# Archived - Notice of Ways and Means Motion to introduce an Act to implement the accord between the Government of Canada and the Government of Quebec for the joint management of petroleum resources in the Gulf of St. Lawrence and to make consequential amendments to other Acts

Archived information

Archived information is provided for reference, research or recordkeeping purposes. It is not subject to the Government of Canada Web Standards and has not been altered or updated since it was archived. Please contact us to request a format other than those available.

## Minister of Natural Resources and Minister for the Federal Economic Development Initiative for Northern Ontario

90760WM—2015-6-5
That it is expedient to introduce an Act to implement the accord between the Government of Canada and the Government of Quebec for the joint management of petroleum resources in the Gulf of St. Lawrence and to make consequential amendments to other Acts, the provisions of which are as follows:

## Short Title

Short title
1.  This Act may be cited as the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act.

## Interpretation and Purpose

Definitions
2.  The following definitions apply in this Act.
"Board"
« Office »
"Board" means the National Energy Board established by section 3 of the National Energy Board Act.
"Boards"
Version anglaise seulement
"Boards" means the National Energy Board and the Quebec Energy Board.
"Committee"
« Comité »
"Committee" means the Oil and Gas Committee established under section 26.
"Federal Minister"
« ministre fédéral »
"Federal Minister" means the Minister of Natural Resources.
"field"
« champ »
"field" means a general submarine surface area that is or appears to be underlain by one or more pools and includes the subsurface regions vertically beneath such an area.
"gas"
« gaz »
"gas" means natural gas and includes all substances, other than oil, that are produced in association with natural gas.
"interest"
« titre »
"interest" means any exploration licence, significant discovery licence or production licence.
"joint management area" or "petroleum resources joint management area"
« zone » ou « zone de gestion conjointe des hydrocarbures »
"joint management area" or "petroleum resources joint management area" means the submarine areas within the limits described in Schedule 1.
"Ministers"
« ministres »
"Ministers" means the Federal Minister and the Provincial Minister.
"oil"
« pétrole »
"oil" means
(a)  crude oil, regardless of gravity, produced at a well head in liquid form; and
(b)  any other hydrocarbons, except coal and gas, and, without limiting the generality of the foregoing, hydrocarbons that may be extracted or recovered from deposits of oil sand, bitumen, bituminous sand, oil shale or from any other types of deposits on the seabed or its subsoil of the joint management area.
"petroleum"
« hydrocarbures »
"petroleum" means oil or gas.
"pool"
« gisement »
"pool" means a natural underground reservoir containing or appearing to contain an accumulation of petroleum that is or appears to be separated from any other such accumulation.
"prescribed"
Version anglaise seulement
"prescribed" means prescribed by regulations made by the Governor in Council.
"Provincial Minister"
« ministre provincial »
"Provincial Minister" means the minister of the Government of Quebec who is responsible for the management of natural resources.
"Quebec Energy Board"
« Régie »
"Quebec Energy Board" means the Régie de l'énergie established by section 4 of An Act respecting the Régie de l'énergie, CQLR, c. R-6.01.
"spill-treating agent"
« agent de traitement »
"spill-treating agent" means, except in section 159, a spill-treating agent that appears both
(a)  on the list established under section 143.1; and
(b)  on a list established by order made under the Environment Quality Act, CQLR, c. Q-2.
Interpretation
3.  For greater certainty, the provisions of this Act must not be interpreted as providing a basis for any claim by or on behalf of the government of a province in respect of any right in or legislative jurisdiction over the joint management area or any living or non-living resources of the joint management area.
Inconsistency
4.  (1)  In case of any inconsistency or conflict between the provisions of this Act or any regulations made under it and the provisions of any other Act of Parliament that deals primarily with the management of petroleum resources in the joint management area, including the exploration for, development and transportation by pipeline, as defined in section 99, of those resources, or of any regulations made under such an Act, the provisions of this Act and the regulations made under it take precedence.
No inconsistency
(2)  For greater certainty, the provisions of this Act are not inconsistent or in conflict with the provisions of any other Act of Parliament that implements an agreement between the Government of Canada and the government of a province for the joint management of petroleum resources.
Purpose
5.  The purpose of this Act is to regulate the development of petroleum in the joint management area by promoting, among other things, transparency, the sustainable management of resources and best practices to ensure personal safety and environmental protection while maximizing social and economic benefits.

## Prescribing the Limits of the Joint Management Area

Regulations
6.  (1)  Subject to subsection 7(1), the Governor in Council may make regulations amending the description of the limits of the joint management area set out in Schedule 1.
Issue of charts
(2)  The Ministers may approve or issue charts setting out the limits or a portion of the limits of the joint management area.
Evidence
(3)  In any legal or other proceedings, a chart purporting to be approved or issued by or under the authority of the Ministers is conclusive proof of the limits or a portion of the limits of the joint management area set out in the chart without proof of the signature or official character of the person purporting to have approved or issued the chart.

## Prior Approval for Regulations

Approval of Provincial Minister — regulations
7.  (1)  Subject to subsections 16(2) and 234(3), the Federal Minister must consult the Provincial Minister with respect to any regulation proposed to be made under this Act. No regulation is to be made without the Provincial Minister's approval.
Approval — regulations
(2)  The Federal Minister must, before a regulation is made under subsection 142(2) or 145(8), also consult the minister of the Government of Quebec who is responsible for occupational health and safety with respect to the proposed regulation and no regulation is to be so made without the approval of that minister.

## Cost Recovery

Regulations respecting fees, etc.
8.  (1)  Subject to subsection 7(1), the Governor in Council may make regulations
(a)  respecting the fees or charges, or the method of calculating the fees or charges, to be paid for the provision by the Board or the Federal Minister of a service or a product under this Act;
(b)  respecting the fees or charges, or the method of calculating the fees or charges, in respect of any of the Board's or the Federal Minister's activities under this Act or under the Canadian Environmental Assessment Act, 2012, to be paid by
(i)  a person who makes an application for an authorization under paragraph 106(1)(b) or an application under subsection 113(2), or
(ii)  the holder of an operating licence issued under paragraph 106(1)(a) or an authorization issued under paragraph 106(1)(b); and
(c)  respecting the refund of all or part of any fee or charge referred to in paragraph (a) or (b) or the method of calculating that refund.
Amounts not to exceed cost
(2)  The amounts of the fees or charges referred to in paragraph (1)(a) must not exceed the cost of providing the services or products.
Amounts not to exceed cost
(3)  The amounts of the fees or charges referred to in paragraph (1)(b) must not exceed the cost of performing the activities under this Act or under the Canadian Environmental Assessment Act, 2012.
Non-application of User Fees Act
9.  The User Fees Act does not apply in respect of any fees or charges payable in accordance with regulations made under section 8.
Remittance of fees and charges
10.  The amounts obtained in accordance with regulations made under section 8 must be paid to the credit of the Receiver General in the prescribed time and manner.

## Application

Application
11.  (1)  This Act applies within the joint management area. It also applies beyond the joint management area with respect to the transportation of petroleum by pipeline to the extent provided for in the definition of "pipeline" in section 99.
Area beyond joint management area
(2)  For greater certainty, unless the context requires otherwise, any reference to the joint management area in a provision is to be read as a reference to any area beyond the joint management area to which this Act applies.
Excluded legislation
(3)  Subject to section 117, the provisions of the Canada Petroleum Resources Act and the provisions of the Canada Oil and Gas Operations Act other than sections 5.4 and 5.5, do not apply within the joint management area.
Her Majesty
12.  This Act is binding on Her Majesty in right of Canada or a province.

## Amendment of Accord

Amendment of accord
13.  The Government of Canada may jointly with the Government of Quebec amend the accord between the Government of Canada and the Government of Quebec for the joint management of petroleum resources in the Gulf of St. Lawrence, signed on March 24, 2011.

## Dispute Resolution

Definition of "agreement"
14.  (1)  In this section "agreement" means an agreement between the Government of Canada and the government of a province respecting resource management and revenue sharing resulting from activities in relation to the exploration for or the production of offshore petroleum.
Disputes between neighbouring provinces
(2)  If a dispute between Quebec and any other province that is a party to an agreement arises in relation to the limits of the joint management area, the parties to the dispute are to proceed as follows:
(a)  they may try to negotiate a settlement;
(b)  if negotiations are unsuccessful, they may agree to settle the dispute by means of mediation; and
(c)  if negotiation or mediation is unsuccessful, they may agree to submit the dispute to arbitration according to the conditions to which they jointly agree, and the decision of the arbitrator is final and binding on all parties specified in the decision as of the date specified in it.
Binding arbitration
(3)  If the provinces are unable within a reasonable time to settle the dispute in accordance with subsection (2), the dispute is to be submitted to a binding arbitration process in accordance with section 15 on the request of one of the provinces by serving notice on the other provinces that are parties to the dispute and on the Federal Minister.
Arbitration panel
15.  (1)  If the dispute is submitted to a binding arbitration process, an arbitration panel must be established. Members of the panel, including the Chairperson, must be neutral and independent of the parties to the dispute.
Members to be appointed by provinces
(2)  Within 60 days after the day on which notice is served under subsection 14(3), each province that is a party to the dispute must appoint one member to the panel.
Service
(3)  Notice is served if it is sent by registered mail to the recipient and is considered to have been served on the day on which it was mailed.
Chairperson of panel
(4)  Subject to subsection (5), the Governor in Council must appoint a Chairperson to the panel from a list of candidates agreed on by the provinces that are parties to the dispute. If the provinces do not provide a list of candidates within 60 days after the day on which notice is served, the Governor in Council must appoint the Chairperson after consultation with the provinces that are parties to the dispute.
Qualifications of Chairperson
(5)  The Chairperson is a member of the panel and must be proficient in matters relating to maritime boundary delimitation. The Chairperson must not be a resident of a province that is a party to the dispute.
Appointment by Chairperson
(6)  If a province that is a party to the dispute fails to appoint a member in accordance with subsection (2), the Chairperson must make the appointment.
Conduct of affairs
(7)  The panel must control the discharge of its responsibilities and the conduct of its affairs, including its arbitration procedures.
Decisions
(8)  The panel's decisions must be made on the basis of a majority vote of its members. The Chairperson's vote is the deciding vote in the case of a tie.
Principles of international law
(9)  The panel must apply the principles of international law governing maritime boundary delimitation, with any modifications that the circumstances require.
Decision is final and binding
(10)  A decision made by the panel is final and binding on all parties specified in the decision as of the date specified in it.
Amendment by regulation
16.  (1)  If a dispute is settled by means of negotiation, mediation or arbitration under section 14 or 15, the Governor in Council must, by regulation, amend the description of the limits of the joint management area set out in Schedule 1 in accordance with the settlement.
Exemption
(2)  The regulation referred to in subsection (1) is not subject to the procedure set out in subsection 7(1).
For greater certainty
(3)  For greater certainty, any settlement pertains only to the limits of the joint management area and is without prejudice to the constitutional positions of the parties and the Government of Canada.

## Decision-Making Procedures and Administrative Coordination

Decisions — Ministers
17.  (1)  The decisions that are to be made under this Act by the Ministers must be made jointly.
Documents to be issued jointly
(2)  Any document, including an interest or order, that is issued as a result of a decision made jointly by the Ministers is to be issued as a joint document.
Memoranda of understanding — Ministers
(3)  The Ministers may conclude with each other or with the appropriate departments and agencies of the Government of Canada and of the Government of Quebec agreements or memoranda of understanding about any matter that they consider appropriate, including joint decision-making.
Delegation
(4)  The Ministers may together or individually delegate any of their powers, duties or functions under this Act to any person, and those powers, duties and functions are to be exercised or performed in accordance with the terms of the delegation.
(5)  The Ministers may establish one or more advisory councils, and fix their terms of reference, for the purpose of advising the Ministers about any matter relating to the application of this Act.
Boards
18.  (1)  The Boards must jointly exercise the powers and perform the duties and functions that are attributed to them under this Act.
Coordination
(2)  The Boards must take the necessary measures to coordinate the exercise of their powers and the performance of their duties and functions as well as any activities that flow from the application of this Act by encouraging consultation and collaboration with each other to avoid duplication of work and activities and to establish shared services.
Memorandum of understanding — operational rules
(3)  For the purposes of subsection (2), the Boards must conclude with each other an agreement or memorandum of understanding establishing their operational rules, including rules in respect of the procedural framework and the manner of collaboration. The agreement or memorandum of understanding must be made public.
Memorandum of understanding — other matters
(4)  The Boards may, to ensure effective coordination and avoid duplication of work and activities, conclude with each other or with the appropriate departments and agencies of the Government of Canada and of the Government of Quebec — together or individually — agreements or memoranda of understanding about
(a)  environmental assessment and regulation;
(b)  emergency measures;
(c)  marine regulation including the safety and security of navigation;
(d)  aviation regulation;
(e)  employment and industrial benefits and the review and evaluation procedures to be followed in relation to those benefits;
(f)  occupational health and safety;
(g)  public hearings; and
(h)  any other matters that they consider appropriate.
Ministers
(5)  Any agreement or memorandum of understanding concluded between the Boards, or any amendment to it, must be approved by the Ministers. The Ministers must be parties to any agreement or memorandum of understanding concluded in relation to a matter referred to in paragraph (4)(e).
Delegation
(6)  Subject to subsections 54(13), 61(4), 106(8) and 113(7), the Boards may delegate any of their powers, duties and functions under this Act to each other or to any of their members, officers or employees, and those powers, duties and functions must be exercised or performed in accordance with the terms of the delegation. The delegation may be of general or specific application.
Decisions — Boards
19.  (1)  If the Boards are authorized to make a decision under this Act, the decision must be made jointly and in accordance with the decision-making process set out in this section.
Individual decisions
(2)  For the purpose of making a joint decision and subject to section 107, the Boards must, within 12 months after the day on which an applicant has, in the Boards' opinion, provided a complete application, render individual decisions and communicate them to each other. The individual decisions are of no force or effect and must remain confidential.
Joint decision
(3)  Once both of the individual decisions have been communicated, the Boards must, while respecting those decisions, make a joint decision.
Terms
(4)  The Boards must ensure that their joint decision includes any terms that are, in their opinion, necessary to ensure respect for their individual decisions.
(5)  Despite subsections (2) and (3), any decision made under a delegated power between the Boards is deemed to be a joint decision of the Boards.
Decision final
(6)  Any joint decision is to be issued by the Boards as a joint document to the person concerned within three months after the day on which the time period in subsection (2) expires. The decision is final.
Judicial review
(7)  A joint decision is deemed, for the purposes of judicial review, to be a decision of the Quebec Energy Board.
Federal board, commission or other tribunal
(8)  Neither the Board nor the Quebec Energy Board is a federal board, commission or other tribunal as defined in subsection 2(1) of the Federal Courts Act when they make a joint decision under this section.
Amendment or rescission of decision
20.  (1)  The Boards may, on their own initiative or on application, amend or rescind any joint decision of the Boards.
Representations
(2)  Before amending or rescinding a joint decision, the Boards must allow the person concerned to make representations.
Amendment under delegated power
(3)  The person responsible for making a decision under a delegated power between the Boards may, if new facts warrant it, amend that decision.
Excluded decisions
(4)  This section does not apply to decisions made under sections 54, 61, 106 and 113.
Joint document
21.  (1)  Any notice, licence, authorization, order, declaration or other document that is given, issued or made following a joint decision by the Boards, must be given, issued or made as a joint document.
(2)  Any notice, licence, authorization, order, declaration or other document that must be sent to the Boards under this Act must be sent to the Quebec Energy Board's head office or any other place specified by the Boards in a public notice.

