Canada: Oh Canada - Significant Developments in Canadian Energy - March 2011

Oil Sands News

1. The new Federal Budget proposes to treat the cost of acquiring oil sands leases and certain oil sands resource property as a Canadian oil and gas property expense, as opposed to its current treatment as a Canadian development expense. The result will be a deductible rate of 10% per year on a declining basis, instead of the current 30% per year, effective for acquisitions made on or after March 22, 2011. The Budget also proposes new treatment for pre-production development expenses incurred for the purpose of bringing new oil sands mines into production. Instead of treating such expenses as Canadian exploration expenses, the proposal will treat them as Canadian development expenses, deductible at a rate of 30% per year. The current Canadian exploration expense treatment will continue with respect to expenses incurred before March 22, 2011, and for expenses incurred before 2015 on new mines on which major construction commenced prior to March 22, 2011.

1. ConocoPhillips has announced plans to spend approximately USD $1.2 billion in Foster Creek/Christina Lake and Surmont in 2011, and between $1 billion to $1.5 billion per year for the foreseeable future. Site work has commenced and engineering work is nearing completion for the 83000 bpd expansion project at Surmont. Steam injection at the expansion is expected by the end of 2014, with oil production commencing in 2015.

1. BlackPearl Resources plans to inject steam into its Blackrod pilot SAGD project in the second quarter of this year. BlackPearl has a 100% working interest and is the operator of the oilsands project. The company expects results late in the year, following which it expects to apply for a 40,000 bpd commercial development in early 2012.

1. Anglo-Dutch Shell has announced that the 100,000 bpd expansion to its oilsands project, which is expected to produce 255,000 bpd, will be up and running by the second quarter of 2011. Shell's interest in the northern Alberta project is 60%, with Marathon Oil and Chevron each holding a 20% stake.

East Coast News

2. Following favourable identification and interpretation of seismic anomalies, Forent Energy is moving forward with the conventional exploration of its 750,000 acre onshore Alton Block in Nova Scotia. Forent Energy intends to accelerate its exploration drilling program in the fall, aiming to initiate drilling operations in the fourth quarter of this year.

3. Production of the Hibernia South oilfield is projected to begin between April and June of this year. Production is expected from the southern part of the field, which is estimated to contain approximately 260 million barrels of crude. The Hibernia South partners are ExxonMobil, Chevron Resources Canada, Statoil Canada, Suncor, and Nalcor Energy.

West Coast News

4. Subject to regulatory approval, Encana has agreed to acquire a 30% stake in the Kitimat Liquefied Natural Gas (LNG) terminal, which has planned initial capacity of 700 mmcfpd of LNG in the first of two potential phases. The deal for the facility is expected to close in the second quarter of this year, leaving operator Apache and partner EOG Resources with interests of 40% and 30%, respectively.

4. In addition to the Encana-Apache-EOG Resources application to the National Energy Board (NEB) for a license to export LNG from the Kitimat terminal, B.C. LNG Export Co-Operative has filed an application to export LNG for a period of 20 years. The latter has received firm commitments through a purchase and sale agreement for the purchase of the full capacity of the LNG facility throughout the 20 year term. Pending regulatory approval, it is expected that the facility will be commissioned and sales will commence by fourth quarter 2013.

5. Murphy Oil announced that production has commenced at its 180 mmcfpd Tupper West gas processing plant. By the end of this year, production at the facility is expected to exceed 120 mmcfpd. The first phase of the development is expected to have 275 wells drilled, with another 244 wells in a possible second phase.

Canadian Arctic News

6. The NEB has issued a certificate of public convenience and necessity for the 1,196 km $16 billion Mackenzie Valley Pipeline. With this final approval in place, the next step is to negotiate a fiscal agreement with the federal government that could possibly include a federal loan guarantee, reducing the cost of capital of the pipeline and resulting in lower tolls. The pipeline will transport as much as 1.2 bcfpd of natural gas from the Mackenzie Delta on the Beaufort Sea to southern markets. The NEB approval requires that the construction of the pipeline begin by Dec. 31, 2015.

7. The Canadian Northern Economic Development Agency is funding more than $300,000 over 2 years for a feasibility study and business plan to assess the viability of oil and gas development in the Eagle Plain region of Northern Yukon. Vuntut Gwitchin Limited Partnership will lead the project on behalf of North Yukon Economic Partnership, which includes the four First Nations of Vuntut Gwitchin, Tr'ondek Hwech'in, Nacho Nyak Dun and Gwitch'in Tribal Council.

8. Paramount Resources is currently evaluating the potential of its 175,000 acreage for prospective shale gas from the Liard Basin. Paramount Resources plans to drill its first shale gas well in the Liard Basin in the first quarter of 2012.

Alternative Energy News

9. Canadian Solar and Sky Power have entered into a third engineering, procurement and construction (EPC) agreement for a 10.5MW solar park in Thunder Bay, Ontario. This EPC agreement is in addition to two previous EPC agreements entered into by the companies in December 2010, the first consisting of a 10.5MW solar park in Napanee and the second consisting of an 8.5MW solar park located on Thunder Bay International Airport Authority land. The construction of all three projects is expected to be completed by third quarter 2011. Together, the projects are expected to generate approximately 28 million kWh in their first full year of operation and almost 600million kWh total over the next 20 years.

10. Greengate Power has received provincial approval for the construction of its 300MW Blackspring Ridge 1 project in Vulcun County, which will be the largest wind farm in Canada. Construction of the wind farm is targeted for 2012, and it is expected to be in service in 2013.

Innergex Renewable Energy has purchased Cloudworks Energy in a $187.5m deal. Cloudworks' portfolio includes 75MW of operating hydro facilities and 76 MW currently under development, all with 40-year power purchase agreements with BC Hydro, as well as 800MW of prospective projects.

On the Horizon

A report from independent UK analyst Verdantix forecasts that the Canadian sustainable business market will grow at 12% per year and be worth $3.7 billion by 2014. The report used a market driver analysis tool called the Critical Moments model to gauge investment by companies across 29 sustainability initiatives, including energy efficiency, carbon management, risk management, cleantech innovation, sustainable operations, human capital investments and industrial emission reductions.

About Fraser Milner Casgrain LLP (FMC)

FMC is one of Canada's leading business and litigation law firms with more than 500 lawyers in six full-service offices located in the country's key business centres. We focus on providing outstanding service and value to our clients, and we strive to excel as a workplace of choice for our people. Regardless of where you choose to do business in Canada, our strong team of professionals possess knowledge and expertise on regional, national and cross-border matters. FMC's well-earned reputation for consistently delivering the highest quality legal services and counsel to our clients is complemented by an ongoing commitment to diversity and inclusion to broaden our insight and perspective on our clients' needs. Visit: www.fmc-law.com

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Events from this Firm
16 Oct 2018, Other, Calgary, Canada

Dentons and SheEO are coming together for a morning of #radicalgenerosity on October 16, 2018. Meet Vicki Saunders, Founder of SheEO, and learn about how SheEO is changing the landscape for female entrepreneurs.

17 Oct 2018, Webinar, Toronto, Canada

With the continued focus on Bill 148’s significant changes to the Employment Standards Act, Dentons’ Toronto Employment and Labour group is pleased to launch a new webinar series focusing on Bill 148.

17 Oct 2018, Webinar, Toronto, Canada

Dentons and SheEO are coming together for an evening of #radicalgenerosity on October 17, 2018. Meet Vicki Saunders, Founder of SheEO, and learn about how SheEO is changing the landscape for female entrepreneurs.

Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions