Frequently Asked Questions (FAQs) Concerning Federally-Regulated Petroleum Pipelines in Canada
1. General Information on Pipelines
1.1 What is the difference between a pipeline that moves oil and a pipeline that moves natural gas?
Oil and natural gas pipelines are similar since they are both coated steel pipe buried underground. The key difference is that oil transmission pipelines typically transport liquids at pressure between 600 to 1000 pounds per square inch (psi), while natural gas transmission pipelines transport gas at higher pressures of 1000 psi or greater.
Natural gas pipelines have above-ground compressor stations at select intervals. These compressors are often land-based jet engines, and are typically fueled by the natural gas within the pipeline itself. Crude oil or liquids pipelines have above-ground pump stations at select intervals. These are typically electric pumps.
1.2 How long have pipelines been used to transport oil and gas in Canada?
Canadian pipelining began in 1853, with a 25-kilometre cast-iron pipe moving natural gas to Trois-Rivières, QC, to light the streets. Canada had one of the world’s first oil pipelines in 1862 when a pipeline connected the Petrolia oilfield to Sarnia, ON. By 1947, only three Canadian crude oil pipelines existed. One was located in Alberta and transported oil from Turner Valley to Calgary. A second moved imported crude from coastal Maine to Montreal, while the third brought American mid-continent oil into Ontario. Canada’s extensive pipeline grid began in the 1950s when major crude oil and natural gas finds in Western Canada led to the construction of large pipeline systems.
The Canada Energy Regulator (CER, formerly the National Energy Board) has been regulating inter-provincial and international pipelines since 1959. While much has changed since then, environmental protection and the safety and security of Canadians remains of paramount importance to the CER.
1.3 How extensive is Canada’s pipeline system?
There are an estimated 840,000 kilometres of transmission, gathering and distribution lines in Canada, with most provinces having significant pipeline infrastructure. This includes 117,000 kilometres of large diameter transmission lines. Of this amount, approximately 73,000 kilometres are federally-regulated pipelines, which are primarily transmission lines. Pipelines operate in both remote and populated areas. Canada’s natural gas pipeline grid stretches from the coast of British Columbia and Vancouver Island to Quebec City, and its crude oil pipelines stretch from Vancouver to Montreal. There are also separate pipelines, not linked to the rest of the pipeline grid, in Newfoundland, New Brunswick, Nova Scotia, Prince Edward Island, and offshore Canada. There are major crude oil and natural gas pipelines servicing most major Canadian cities. Canadian pipeline systems are highly integrated with those in the US, allowing Canadian oil and natural gas to access and receive delivery from markets in the US.
The 73,000 kilometers of oil and natural gas pipelines regulated by the CER transport over 100 billion dollars of hydrocarbons each year.
For more information about the pipeline network in Canada, visit the CER website.
1.4 How many oil and gas pipelines cross the Canada-US border?
There are 70 operating oil and gas pipelines regulated by the CER that cross the Canada-US border: 31 oil and 39 natural gas. There are 16 operating pipelines which transport other commodities. There are also about 10-15 additional pipelines at other stages (e.g., deactivated, decommissioned, built, but not operating).
2. Need for Pipelines
2.1 How do Canadians benefit from pipelines?
Pipelines deliver crude oil, natural gas and petroleum products to domestic markets throughout Canada. Pipelines are necessary to deliver fuel to Canadians to heat their homes, drive their cars, or travel by bus, train, or by air. The majority of homes in Canada are heated with natural gas, all of which is delivered by pipelines. Cars, buses, trains, boats and airplanes are all fueled primarily by petroleum products such as gasoline, diesel, or aviation fuel. These products are produced at refineries across Canada, and pipelines are needed to transport crude oil to these refineries. Without pipelines, large volumes of crude oil (over three million barrels per day in Canada) would have to be transported to refineries by other modes of transport, such as tanker trucks, tanker ships, or rail cars. Transporting three million barrels per day by truck would mean more than 15,000 additional long distance truck trips every day on Canada’s highways, which would have public safety, road maintenance, noise, and emissions implications.
2.2 Why do parts of Eastern Canada import oil when there is supply in Western Canada?
At present, some refineries in Eastern Canada are not connected by pipeline to western Canadian crude oil production. As a result, these refineries import most of their crude needs by tanker ship. Canada’s current crude oil pipeline infrastructure can deliver western Canadian crude oil as far east as Montreal, Quebec. Canadian crude oil supplies all the needs of western Canadian refineries, and more than three-quarters of Ontario’s refinery capacity. With the startup of the 300,000 barrel per day Enbridge Line 9 flow reversal project, Canadian crude oil delivered by pipeline began arriving in Montreal in December, 2015.
2.3 Where does Eastern Canada import oil from?
Canada’s Eastern refineries import oil from a variety of oil-producing countries. The United States recently became the largest source for imported oil. Apart from the United Sates, most of Eastern Canada’s oil imports come from the countries that are part of the Organization of the Petroleum Exporting Countries (OPEC), specifically from Algeria, Saudi Arabia, Nigeria, Angola and Iraq. Some of Eastern Canada’s oil was also imported from North Sea countries, including Norway and the United Kingdom.
