: What You Need to Know.” Transgas website at

Vagts, Christopher. “petroleum and petroleum Refining.” The New Book of Knowledge
Encyclopedia. New York: Grolier Inc., 1979.

Western Canada Spill Services. “Coop Training Exercises.” 2003. Western Canada Spill
Services website at

Willes, John A. Contemporary Canadian Business Law: principles and Cases (2nded.). Toronto:
McGraw-Hill Ryerson Limited, 1986.


Busse Farms Ltd. v. Federal Business Development Bank, CA98108, December 1, 1998 (Sask.C.A.).



Canadian Occidental petroleum Ltd. v. Antoniuk, CA2992, February 5, 2001 (Sask.C.A.).

Cubbon v. White, [1938] 2 W.W.R. 257 (Sask.K.B).

Fletcher Challenge Energy Canada Inc. v. Sulz, CA3087, February 5, 2001 (Sask.C.A.).

Fondrick v. Gross, QB03285, July 8, 2003 (Sask.Q.B.).

Hunter v. Saskatchewan, [1994] 10 W.W.R. 756 (Sask.Q.B.).

Joyce v. Yorkton Gun Club Inc. (1992), 97 Sask. R. 243 (Sask.C.A.).

Lawrysyn v. Town of Kipling (1964), 50 W.W.R. 430 (Sask.Q.B.).


The Crown Minerals Act

The Environmental Assessment Act

The Environmental Management and protection Act

The Mineral Resources Act, 1985
The Seismic Exploration Regulations, 1999

The Oil and Gas Conservation Act
The Oil and Gas Conservation Regulations, 1985

The pipelines Act, 1998
The pipelines Regulations, 2000

The Wildlife Habitat protection Act

The Wildlife Act
Wild Species at Risk Regulations


GL 97-01 Construction and Operation of Oily Byproduct Storage Structures in Saskatchewan (1998)

GL 99-01 Saskatchewan Drilling Waste Management Guidelines (1999)

GL 2000-01 Saskatchewan Hydraulic Fracturing Fluids and propping Agents Containment and Disposal
Guidelines (2000)

SpIGEC 1 Upstream Waste Management Guidelines (1996)

SpIGEC 2 Restoration of Well Sites on Cultivated Lands Guidelines (1999)

SpIGEC 3 Restoration of Spill Sites on Agriculture and pasture Lands (1999)

SpIGEC 4 Upstream Contaminated Site Remediation Guidelines (1999)

SpIGEC 5 Environmental Site Assessment Guidelines (1999)

SpIGEC 6 Required Qualifications: Field Environmental Monitors for Oil and Natural Gas Exploration
and Development projects (2002)

Environmental Operating Guidelines for the Upstream petroleum Industry (2001)