## Public Hearings

Public hearings
22.  The Boards may conduct a public hearing in relation to the exercise of any of their powers or the performance of any of their duties and functions under this Act.
Confidentiality
23.  At any public hearing conducted under section 22 or in any proceedings with respect to Division 1 of Part 2, the Boards may take any measures and make any order that they consider necessary to ensure the confidentiality of any information that is likely to be disclosed at the hearing or in the proceedings if they are satisfied that
(a)  the disclosure of the information could reasonably be expected to result in a material loss or gain to a person who is directly affected by the hearing or proceedings, or to prejudice the person's competitive position, and the potential harm resulting from the disclosure outweighs the public interest in making the disclosure; or
(b)  the information is financial, commercial, scientific or technical information that is confidential information supplied to the Boards and
(i)  the information has been consistently treated as confidential information by a person directly affected by the hearing or proceedings, and
(ii)  the person's interest in confidentiality outweighs the public interest in its disclosure.
Confidentiality — security
24.  At any public hearing conducted under section 22 or in respect of an order, or in any proceedings with respect to Division 1 of Part 2, the Boards may take any measures and make any order that they consider necessary to ensure the confidentiality of information that is likely to be disclosed at the hearing or in the proceedings or is contained in the order if they are satisfied that
(a)  there is a real and substantial risk that disclosure of the information will impair the security of pipelines, as defined in section 99, installations, vessels, aircraft or systems, including computer or communication systems, or methods employed to protect them; and
(b)  the need to prevent disclosure of the information outweighs the public interest in its disclosure.
Exception
25.  The Boards must not take any measures or make any order under section 23 or 24 in respect of information or documentation referred to in paragraphs 93(5)(a) to (e) and (i).

## Oil and Gas Committee

### Constitution and Function

Oil and Gas Committee
26.  (1)  The Ministers may establish a committee to be known as the Oil and Gas Committee.
(2)  The Committee must submit to the Ministers its report or recommendation on any question, matter or thing arising under Part 2 or relating to the conservation, production, storage, processing or transportation of petroleum that the Ministers refer to the Committee.
Hearings
(3)  On the request of the Ministers, the Committee must hold hearings in respect of any request that may be made by a person directly affected by a proposed drilling order, development order or order for the cancellation of interests, and submit to the Ministers its recommendations concerning the proposed order. The Committee must also hold hearings and exercise its powers under Part 2 with respect to pooling agreements, unit agreements and unit operating agreements.
Constitution
27.  (1)  The Committee must consist of not more than five members, not more than three of whom may be employees in the federal public administration or the public service of Quebec.
Appointment of members and Chairperson
(2)  The members of the Committee must be appointed by the Ministers to hold office for a term of three years, and one member is to be designated as Chairperson for the term that is fixed by the Ministers.
Re-appointment permitted
(3)  A retiring member may be re-appointed to the Committee in the same or another capacity.
Qualification of members
28.  (1)  The Ministers must appoint as members of the Committee at least two persons who have specialized or expert knowledge of petroleum.
Employees
(2)  Persons employed or who hold office in any division, branch or bureau of the departments that are presided over by either of the Ministers and that is designated as the division, branch or bureau charged with the day-to-day administration and management of oil and gas resources for the department, are not eligible to be members of the Committee, but the Ministers may designate an employee or officer from any such division, branch or bureau to act as secretary to the Committee.
Interest in petroleum properties
(3)  A member of the Committee must not have a pecuniary interest of any description, directly or indirectly, in any property in petroleum to which this Act applies or own shares in any company engaged in any phase of the petroleum industry in Canada in an amount in excess of 5% of the company's issued shares and a member who owns any shares of such a company must not vote or participate in any work of the Committee when a question affecting that company is before the Committee.
Staff
(4)  The Ministers must provide the Committee with any officers, clerks and employees that may be necessary for the proper conduct of its affairs, and may provide the Committee with any professional or technical assistance for temporary periods or for specific work that it may request, but no such assistance is to be provided otherwise than from the staff of the federal public administration or the public service of Quebec except with the approval of the Ministers.
Remuneration
(5)  The members of the Committee who are not employees of the federal public administration or the public service of Quebec are to be paid any remuneration that is authorized by the Ministers.
Expenses
(6)  All members of the Committee are entitled to be paid reasonable travel and living expenses while absent from their ordinary place of residence in the course of their duties.
Quorum
29.  (1)  A majority of the members of the Committee, including one member who is not an employee of the federal public administration or the public service of Quebec, constitutes a quorum.
Powers of Committee
(2)  The Committee may make general rules regulating its practice and procedure and the places and times of its sittings.

### Inquiries and Hearings

Powers of Committee
30.  (1)  The Committee may conduct any inquiry or hold any hearing necessary or proper for the due exercise of its powers under this Act and for that purpose it has all of the powers, rights and privileges that are vested in a superior court of record, other than the power to make a finding of, and impose a punishment for, contempt of court. The Committee may, however, apply to a judge of the Superior Court of Quebec to make a finding of, and impose a punishment for, contempt of court.
Jurisdiction
(2)  If the Committee is charged with a duty to conduct an inquiry or hold a hearing, it has full jurisdiction to inquire into, hear and decide the matter that is the subject of that inquiry or hearing and to make any order, or give any direction that under this Act it is authorized to make or give or with respect to any matter, act or thing that by this Act may be prohibited or approved by it or required by it to be done.
Question of fact
(3)  The finding or determination of the Committee on any question of fact within its jurisdiction is final and binding.
Contempt of court
(4)  For the purposes of subsection (1), every person who refuses or fails to comply with an order made under subsection (2), or who refuses to answer questions that the Committee has the legal authority to ask or to produce documents or other things that the Committee has the legal authority to request, or who undermines the conduct of any hearing is guilty of contempt of court.
Member may conduct inquiry or hold hearing
(5)  The Committee may direct any of its members to conduct an inquiry into or hold a hearing in respect of any matter before it and to report the evidence and their findings to it. The report may be adopted as a finding of the Committee or otherwise dealt with as the Committee considers advisable.
Powers of deputed member
(6)  If an inquiry is conducted by a member under subsection (5), the member has all the powers, rights and privileges of the Committee under subsection (1).

### Enforcement

Enforcement of Committee orders
31.  (1)  The Committee or any interested person may file a true copy of any order made by the Committee in the Superior Court of Quebec, in accordance with the practice and procedure established by or under an Act of the Legislature of Quebec, in order to make it a judgment of that Court for the purpose of its enforcement.
Procedure for enforcement
(2)  An order that is filed in accordance with subsection (1) has the same force and effect as a judgment that was made by the Superior Court of Quebec.
When order rescinded or replaced
(3)  Any order of the Committee, or of the Ministers under section 185, rescinding or replacing an order of the Committee that is filed in the Superior Court of Quebec under subsection (2), has the effect of cancelling the order so filed and may in like manner be made a judgment of that Court.

## Regulations

Regulations
32.  Subject to subsection 7(1), the Governor in Council may make regulations
(a)  that may be considered necessary for carrying out the purposes of the provisions of this Act that precede Part 1; and
(b)  prescribing anything that, for the purposes of the provisions of this Act that precede Part 1 or the purposes of Schedule 1, is to be prescribed.

## Part 1Petroleum Resources

### Interpretation

Definitions
33.  The following definitions apply in this Part.
"call for bids"
« appel d'offres »
"call for bids" means a call for bids made in accordance with section 41.
"commercial discovery"
« découverte exploitable »
"commercial discovery" means a discovery of petroleum that has been demonstrated to contain petroleum reserves that justify the investment of capital and effort to bring the discovery to production.
"commercial discovery area"
« périmètre de découverte exploitable »
"commercial discovery area" means, in relation to a declaration of commercial discovery made under subsection 61(1) or (2), those portions of the joint management area described in the declaration.
"Crown reserve area"
« réserves de l'État »
"Crown reserve area" means portions of the joint management area in respect of which no interest is in force.
"holder"
Version anglaise seulement
"holder" means, in respect of an interest or a share in an interest, the person indicated in the register maintained under Division 7 as the holder of the interest or the share.
"owner"
Version anglaise seulement
"owner" means, in respect of an interest, the holder who holds the interest or the group of holders who hold all the shares in the interest.
"share"
« fraction »
"share" means, in respect of an interest, an undivided share in the interest or a share in the interest held in accordance with section 49.
"significant discovery"
« découverte importante »
"significant discovery" means a discovery indicated by the first well on a geological feature that demonstrates by flow testing the existence of petroleum in that feature and, having regard to geological and engineering factors, suggests the existence of an accumulation of petroleum that has potential for sustained production.
"significant discovery area"
« périmètre de découverte importante »
"significant discovery area" means, in relation to a declaration of significant discovery made under subsection 54(1) or (2), those portions of the joint management area described in the declaration.

### Division 1General

#### Manner of Giving Notices

Notice
34.  A notice that is required under this Part must be given in the prescribed manner, in the form and containing the information that is specified by the Ministers.
Documents
35.  (1)  The Ministers may establish the form of any document provided for under this Part and may include a declaration to be signed by the person completing it declaring that the information given by that person is, to the best of that person's knowledge, true, accurate and complete.
Presumption
(2)  Every document purporting to be a document established by the Ministers is deemed to be established by them under this Part unless it is called into question by either of the Ministers or a person acting for either of them or for the Government of Canada or of Quebec.
Information in application
(3)  The information to be given in an application under subsections 54(1), 56(1), 61(1) and 64(1) is prescribed.

#### Appointments

Appointment of representative
36.  (1)  If an interest owner consists of a group of holders, those holders must, in the prescribed manner, appoint one of their number to act as a representative of the interest owner, but the holders may, with the approval of the Ministers, appoint different representatives for different purposes.
Designation of representative
(2)  If the holders fail to appoint a representative, the Ministers may designate one of those holders as the representative.
Acts or omissions of representative binding
(3)  An interest owner is bound by an act or omission on the part of the representative within the scope of the representative's authority.
Duties of representative
(4)  The representative must prudently and diligently perform the duties for which he or she has been appointed or designated.
Subsections (3) and (4)
(5)  Any agreement or other arrangement in force concerning an interest owner's relevant interest is varied or amended as required to give effect to subsections (3) and (4).

#### General Rules Respecting Interests

No issuance of interests for certain areas
37.  The Ministers may, by order, for any purposes and under any conditions that are set out in the order, prohibit the issuance of interests for any portion of the joint management area that is specified in the order.
Surrender of interests
38.  (1)  An interest owner may, in the prescribed manner and subject to any requirements that may be prescribed respecting the minimum geographical area to which an interest may relate, surrender an interest for all or any portion of the joint management area subject to the interest.
Debts due to Her Majesty not affected
(2)  Any liability of an interest owner or the holder of a share in an interest to Her Majesty in right of Canada that exists at the time of any surrender under subsection (1) is not affected by the surrender.
Prohibition orders
39.  (1)  The Ministers may, by order, prohibit any interest owner specified in the order from commencing or continuing any work or activity in the joint management area or any portion of it that is subject to the interest of that owner if there exists
(a)  an environmental or social problem of a serious nature; or
(b)  dangerous or extreme weather conditions affecting the health or safety of persons or the safety of equipment.
Suspension of requirements
(2)  Any requirement in relation to an interest that cannot be complied with while an order under subsection (1) is in force is suspended until the order is revoked by the Ministers.
Extension of term of interest
(3)  Despite anything in this Act, the term of an interest that is subject to an order under subsection (1) and the period provided for compliance with any requirement in relation to the interest are extended for a period equal to the period that the order is in force.
Exception
(4)  Nothing in this section affects the authority of the Ministers to relieve a person from any requirement in relation to an interest or under this Part.

### Division 2General Rules Relating to the Issuance of Interests

#### General Authority

Authority to issue interests
40.  (1)  The Ministers may issue interests for any portion of the joint management area in accordance with this Part and the regulations made under it.
Application of interest may be restricted
(2)  The application of an interest may be restricted to any geological formations and substances that are specified in the interest.
Interests in Relation to Crown Reserve Areas
Calls for bids
41.  (1)  Subject to section 44, the Ministers must not issue an interest in relation to Crown reserve areas unless
(a)  before issuing it, the Ministers have made a call for bids in relation to those Crown reserve areas by publishing a notice in accordance with this section and section 46; and
(b)  the interest is issued to the person who submitted, in response to the call, the bid selected by the Ministers in accordance with subsection 42(1).
Requests for portions of joint management area
(2)  Any request received by the Ministers to make a call for bids for particular portions of the joint management area must be considered by the Ministers in selecting the portions of the joint management area to be specified in the call for bids.
Contents of call for bids
(3)  A call for bids must specify
(a)  the interest to be issued and the portions of the joint management area to which the interest is to apply;
(b)  if applicable, the geological formations and substances to which the interest is to apply;
(c)  the other terms subject to which the interest is to be issued;
(d)  any terms that a bid must satisfy to be considered by the Ministers;
(e)  the form and manner in which a bid is to be submitted;
(f)  the closing date and time for the submission of bids; and
(g)  the sole criterion that the Ministers will apply in assessing bids.
Time of publishing call for bids
(4)  Unless otherwise prescribed, a call for bids must be published at least 120 days before the last day on which bids may be submitted as specified in the call for bids.
Selection of bid
42.  (1)  A bid submitted in response to a call for bids must not be selected unless
(a)  the bid satisfies the terms and is submitted in the form and manner specified in the call for bids; and
(b)  the selection is made on the basis of the criterion specified in the call for bids.
Publication of bid selected
(2)  The Ministers must publish a notice in accordance with section 46 setting out the terms of the bid selected.
Interest to be consistent with bid
(3)  If an interest is to be issued as a result of a call for bids, the terms of the interest must be substantially consistent with any terms specified in the call for bids in respect of that interest.
Publication of interest issued
(4)  The Ministers must publish a notice in accordance with section 46 setting out the terms of any interest issued as a result of a call for bids as soon as feasible after issuing it.
Issuance of interest not required
43.  (1)  The Ministers are not required to issue an interest as a result of a call for bids.
New call required
(2)  Subject to section 44, if the Ministers have not issued an interest for a particular portion of the joint management area specified in a call for bids within six months after the last day on which bids may be submitted, they must, before issuing an interest for that portion of the joint management area, make a new call for bids.
Exception to call for bids
44.  (1)  The Ministers may issue an interest, for any Crown reserve area, without making a call for bids if
(a)  the portion of the joint management area to which the interest is to apply has, through error or inadvertence, become a Crown reserve area and the interest owner who last held an interest for that portion has, within one year after the time it so became a Crown reserve area, requested the Ministers to issue an interest; or
(b)  they are issuing the interest to an interest owner in exchange for the surrender by the interest owner, at the Ministers' request, of any other interest or a share in any other interest, for all or any portion of the joint management area subject to that other interest.
Notice
(2)  If the Ministers propose to issue an interest under subsection (1), they must, not later than 90 days before the day on which they issue the interest, publish a notice in accordance with section 46 setting out the terms of the proposed interest.
Interest not vitiated
45.  If an interest has been issued, it is not vitiated by reason only of a failure to comply with any of the requirements set out in sections 41 to 44 respecting the form and content of, and time and manner of publishing, any notice required by those sections in relation to that interest.
Manner of publication of notices
46.  Any notice that is required to be published by the Ministers under subsection 41(1), 42(2) or (4), 44(2) or 51(2) must be published in the Canada Gazette and in any other publication they consider appropriate and, despite those subsections, may contain only a summary of the information required to be published and a statement that the full text is available for inspection by any person on request made to them.
Regulations
47.  The Governor in Council may, for the purpose of section 41 and subject to subsection 7(1), make regulations of general application in relation to all or any portion of the joint management area, or in respect of any particular call for bids, prescribing the terms and sole criterion to be specified in a call for bids, the manner in which bids are to be submitted and requiring that those terms and that criterion and manner be specified in the call.

### Division 3Exploration

#### Exploration Licences

Rights under exploration licences
48.  An exploration licence confers, with respect to the portions of the joint management area to which the licence applies,
(a)  the right to explore, and the exclusive right to drill and test, for petroleum;
(b)  the exclusive right to develop those portions of the joint management area in order to produce petroleum; and
(c)  the exclusive right, subject to compliance with the other provisions of this Act, to obtain a production licence.
Shares
49.  A share in an exploration licence may, subject to any requirements that may be prescribed, be held with respect only to a portion of the joint management area that is subject to the licence.
Terms
50.  An exploration licence must contain the terms that are prescribed and may contain any other terms, which are not inconsistent with this Part, that are agreed on by the Ministers and the owner of the licence.
Amendment of exploration licence
51.  (1)  The Ministers may, in agreement with the owner of an exploration licence, amend any provision of the licence in any manner not inconsistent with the provisions of this Part or the regulations made under it and may also, subject to subsection (2), amend the licence to include any other portion of the joint management area.
Exception
(2)  The Ministers must not amend an exploration licence to include any portion of the joint management area that was a Crown reserve area unless the Ministers would be able to issue an interest to that interest owner for that area under subsection 44(1) and a notice has been published in accordance with section 46 not later than 90 days before the day on which they make the amendment. The notice must set out the terms of the amendment.
Consolidation of exploration licences
(3)  The Ministers may, on the application of the interest owners of two or more exploration licences, consolidate those licences into a single exploration licence, subject to any terms that may be agreed on by the Ministers and interest owners.
Effective date of exploration licence
52.  (1)  An exploration licence takes effect on the date that is specified in the licence.
Non-renewable term of nine years
(2)  Subject to section 53, the term of an exploration licence must not be greater than nine years from the day on which the licence takes effect and the term must not be renewed.
Crown reserve area on expiry of licence
(3)  On the expiry of an exploration licence, the portions of the joint management area to which the exploration licence related that are not subject to a production licence or a significant discovery licence become Crown reserve areas.
Continuation of exploration licence
53.  (1)  An exploration licence that is set to expire during the drilling of a well continues to be in force while the drilling of that well is being pursued diligently and for so long after that as may be necessary to determine the existence of a significant discovery based on the results of that well.
Deemed pursued diligently
(2)  If the drilling of that well is suspended because of dangerous or extreme weather conditions or mechanical or other technical problems, the drilling is deemed to have been pursued diligently during the period of suspension.
Drilling of second well deemed begun
(3)  If the drilling of that well cannot be completed because of mechanical or other technical problems and if, within 90 days after the day on which drilling operations for that well cease, or any longer period that the Ministers decide, the drilling of another well is begun on any portion of the joint management area that was subject to the exploration licence, the drilling of that other well is deemed to have begun before the expiry of the exploration licence.

#### Significant Discoveries

Application for declaration of significant discovery
54.  (1)  If a significant discovery has been made on any portion of the joint management area that is subject to an interest or a share in an interest held in accordance with section 49, the Boards must, on the holder's application made in the prescribed manner, make a written declaration of significant discovery for those portions of the joint management area in respect of which there are reasonable grounds to believe that the significant discovery may extend.
Declaration on initiative of Boards
(2)  If a significant discovery has been made on any portion of the joint management area, the Boards may, on their own initiative, make a written declaration of significant discovery for those portions of the joint management area in respect of which there are reasonable grounds to believe the significant discovery may extend.
Description of joint management area
(3)  A declaration made under subsection (1) or (2) must describe the portions of the joint management area to which the declaration applies.
Amendment or revocation of declaration
(4)  Subject to subsection (5), if a declaration is made under subsection (1) or (2) and, based on the results of further drilling, there are reasonable grounds to believe that a discovery is not a significant discovery or that the portions of the joint management area to which the significant discovery extends differ from the significant discovery area, the Boards may, as appropriate in the circumstances,
(a)  amend the declaration by increasing or decreasing the significant discovery area; or
(b)  revoke the declaration.
Amendment or revocation of declaration
(5)  A declaration of significant discovery must not be amended to decrease the significant discovery area or be revoked earlier than
(a)  in the case of a significant discovery area that is subject to a significant discovery licence issued under subsection 56(1), the day on which the exploration licence referred to in that subsection expires; and
(b)  in the case of a significant discovery area that is subject to a significant discovery licence issued under subsection 56(2), three years after the day on which the significant discovery licence takes effect.
Notice
(6)  A copy of a declaration of significant discovery and of any amendment or revocation of the declaration made under this section for any portion of the joint management area subject to an interest must be sent by registered mail to the interest owner.
Notice
(7)  At least 30 days before making a decision to which this section applies, the Boards must give written notice of their intention to make the decision to any person that the Boards consider to be directly affected by the decision.
Request for hearing
(8)  A person to whom notice is given may, in writing, request a hearing in respect of the decision, but the request must be received by the Boards within 30 days after day on which the notice is given.
(9)  If no request is received under subsection (8), the Boards may make the decision.
(10)  If a request is received under subsection (8), the Boards must fix a suitable time and place for the hearing and notify each person who requested the hearing.
Representations
(11)  Each person who requests a hearing may make representations and introduce witnesses and documents at the hearing.
Decision
(12)  At or after the conclusion of the hearing, the Boards must make the decision, give notice of it to each person who requested the hearing and, if the person requests reasons, publish or make available the reasons for the decision.
Delegation
(13)  The Boards may each delegate any of their powers, duties and functions under this section to any of their members, officers or employees, and those powers, duties and functions must be exercised or performed in accordance with the terms of the delegation.

#### Significant Discovery Licences

Rights under significant discovery licence
55.  A significant discovery licence confers, with respect to the portions of the joint management area to which the licence applies,
(a)  the right to explore, and the exclusive right to drill and test, for petroleum;
(b)  the exclusive right to develop those portions of the joint management area in order to produce petroleum; and
(c)  the exclusive right, subject to compliance with the other provisions of this Act, to obtain a production licence.
Significant discovery licence
56.  (1)  If a declaration of significant discovery is in force and all or a portion of the significant discovery area is subject to an exploration licence or a share in it held in accordance with section 49, the Ministers must, on the holder's application made in the prescribed manner, issue to the interest holder a significant discovery licence for all portions of the significant discovery area that are subject to the exploration licence or the share.
Significant discovery licence for Crown reserve areas
(2)  If a declaration of significant discovery is in force and the significant discovery area extends to a Crown reserve area, the Ministers may, after making a call for bids for all or any portion of that Crown reserve area and selecting a bid that was submitted in response to the call for bids in accordance with subsection 42(1), issue a significant discovery licence to the person who submitted that bid.
Terms of significant discovery licence
(3)  A significant discovery licence may contain any other terms, not inconsistent with the provisions of this Part or the regulations made under it, that may be agreed on by the Ministers and the interest owner.
Reduction of area
57.  (1)  If a significant discovery area in relation to a declaration of significant discovery is decreased as the result of an amendment made under subsection 54(4), any significant discovery licence that was issued on the basis of that declaration must be amended to decrease the portions of the joint management area subject to the licence accordingly.
Increase in area
(2)  If a significant discovery area in relation to a declaration of significant discovery is increased as a result of an amendment made under subsection 54(4), any significant discovery licence that was issued on the basis of that declaration must be amended to include all portions of that amended significant discovery area.
Exploration licence ceases to have effect
58.  (1)  On the day on which a significant discovery licence for a significant discovery area is issued under subsection 56(1), any exploration licence issued for that area ceases to have effect.
Effective date of significant discovery licence
(2)  A significant discovery licence takes effect on the day on which the application for the licence was submitted.
Term of significant discovery licence
(3)  Subject to subsection 68(1), a significant discovery licence continues to be in force for each portion of the joint management area to which the licence applies during the period that the relevant declaration of significant discovery remains in force.
Crown reserve area
(4)  On the day on which a significant discovery licence expires, any portion of the joint management area to which the significant discovery licence relates and that is not subject to a production licence becomes a Crown reserve area.

#### Drilling Orders

Drilling orders
59.  (1)  Subject to subsections (2) to (4) and if a declaration of significant discovery has been made, the Ministers may, by order subject to section 96, require the owner of an interest in relation to any portion of the significant discovery area to drill a well on any portion of the significant discovery area that is subject to that interest, in accordance with any directions that are set out in the order, and to begin the drilling within one year after the day on which the order is made or within any longer period that the Ministers specify in the order.
Exception
(2)  A drilling order must not be made under subsection (1) with respect to any interest owner who has completed a well on the relevant portion of the significant discovery area within six months after the completing of that well.
Condition
(3)  A drilling order must not be made within three years after the termination date of the well indicating the relevant significant discovery.
Number of wells
(4)  A drilling order must not require an interest owner to drill more than one well at a time on the relevant portion of the significant discovery area.
Definition of "termination date"
(5)  For the purposes of subsection (3), "termination date" means the day on which a well has been abandoned, completed or suspended in accordance with any applicable drilling regulations made under Part 2.
Provision of information
60.  (1)  The Ministers may, despite section 93, provide information or documentation relating to a significant discovery to any interest owner who requires it to assist that owner in complying with a drilling order. The Ministers may ask or direct the Boards to provide that information or documentation to that owner.
Exception
(2)  An interest owner must not disclose any information or documentation provided to them under subsection (1) except if necessary to comply with a drilling order.

### Division 4Production

#### Commercial Discoveries

Application for declaration of commercial discovery
61.  (1)  If a commercial discovery has been made on any portion of the joint management area that is subject to an interest or a share in an interest held in accordance with section 49, the Boards must, on the holder's application made in the prescribed manner, make a written declaration of commercial discovery for those portions of the joint management area in respect of which there are reasonable grounds to believe that the commercial discovery may extend.
Declaration on initiative of Boards
(2)  If a commercial discovery has been made on any portion of the joint management area, the Boards may, on their own initiative, make a written declaration of commercial discovery in relation to those portions of the joint management area in respect of which there are reasonable grounds to believe that the commercial discovery may extend.
Application of certain provisions
(3)  Subsections 54(3), (4) and (6) to (12) apply, with any modifications that the circumstances require, with respect to a declaration made under this section.
Delegation
(4)  The Boards may each delegate any of their powers under this section to any of their members, officers or employees and those powers must be exercised in accordance with the terms of the delegation.

#### Development Orders

Notice of order to reduce term
62.  (1)  If a declaration of commercial discovery has been made, the Ministers may give notice to the owner of any interest in any portion of the commercial discovery area where commercial production of petroleum has not begun that, after any period of not less than six months that is specified in the notice, they intend to issue an order reducing the term of that interest.
Opportunity for submissions
(2)  During the period specified in the notice under subsection (1), the Ministers must provide a reasonable opportunity for the interest owner to make submissions in relation to the order.
Order reducing term of interest
(3)  Despite anything in this Act, if the Ministers are of the opinion that it is in the public interest, they may, at any time within six months after the day on which the period specified in the notice under subsection (1) ends, by order subject to section 96, reduce the term of the interest to a period of three years, or any longer period that may be specified in the order, beginning on the day on which the order is made.
All interests cease
(4)  Despite anything in this Act, but subject to subsections (5) and (6), any interest that is the subject of an order made under subsection (3) ceases to have effect at the end of the period specified in the order.
Order ceases to have effect
(5)  If commercial production of petroleum in any portion of the joint management area to which the interest that is the subject of an order under subsection (3) relates begins before the day on which the period specified in that order or the period extended under subsection (6) ends, the order ceases to have effect and is considered to have been vacated.
Extension of period
(6)  The Ministers may extend the period specified in an order made under subsection (3) or may revoke the order.