2.4 Can the railway be used to transport crude oil?
Yes. Over 611,000 barrels per day of crude oil and petroleum products were transported by rail in Canada in 2014. However, transporting oil by rail is significantly more expensive than by pipeline. Transporting oil by rail or truck is typically more economically viable for small volumes over shorter distances, especially if the rail infrastructure is already in place.
2.5 Why does Canada not keep all of its oil for Canadians to use?
Canada has the third largest crude oil reserves in the world, after Venezuela and Saudi Arabia, and Canadian crude oil production is growing rapidly. Canadian oil production and resources far exceed Canadian needs for crude oil and petroleum products. On a dollar value basis, Canadian exports of crude oil, natural gas and petroleum products account for 28% of all Canada’s exports in 2014.
2.6 What are the economic benefits for Canadians from pipelines?
In addition to directly employing thousands of people during construction and operation, pipelines are a key piece of infrastructure that allows crude oil and natural gas production to reach markets. The oil and gas sector, which depends on pipelines to connect to customers, directly and indirectly employs about 740,000 people, contributes nearly 11% to the country's GDP and pays approximately $20 billion per year in taxes, royalties and fees to governments.
3. Pipeline Safety and Environmental Protection
3.1 How safe are pipelines?
Pipeline companies are subject to various regulations and are required to meet specific standards. The CER’s regulations require a pipeline company to create a management system and protection programs that anticipate, prevent, manage and mitigate potentially dangerous conditions associated with their pipelines.
Pipeline companies are required to design safety, integrity and emergency response protection programs specific to their infrastructure that manage and mitigate risks posed to people and the environment. These programs are reviewed, inspected and audited by the CER. If non-compliance is found, the CER will take necessary steps to protect the environment and the public. The CER has several compliance enforcement tools available to it and may revoke authorizations, impose safety orders that restrict operations, issue stop-work orders, and pursue criminal prosecution. The CER is also authorized to issue administrative monetary penalties (AMPs) ranging from $25,000 for individuals to $100,000 for companies per infraction, per day.
To ensure safety, companies are required to inspect their systems regularly using specialized tools that run inside the pipelines, and conduct right-of-way surveillance and inspection. Pipeline leaks and ruptures are detected in real time using sophisticated computer-based systems. Companies can often remotely shut down flows to minimize spill volumes.
3.2 What is the accident and leak record of Canadian pipelines?
In Canada, the CER regulates over 73,000 kilometres of pipelines that move approximately 1.3 billion barrels of oil per year. According to the CER, these pipelines spilled an average of about 1,084 barrels per year between 2011 and 2014. This is roughly equivalent to two tank cars. Typically, most of the oil spilled is contained on pipeline company property. Spill sites must be reclaimed to restore the natural environment.
The CER’s Safety Performance Dashboard presents statistics on the number and frequency of various incidents that affect pipeline safety, integrity and the environment.
3.3 How is a crude oil pipeline leak cleaned up?
Federal and provincial regulators must be notified of spills immediately by law. A company’s Emergency Response Plan, which must be pre-approved by the CER, then guides initial response and containment of a spill with appropriate equipment, such as absorbent booms. Pipeline companies must have spill first-responders under contract. It is also a CER requirement that companies continually educate all first responders on practices and procedures to be followed in the event of an emergency.
Once a spill is contained, oil is removed by vacuum truck for recycling. Contaminated soil and water is then removed for treatment. For CER-regulated pipelines, a Remediation Process Guide requires companies to conduct the appropriate level of Environmental Site Assessment, and to submit a Remedial Action Plan for approval by the CER. The Guide indicates that the most stringent criteria must be used for remediation of residual soil and groundwater contamination. The spill site is considered clean once the CER approves a remediation closure report demonstrating all standards have been met. Reclamation of the site to restore the environment is also a part of the clean up.
3.4 How are pipeline leaks prevented or minimized?
Today, pipeline companies use sophisticated automated leak detection systems with central control rooms that permit companies to monitor rates of flow, pipeline pressure and fluid characteristics in real time. Pipeline inspection technology has also improved with the use of magnetic flux and ultrasonic tools that examine the pipe wall from the inside. These tools, known as “smart pigs,” permit companies to detect potential problems and prevent leaks. In addition, improvements in pipeline coating technologies and the use of cathodic protection have reduced corrosion of pipelines. Finally, the quality control at pipeline manufacturing facilities has also improved.
Pipeline management also has improved in the past 20 years with the creation of standards and regulations that require management systems for pipeline operation and pipeline integrity management programs to systematically evaluate pipe condition and proactively repair the pipeline as it ages so that it can operate safely.
