A common carrier is a pipeline that must accept all products offered to it for transportation provided that it has excess capacity.1 British Columbia, Alberta, Saskatchewan and Manitoba all have provincial legislation governing when a common carrier application can be made by a producer wanting to transport its product on an intra-provincial pipeline. In practice, only Alberta and British Columbia have actually granted a common carrier order and have a well-defined process to review an application for a common carrier order.
Alberta's common carrier legislation and supporting Alberta Energy Regulatory (AER) directive is the most comprehensive of the four provinces and provides the most certainty for those applying. The AER has a defined process and will review a common carrier application in 120 days.2 In British Columbia, the British Columbia Utilities Commission also has a defined process but the processing time for a common carrier application varies from one month to a year or longer. In both Saskatchewan and Manitoba, the process is unknown and, to date, neither has yet to consider an application. Manitoba's regime is particularly challenging. The Oil and Gas Act in Manitoba allows a person to, in accordance with the regulations; make an application to the minister for an order declaring a licensee to be a common carrier.3 However, there are no applicable regulations in existence at this time. When Manitoba's Mineral Resources department was contacted in late November 2016, the Director of Petroleum indicated that regulations and a procedure to deal with common carrier applications were in draft.
In Alberta, 10 common carrier orders have been issued since 1963. The AER does not receive many of these applications; in 2016 — only two applications were submitted. In British Columbia, only 5 common carrier orders have been made by the British Columbia Utilities Commission.
Even though there have not been a plethora of common carrier orders issued by provincial regulators to date, it is important to not lose sight of the fact that the threat of a public order being made is often times enough to persuade pipeline owners to cooperate.
Footnotes
1 National Energy Board, Regulation of pipeline traffic, tolls and tariffs, Government of Canada (2016-4-13) online: https://www.neb-one.gc.ca/bts/whwr/rspnsblt/trffctlltrff-eng.html .
2 Directive 065: Resources Applications for Oil and Gas Reservoirs, online: http://www.aer.ca/rules-and-regulations/directives/directive-065 .
3 The Oil and Gas Act, SM 1993, c 4, s 153.
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