#### Production Licences

Rights under production licence
63.  (1)  A production licence confers, with respect to the portions of the joint management area to which the licence applies,
(a)  the right to explore and the exclusive right to drill and test for petroleum;
(b)  the exclusive right to develop those portions of the joint management area in order to produce petroleum;
(c)  the exclusive right to produce petroleum from those portions of the joint management area; and
(d)  the title to the petroleum so produced.
Exception
(2)  Despite subsection (1), the Ministers may, subject to any terms that they consider appropriate, authorize any holder of an interest or a share in an interest to produce petroleum on the portions of the joint management area that are subject to the interest or share for use in the exploration or drilling for or development of petroleum in any portion of the joint management area.
Issuance
64.  (1)  The Ministers, on application made in the prescribed manner,
(a)  must issue a production licence to one interest owner, in respect of any one commercial discovery area or portion of it that is subject to an exploration licence or a significant discovery licence held by that interest owner; and
(b)  may, subject to any terms that may be agreed on by the Ministers and the relevant interest owners, issue a production licence to
(i)  one interest owner, in respect of two or more commercial discovery areas or portions of them that are subject to an exploration licence or a significant discovery licence held by that interest owner, or
(ii)  two or more interest owners, in respect of one or more commercial discovery areas or portions of them that are subject to an exploration licence or a significant discovery licence held by any of those interest owners.
Production licence for Crown reserve areas
(2)  If a declaration of commercial discovery is in force and the commercial discovery area extends to a Crown reserve area, the Ministers may, after making a call for bids for all or any portion of that Crown reserve area and selecting a bid that was submitted in response to the call for bids in accordance with subsection 42(1), issue a production licence to the person who submitted that bid.
Terms of production licence
(3)  A production licence may contain any terms, not inconsistent with the provisions of this Part or the regulations made under it, that may be agreed on by the Ministers and the interest owner.
Consolidation of licences
65.  The Ministers may, on the application of the interest owners of two or more production licences, consolidate any of those production licences into a single production licence, on any terms that may be agreed on by the Ministers and those interest owners.
Reduction of area
66.  (1)  If a commercial discovery area in relation to a declaration of commercial discovery is decreased as the result of an amendment made under subsections 54(4) and 61(3), any production licence that was issued on the basis of that declaration must be amended to decrease the portions of the joint management area subject to the licence accordingly.
Increase in area
(2)  If a commercial discovery area in relation to a declaration of commercial discovery is increased as the result of an amendment made under subsections 54(4) and 61(3), any production licence that was issued on the basis of that declaration must be amended to include all portions of that amended commercial discovery area subject to an exploration licence or a significant discovery licence held by the production licence owner.
Term of production licence
67.  (1)  A production licence takes effect on the day on which it is issued and must be issued for a term of 25 years.
Expiry
(2)  If a declaration of commercial discovery on the basis of which a production licence was issued is, under subsections 54(4) and 61(3), revoked or amended to exclude all portions of the commercial discovery area for which the production licence was issued, the production licence ceases to be in force.
Automatic extension of term
(3)  If petroleum is being produced commercially on the day on which the production licence expires, the term is extended for any period during which the commercial production continues.
Discretionary extension of term
(4)  The Ministers may, by order, on any terms that they may specify, extend the term of a production licence if
(a)  commercial production of petroleum from the portions of the joint management area that are subject to the licence ceases before or on the day on which the production licence's 25-year term expires and the Ministers have reasonable grounds to believe that commercial production from those portions of the joint management area will restart; or
(b)  the Ministers have reasonable grounds to believe that commercial production of petroleum from those portions of the joint management area will, at any time before or after the day on which the licence expires, cease during any period and restart after the period.
Lapsing of other interests
68.  (1)  Any interest in portions of the joint management area that is held before a production licence is issued for those portions ceases to have effect in relation to those portions on the day on which the licence is issued but otherwise continues to have effect.
Crown reserve areas
(2)  On the expiry of a production licence, the portions of the joint management area for which the production licence was issued become Crown reserve areas.

#### Subsurface Storage Licences

Licence for subsurface storage
69.  (1)  The Ministers may, subject to any terms that they consider appropriate, issue a licence authorizing the subsurface storage of petroleum or any other substance approved by them in portions of the joint management area at depths greater than 20 metres.
Prohibition
(2)  The joint management area must not be used for a purpose referred to in subsection (1) without a licence referred to in that subsection.

### Division 5Royalties

#### Payment of Royalties

Royalties
70.  (1)  Every holder of a share in a production licence, and every person who conducts an extended formation flow test under section 124, is liable for and must pay the royalties under this Division in respect of their share of the production of petroleum in the joint management area and the amount of royalties that the holder or person must pay is to be determined in accordance with the relevant provisions of the Mining Act or the replacement act. The holder and person must also pay the related interest and penalties in default of payment of those royalties as determined in accordance with either of those Acts, as the case may be.
Application of Quebec legislation
(2)  Subject to the provisions of this Act and any regulations made under it, the provisions of the Mining Act or the replacement act that relate to royalties in respect of petroleum, including the remittance, collection or enforcement of those royalties, are incorporated by reference for the purposes of this Division with any modifications that the circumstances require including, in the Mining Act, the following:
(a)  a reference to the domain of the State is a reference to the joint management area;
(b)  a reference to a lessee under a lease to produce petroleum and natural gas is a reference to a holder of a share in a production licence; and
(c)  a reference to the Minister in a provision stating that an amount is to be paid to the Minister is a reference to the Receiver General and, in any other case, is a reference to the Ministers.
(3)  All amounts payable under subsection (1) must be remitted to the Receiver General.
Remittance to Quebec
(4)  The Government of Canada must, without delay, unconditionally remit the amounts referred to in subsection (3) to the Government of Quebec.
Payment out of Consolidated Revenue Fund
(5)  There may be paid out of the Consolidated Revenue Fund to the Government of Quebec, on the requisition of the Federal Minister, any amount to be remitted during a fiscal year under subsection (4).
Remedies for unpaid royalties
71.  (1)  Despite anything in this Act, if a person is in default in the payment of any amount payable under subsection 70(1), the Ministers may, for so long as the amount remains unpaid,
(a)  refuse to issue to that person any interest for any portion of the joint management area;
(b)  refuse to authorize, under Part 2, that person to carry on any work or activity related to the exploration for or the production of petroleum on any portion of the joint management area and suspend any authorization already given; and
(c)  exercise the powers under section 92.
No remedy before appeals
(2)  A remedy must not be exercised under this section in respect of a default in the payment of an amount before any remedy, including assessment, reassessment, appeal or review, under the Mining Act or the replacement act is exhausted in respect of that default.
Agreement concerning royalties
72.  The Federal Minister may, with the approval of the Governor in Council, enter on behalf of the Government of Canada into an agreement with the Government of Quebec with respect to the collection and administration of the amounts referred to in subsection 70(1) on behalf of the Government of Canada.
Definitions of "Mining Act" and "replacement act"
73.  In sections 70 and 71,
(a)  "Mining Act" means the Mining Act, CQLR, c. M-13.1 and the regulations made under it, as amended from time to time; and
(b)  "replacement act" means any act of the Legislature of Quebec that replaces the Mining Act, in whole or in part, in respect of the management of petroleum, and the regulations made under that act, as amended from time to time.

#### Liability and Collection of Royalties

Debts due to Government of Canada
74.  All amounts payable under subsection 70(1) are debts due to the Government of Canada and are recoverable as such from the person required to pay them in accordance with this Part.

#### Revenue Account

Revenue Account
75.  (1)  There is established in the accounts of Canada an account to be known as the "Quebec Revenue Account — Petroleum Resources Joint Management Area".
Payment
(2)  The Federal Minister must, in the prescribed time and manner,
(a)  credit the Revenue Account with
(i)  an amount equal to the total of any royalties, interest and penalties payable to the Government of Canada under section 70, that have been collected by the Government of Quebec during any fiscal year in accordance with any agreement entered into under section 72, and
(ii)  an amount equal to the total of any amounts received during any fiscal year under this Part or Part 2 and not required to be returned, other than the amounts referred to in subparagraph (i) and other than any fees or charges collected under section 8; and
(b)  pay to the Government of Quebec any amount credited to the Revenue Account under paragraph (a).
Excess recoverable
(3)  If, by application of subsection (2), the Government of Quebec has received any amount in excess of the amount to which it is entitled, the Federal Minister may recover as a debt due to Her Majesty in right of Canada an amount equal to that excess from any moneys that are or may become payable to the Government of Quebec under subsection (2) or under a provision of any other Act of Parliament.
Appropriation
(4)  The Federal Minister may, for each fiscal year, pay out of the Consolidated Revenue Fund, in the prescribed time and manner, an amount to the Government of Quebec under paragraph 75(2)(b).
Regulations
76.  Subject to subsection 70(4), the Governor in Council may, on the recommendation of the Minister of Finance, make regulations prescribing the time and manner in which the amounts referred to in subsections 75(2) and (4) are to be credited or paid, as the case may be.

### Division 6Courts

Jurisdiction of courts
77.  (1)  Every court in Quebec has jurisdiction in respect of matters arising in the joint management area under Division 5 to the same extent as the court has jurisdiction in respect of matters arising within its ordinary territorial jurisdiction.
Presumption
(2)  For the purposes of subsection (1), the joint management area is deemed to be within the territorial limits of the judicial district of Montreal.
Saving
(3)  Nothing in this section limits the jurisdiction that a court may exercise apart from this section.
Definition of "court"
(4)  In this section, "court" includes a judge of the court and any provincial court judge or justice.

### Division 7Transfers, Assignments and Registration

#### Interpretation

Definitions
78.  (1)  The following definitions apply in this Division.
"assignment of security interest"
« cession de sûreté »
"assignment of security interest" means a notice of the assignment of a security interest or any part of it for which a security notice has been registered under this Division.
"court"
« tribunal »
"court" means the Superior Court of Quebec and includes a judge of that Court.
"discharge"
« mainlevée »
"discharge" means a notice of the discharge or release of a security notice or postponement and includes a notice of partial discharge or release.
"instrument"
« acte »
"instrument" means a discharge, postponement, security notice, transfer of an interest or a share in an interest or an assignment of a security interest.
"operator's lien"
« privilège de l'exploitant »
"operator's lien" means any charge on or right in relation to an interest or a share in an interest
(a)  that arises under a contract
(i)  to which the interest owner or holder of the interest or share is a party,
(ii)  that provides for the operator appointed under that contract to carry out any work or activity related to the exploration for or the development or production of petroleum in the portions of the joint management area to which the interest or share applies, and
(iii)  that requires the interest owner or holder to make payments to the operator to cover all or part of the advances made by the operator in respect of the costs and expenses of any work or activity; and
(b)  that secures the payments referred to in subparagraph (a)(iii).
"postponement"
« cession de rang »
"postponement" means a document evidencing the postponement of a security notice or operator's lien.
"secured party"
« partie garantie »
"secured party" means the person claiming a security interest under a security notice.
"security interest"
« sûreté »
"security interest" means any charge on or right in relation to an interest or a share in an interest, including a security given under section 426 of the Bank Act but not including an operator's lien, that secures
(a)  the payment of an indebtedness arising from an existing or future loan or advance of money;
(b)  a bond, debenture or other security of a corporation; or
(c)  the performance of the obligations of a guarantor under a guarantee given in respect of all or part of an indebtedness referred to in paragraph (a) or all or part of a bond, debenture or other security of a corporation referred to in paragraph (b).
"security notice"
Version anglaise seulement
"security notice" means a notice of a security interest.
Assignees considered secured parties
(2)  If an assignment of security interest is registered, a reference in this Division to a secured party is, in respect of the security notice to which the assignment of security interest relates, a reference to the assignee named in the assignment of security interest.

#### Transfer and Assignment

Notice of disposition of any interest
79.  If a holder of an interest or any share in an interest enters into an agreement or arrangement that results in or may result in a transfer, assignment or other disposition of the interest or share, the holder must give notice of that agreement or arrangement to the Ministers, together with a summary of its terms or, on the request of the Ministers, a copy of the agreement or arrangement.

#### Registration

Establishment of register
80.  (1)  A public register of all interests issued under this Act, and all instruments related to those interests, is to be established and maintained in accordance with this Division.
Duties of Registrar and Deputy Registrar
(2)  The Ministers must designate a Registrar and Deputy Registrar to exercise the powers and perform any duties and functions in respect of the register that may be prescribed.
Registration
81.  (1)  A document other than an interest or instrument must not be registered.
Requirements of registration
(2)  An instrument must not be registered unless it has been submitted for registration in the form and containing the information required under this Division and it meets any other requirement for its registration.
(3)  An instrument must not be registered unless a notice of official address for service of that instrument is filed with the Registrar. The official address for service may be changed by filing with the Registrar another notice of official address for service.
Additional requirements of registering security notice
(4)  In the case of a security notice, it must also specify
(a)  the nature of the security interest claimed;
(b)  the person from whom the security interest was acquired;
(c)  the documents giving rise to the security interest; and
(d)  any other particulars in respect of the security interest that may be prescribed.
Security notice carries forward to new interests
82.  If a significant discovery licence or production licence is issued at any time in respect of any portion of the joint management area, the registration of a security notice in respect of the interest in force immediately preceding the issuance of that licence and relating to that portion of the joint management area applies in respect of the licence as though the security notice referred to that licence, and as though that licence had been issued before the registration of the security notice.
Registration
83.  (1)  Every document submitted for registration must be examined by the Registrar and if the document meets all the requirements for its registration under this Division and the regulations, the Registrar must register it.
Refusal to register
(2)  If the Registrar refuses to register any document, the Registrar must return the document to the person who submitted it for registration and provide that person with the reasons for the refusal.
Endorsement
(3)  An instrument is registered when the Registrar endorses it with a registration number and the time and date of registration.
Chronological order of receipt for registration
(4)  Instruments that are accepted for registration must be registered in the chronological order in which they are received by the Registrar.
Registration as notice
84.  The registration of an instrument constitutes actual notice of the instrument to all persons as of the instrument's time of registration and actual notice of the contents of the documents specified in a security notice to all persons who may serve a demand for information under subsection 86(1).
Priority of rights
85.  (1)  Subject to subsections (2) and (5), any particular right in an interest or a share in an interest, in respect of which an instrument has been registered at any time, has priority over and is valid against any other right, in relation to that interest or share,
(a)  in respect of which an instrument may be registered, whether that other right was acquired before or after that particular right,
(i)  if the instrument was not so registered, or
(ii)  if the instrument was so registered after that time; or
(b)  in respect of which an instrument must not be registered, if that other right was acquired after that time.
Right acquired
(2)  If any right in respect of which an instrument may be registered was acquired before the day on which this Division comes into force and an instrument in respect of that right is registered not later than 180 days after the day on which this Division comes into force, the priority and validity of that right must be determined as though the instrument was registered at the time the right was acquired and as though this Division was in force at that time.
Priority
(3)  Despite subsection (2), no right in respect of which that subsection applies is to have priority over and be valid against any other right in respect of which that subsection applies but in respect of which an instrument is not registered within the period referred to in that subsection, if the person who claims the right in respect of which the instrument is registered within that period acquired that right with actual knowledge of the other right.
Registration of instrument
(4)  An instrument in respect of any right to which subsection (2) applies must not be registered unless it is accompanied by the statutory declaration, in the form and containing the information specified by the Ministers, of the person claiming that right, attesting to the day on which that right was acquired.
Operator's lien
(5)  An operator's lien, in relation to an interest or a share in an interest, must, without the need for registration of any document evidencing the operator's lien, have priority over and be valid against any other right, in relation to that interest or share, in respect of which an instrument may be registered, whether an instrument in respect of that other right was registered before or after the acquisition of the operator's lien or the operator's lien was acquired before or after that other right, unless the operator's lien is postponed with respect to any other rights by the registration of a postponement in respect of the operator's lien and a discharge in respect of that postponement has not been registered.
Demand for information
86.  (1)  A person may, in accordance with this section, serve a demand for information in respect of a security notice that has been registered in relation to an interest or a share in an interest if that person
(a)  is the holder of that interest or share;
(b)  is specified in the security notice as the person from whom the security interest was acquired;
(c)  is the secured party under another security notice registered in respect of that interest or share;
(d)  is a member of a class of prescribed persons; or
(e)  obtains leave to do so from the court.
Contents of demand notice
(2)  A demand for information may be served by delivering to the secured party under the security notice a demand notice requiring the secured party
(a)  to inform the person serving the demand notice, within 15 days after the day on which the notice is served, of the place where the documents specified in the security notice or copies of those documents are located and available for examination and of the normal business hours during which the examination may be made; and
(b)  to make those documents or copies available for examination at that place during normal business hours, by or on behalf of the person serving the notice, within a reasonable period after the demand notice is served.
Service
(3)  A demand for information is served if it is sent by registered mail or delivered to the official address for service of the security notice according to the records of the Registrar.
Compliance with demand
(4)  A demand for information may be complied with by mailing or delivering to the person serving the demand notice a true copy of the documents referred to in the demand notice.
Court order for failure to comply
(5)  If a secured party fails without reasonable excuse to comply with a demand for information, the court may, on application by the person who served the demand notice, make an order requiring the secured party to comply with the demand within the time and in the manner specified in the order.
Failure to comply with court order
(6)  If a secured party fails to comply with a court order made under subsection (5), the court may, on the application of the person who applied for the order,
(a)  make any other order the court considers necessary to ensure compliance with the order made under subsection (5); or
(b)  make an order directing the Registrar to cancel the registration of the security notice.
Definition of "document"
(7)  In this section, "document" includes any amendment to the document.
Notice to take proceedings
87.  (1)  A person who may serve a demand for information in respect of a security notice under subsection 86(1) may
(a)  serve on the secured party under the security notice a notice to take proceedings directing that secured party to apply to the court, within 60 days after the day on which the notice to take proceedings is served, or any shorter period ordered under subsection (2), for an order substantiating the security interest claimed in the security notice; or
(b)  begin proceedings in the court, requiring the secured party to show cause why the registration of the security notice should not be cancelled.
Order to shorten notice
(2)  The court may, by order, on the ex parte application of a person who proposes to serve a notice to take proceedings under paragraph (1)(a), shorten the 60-day period referred to in that paragraph and, if the order is made, a certified copy of it must be served with that notice to take proceedings.
Order to extend notice
(3)  The court may, on the application of a secured party served with a notice to take proceedings, extend the period referred to in paragraph (1)(a), whether or not that period has been shortened under subsection (2).
Service
(4)  A notice to take proceedings is served if it is sent by registered mail or delivered to the secured party at the official address for service of the security notice according to the records of the Registrar.
Cancellation of registration of security notice
(5)  The registration of a security notice is to be cancelled on submission to the Registrar of a statutory declaration showing that
(a)  a notice to take proceedings was served in accordance with this section; and
(b)  no application was made in relation to the notice to take proceedings or an application so made was dismissed by the court or discontinued.
No further registration after cancellation
(6)  If the registration of a security notice in respect of a security interest is cancelled, the secured party under the security notice is not to submit for registration under this Part another security notice in respect of that security interest without leave of the court.
Cancellation of registration on court order
(7)  The registration of a security notice is to be cancelled on submission to the Registrar of a certified copy of a court order or judgment directing the Registrar to do so, whether as a result of proceedings taken under this Division or otherwise.
Transfer effective on registration
88.  A transfer of an interest or a share in an interest is not effective against the Crown before the registration of the transfer.
No restriction on rights
89.  For greater certainty, the registration of an instrument
(a)  does not restrict or in any manner affect any right or power of the Ministers under this Act or under the terms of any interest; and
(b)  does not derogate from any interest or right over property or natural resources that Her Majesty in right of Canada has in respect of any portion of the joint management area.
No action
90.  No action or other proceedings for damages is to be commenced against the Registrar or Deputy Registrar or anyone acting under their authority for an act done or omitted to be done in good faith in the exercise of a power or the performance of a duty or function.
Regulations
91.  Subject to subsection 7(1), the Governor in Council may make regulations for carrying out the purposes and provisions of this Division, including regulations
(a)  prescribing the powers, duties and functions of the Registrar and Deputy Registrar for the purposes of this Division and the time when, and manner and circumstances in which, they are to be exercised or performed, and providing for the designation by the Ministers of any person or class of persons to exercise any powers and perform any duties and functions that may be specified in the regulations;
(b)  governing the books, abstracts and indexes to be maintained as the register for the purposes of this Division and the particulars of interests, instruments and portions of the joint management area and the orders and declarations made in relation to interests to be recorded in them;
(c)  governing the filing of copies of documents relating to interests, registered instruments and other documents in the register established under this Division; and

### Division 8Cancellation of Interests

Notice to comply
92.  (1)  If the Ministers have reason to believe that an interest owner or holder is failing or has failed to meet any requirement under this Act, they may give notice to that interest owner or holder requiring compliance with the requirement within 90 days after the day on which the notice was given or within any longer period that they consider appropriate.
Default
(2)  Despite anything in this Act, if an interest owner or holder fails to comply with a notice under subsection (1) within the period specified in the notice and the Ministers consider that the failure to comply warrants cancellation of the interest of the interest owner or holder or any share in the interest held by the holder with respect to a portion only of the joint management area subject to the interest, the Ministers may, by order subject to section 96, cancel that interest or share, and if the interest or share is so cancelled, the portions of the joint management area under that share or interest become Crown reserve areas.

### Division 9Information

#### Disclosure of Information

Definitions
93.  (1)  The following definitions apply in this section.
"delineation well"
« puits de délimitation »
"delineation well" means a well that is so located in relation to another well penetrating a pool that there is a reasonable expectation that another portion of that pool will be penetrated by the first-mentioned well and that the drilling is necessary in order to determine the commercial value of the pool.
"development well"
« puits d'exploitation »
"development well" means a well that is so located in relation to another well penetrating a pool that it is considered to be a well or part of a well drilled for the purpose of production or observation or for the injection or disposal of fluid into or from the pool.
"engineering research or feasibility study"
« recherches ou études techniques »
"engineering research or feasibility study" includes work undertaken to facilitate the design or to analyze the viability of engineering technology, systems or schemes to be used in the exploration for or the development, production or transportation of petroleum in the joint management area.
"environmental study"
« études de l'environnement »
"environmental study" means work pertaining to the measurement or statistical evaluation of the physical, chemical and biological elements of the lands, oceans or coastal zones, including winds, waves, tides, currents, precipitation, ice cover and movement, icebergs, pollution effects, flora and fauna both onshore and offshore, human activity and habitation and any related matters.
"experimental project"
« opération expérimentale »
"experimental project" means work or activity involving the use of methods or equipment that are untried or unproven.
"exploratory well"
« puits d'exploration »
"exploratory well" means a well that is drilled on a geological feature on which a significant discovery has not been made.
"geological work"
« travaux de géologie »
"geological work" means work, in the field or laboratory, involving the collection, examination, processing or other analysis of lithological, paleontological or geochemical materials recovered from the surface or subsurface or the seabed or its subsoil of any portion of the joint management area and includes the analysis and interpretation of mechanical well logs.
"geophysical work"
« travaux de géophysique »
"geophysical work" means work involving the indirect measurement of the physical properties of rocks in order to determine the depth, thickness, structural configuration or history of their deposition and includes the processing, analysis and interpretation of material or data obtained from any work.
"geotechnical work"
« travaux de géotechnique »
"geotechnical work" means work, in the field or laboratory, involving the analysis of the physical properties of materials recovered from the surface or subsurface or the seabed or its subsoil of any portion of the joint management area.
"termination date"
« date d'abandon »
"termination date" means the day on which a well has been abandoned, completed or suspended in accordance with any applicable drilling regulations made under Part 2.
"well site seabed survey"
« levé du fond marin »
"well site seabed survey" means a survey pertaining to the nature of the surface or subsurface or the seabed or its subsoil of any portion of the joint management area in the area of the proposed drilling site in respect of a well and to the conditions of those portions of the joint management area that may affect the safety or efficiency of drilling operations.
Disclosure of information with consent
(2)  Subject to the other provisions of this section and section 95, information or documentation provided for the purposes of this Act or any regulations made under it, whether or not the information or documentation is required to be provided, is privileged and must not knowingly be disclosed without the written consent of the person who provided it except for the purposes of the administration or enforcement of this Act, or for the purposes of legal proceedings relating to that administration or enforcement.
Protection of information
(3)  A person is not required to produce or give evidence relating to any information or documentation that is privileged under subsection (2) in connection with any legal proceedings, other than proceedings relating to the administration or enforcement of this Act.
Registration of documents
(4)  This section does not apply to a document that has been registered under Division 7.
Disclosure of information
(5)  Subsection (2) does not apply to the following classes of information or documentation obtained as a result of carrying on a work or activity that is authorized under Part 2, namely, information or documentation in respect of
(a)  an exploratory well, if the information or documentation is obtained as a direct result of drilling the well and if two years have passed since the termination date of that well;
(b)  a delineation well, if the information or documentation is obtained as a direct result of drilling the well and if the later of the following time periods has passed:
(i)  two years since the termination date of the relevant exploratory well, and
(ii)  90 days since the termination date of the delineation well;
(c)  a development well, if the information or documentation is obtained as a direct result of drilling the well and if the later of the following time periods has passed:
(i)  two years since the termination date of the relevant exploratory well, and
(ii)  60 days since the termination date of the development well;
(d)  geological work or geophysical work performed on or in relation to any portion of the joint management area,
(i)  in the case of a well site seabed survey if the well has been drilled, after the expiry of the period referred to in paragraph (a) or the later period referred to in subparagraph (b)(i) or (ii) or (c)(i) or (ii), according to whether paragraph (a), (b) or (c) is applicable in respect of that well, or
(ii)  in any other case, five years after the day on which the work is completed;
(e)  any engineering research or feasibility study or experimental project, including geotechnical work, carried out on or in relation to any portion of the joint management area,
(i)  if it relates to a well that has been drilled, after the expiry of the period referred to in paragraph (a) or the later period referred to in subparagraph (b)(i) or (ii) or (c)(i) or (ii), according to whether paragraph (a), (b) or (c) is applicable in respect of that well, or
(ii)  in any other case, five years after the day on which the research, study or project is completed or after the reversion of that portion of the joint management area to Crown reserve areas, whichever occurs first;
(f)  any contingency plan formulated in respect of emergencies arising as a result of any work or activity authorized under Part 2;
(g)  diving work, weather observation or the status of operational activities or of the development of or production from a pool or field;
(h)  accidents, incidents or petroleum spills, if necessary to permit a person or body to produce and to distribute or publish a report for the administration of this Act in respect of the accident, incident or spill;
(i)  an environmental study
(i)  if it relates to a well that has been drilled, after the expiry of the period referred to in paragraph (a) or the later period referred to in subparagraph (b)(i) or (ii) or (c)(i) or (ii), according to whether paragraph (a), (b) or (c) is applicable in respect of that well, or
(ii)  in any other case, five years after the day on which the study is completed; and
(j)  the quantity of petroleum that is extracted from a pool or well.
Disclosure — governments and agencies
(6)  The Boards may disclose any information or documentation that they obtain under this Act — to officials of the Government of Canada, the Government of Quebec or any other provincial government, or a foreign government or to the representatives of any of their agencies — for the purposes of a federal, provincial or foreign law, as the case may be, that deals primarily with a petroleum-related work or activity, including the exploration for and the management, administration and production of petroleum, if
(a)  the government or agency undertakes to keep the information or documentation confidential and not to disclose it without the Boards' written consent;
(b)  the information and documentation is disclosed in accordance with any conditions agreed to by the Boards and the government or agency; and
(c)  in the case of disclosure to a foreign government or agency, the Ministers consent in writing.
Disclosure — Ministers
(7)  The Boards may disclose to the Ministers the information or documentation that the Boards have disclosed or intend to disclose under subsection (6), but the Ministers are not to further disclose that information or documentation unless the Boards consent in writing to that disclosure or the Federal Minister or the Provincial Minister is required by an Act of Parliament or an Act of the Legislature of Quebec, as the case may be, to disclose that information or documentation.
Consent
(8)  For the purposes of paragraph (6)(a) and subsection (7), the Boards may consent to the further disclosure of information or documentation only if the Boards themselves are authorized under this section to disclose it.
Applicant and proposed work or activity
(9)  Subsection (2) does not apply in respect of information or documentation regarding the applicant for an operating licence or authorization under subsection 106(1) or the scope, purpose, location, timing and nature of the proposed work or activity for which the authorization is sought.
Public hearing
(10)  Subsection (2) does not apply in respect of information or documentation provided for the purposes of a public hearing conducted under section 22.
Safety or environmental protection
(11)  Subject to section 94, the Boards may disclose all or part of any information or documentation related to safety or environmental protection that is provided in relation to an application for an operating licence or authorization for a work or activity under subsection 106(1) or to an operating licence or authorization for a work or activity that is issued under that subsection or provided in accordance with any regulation made under this Act. The Boards are not, however, permitted to disclose information or documentation if they are satisfied that
(a)  disclosure of it could reasonably be expected to result in a material loss or gain to a person, or to prejudice their competitive position, and the potential harm resulting from the disclosure outweighs the public interest in making the disclosure;
(b)  it is financial, commercial, scientific or technical information or documentation that is confidential and has been consistently treated as such by a person who would be directly affected by its disclosure, and for which the person's interest in confidentiality outweighs the public interest in its disclosure; or
(c)  there is a real and substantial risk that disclosure of it will impair the security of pipelines, as defined in section 99, installations, vessels, aircraft or systems, including computer or communication systems, used for any work or activity in respect of which this Act applies — or methods employed to protect them — and the need to prevent its disclosure outweighs the public interest in its disclosure.
Exception — subsections (9) to (11)
(12)  Subsections (9) to (11) do not apply in respect of information or documentation described in paragraphs (5)(a) to (e).
Notice — subsection 93(11)
94.  (1)  If the Boards intend to disclose any information or documentation under subsection 93(11), the Boards must make every reasonable effort to give the person who provided it written notice of the Boards' intention to disclose it.
Waiver of notice
(2)  Any person to whom a notice is required to be given under subsection (1) may waive the requirement, and if they have consented to the disclosure they are deemed to have waived the requirement.
Contents of notice
(3)  A notice given under subsection (1) must include
(a)  a statement that the Boards intend to disclose information or documentation under subsection 93(11);
(b)  a description of the information or documentation that was provided by the person to whom the notice is given; and
(c)  a statement that the person may, within 20 days after the day on which the notice is given, make written representations to the Boards as to why the information or documentation, or a portion of it, should not be disclosed.
Representations
(4)  If a notice is given to a person by the Boards under subsection (1), the Boards must
(a)  give the person the opportunity to make, within 20 days after the day on which the notice is given, written representations to the Boards as to why the information or documentation, or a portion of it, should not be disclosed; and
(b)  after the person has had the opportunity to make representations, but no later than 30 days after the day on which the notice is given, make a decision as to whether or not to disclose the information or documentation and give written notice of the decision to the person.
Contents of notice of decision to disclose
(5)  A notice given under paragraph (4)(b) of a decision to disclose information or documentation must include
(a)  a statement that the person to whom the notice is given may request a review of the decision under subsection (7) within 20 days after the day on which the notice is given; and
(b)  a statement that if no review is requested under subsection (7) within 20 days after the day on which the notice is given, the Boards will disclose the information or documentation.
Disclosure of information or documentation
(6)  If, under paragraph (4)(b), the Boards decide to disclose the information or documentation, the Boards must disclose it within 20 days after the day on which the notice is given under that paragraph, unless a review of the decision is requested under subsection (7).
Review
(7)  Any person to whom the Boards are required under paragraph (4)(b) to give a notice of a decision to disclose information or documentation may, within 20 days after the day on which the notice is given, apply to the Superior Court of Quebec for a review of the decision.
Hearing in summary way
(8)  An application made under subsection (7) must be heard and determined in a summary way in accordance with any applicable rules of practice and procedure of that Court.
Court to take precautions against disclosing
(9)  In any proceedings arising from an application under subsection (7), the Superior Court of Quebec must take every reasonable precaution, including, when appropriate, conducting hearings in camera, to avoid the disclosure by the Court or any person of any information or documentation that, under this Act, is privileged or is not to be disclosed.
95.  (1)  The Ministers are entitled to access to any information or documentation, relating to petroleum resource activities in the joint management area, that is provided for the purposes of this Act and any information or documentation must, on the request of either Minister, be disclosed to that Minister without requiring the consent of the party who provided the information or documentation.
Exchange of information
(2)  The Boards may disclose to each other any information or documentation, relating to petroleum resource activities in the joint management area, that is provided for the purposes of this Act without requiring the consent of the party who provided the information or documentation.
Applicable provision
(3)  Section 93 applies, with any modifications that the circumstances require, in respect of any disclosure of information or documentation or the production or giving of evidence relating to that information or documentation as if the references in that section to the administration or enforcement of this Act included references to the administration or enforcement of the provincial Act that enacts the accord referred to in section 13, as amended from time to time.
Annual report
(4)  The Ministers must make an annual report detailing the amount of petroleum extracted by an owner from a pool or a well during the previous year and the amount of royalties paid by that owner. The report must be made available to the public.

### Hearings and Judicial Review

Notice
96.  (1)  The Ministers must, not less than 30 days before the day on which they make any order that is expressly stated in this Part to be subject to this section, give notice in writing to the persons that the Ministers consider to be directly affected by the proposed order.
Request for hearing
(2)  Any person who receives a notice under subsection (1) may, in writing to the Ministers, request a hearing within the 30-day period referred to in that subsection and, on receipt of that request, the Ministers must refer the request to the Committee for the purpose of holding the hearing and direct the Committee to appoint a time and place for the hearing and to give notice of that hearing to the person who requested it.
Hearing
(3)  Any person who requests a hearing may make representations and introduce witnesses and documents at the hearing.
Recommendations of Committee
(4)  On the conclusion of the hearing, the Committee must submit to the Ministers its recommendations concerning the proposed order, together with the evidence and other material that was before the Committee.
Decision
(5)  Before making any decision in respect of the proposed order, the Ministers must consider the recommendations of the Committee.
(6)  The Ministers must notify the person who requested the hearing of any order made and, on request by that person, publish or make available to that person the reasons for the order.
Effective date of order
(7)  An order takes effect
(a)  as of the day after the 30-day period referred to in subsection (1), if no hearing is requested under subsection (2); or
(b)  as of the day on which the decision to make the proposed order is made by the Ministers, if a hearing is requested under subsection (2).
Judicial review
(8)  An order made after a hearing under this section is subject to review by the Superior Court of Quebec in accordance with an Act of the Legislature of Quebec.

#### Regulations

Regulations
97.  Subject to subsection 7(1), the Governor in Council may make regulations for carrying out the purposes and provisions of this Part, including regulations
(a)  respecting the division and subdivision of the joint management area including providing for the criteria to define and describe those divisions and subdivisions;
(b)  respecting any notice or application and indicating to or by whom it is to be given or made;
(c)  prescribing the information and documentation to be provided by interest owners and holders of an interest or a share in an interest and the time when and manner in which they are to be provided, and requiring that information and documentation to be provided in accordance with the regulations;
(d)  respecting fees and deposits to be paid in respect of interests, prescribing the amounts of those fees and deposits and the time and manner of their payment and providing for the administration of those fees and deposits and the disposition and return of deposits; and
(e)  prescribing anything that for the purposes of this Part is to be prescribed.

### Division 10Special Exploration Licences

Issuance
98.  (1)  Despite sections 41 to 47, one year after the coming into force of this section, the Ministers must issue an exploration licence under this Act to the holder of a licence issued under section 166 of the Mining Act, CQLR, c. M-13.1 and set out in Schedule 2 for the portion of the joint management area specified in the licence issued under that Act.
Dispute
(2)  However, in the event of a dispute concerning the limits of the joint management area adjacent to any portion of the area specified in a licence referred to in Schedule 2, an exploration licence for that area must not be issued under subsection (1) until the dispute is resolved under this Act.
Licence issued following dispute resolution
(3)  Any exploration licence that is issued under subsection (1) following the resolution of a dispute referred to in subsection (2) must give effect to any amendment to the limits of the joint management area.
Indemnification
(4)  The Government of Quebec undertakes to indemnify the Government of Canada in relation to any damages the Government of Canada is required to pay under the terms of a final judgment relating to the issuance of exploration licences under subsection (1).

## Part 2 Petroleum Operations

### Interpretation

Definitions
99.  The following definitions apply in this Part.
"Chief Conservation Officer"
« délégué à l'exploitation »
"Chief Conservation Officer" means the person designated as the Chief Conservation Officer under section 102.
"Chief Safety Officer"
« délégué à la sécurité »
"Chief Safety Officer" means the person designated as the Chief Safety Officer under section 102.
"pipeline"
« pipeline »
"pipeline" means any pipe or any system or arrangement of pipes that is within the joint management area or that extends beyond the joint management area to ground installations for the storage, production or processing of petroleum — unless the pipe, system or arrangement connects with a territory outside Quebec — by which petroleum or any other substance, including water, that is incidental to the drilling for or production of petroleum is transported from any wellhead or other place at which it is produced to any other place, or from any place where it is stored, processed or treated to any other place, and includes all property of any kind used for the purpose of, or in connection with or incidental to, the operation of a pipe or system or arrangement of pipes, in the gathering, transportation, handling and delivery of the petroleum or substance and includes installations or vessels in the joint management area, tanks, surface reservoirs, pumps, racks, storage and loading facilities, compressors, compressor stations, pressure measuring and controlling equipment and fixtures, flow controlling and measuring equipment and fixtures, metering equipment and fixtures, and heating, cooling and dehydrating equipment and fixtures, but does not include any pipe or any system or arrangement of pipes that constitutes a system for the distribution of gas to ultimate consumers.
"well"
« puits »
"well" means any opening in the ground — other than a seismic shotpoint — that is made, is to be made or is in the process of being made by drilling, boring or other method
(a)  for the production of petroleum;
(b)  for the purpose of exploring for or obtaining petroleum;
(c)  for the purpose of obtaining water to inject into an underground formation;
(d)  for the purpose of injecting gas, air, water or any other substance into an underground formation; or
(e)  for any purpose if made through sedimentary rocks to a depth of at least 150 metres.

### Purpose

Purpose
100.  The purpose of this Part is to promote, in respect of the exploration for and development of petroleum,
(a)  safety, particularly by encouraging persons who are exploring for and developing petroleum to maintain a prudent regime for achieving safety;
(b)  the protection of the environment;
(c)  accountability in accordance with the "polluter pays" principle;
(d)  the conservation of petroleum resources;
(e)  joint production arrangements; and
(f)  economically efficient infrastructures.

### Application

Application
101.  This Part applies in respect of the exploration and drilling for and the production, conservation, processing and transportation of petroleum in the joint management area.

### Chief Safety Officer and Chief Conservation Officer

Designation
102.  The Boards may designate a member, officer or employee of either of the Boards as the Chief Safety Officer and another member, officer or employee of either of the Boards as the Chief Conservation Officer; however, the Chief Executive Officer of either of the Boards must not be designated as the Chief Safety Officer.

### Status of an Order

Statutory Instruments Act
103.  An order made under this Act by a safety officer, the Chief Safety Officer, a conservation officer, the Chief Conservation Officer, the Committee or the Boards is not a statutory instrument as defined in the Statutory Instruments Act.

### Prohibition and Limitations

Prohibition
104.  A person must not carry on any work or activity related to the exploration or drilling for or the production, conservation, processing or transportation of petroleum in the joint management area unless
(a)  that person is the holder of an operating licence issued under paragraph 106(1)(a);
(b)  that person is the holder of an authorization issued, before operations are commenced, under paragraph 106(1)(b) for each work or activity; and
(c)  when it is required, that person is authorized or entitled to carry on business in the place where that person proposes to carry on the work or activity.
Limitations on pipelines
105.  (1)  A holder of an authorization to construct or operate a pipeline that is issued under paragraph 106(1)(b) must not, without the leave of the Boards,
(a)  sell, transfer or lease the pipeline, in whole or in part, to any person;
(b)  purchase or lease any other pipeline from any person;
(c)  enter into an agreement for amalgamation with any person; or
(d)  abandon the operation of a pipeline.
Exception
(2)  Despite paragraph (1)(a), leave is required only if the holder sells, transfers or leases any part of the pipeline that is capable of being operated for the transportation of petroleum or any other substance, including water, that is incidental to the drilling for or production of petroleum.
Definition of "pipeline"
(3)  For the purpose of paragraph (1)(b), "pipeline" is not limited to the definition that is given to it in section 99.

### Licences and Authorizations

#### Operating Licences and Authorizations for Work or Activity

Licences and authorizations
106.  (1)  The Boards may, on application made in the form established and containing the information required by them, and, in the prescribed manner, issue
(a)  an operating licence; and
(b)  subject to section 117, an authorization for each proposed work or activity, referred to also as an "authorization for a work or activity".
Term and renewals
(2)  An operating licence expires on March 31 following the day on which it is issued and may be renewed for successive periods not exceeding one year each.
Requirements for operating licence
(3)  An operating licence is subject to any requirements that are determined by the Boards or that are prescribed and to any deposits that are prescribed.
Copy of application
(4)  On receipt by the Boards of an application for an authorization for a work or activity or of an application to amend an authorization, the Boards are to provide a copy of the application to the Chief Safety Officer.
Requirements for authorization
(5)  An authorization is subject to any approvals that the Boards determine or that may be granted in accordance with the regulations and any requirements and deposits that the Boards determine or that may be prescribed — which approvals, requirements or deposits must not be inconsistent with the provisions of this Act or the regulations — including requirements
(a)  relating to liability for loss, damage, costs or expenses;
(b)  for the carrying out of environmental programs or studies; and
(c)  for the payment of expenses incurred by the Boards in approving the design, construction and operation of production facilities and production platforms, as those terms are defined in the regulations.
Suspension or revocation
(6)  The Boards may suspend or revoke an operating licence or an authorization for a work or activity for failure to comply with, contravention of or default in respect of
(a)  a requirement, approval or deposit subject to which the licence or authorization was issued;
(b)  a fee or charge payable in accordance with regulations made under section 8;
(c)  a requirement undertaken in a declaration referred to in subsection 114(1);
(d)  any of subsections 114(2), 115(2), 161(4) or (5) and 162(2) or (3); or
(e)  any applicable regulation.
Variation
(7)  The Boards may vary the terms of an operating licence or authorization.
Delegation
(8)  The Boards may each delegate any of their powers under paragraph (1)(b) to any of their members, officers or employees and those powers must be exercised in accordance with the terms of the delegation.
Environmental assessment
107.  (1)  If an application made under paragraph 106(1)(b) or subsection 113(2) is in respect of a physical activity described in subsection (3), the Boards must not issue an authorization or approval, as the case may be, unless the following conditions are met:
(a)  in the case of a physical activity referred to in subparagraph (3)(b)(i), the applicant has received from the Board the decision statement referred to in section 54 of the Canadian Environmental Assessment Act, 2012 in respect of that activity; and
(b)  in the case of a physical activity referred to in subparagraph (3)(b)(ii), the minister of the Government of Quebec responsible for the environment has communicated his or her recommendation to the Quebec Energy Board under section 31.8.4 or 31.8.5 of the Environment Quality Act, CQLR, c. Q-2.
Time limit
(2)  The Board must issue the decision statement referred to in section 54 of the Canadian Environmental Assessment Act, 2012 in respect of the physical activity within 12 months after the day on which the applicant has, in the Board's opinion, provided a complete application.
Physical activity
(3)  The physical activity in question — including any physical activity that is incidental to it — is a physical activity
(a)  that is carried out in the joint management area;
(b)  that is
(i)  designated by regulations made under paragraph 84(a) of the Canadian Environmental Assessment Act, 2012 or in an order made under subsection 14(2) of that Act, or
(ii)  referred to in section 31.8.2 of the Environment Quality Act, CQLR, c. Q-2; and
(c)  for which, in the case of a physical activity referred to in subparagraph (b)(i), the Board is the responsible authority as defined in subsection 2(1) of Canadian Environmental Assessment Act, 2012.
Excluded period
(4)  If the Board requires the applicant to provide information or undertake a study with respect to the physical activity, the period that is taken by the applicant, in the Board's opinion, to comply with the requirement is not included in the calculation of the period referred to in subsection (2).
Public notice
(5)  The Board must, without delay, make public
(a)  the date on which the 12-month period referred to in subsection (2) begins; and
(b)  the date on which the period referred to in subsection (4) begins and the date on which it ends.
Participant funding program
108.  The Board has the authority to establish a participant funding program to facilitate the participation of the public in the environmental assessment as defined in subsection 2(1) of the Canadian Environmental Assessment Act, 2012 of any physical activity described in subsection 107(3) — including any physical activity that is incidental to it — that meets the condition set out in paragraph 58(1)(a) of that Act and that is the subject of an application for an authorization under paragraph 106(1)(b) or an application under subsection 113(2).
Right of entry
109.  (1)  Any person may, for the purpose of exploring for or developing petroleum, enter in and use any portion of the joint management area in order to carry on a work or activity authorized under paragraph 106(1)(b).
Restriction
(2)  However, if a person occupies a portion of the joint management area under lawful title or ownership or lawful possession, other than an authorization for a work or activity or an interest, no person is to enter on or use that portion for a purpose referred to in subsection (1) without the consent of the occupier or, if consent has been refused, except in accordance with the terms imposed by a decision of an arbitrator made in accordance with the regulations.

#### Safety of Works and Activities

Review
110.  The Boards must, before issuing an authorization for a work or activity, consider the safety of the work or activity by reviewing, in consultation with the Chief Safety Officer, the system as a whole and its components, including its installations, equipment, operating procedures and personnel.

#### Spill-treating Agent

Net environmental benefit
111.  The Boards must not permit the use of a spill-treating agent in an authorization for a work or activity unless the Boards determine that the use of the spill-treating agent is likely to achieve a net environmental benefit.

#### Financial Requirements

Compliance with certain provisions
112.  The Boards must, before issuing an authorization for a work or activity, ensure that the applicant has complied with the requirements of subsections 161(1) or (2) and 162(1) in respect of that work or activity.