Pipeline companies have primary responsibility for ensuring pipeline safety and environmental protection. The CER requires companies to anticipate, prevent, manage and mitigate potentially dangerous conditions associated with their pipelines. Pipeline companies must design safety, emergency response, and integrity management programs, which are then reviewed and audited by the CER. The CER evaluates regulated companies and their facilities to determine appropriate compliance verification activities. The CER looks at potential consequences to people and the environment posed by a facility based on a number of criteria including its location, type, age, and operating history. The CER also examines historical information on the company’s management of these consequences collected through previous compliance monitoring activities.
Companies inspect their systems regularly through a combination of external and internal inspection methods. Pipelines are run and monitored 24/7 from centralized control centers that gather pressure, volume and other information in real time. Systems may have manual or automatic shut-down capabilities.
3.5 What causes pipeline failures to occur?
Pipeline failures can occur for a variety of reasons, including corrosion, environmentally-assisted cracking, equipment failure, material defects, environmental incidents (such as landslides and washouts) and human interference (such as being hit by heavy machinery).
An important part of damage prevention for pipelines in Canada are the “one call” or “call before you dig” services that aim to build awareness and promote safe excavation practices in order to reduce damages to underground facilities, like pipelines. Since pipeline failures may occur through human interference, it is important to ‘call before you dig’ to ensure that work being performed near pipelines is being done safely, and legally. Making this call initiates a communications process that will identify the location of pipelines and other buried utilities and provide information on how to safely work around them.
The Canadian Common Ground Alliance has also been working with provincial and regional partners and industry associations on the “one call” issue across Canada.
3.6 Is oil sands crude (diluted bitumen) more corrosive than conventional crude oil?
Significant independent scientific research has been done on this subject, and the results show that bitumen-derived crude is no more corrosive in transmission pipelines than other crudes.
ASTM International – an internationally recognized agency that develops standards tests – published a guide (Guide G205) for measuring the corrosivity of crude oil under pipeline conditions, based on research conducted by several organizations, including the Canmet Laboratories of Natural Resources Canada. The guide describes test methods that enable a direct comparison of various crude oils, including bitumen.
Corrosivity in transmission pipelines comes from two sources – water content and erosive constituents, such as mud and sand. Those substances are removed before crude oil enters pipelines for transmission. Moreover, for transport in transmission pipelines, the sand and water content of oil is strictly controlled and the combined basic sediment and water content must be less than 0.5 per cent by volume.
In addition, crude oils, including bitumen-derived crudes, contain little or no carbon dioxide (CO2) or hydrogen sulphide (H2S).
Finally, pipelines carrying bitumen-derived crude oil operate at the same pressure levels as pipelines carrying other types of crude oil.
3.7 Who is liable for cleaning up a pipeline spill?
If the operator is at fault, the pipeline company is completely liable for all costs to clean up a pipeline spill. In Canada, there is no limit on the amount a company may be required to pay to clean up a spill. In addition to being financially responsible for clean up, the company may also be fined or be subjected to other enforcement actions such as Commission Orders and Directives or prosecution.
If an incident occurs, the CER holds the company responsible and accountable for clean-up and site remediation. The Pipeline Safety Act sets out absolute liability of $1 billion for companies operating major oil pipelines (classes and limits for other pipelines will be established in regulations). This means that companies will be automatically responsible for up to $1 billion in damages regardless of whom or what caused the incident. It is important to note that where the pipeline company is at fault or negligent, liability will remain unlimited. This extends to damages to the environment beyond the costs of clean-up and other losses. All companies operating a pipeline will be required to hold a minimum level of financial resources to ensure they can respond quickly in the event of an incident. If the operator is unwilling or unable to shoulder its responsibilities, the Government of Canada will provide the CER with the resources to take control of spill response, cleanup and remediation, and the CER will be authorized to recover any costs incurred from industry.
4. Regulation of Pipelines in Canada
4.1 Who regulates pipelines in Canada?
Pipelines in Canada are regulated based on jurisdiction, according to Canada’s Constitution. The CER, an independent federal agency created in 1959 (as the NEB) by the Government of Canada, regulates pipelines that cross inter-provincial or international boundaries. This includes 73,000 kilometres of inter-provincial and international pipelines within Canada. The CER regulates approximately 100 pipeline companies in Canada.
Pipelines that are intra-provincial (i.e. are entirely within one province) are regulated by each individual province. This includes the smaller natural gas distribution lines which go to every house with a natural gas furnace or water heater.
4.2 Who makes the decision to build a new pipeline?
This is a business decision made by commercial participants based on market demand for transportation capacity. Pipeline companies propose projects based on their predicted economic feasibility. Before any project for an international or inter-provincial pipeline can proceed it must be reviewed by the CER and approved by the Government of Canada.
4.3 What are the regulatory requirements to build a pipeline?
Before any pipeline can be constructed in Canada, it requires permission from the appropriate federal or provincial regulator.
In making this determination, the CER may consider information relating to:
- Engineering;
- Environmental and socio-economic matters;
- Economics and financial matters;
- Land matters; and
- Any public interest that may be affected by granting or refusing the application.
