Jasper Research Seminar 2018 – Papers & Presentations
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Thursday, June 14, 2018
CONTINENTAL ENERGY TRADE: WHAT TO EXPECT FROM NAFTA 2.0
Presenters & Authors: Paul Lalonde (Dentons Canada LLP), James Moore (Dentons Canada LLP, Former Minister of Industry, Government of Canada)
Additional Authors: Jorge Jimenez (Dentons Mexico LLP)
This paper reviews the state of the North American Energy Market since the implementation of the NAFTA in 1994. It reviews the main elements of the legal framework within which the oil & gas, electricity and renewables markets operate on the Continent and assesses whether and how the provisions of Chapter 6 of NAFTA continue to serve the interests of the three signatory States. The paper inventories the known priorities of Canada, Mexico and the US in relation to NAFTA’s energy provisions and assesses the likely outcomes of the negotiations.
Finally, the paper reviews the likely implications of a termination of the NAFTA on the energy sector and provides insights into what industry actors should do to prepare for the various realistic outcomes of the negotiations.
WASTE NOT, WANT NOT: ‘WASTE’ AS A TOOL OF RESOURCE CONSERVATION IN THE ATLANTIC CANADIAN OFFSHORE
Presenters & Authors: Greg Moores (Stewart McKelvey), Mark Andrews (ExxonMobil Canada), Amanda Whitehead (Stewart McKelvey)
As the Atlantic Canadian oil and gas industry continues to mature, offshore regulators face new and varied issues as they work to implement the objectives of the Atlantic Accord. Laws that were largely developed before the Atlantic Canadian offshore contained producing projects are now being applied to a diverse and evolving industry. As is often the case, laws, as expressed on paper, can prove difficult to apply to each unique set of circumstances that arises in practice.
Fundamentally, many of the powers of the Atlantic Canadian offshore regulators rely on the concept of ‘waste’. An offshore regulator can order a company to commence, continue or increase production of petroleum where it is of the opinion that such an order “would stop waste”. Conversely, the regulators may order a decrease, cessation or suspension of the production of petroleum, for the same reason. In certain situations of ‘waste’, the Accord Acts provide for a forced marriage via compulsory unitization.
While ‘waste’ is instrumental to the authority of the regulator, its definition, by necessity, is open to some interpretation. This paper explores various interpretations of ‘waste’, and examines the role of waste in the Atlantic Canadian offshore regimes. Against this backdrop, the authors draw on comparisons from other jurisdictions, with a view to understanding waste’s place in the regulation of oil and gas exploration and production on Canada’s east coast.
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KEEP CALM AND…UNDERSTAND CANNABIS: WHAT EMPLOYERS IN THE ENERGY SECTOR WANT TO KNOW ABOUT LEGALIZED CANNABIS AND THE WORKPLACE
Presenters & Authors: Shana Wolch (McCarthy Tétrault LLP), Ben Ratelband (McCarthy Tétrault LLP), Dan Demers (CannAmm Occupational Testing Services)
Additional Authors: Justine Lindner (McCarthy Tétrault LLP)
With the federal government’s anticipated legalization of recreational cannabis use in Canada, employers are forced to evaluate the impact that cannabis will have on their workplaces. These considerations are of particular concern to organizations in the energy sector, many having operations that are safety sensitive and require uncompromised workplace health and safety programs.
Canadian law requires a weighing of an individual’s right to privacy against an employer’s obligation to take specific measures to ensure its workplace is healthy and safe. Given the heightened importance of safety in the high risk working environments of the energy sector, these employers are often on the front line for worker drug testing and the enforcement of bans of possession and use of drugs on work sites.
A review of the current Canadian framework for workplace drug testing demonstrates that the law has not yet fully evolved with the advances in scientific understanding of the effects of cannabis or the advances in the technology for testing methodologies.
By exploring the practical impact of recent Canadian court decisions on workplace policies and applying existing legal principles to scientific and technological advances, conclusions can be drawn regarding the types of changes that may be expected in Canadian law and workforces moving forward, along with the likelihood of drug testing programs being upheld. The requirements and guidance set out by industry governing bodies also provide useful direction for employers who are seeking to implement and uphold effective workplace drug testing policies.
This paper provides both awareness and best practices when it comes to the enforceability of drug testing programs and related workplace policies in the wake of the new legal, green landscape.
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Friday, June 15, 2018
MAY YOU LITIGATE IN INTERESTING TIMES: SPECIFIC PERFORMANCE, MITIGATION, AND VALUATION ISSUES IN A RISING (OR FALLING) MARKET
Presenters & Authors: Scott Gordon (Imperial Oil Limited), Gunnar Benediktsson (Norton Rose Fulbright LLP), Howard Gorman Q.C (Norton Rose Fulbright LLP)
Price volatility in commodities markets creates significant challenges for industry participants – and creates a unique set of challenges for litigants.
This paper focuses on valuation and judicial remedies issues arising in litigation involving a fluctuating commodities market. The paper canvasses specific issues such as appropriate remedies (specific performance or damages), multi-party preferential rights, proper dates of valuation or assessment (date of breach; date of trial; or another date), and how to address mitigation, if at all, in the context of a volatile market.
In addition to examining jurisprudence and academic authority considering judicial remedies questions, the paper provides practical insights and strategic guidance regarding how to properly structure (or defend against) a claim in a rising or falling market, and what expert and fact evidence is necessary to support (or refute) a claim.
The paper is particularly relevant to the oil and gas market, given the significant fluctuation in underlying benchmark oil prices in recent years; it has further implications for any situation involving a floating commodity price (oil; gas; power; resources; housing).
This paper provides a comprehensive analysis of valuation issues in a rising (or falling) market context.