#### Development Plan

Approval
113.  (1)  An approval that is applicable to an authorization issued under paragraph 106(1)(b) in relation to developing a pool or field and that is prescribed for the purposes of this section is not to be granted unless the Boards have, on application, approved a development plan relating to the development of that pool or field under subsection (4).
Application for approval
(2)  An application for the approval of a development plan must be submitted to the Boards in the form established and containing the information required by them, at the time and in the manner prescribed, together with the proposed development plan in the form and containing the information described in subsection (3).
Development plan in two parts
(3)  The development plan relating to the proposed development of a pool or field that is submitted under this section must be set out in two parts, containing
(a)  in the first part, a description of the general approach to developing the pool or field and, in particular, information, in any detail that may be prescribed, with respect to
(i)  the scope, purpose, location, timing and nature of the proposed development,
(ii)  the production rate, evaluations of the pool or field, estimated amounts of petroleum proposed to be recovered, reserves, recovery methods, production monitoring procedures, costs and environmental factors in connection with the proposed development, and
(iii)  the production system and any alternative production systems that could be used for the development of the pool or field; and
(b)  in the second part, all technical or other information and proposals, as may be prescribed, that are necessary for a comprehensive review and evaluation of the proposed development.
Approval of development plan
(4)  After reviewing the application and development plan, the Boards may approve the development plan, subject to the consent of the Ministers for the first part of the development plan and any requirements that the Boards consider appropriate or that may be prescribed.
Approval of amendment to plan
(5)  If a development plan has been approved under subsection (4),
(a)  it is not to be amended unless the amendment is approved by the Boards and, in the case of an amendment to the first part of the development plan, the Ministers consent to the approval; and
(b)  any requirement to which the approval is subject may be amended by the Boards but, if the requirement relates to the first part of the development plan, it may only be amended with the consent of the Ministers.
Application of certain provisions
(6)  Subsections (1) to (5) apply, with any modifications that the circumstances require, with respect to a proposed amendment to a development plan or to any requirement to which the approval of the plan is subject.
Delegation
(7)  The Boards may each delegate any of their powers under subsection (4) to any of their members, officers or employees and those powers must be exercised in accordance with the terms of the delegation.

#### Declarations

Declaration by applicant
114.  (1)  No authorization for a work or activity is to be issued unless the Boards have received, from the applicant, a declaration in the form established by the Boards that states that
(a)  the equipment and installations that are to be used in the work or activity to be authorized are fit for the purposes for which they are to be used, the operating procedures relating to them are appropriate for those uses and the personnel who are to be employed in connection with them are qualified and competent; and
(b)  the applicant will ensure, as long as the work or activity that is authorized continues, that the equipment and installations continue to be fit for the purposes for which they are used, the operating procedures continue to be appropriate for those uses and the personnel continue to be qualified and competent.
Changes
(2)  If any equipment, installation, operating procedure or personnel specified in the declaration changes and no longer conforms to the declaration, the holder of the authorization must provide the Boards with a new declaration as soon as feasible after the change occurs.
Immunity
(3)  The Boards or any of their delegates are not liable to any person by reason only of having issued an authorization in reliance on a declaration made under this section.

#### Certificates

Certificate
115.  (1)  No authorization for a work or activity is to be issued with respect to any prescribed equipment or installation, or any equipment or installation of a prescribed class, unless the Boards have received, from the applicant, a certificate issued by a prescribed certifying authority in the form established by the Boards.
Continuing obligation
(2)  The holder of an authorization must ensure that the certificate remains in force for as long as the equipment or installation to which the certificate relates is used in the work or activity in respect of which the authorization is issued.
Contents of certificate
(3)  The certificate must state that the equipment or installation in question
(a)  is fit for the purposes for which it is to be used and may be operated safely without posing a threat to human beings or the environment in the location and for the period set out in the certificate; and
(b)  is in conformity with all the requirements and conditions that are imposed under subsection 106(5), whether they are imposed by regulation or by the Boards.
Validity of certificate
(4)  The certificate is not valid if the certifying authority
(a)  has not complied with any prescribed procedure or any procedure that may be established by the Boards; or
(b)  has participated, directly or indirectly, to any extent greater than that prescribed, in the design, construction or installation of the equipment or installation in respect of which the certificate is issued.
Access
(5)  An applicant for an authorization must permit the certifying authority to have access to the equipment and installations in respect of which the certificate is required and to any information that relates to them.
Immunity
(6)  The Boards or any of their delegates are not liable to any person by reason only of having issued an authorization in reliance on a certificate issued under this section.

#### Site Plans and Location Maps

Obligation
116.  (1)  A holder of both an operating licence and an authorization for a work or activity must ensure that a certified site plan and certified location map are made to confirm the location of a well on the seabed by a person who both holds a licence issued under the Canada Lands Surveyors Act and is a member of l'Ordre des arpenteurs-géomètres du Québec.
Specifications and requirements
(2)  The person charged with making a site plan and location map must do so in accordance with the specifications and requirements of the provisions of this Act and any regulations made under it; however, a plan or map is not subject to the specifications and requirements under the Canada Lands Surveys Act.
Certified copy
(3)  The site plan and location map must be kept on file in the office of the person who made them and a certified copy must be sent, for administrative purposes, to the Boards and to the Surveyor General, as defined in subsection 2(1) of the Canada Lands Surveys Act, and to the Surveyor-General of Quebec.

#### Benefits Plan Approval

Benefits plan
117.  For the purposes of this Act, section 5.2 of the Canada Oil and Gas Operations Act continues to apply with any modifications that the circumstances require, except that
(a)  the reference to a development plan under subsection 5.1(1) in subsection 5.2(2) of that Act is to be read as a reference to a development plan under subsection 113(1);
(b)  the reference to an authorization under paragraph 5(1)(b) in subsection 5.2(2) of that Act is to be read as a reference to an authorization for a work or activity; and
(c)  the Federal Minister must consult with the Provincial Minister before approving, or waiving approval of, a benefits plan.
Maximization committee
118.  (1)  Any holder of an authorization for a work or activity referred to in subsection 113(1) must establish a committee for the maximization of benefits. The committee must follow the approved benefits plan and ensure that the holder maximizes benefits in accordance with the principles of sustainable development.
Establishment of committee
(2)  The committee must be established within 30 days after the day on which the authorization for a work or activity is issued and must be continued until the day on which the development of the pool or field in respect of the authorization for which the submission of a development plan was required under subsection 113(1) ceases.
Composition of committee
(3)  The composition of the committee and the method for the selection of members are to be determined by the holder and submitted to the Boards for approval. The majority of the committee's members must be independent of the holder.
Regulations
(4)  Subject to subsection 7(1), the Governor in Council may make regulations respecting the operation of the committee, including
(a)  the information and documents that a holder must submit to the committee so that it can carry out its duties;
(b)  the types of charges that will be reimbursed by the holder to the committee;
(c)  the number of meetings that the committee must hold every year; and
(d)  the requirement to produce an annual report.

#### Jurisdiction and Powers of the Boards

Jurisdiction
119.  (1)  The Boards have full and exclusive jurisdiction to inquire into, hear and determine any matter if it appears to them
(a)  that any person has failed to do any act or thing that the person is required to do under the provisions of this Part or the regulations made under it, an order or direction made by the Boards under this Part, or an operating licence or authorization for a work or activity, or that any person has done or is doing any act or thing that is contrary to this Part or the regulations made under it, an order or direction made by the Boards under this Part, or an operating licence or authorization for a work or activity; or
(b)  that the circumstances may require them, in the public interest, to make any order or give any direction, leave or approval that by law they are authorized to make or give, or with respect to any act or thing that is prohibited, sanctioned or required to be done by the provisions of this Part or the regulations made under it, an order or direction made by the Boards under this Part, or an operating licence or authorization for a work or activity.
Initiative
(2)  The Boards may, of their own motion, inquire into, hear and determine any matter or thing that under this Part they may inquire into, hear and determine.
Matters of law and fact
(3)  For the purposes of this Part, the Boards have full jurisdiction to hear and determine all matters, whether of law or of fact.
Orders and prohibitions
120.  The Boards may
(a)  order any person to do, without delay, or within or at any time and in any manner established by the Boards, any act or thing that the person is or may be required to do under the provisions of this Part or the regulations made under it, or under an order or direction made by the Boards under this Part or an operating licence or authorization for a work or activity; and
(b)  prohibit any act or thing or the continuing of any act or thing that is contrary to the provisions of this Part or the regulations made under it, an order or direction made under this Part or an operating licence or authorization for a work or activity.
Committee's decisions and orders
121.  Sections 119 and 120 do not apply to any act or thing that is required or prohibited by any decision or order of the Committee.
Conditional orders — delayed coming into force
122.  (1)  The Boards may specify in an operating licence or authorization for a work or activity or in any of their orders that it or any portion or provision of it is to come into force at a future time.
Conditional coming into force
(2)  The Boards may also make the coming into force contingent on whether the conditions specified in the operating licence, authorization for a work or activity or order have been met to the Boards' satisfaction, on the happening of any contingency, on any condition or on any required approval. They may also direct that the whole or any portion of the operating licence, authorization for a work or activity or order is to be in force for a limited time or until the happening of a specified event.
Interpretation
(3)  This section does not limit the generality of any provision of this Part that authorizes the Boards to impose terms in respect of an operating licence or authorization for a work or activity or any of their orders.
Interim orders
(4)  The Boards may make an interim order and may reserve their decision pending further proceedings in connection with any matter.

#### Documents

Documents
123.  (1)  A holder of an authorization for a work or activity that relates to the construction or operation of a pipeline must keep, in the form and manner determined by the Boards, any documents, including any records or books of account, that the Boards require and that contain information that is determined by the Boards to be necessary for the administration of this Part.
Production and inspection
(2)  The holder must produce those documents to the Boards, or make them available to the Boards or their designated representative, for inspection or copying at a time and under conditions set by the Boards.

#### Extended Formation Flow Tests

Title
124.  (1)  The title to petroleum produced during an extended formation flow test vests in the person who conducts the test in accordance with an authorization for a work or activity, with every approval and requirement subject to which such an authorization is issued and with any applicable regulation, whether or not the person has a production licence.
Conditions
(2)  The title to petroleum is conditional on compliance with the terms of the authorization, approval and regulation, including the payment of royalties or other payment in lieu of royalties.
Limitation
(3)  This section applies only in respect of an extended formation flow test that provides significant information for determining the best recovery system for a reservoir, the limits of a reservoir or the productivity of a well producing petroleum from a reservoir and that does not adversely affect the ultimate recovery from a reservoir.

### Division 1Traffic, Tolls and Tariffs

#### Interpretation

Definitions
125.  The following definitions apply in this Division.
"holder"
« titulaire »
"holder" means a holder of an authorization for a work or activity that relates to the construction or operation of a pipeline.
"tariff"
« tarif »
"tariff" means a schedule of tolls, terms, classifications, practices or rules and regulations applicable to the provision of a service by a holder and includes rules respecting the calculation of tolls.
"toll"
« droits »
"toll" includes any rate, charge or allowance that is charged or made
(a)  for the shipment, transportation, transmission, care, handling or delivery of oil, gas or any other substance, including water, that is incidental to the drilling for or production of oil or gas that is transmitted through a pipeline, or for storage, demurrage or the like;
(b)  for the provision of a pipeline when the pipeline is available and ready to provide for the transmission of oil, gas or any other substance, including water, that is incidental to the drilling for or production of oil or gas; and
(c)  in respect of the purchase and sale of gas that is the property of a holder and that is transmitted by the holder through its pipeline, from which is subtracted the cost to the holder of the gas at the point where it enters the pipeline.

#### Powers of the Boards

Regulation of traffic, etc.
126.  The Boards may make orders with respect to all matters relating to traffic, tolls or tariffs.

#### Filing of Tariff

Tolls to be filed
127.  (1)  A holder must not charge any tolls except tolls that are
(a)  specified in a tariff that has been filed with the Boards and is in effect; or
(b)  approved by an order of the Boards.
Tariff — gas
(2)  If gas that is transmitted by a holder through its pipeline is the property of the holder, the holder must file with the Boards true copies of all the contracts that it makes for the sale of the gas at the time they are made and any amendments to those contracts made from time to time. The true copies constitute, for the purposes of this Division, a tariff under subsection (1).
Tariff — coming into force
128.  If a holder files a tariff with the Boards and the holder proposes to charge a toll referred to in paragraph (b) of the definition "toll" in section 125, the Boards may establish the day on which the tariff is to come into effect and the holder must not begin charging the toll before that day.

#### Just and Reasonable Tolls

Tolls to be just and reasonable
129.  All tolls must be just and reasonable and must always, under substantially similar circumstances and conditions with respect to all traffic of the same description carried over the same route, be charged equally to all persons at the same rate.
Boards' determinations
130.  The Boards may determine, as questions of fact, whether the traffic is or has been carried out under substantially similar circumstances and conditions referred to in section 129, whether in any case a holder has complied with the requirements of that section and whether there has, in any case, been unjust discrimination under section 134.
Interim tolls
131.  If the Boards have made an interim order authorizing a holder to charge tolls until a specified time or the happening of a specified event, the Boards may, in any subsequent order, direct the holder to, in a manner satisfactory to the Boards,
(a)  refund any part of the tolls that are charged under the interim order that is in excess of the tolls determined by the Boards to be just and reasonable, together with interest on the amount so refunded; or
(b)  recover in its tolls the amount by which the tolls determined by the Boards to be just and reasonable exceed the tolls charged under the interim order, together with interest on the amount so recovered.

#### Disallowance or Suspension of Tariff

Disallowance of tariff
132.  The Boards may disallow any tariff or any portion of any tariff that they consider to be contrary to any of the provisions of this Act or any of their orders and they may require a holder, within a time fixed by them, to substitute for the tariff a tariff that is satisfactory to them or establish other tariffs in lieu of the tariff or the portion so disallowed.
Suspension of tariff
133.  The Boards may suspend any tariff or any portion of any tariff before or after the tariff goes into effect.

#### Unjust Discrimination

No unjust discrimination
134.  A holder must not make any unjust discrimination in tolls, service or facilities against any person or locality.
Burden of proof
135.  If it is shown that a holder makes any discrimination in tolls, service or facilities against any person or locality, the burden of proving that the discrimination is not unjust lies on the holder.
No rebates, etc.
136.  (1)  A holder or shipper or an officer or employee, or an agent or mandatary, of a holder or shipper must not
(a)  offer, grant, give, solicit, accept or receive a rebate, concession or discrimination by which a person obtains the transmission of oil, gas or any other substance, including water, that is incidental to the drilling for or production of oil or gas from the holder at a rate less than that specified in the tariffs then in force; or
(b)  knowingly be party or privy to a false billing, false classification, false report or other device resulting in a rate being charged that is less than that specified in the tariffs then in force.
Prosecution
(2)  No prosecution is to be instituted for a contravention of this section without leave of the Boards.