New pipelines requiring a total of 75 km or more of new right of way are subject to the Impact Assessment Act, and the Impact Assessment Agency of Canada will conduct an integrated impact assessment with support from the CER.
4.4 How are Aboriginal groups/communities involved in the process of pipeline construction?
The Government of Canada has a legal duty to consult Aboriginal groups whose Aboriginal and treaty rights may be adversely affected by any proposed project that requires a federal decision. The Government recognizes that Aboriginal groups and communities have the right to be given the opportunity to understand the impacts a project may have on their rights and interests, to express their views regarding the project, and to have their views in respect of impacts to established or potential rights be considered and accommodated, where appropriate.
For major pipeline projects over 40 kilometers, the Government of Canada engages Aboriginal groups early in the review process and also relies on the CER hearing processes, to the extent possible, to fulfill its duty to consult. The CER’s filing requirements require applicants to consult with potentially-affected Aboriginal groups on all proposed projects both before and during a project review. The proponents are also required to report to the CER on the outcomes of their consultation. Aboriginal groups are encouraged to bring forward their concerns about a proposed project to the regulatory process to ensure the CER and the Government can consider their views. CER staff members are available to explain the CER’s processes and how to become involved in those processes.
The CER encourages companies and Aboriginal groups to work together during the planning and design phases of a project to eliminate or mitigate impacts on Aboriginal interests. Aboriginal groups are encouraged to bring outstanding issues forward to the CER for consideration in its decision-making or recommendation.
Where major projects may impact treaty or Aboriginal rights, the CER implements its Enhanced Aboriginal Engagement procedures, which can include meeting to discuss process and opportunities to participate in processes related to specific applications. The CER offers a Participant Funding Program to assist interested parties, including Aboriginal persons and groups, with participation in an oral facilities hearing.
On certain pipeline reviews, the federal Crown may also undertake direct engagement and consultation with Aboriginal groups whose rights could be potentially affected by projects. These activities could include early meetings to explain the process and hear concerns; consultations outside of the CER’s review to better understand issues or consult on matters outside of the CER mandate; consultation on CER recommendations and follow-up engagement activities.
The Government may also engage Aboriginal groups on broader issues including to identify and advance opportunities to enhance participation in pipeline development, safety and operations (e.g., monitoring, incident response, advancing the use of federal programs to support training and skills development, etc.).
4.5 What are the implications of new pipelines for landowners?
If the CER or Government of Canada approves a major pipeline, this approval will include a proposed general pipeline route or corridor. The CER requires companies to communicate with and involve the public when they are developing projects. The level of public engagement should be appropriate for the setting, and the nature and magnitude of each project.
Pipeline companies are responsible for attempting to negotiate easements with landowners. These are land agreements that grant the company permission to place the pipeline in the ground within a certain location along the route. The landowner may be a farmer, municipality, province, or other individual. Landowners receive financial compensation for having the pipeline on their land. These are private negotiations, where landowners and pipelines agree on compensation and other details, including the activities that can occur on the pipeline right-of-way.
The CER has an Alternative Dispute Resolution (ADR) process which is used to help parties work together to resolve a dispute. Those trained in ADR may use various tools and techniques to help parties reach an outcome that is acceptable for both parties. This may include negotiation, facilitation, workshops, or mediation. ADR can be used to address a wide range of disputes, including damage to property, compensation matters and the detailed pipeline route location.
4.6 How does a company decide where the pipeline route should go?
Pipeline companies may study various routes and optimize the use of existing rights-of-way, such as public utility corridors, electrical transmission lines, other oil or natural gas pipelines, highways and railways. Companies will also gather input from affected landowners and land users and consider environmental and socio-economic impacts when proposing final pipeline routing for CER approval.
4.7 Will I be restricted in my use of the lands where the company has a pipeline right-of-way?
Landowners may face some restrictions on use of the land on or near the pipeline in order to maintain public safety and environmental protection. For a farmer, this typically means the land can continue to be farmed, including crossings by certain agricultural equipment if certain conditions are met. However, buildings or other structures cannot be installed immediately over the pipeline right-of-way, as this would cause safety hazards.
4.8 What are a pipeline company’s obligations after construction?
Pipeline companies are responsible for all aspects of a pipeline during its construction, operation and after the company stops operating the pipeline. This means that companies are required to address all conditions that have the potential to harm people, property or the environment throughout the life-cycle of a pipeline.
4.9 What happens when a pipeline is no longer needed and is abandoned?
Pipeline owners and operators are responsible for the costs to abandon pipelines or facilities. The costs include the abandonment work, which includes clean-up of the surrounding area until it is reclaimed to the acceptable environmental standards, and unforeseen events such as pipeline settlement or exposure that might occur after abandonment.
When the CER reviews a pipeline abandonment application, the CER will assess the environmental and socio-economic implications of abandonment. If the CER approves the abandonment application, it will issue an Abandonment Order, with specific conditions that must be satisfied before the Order can take effect. These are designed to address any risks to public safety, property and the environment.
The CER also requires that the appropriate level of funds to be put aside by pipeline companies to cover the costs of abandonment.