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PRUDENCE, STRANDED ASSETS AND THE REGULATION OF UTILITIES: A REVIEW OF UTILITY REGULATORY PRINCIPLES IN A POST STORES BLOCK ERA
Presenters & Authors: David Wood (Torys LLP), Evan Dickinson (Torys LLP), Gino Bruni (Torys LLP)
Additional Authors: Lou Cusano (Torys LLP)
Utility regulatory principles in Alberta have been significantly affected by the Supreme Court of Canada’s 2006 Stores Block decision in which the court confirmed the fundamental proposition that customers of a regulated utility have no property interest in the assets used to provide them with utility service. In the extensive lineage of post-Stores Block regulatory decisions and jurisprudence, the Alberta Utilities Commission, the courts and the utility industry have grappled with the implications of the principles set out in Stores Block, notably in relation to utility rate base, asset dispositions, the role of prudence, and the allocation of stranded asset risk.
In its 2015 ATCO Pensions and Ontario Power Generation decisions, the Supreme Court of Canada once again waded into the fray, confirming that, unless statutorily mandated, utility regulators are not obliged to apply any particular test when assessing the reasonableness of utility expenditures.
This paper reviews the evolution of jurisprudence and regulatory decisions from the Stores Block decision to the present day, with a particular focus on the treatment of utility asset dispositions and “stranded assets” (assets that are retired before the end of their assumed lives as determined by the relevant depreciation rates). The paper then considers the implications for utilities in the aftermath of Stores Block including possible unintended consequences for both utilities and ratepayers.
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SOBER SECOND THOUGHTS: LITIGATING PURCHASE AND SALE AGREEMENTS IN THE ENERGY INDUSTRY
Presenters & Authors: Michael Marion (Borden Ladner Gervais LLP), Leanne Desbarats (Borden Ladner Gervais LLP), Miles Pittman (Borden Ladner Gervais LLP), Blair McGeough (ConocoPhillips Canada)
In the current economic environment, transactional deal flow is increasing as energy industry participants refresh their asset portfolios. It seems to be the perfect time to take stock of some of the many legal issues arising when parties to purchase and sale agreements contemplate litigation. This paper explores these issues occurring both prior to and postclosing, and offers practical advice on how to avoid common pitfalls and mitigate risk. Further, this paper provides commentary on the who, what, when, where, why and how of litigating energy transaction disputes when they do arise.
Part I of this paper provides a general overview on how courts analyze purchase and sale agreements with reference to issues specific to the energy context, including discussion of principles of contractual interpretation and the use of the factual matrix. Part II of this paper canvasses disputes and events occurring before closing, including when one party refuses to close, what happens when a representation or warranty is untrue or a covenant cannot be satisfied, and how to respond when a third party (such as a holder of a right of first refusal or regulatory body such as the Alberta Energy Regulator) threatens to compromise closing. Part III of the paper provides an overview of frequently litigated issues that arise post-closing, including disputes relating to the definition of the “assets” conveyed, purchase price adjustment clauses, breaches of representations and warranties and the mechanics of indemnities. Part IV of the paper addresses other issues that may impact how, when and where parties bring claims, including limitation of liability clauses, choice of forum provisions, survival periods and limitation periods.
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Saturday, June 16, 2018
RECENT JUDICIAL DECISIONS OF INTEREST TO ENERGY LAWYERS
Presenters & Authors: Colin Feasby (Osler, Hoskin & Harcourt LLP), Olivia Dixon (Osler, Hoskin & Harcourt LLP), Jung Lee (Encana)
The paper discusses a number of recent judicial decisions of interest to energy lawyers that are expected to have considerable impact on both legal and commercial spheres. The paper includes review, commentary and discussion on the past year’s case law in several practice areas and topics, including: Aboriginal law; contractual interpretation; professional negligence; corporate governance and shareholder rights; employment and labour; occupational health and safety; environmental and regulatory law; utility regulation, constitutional law, bankruptcy and insolvency; and, selected developments in civil procedure.
The paper addresses recent Supreme Court of Canada decisions regarding: (i) the duty to consult; (ii) auditors’ liability for negligent misrepresentation or performance of services; (iii) the oppression remedy; (iv) employee breaches of drug and alcohol policies; and, (v) the appeal of arbitral awards. The paper also discusses a number of cases to watch in 2018.
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THE TRANS MOUNTAIN PIPELINE AND THE CONSTITUTION
Presenter: Eric Adams (University of Alberta)
The approval and construction of the Trans Mountain Pipeline has developed into one of the most controversial and fractious constitutional issues of the past year. At the foundation of an intense political dispute of national scope are the subtle and complex realities of a Canadian constitutional law defined by overlapping jurisdictions, Indigenous rights, and the federalism doctrines and principles that mediate conflicts between them. This presentation reviews and analyzes the constitutional ground rules that govern interprovincial pipeline projects, jurisdiction over the environment, the duty to consult with Indigenous Nations, and relevant constitutional case law to illustrate the clear principles, useful precedents, and margins of uncertainty that control the destiny of this energy project and constitutional dispute.
RECENT REGULATORY AND LEGISLATIVE DEVELOPMENTS OF INTEREST TO ENERGY LAWYERS
Presenters & Authors: Carolyn Milne (Shell Canada), Deirdre Sheehan (Bennett Jones LLP), Blake Williams (Bennett Jones LLP), Vivek Warrier (Bennett Jones LLP)
This paper provides an overview of recent regulatory and legislative developments of interest to energy lawyers. This includes the legal, political, and economic background to, and consequences of, new legislation and regulatory regimes. This also includes discussions of recent and ongoing judicial and regulatory decisions involving energy law. Topics discussed include market access, environmental and climate change regulation, Aboriginal consultation, and other natural resource and power developments.
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