5. Compensation
5.1 I have a pipeline crossing my land. Am I entitled to any compensation?
- Compensation is a private matter between a pipeline company and a landowner.
- However, for pipelines that are regulated by the CER, if a landowner and a pipeline company cannot agree on compensation, the CER is available to help facilitate resolution of a dispute.
- Alternative dispute resolution (ADR) is recommended as an option to resolve a dispute before considering other formal processes the CER may provide.
- Those trained in ADR may use various tools and techniques to help parties reach an outcome that is acceptable for both parties. This may include negotiation, facilitation, workshops, or mediation. ADR can be used to address a wide range of disputes, including damage to property, compensation matters and the detailed pipeline route location.
5.2 What is the Pipeline Arbitration Secretariat (PAS or Secretariat)?
- The former PAS advised the Minister of his/her statutory obligations relating to negotiation and arbitration under the National Energy Board Act. The PAS’s responsibilities included:
- Processing notices of arbitration;
- The Ministerial appointment process;
- Correspondence;
- Payment of invoices;
- Court reporting for hearings; and
- Release of decisions where permission has been granted by all parties.
- These responsibilities now fall under the CER as outlined in the Canadian Energy Regulator Act (CERA).
- Any request for negotiation or arbitration services received by PAS prior to August 28, 2019 will continue to be administered by the PAS until their completion.
5.3 How can I receive copies of Arbitration Committee decisions?
- Arbitration Committees’ decisions are subject to the provisions of the Privacy Act. As such, decisions will only be released if permissions is received from all parties involved in the arbitration hearings.
- Natural Resources Canada (NRCan) maintains decisions from Arbitration Committees that were assembled from 1995 - 2019. For any decisions after September 2019, please contact the CER.
- The following Arbitration Committee decisions are available for pubic release, upon request to NRCan:
- Houle vs TransCanada Pipelines Limited (March 24, 1995);
- Brian Burke vs TransCanada Pipelines Limited (February 1, 1996) (August 30, 1999);
- Eric winter and Winter Farms Ltd vs Federated Pipe Lines (Northern) Ltd. (July 5, 1999)*;
- Nicholas Milkovich vs Federated Pipe Lines (Northern) Ltd. (August 30, 1999)*;
- Byron Bue, Raymond Bue, Brian and Teresa Fast, Raymond and Florence Gilkyson, Stirling and Laura Hanson, Lloyd and Kathryn Olley, Kane Piper and Dale and Gwen Smith vs Alliance Pipeline Ltd. (August 25, 2011)*;
- Byron Bue, Raymond Bue, Brian and Teresa Fast, Raymond and Florence Gilkyson, Stirling and Laura Hanson, Lloyd and Kathryn Olley, Kane Piper and Dale and Gwen Smith vs Alliance Pipeline Ltd. – Applicants’ Payment Elections (October 25, 2011);
- Terrence and Marcia Balisky, Peter and Levke Eggers, Byan Ellingson, Fern Jones, Gregory Leroux and 340104 Alberta Ltd., Donald Liland, Randy and Kristin Moe, Franklin Moller, Robert and Ada Richards, Albert Slater and Gordon Strate vs Alliance Pipeline Ltd. (November 25, 2011)*;
- Terrence and Marcia Balisky, Peter and Levke Eggers, Byan Ellingson, Fern Jones, Gregory Leroux and 340104 Alberta Ltd., Donald Liland, Randy and Kristin Moe, Franklin Moller, Robert and Ada Richards, Albert Slater, Gordon Strate, Byron Bue, Raymond Bue, Brian and Teresa Fast, Raymond and Florence Gilkyson, Stirling and Laura Hanson, Lloyd and Kathryn Olley, Kane Piper and Dale and Gwen Smith vs Alliance Pipeline Ltd. (June 15, 2012)
*Redacted version (i.e. does not include any dollar amounts for compensation)
5.4 How many Arbitration Committee decisions have been appealed and what was the outcome?
- Several Arbitration Committee decisions have been appealed (including cross-appeals) to the Federal Court, the Federal Court of Appeal and/or the Supreme Court of Canada. Decisions made at these courts can be found on their respective websites.
- The appeals have involved pipeline companies, landowner(s), mineral rights owners and/or the Minister of Natural Resources. Some decisions have been appealed more than once.
- About half were won by landowners and half were won by the pipeline company or the Minister of Natural Resources. Some decisions were split.
- The following table provides information regarding:
- The applicants and respondents in the court proceeding;
- A brief summary of the case and decision; and
- A link to the complete decision.
PIPELINE ARBITRATION – CASES THAT WERE APPEALED TO THE FEDERAL COURT OR THE FEDERAL COURT OF APPEAL
| Applicants and Respondents | Applicant(s): Marguerite Pelletier and Gisèle de Maddelein (“Landowners”) Respondent(s): The Honourable Minister of Energy, Mines and Resources and Gazoduc Trans-Québec et Maritimes Inc. (TQM) |
| Case Summary | The appellant appealed a decision by the Pipeline Arbitration Committee, which set the compensation she was entitled to because of the expropriation of part of her land to build a pipeline. The Arbitration Committee considered that the best use of the property at the time the expropriating party took possession was for farming or forestry. The appellant maintained that her land should have been assessed as a gravel and sand pit. |
| Decision | The Landowners’ appeal was dismissed. |
| Link to View Decision (Date) | M. Pelletier and G. De Maddelein v. Gazoduc Trans-Québec et Maritimes Inc. (June 23, 1999) |
| Applicants and Respondents | Applicant(s): Terry and Marica Balisky, Bev Holdings Ltd., Byron and Raymond Bue, Peter and Levke Eggers, Bryan Ellingson, Charles and Nora Evaskevich, Brian and Teresa Fast, Doug Gabert, Raymond and Vicky Gilkyson, James and Elaine Gasman, Stirling and Laura Hanson, Roger and Fern Jones, Don and Linda Liland, Mario and Jamie Marouelli, Donald Meador, Mona Middleton, Glenda Haughian, Brian and Janice Moe, Randy and Kris Moe, Franklin Moller, Lloyd and Katherine Olley, Don Pederson, Kane Piper, Robert and Ada Richards, Cornie and Priscilla Schmidt, Albert and Ken Slater, Dale and Gwen Smith, Gordon Strate, Frank and Irma Thederahn and Ed Welsh (“Landowners”) Respondent(s): Minister of Natural Resources and Alliance Pipeline Limited (Alliance) |
| Case Summary | They sought a review of the Minister’s decision not to appoint an Arbitration Committee to address their notices of arbitration with respect to the right of entry orders issued by the National Energy Board to Alliance and the Minister’s request to the Arbitration Committee not to consider the issue of the controlled area. |
| Decision | The Landowners’ application for judicial review was dismissed. |
| Link to View Decision (Date) | Balisky v. Goodale (September 13, 2002) |
| Applicants and Respondents | Applicant(s): Terry and Marica Balisky, Bev Holdings Ltd., Byron and Raymond Bue, Peter and Levke Eggers, Bryan Ellingson, Charles and Nora Evaskevich, Brian and Teresa Fast, Doug Gabert, Raymond and Vicky Gilkyson, James and Elaine Gasman, Stirling and Laura Hanson, Roger and Fern Jones, Don and Linda Liland, Mario and Jamie Marouelli, Donald Meador, Mona Middleton, Glenda Haughian, Brian and Janice Moe, Randy and Kris Moe, Franklin Moller, Lloyd and Katherine Olley, Don Pederson, Kane Piper, Robert and Ada Richards, Cornie and Priscilla Schmidt, Albert and Ken Slater, Dale and Gwen Smith, Gordon Strate, Frank and Irma Thederahn and Ed Welsh (“Landowners”) Respondent(s): Minister of Natural Resources and Alliance Pipeline Limited (Alliance) |
| Case Summary | In Balisky v. Goodale (2002), the Court dismissed the Landowners’ application for a judicial review of the Minister’s request to the Arbitration Committee not to consider the issue of the controlled area. This case was an appeal of that court decision. |
| Decision | The Landowners won their appeal with costs. The Court’s decision quashed the Minister’s decision regarding compensation for the controlled area. The Minister was directed to refer the matter of compensation relating to the controlled area to an Arbitration Committee or committees. |
| Link to View Decision (Date) | Balisky v. Canada (Minister of Natural Resources), (February 27, 2003) |
| Applicants and Respondents | Application(s): Alliance Pipeline Ltd. (Alliance) Respondent(s): Joe and Lil Bokenfohr (Landowner) |
| Case Summary | Alliance appealed an order by an Arbitration Committee in respect of the amount of advance compensation payable to the landowners for the acquisition of permanent and temporary easements for their land for the construction of a pipeline. |
| Decision | Alliance’s appeal was dismissed with cost to the landowner. |
| Link to View Decision (Date) | Alliance Pipeline Ltd. v. Bokenfohr (May 23, 2003) |
| Applicants and Respondents | Application(s): Alliance Pipeline Ltd. (Alliance) Respondent(s): Brian and Theresa Fast (Landowners) |
| Case Summary | Alliance appealed an order of a pipeline Arbitration Committee in respect of the amount of advance compensation payable to the landowners for the acquisition of permanent and temporary easements over their lands for construction of the pipeline. |
| Decision | The Court ruled that the Arbitration Committee’s order be revised by deleting its direction that the advance payment be made in such periodic increments as requested by Alliance. |
| Link to View Decision (Date) | Alliance Pipeline Ltd. v. Fast (May 23, 2003) |
| Applicants and Respondents | Applicant(s): Terry and Marica Balisky, Bev Holdings Ltd., Byron and Raymond Bue, Peter and Levke Eggers, Bryan Ellingson, Charles and Nora Evaskevich, Brian and Teresa Fast, Doug Gabert, Raymond and Vicky Gilkyson, James and Elaine Gasman, Stirling and Laura Hanson, Roger and Fern Jones, Don and Linda Liland, Mario and Jamie Marouelli, Donald Meador, Mona Middleton, Glenda Haughian, Brian and Janice Moe, Randy and Kris Moe, Franklin Moller, Lloyd and Katherine Olley, Don Pederson, Kane Piper, Robert and Ada Richards, Cornie and Priscilla Schmidt, Albert and Ken Slater, Dale and Gwen Smith, Gordon Strate, Frank and Irma Thederahn and Ed Welsh (“Landowners”) Respondent(s): Minister of Natural Resources |
| Case Summary | By way of background, the Minister of Natural Resources had refused the Landowners’ applications to appoint an Arbitration Committee to determine damages in respect of the controlled area on either side of the pipeline’s right of way. The Landowners’ application to the Federal Court for judicial review was refused (Balisky v. Goodale, 2002). Subsequently, the Federal Court of Appeal quashed the Minister’s decision and directed that an Arbitration Committee be appointed to address the issue of compensation for the controlled area (Balisky v. Canada (Minister of Natural Resources), 2003). This case dealt with the Landowners’ assessment of costs in the above court case, which they put a $7,823.57 each against Alliance and the Minister. |
| Decision | The Landowners won their appeal but he Court awarded $1,812.28 respectively against each of the Minister and Alliance, less than what had been sought. |
| Link to View Decision (Date) | Balisky v. Canada (Minister of Natural Resources) (March 24, 2004) |
| Applicants and Respondents | Applicant(s): Maritimes and Northeast Pipeline Limited Partnership by its General Partner, Maritimes and Northeast Pipeline Management (MNP) Respondent(s): Clayton C. Elliot and Linda L. Elliot (Landowners) and the Minister of Natural Resources |
| Case Summary | The Minister of Natural Resources determined that an Arbitration Committee would be appointed to hear the compensation claim of the landowners. The Landowners claimed compensation for diminution of the capital value of their property alleged to have arisen due to its proximity to MNP’s pipeline. MNP submitted that the arbitration provisions of the National Energy Board Act, do not apply to the Landowners or their claim and sought to have the Minister’s decision quashed. |
| Decision | MNP’s appeal was allowed. As such, the Minister’s decision was quashed. |
| Link to View Decision (Date) | Maritimes & Northeast Pipeline Ltd. Partnership v. Elliott (April 13, 2004) |
| Applicants and Respondents | Applicant(s): Alliance Pipelines Ltd. (Alliance) Respondent(s): Dale Smith and Gwen Smith (Landowners) |
| Case Summary | Alliance appealed an award by a pipeline Arbitration Committee dated September 5, 2003 and released March 15, 2004. Alliance contended that the Arbitration Committee had not taken into account that the interest of the Landowners was leasehold, as opposed to all of the other claims dealt with that were freehold land. |
| Decision | Alliance’s appeal against the award provided by the Arbitration Committee was successful. The Court also awarded costs to Alliance in the lump sum of $550.00. |
| Link to View Decision (Date) | Alliance Pipeline Ltd. V. Smith (July 5, 2004) |
| Applicants and Respondents | Applicant(s): Bev Holdings Ltd., Byron and Raymond Bue, Brian and Teresa Fast, Raymond Vicky Gilkyson, Stirling and Laura Hanson, Mario and Jamie Marouelli, Lloyd and Katherine Olley, Dale and Gwen Smith, Frank and Irma Thederahn, Scott and Tricia Gabert and Kane Piper (Landowners) Respondent(s): Alliance Pipeline Ltd. (Alliance) Applicant(s) by Cross-Appeal: |
| Case Summary | The Landowners appealed the Arbitration Committee’s award of compensation. Alliance’s cross-appeal questioned whether the Arbitration Committee had erred in its compensation award to the Peace River Landowners based on a “pattern of dealings”. |
| Decision |
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| Link to View Decision (Date) | Bue v. Alliance Pipeline Ltd. (June 7, 2006) |
| Applicants and Respondents | Applicant(s): Heartland Resources Inc. (Landowner) Respondent(s): Sable Offshore Energy Inc. and Maritimes & Northeast Pipeline Management Ltd. (SOEI and MNP) |
| Case Summary | Heartland was granted by the Province of Nova Scotia a right to explore for minerals on land, which was subsequently acquired to build a pipeline. Heartland alleged that the prohibition on work close to the pipeline diminished the value of its exploration right. Heartland sought compensation t the extent its exploration right was diminished. It appealed the Arbitration Committee’s decision dismissing its request for compensation under section 90 of the National Energy Board Act. |
| Decision | The Federal Court dismissed Heartland’s appeal. The right to explore for minerals, defined in the Nova Scotia Mineral Resources Act 1975, did not amount to an interest in land Heartland. Without an interest in land, the Arbitration Committee did not have jurisdiction to award any compensation, if any could be proven. |
| Link to View Decision (Date) | Heartland Resources Inc. v. Sable Offshore Energy Inc. and Maritimes & Northeast Pipeline Management Ltd. (October 10, 2007) |
| Applicants and Respondents |
Applicant(s): Alliance Pipeline Ltd. (Alliance) Respondent(s): Vernon Joseph Smith |
| Case Summary |
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| Decision |
Alliance’s appeal was dismissed, with costs to Mr. Smith. |
| Link to View Decision (Date) |
Alliance Pipeline Ltd. v. Smith (January 4, 2008) |
| Applicants and Respondents | Applicant(s): Alliance Pipelines Ltd. (Alliance) Respondent(s): Terry and Marica Balisky, Peter and Levke Eggers, Bryan Ellingson, Charles and Nora Evaskevich, James and Elaine Glasman, Roger and Fern Jones, Don Lisland, Donald Meador, Brian and Janice Moe, Randy and Kristen Moe, Franklin Moller, Don Pederson, Robert and Ada Richards, Connie and Priscilla Schmidt, Albert and Ken Slater, Gordon Strate, Ed Welsh, Glen Gabert, Gregory Leroux and 34101 Alberta Ltd. (Landowners) Applicant(s) by Cross-Appeal: |
| Case Summary | Alliance’s appeal questioned whether the Arbitration Committee erred in how it determined the appropriate amount of compensation for the Landowners and the manner in, which compensation should be paid. Alliance argued that the Arbitration Committee took into account irrelevant factors. The Landowners also appealed, contending that the Arbitration Committee should have ordered Alliance to pay them an annual fee rather than a lump sum. |
| Decision | The Court determined that the Arbitration Committee’s decision was, in the large part, reasonable. However, the Court found that the Arbitration Committee erred in its determination of the compensation payable to three of the respondents – two in Fort Saskatchewan, Alberta and one in Fort St. John, British Columbia. As such, Alliance’s appeal was allowed in part. The Landowners’ appeals were dismissed. |
| Link to View Decision (Date) | Alliance Pipeline Ltd. v. Balisky (September 26, 2008) |
| Applicants and Respondents | Applicant(s): Alliance Pipelines Ltd. (Alliance) Respondent(s): Vernon Joseph Smith (Landowner) |
| Case Summary | Alliance appealed a Federal Court decision of January 4, 2008 (Alliance Pipeline Ltd. v. Smith, January 4, 2008) that had dismissed a previous appeal by Alliance of a decision and award by a second Arbitration Committee on September 18, 2006 and corrected on November 6, 2006. This appeal focussed on an award to the Landowner of his legal costs incurred in another court case, initiated by Alliance, that was dismissed by the Alberta Court of Queen’s Branch and the award of costs from a previous Arbitration Committee that was unable to complete its work on his compensation case because one of the members resigned. |
| Decision | Alliance won its appeal with costs. As such, the Federal Court decision of January 4, 2008 (Alliance Pipeline Ltd. v. Smith, January 4, 2008) was set aside. In addition, Alliance won its appeal of the second Arbitration Committee’s decision of September 18, 2006 to award the costs incurred by the Landowner during the first Arbitration Committee’s proceedings. |
| Link to View Decision (Date) | Alliance Pipeline Ltd. v. Smith (April 8, 2009) |
| Applicants and Respondents | Applicant(s): Vernon Joseph Smith (Landowner) Respondent(s): Alliance Pipelines Ltd. (Alliance) |
| Case Summary | The Landowner and Alliance had a dispute over the losses the Landowner suffered from Alliance’s operations on his land. This dispute was submitted during arbitration but the Arbitration Committee lost a member and could not render a decision. Alliance afterwards initiated and then discontinued a lawsuit against the Landowner in relation to the dispute. A second Arbitration Committee awarded the Landowner compensation for his losses and reimbursement of his costs before the first Arbitration Committee and before the Court. Alliance appealed the Arbitration Committee’s decision about reimbursement of the costs on the grounds that the Arbitration Committee did not have the power to order a reimbursement of the costs under section 99 of the National Energy Board Act.
This appeal revisited the Federal Court of Appeal’s decision to overturn an Arbitration Committee’s award to the Landowner for his legal costs. The Supreme Court of Canada decided that the Landowner’s costs incurred before the first Arbitration Committee and before the Court were the kinds of costs that the National Energy Board Act empowered Arbitration Committees to consider. |
| Decision | The Landowner won his case before the Supreme Court of Canada. Alliance was ordered to pay the costs awarded by the second Arbitration Committee, as well as the Landowner’s legal costs throughout. |
| Link to View Decision (Date) | Vernon Smith v. Alliance Pipelines Ltd. (February 11, 2011) |
5.5 How do I contact the former Pipeline Arbitration Secretariat?
The former PAS can be reached by the following:
Natural Resources Canada
Petroleum Resources Branch/PAS
580 Booth Street, 17th Floor
Ottawa, Ontario K1A 0E4
Local: 343-292-7431
Toll free: 1-844-894-6626
Email: nrcan.pas-sap.rncan@canada.ca
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