#### Contracts Limiting Liabilities

Contracts limiting liability
137.  (1)  Except as provided in this section, no contract, condition or notice made or given by a holder that impairs, restricts or limits its liability in respect of the transmission of oil, gas or any other substance, including water, that is incidental to the drilling for or production of oil or gas relieves the holder from its liability, unless that class of contract, condition or notice is included as a term of its tariffs as filed or has been first authorized or approved by order of the Boards.
Boards may determine limits
(2)  The Boards may determine the extent to which the liability of a holder may be impaired, restricted or limited as provided in this section.
Terms
(3)  The Boards may establish the terms under which oil, gas or any other substance, including water, that is incidental to the drilling for or production of oil or gas may be transmitted by a holder.

#### Transmission of Oil or Gas

Oil
138.  (1)  Subject to any exemptions or conditions that the Boards may establish, a holder that operates a pipeline for the transmission of oil must, according to the holder's powers, without delay and with due care and diligence, receive, transport and deliver all oil and any other substance, including water, that is incidental to the drilling for or production of oil that the holder is requested to transmit by means of its pipeline.
Gas
(2)  The Boards may, by order, on any conditions that they may specify in the order, require a holder that operates a pipeline for the transmission of gas to receive, transport and deliver, according to the holder's powers, gas and any other substance, including water, that is incidental to the drilling for or production of gas that the holder is requested to transmit by means of its pipeline.
Extension of facilities
(3)  If the Boards find that no undue burden will be placed on the holder by requiring the holder to do so and if they consider it in the public interest, they may require a holder that operates a pipeline for the transmission of oil or gas to provide adequate and suitable facilities for
(a)  the receipt, transmission and delivery of the oil, gas or any other substance, including water, that is incidental to the drilling for or production of oil or gas that is offered for transmission by means of its pipeline;
(b)  the storage of the oil, gas or any other substance, including water, that is incidental to the drilling for or production of oil or gas; and
(c)  the junction of its pipeline with other facilities for the transmission of the oil, gas or any other substance, including water, that is incidental to the drilling for or production of oil or gas.
Holder's powers
139.  A holder may, for the purposes of its undertaking and subject to the provisions of this Part, transmit by pipeline oil, gas or any other substance, including water, that is incidental to the drilling for or production of oil or gas and regulate the time and manner in which it is to be transmitted and the tolls to be charged for the transmission.

#### Transmission and Sale of Gas

Extension of services
140.  (1)  If the Boards find that no undue burden will be placed on the holder by requiring the holder to do so and if they consider it in the public interest, they may require a holder who operates a pipeline for the transmission of gas to extend or improve its transmission facilities in order to facilitate the junction of its pipeline with any facilities of, and to sell gas to, any locality or entity that is authorized by law to distribute gas locally to the public and, for those purposes, to construct branch lines to communities immediately adjacent to its pipeline.
Limitation
(2)  Subsection (1) does not empower the Boards to compel a holder to sell gas to additional customers if doing so would impair its ability to render adequate service to its existing customers.

#### Regulations

Regulations
141.  Subject to subsection 7(1), the Governor in Council may make regulations for the purposes of this Division, designating as oil or gas any other substance resulting from the processing or refining of hydrocarbons, including coal, if that substance
(a)  is asphalt or a lubricant; or
(b)  is a suitable source of energy by itself or when it is combined or used in association with something else.

### Division 2Regulation of Operations

#### General

Governor in Council's regulatory power
142.  (1)  Subject to subsection 7(1), the Governor in Council may make regulations under this Part for the purposes of safety, the protection of the environment and accountability as well as for the production and conservation of petroleum resources, including regulations
(a)  respecting the form and content of a notice, application, request or report and the method of transmission;
(b)  prescribing to or by whom any notice, application, request or report is to be given or made;
(c)  respecting the exploration and drilling for and the production, processing and transportation of petroleum as well as the works and activities related to the exploration, drilling, production, processing and transportation;
(d)  concerning the measures to be taken in preparation for or in the case of a spill, as defined in subsection 153(1), including measures concerning the use of a spill-treating agent;
(e)  concerning the process for the determination of a net environmental benefit;
(f)  concerning the variation or revocation of an approval referred to in paragraph 155(1)(b);
(g)  authorizing the Boards or any person to make any orders that may be specified in the regulations and to exercise any powers and perform any duties that may be necessary for
(i)  the management and control of petroleum production,
(ii)  the removal of petroleum from the joint management area, and
(iii)  the design, construction, operation or abandonment of a pipeline;
(h)  respecting arbitration for the purposes of subsection 109(2), including the costs of or incurred in relation to the arbitration;
(i)  respecting the approvals to be granted as conditions of authorizations for proposed works or activities;
(j)  establishing classes of installations and equipment;
(k)  respecting certificates for the purposes of section 115;
(l)  prohibiting or limiting the introduction into the environment of substances, classes of substances and forms of energy, in the prescribed circumstances;
(m)  authorizing, for the purposes of the definition "spill" in subsection 153(1), the discharge, emission or escape of petroleum in any quantities, at any locations, under any conditions and by any persons that are prescribed;
(n)  concerning the circumstances under which the Boards may make a recommendation for the purposes of subsection 163(1) and the information to be submitted with respect to that recommendation;
(o)  concerning the creation, conservation and production of records;
(p)  prescribing the circumstances under which an inquiry is to be held under section 164;
(q)  respecting the making, certification and filing of site plans and location maps for any infrastructure related to the exploration for and development of petroleum; and
(r)  prescribing anything that for the purposes of this Part is to be prescribed.
Occupational health and safety
(2)  Subject to section 7, and on the recommendation of the Federal Minister and the Minister of Labour, the Governor in Council may make regulations under this Part for the purposes of occupational health and safety, including regulations
(a)  respecting the safety of any work or activity that involves the use of explosives or that is carried out at heights, directly over water or under water or in a confined space;
(b)  respecting the establishment of standards for the design and maintenance of equipment, machines, devices, materials and other things that may be used by employees — as defined by regulation — in carrying out their job functions;
(c)  respecting the circumstances and manner in which any thing referred to in paragraph (b) is or is not to be used, and any qualifications that an individual must have in order to use it;
(d)  specifying who is responsible for ensuring that the standards referred to in paragraph (b) are complied with and that the things referred to in that paragraph are used in the specified circumstances and manner and by individuals who have the required qualifications;
(e)  respecting the establishment of standards relating to levels or limits for ventilation, lighting, temperature, humidity, sound and vibration, and exposure to chemical agents, biological agents and radiation and specifying who is responsible for ensuring that those standards are complied with;
(f)  respecting the qualifications of persons authorized to carry out prescribed training;
(g)  respecting the establishment of fire safety and emergency measures, and specifying who is responsible for ensuring that those measures are complied with;
(h)  respecting the form and manner in which records are to be maintained and information is to be communicated; and
(i)  prescribing anything that for the purposes of this Part is to be prescribed.
Spill-treating agents
(3)  Regulations made under subsection (1) respecting a spill-treating agent must, in addition to meeting the requirements set out in subsection 7(1), be made on the recommendation of the Federal Minister and the Minister of the Environment.
Regulations general or specific
(4)  The regulations made under subsection (1) or (2) may be made applicable to all persons or one or more classes of persons.
Incorporation by reference
(5)  The regulations made under subsection (1) or (2) may incorporate any material by reference regardless of its source and either as it exists on a particular day or as amended from time to time.
No registration or publication
(6)  For greater certainty, material that is incorporated by reference in a regulation is not required to be transmitted for registration or published in the Canada Gazette by reason only that it is incorporated by reference.
Amendment to Schedule 3 or 4
143.  (1)  The Governor in Council may, by order, amend Schedule 3 or 4 to add, amend or remove a reference to a federal Act or regulation, or to a provision of a federal Act or regulation.
Recommendation
(2)  The order must be made on the recommendation of the Federal Minister and every minister responsible for the administration of the provision.
List of spill-treating agents
143.1  The Minister of the Environment may, by regulation, establish a list of spill-treating agents.
Equivalent standards and exemptions
144.  (1)  The Chief Safety Officer and Chief Conservation Officer may
(a)  authorize the use of equipment, methods, measures or standards in lieu of any that are required by any regulation made under section 142 if those Officers are satisfied that the use of that other equipment or those other methods, measures or standards would provide a level of safety, protection of the environment and conservation that is equivalent to that that would be provided by compliance with the regulations; or
(b)  grant an exemption from any requirement imposed, by any regulation made under subsection 142(1), in respect of equipment, methods, measures or standards if those Officers are satisfied with the level of safety, protection of the environment and conservation that will be achieved without compliance with that requirement.
One officer authorizations
(2)  The Chief Safety Officer alone may exercise the powers referred to in paragraph (1)(a) or (b) if the regulatory requirement referred to in that paragraph does not relate to protection of the environment or conservation and the Chief Conservation Officer alone may exercise those powers if the regulatory requirement does not relate to safety.
No contravention
(3)  No person contravenes the regulations if that person acts in compliance with an authorization or exemption under subsection (1) or (2).
Definitions
145.  (1)  The following definitions apply in this section.
"marine installation or structure"
« ouvrage en mer »
"marine installation or structure"
(a)  includes
(i)  any ship, including any ship used for construction, production, diving, geotechnical or seismic work,
(ii)  any offshore drilling unit, including a mobile offshore drilling unit,
(iii)  any production platform, subsea installation, a pipeline as defined in section 99, pumping station, living accommodation, storage structure or loading or landing platform, and
(iv)  any other prescribed work, or work within a class of works, but
(b)  does not include
(i)  any vessel, including any supply vessel, standby vessel, shuttle tanker or seismic chase vessel, that provides any supply or support services to a ship, installation, structure, work or anything else described in paragraph (a), unless the vessel is within a prescribed class of vessels, or
(ii)  any ship or vessel within a prescribed class of ships or vessels.
"Quebec labour legislation"
« lois du travail du Québec »
"Quebec labour legislation" means An Act Respecting Industrial Accidents and Occupational Diseases, CQLR, c. A-3.001, An Act Respecting Pressure Vessels, CQLR, c. A-20.01, the Building Act, CQLR, c. B-1.1, the Labour Code, CQLR, c. C-27, the National Holiday Act, CQLR, c. F-1.1, An Act Respecting Workforce Vocational Training and Qualification, CQLR, c. F-5, the Master Electricians Act, CQLR, c. M-3, the Master Pipe-mechanics Act, CQLR, c. M-4, the Stationary Enginemen Act, CQLR, c. M-6, An Act Respecting Labour Standards, CQLR, c. N-1.1, An Act Respecting Labour Relations, Vocational Training and Workforce Management in the Construction Industry, CQLR, c. R-20, and An Act Respecting Occupational Health and Safety, CQLR, c. S-2.1 and any other prescribed Act of the Legislature of Quebec, as those Acts are amended from time to time.
Incorporation by reference of Quebec labour legislation
(2)  Subject to subsections (5) and (6), the Quebec labour legislation and any regulations made under it apply on any marine installation or structure that is within the joint management area in connection with the exploration or drilling for or the production, conservation, processing or transportation of petroleum within the joint management area.
Inconsistency or conflict
(3)  In the event of an inconsistency or conflict between the provisions of this Act, or any regulations made under it, and the provisions of the Quebec labour legislation, or any regulations made under that legislation, the provisions of this Act and the regulations made under it prevail to the extent of the inconsistency or conflict.
Non-application of certain Acts
(4)  The Non-smokers' Health Act and, despite subsection 168(1) of the Canada Labour Code, Parts I and III of the Canada Labour Code do not apply on any marine installation or structure referred to in subsection (2).
Precedence
(5)  Despite subsection 123(1) of the Canada Labour Code and the Oil and Gas Occupational Safety and Health Regulations, the provisions of Part II of the Canada Labour Code that permit the administration and enforcement of those regulations, and paragraphs 125(1)(e), (y) and (z.14) of that Act, apply on a marine installation or structure referred to in subsection (2) and take precedence over the Quebec labour legislation and any regulations made under it.
Complaint or remedy
(6)  Any complaint or remedy must be made or sought under the Quebec labour legislation unless the complaint or remedy relates substantially to a matter to which the regulations mentioned in subsection (5) apply.
Reference to occupational health and safety committee
(7)  For the purposes of subsection (5), any reference to an occupational health and safety committee in the regulations referred to in that subsection or in Part II of the Canada Labour Code is to be read as a reference to the occupational health and safety committee established under An Act Respecting Occupational Health and Safety, CQLR, c. S-2.1.
Regulations
(8)  Subject to section 7, and on the recommendation of the Federal Minister, the Minister of Labour and the Minister of Transport, the Governor in Council may make regulations
(a)  prescribing a work or a class of works for the purpose of subparagraph (a)(iv) of the definition "marine installation or structure";
(b)  prescribing a class of vessels for the purpose of subparagraph (b)(i) of the definition "marine installation or structure"; and
(c)  prescribing a class of ships or vessels for the purpose of subparagraph (b)(ii) of the definition "marine installation or structure".
(9)  When an independent joint board is established for the management of petroleum resources in the joint management area,
(a)  the provisions of Part II of the Canada Labour Code and the Oil and Gas Occupational Safety and Health Regulations cease to apply in respect of any marine installation or structure in the joint management area; and
(b)  the provisions of any Quebec labour legislation respecting occupational health and safety in the petroleum sector and any regulations made under the provisions of that labour legislation apply to a marine installation or structure in the joint management area.
Emergency situations
146.  (1)  In a prescribed emergency situation, if the Federal Minister is of the opinion that there is a conflict between the provisions of this Part or the regulations made under it and the provisions of another federal law, other than provisions implementing an international treaty or convention to which Canada is a party, and that compliance with that law and the provisions of this Part or the regulations made under it is likely to create a situation that would seriously endanger the safety of persons or property, the Minister may by order issue a declaration to that effect.
Contents of declaration
(2)  The declaration must
(a)  describe the emergency situation;
(b)  specify the provisions that conflict and describe the nature of the conflict;
(c)  describe the consultation that has taken place under subsection (4);
(d)  describe the geographical area, persons, work or activity affected by the declaration; and
(e)  specify the time the declaration comes into effect.
Effect of declaration
(3)  From the time specified in the declaration, the provisions of this Part or the regulations specified in the declaration prevail, in respect of the geographical area, persons, work or activity described, over the provisions of the other federal law specified in the declaration until the Federal Minister or the Governor in Council by order revokes the declaration.
Consultation
(4)  Before the Federal Minister issues or revokes the declaration, the minister responsible for the federal law that is specified in the declaration must be consulted.
Submission for revocation
(5)  The minister responsible for a federal law that is specified in the declaration may submit the declaration to the Governor in Council for revocation.
Exemption
(6)  An order under which a declaration is issued or revoked is exempt from the application of sections 3 and 9 of the Statutory Instruments Act.
Production orders
147.  (1)  If the Chief Conservation Officer, on reasonable grounds, is of the opinion that, with respect to an interest in any portion of the joint management area, the capability exists to begin, continue or increase petroleum production and that a production order would stop waste, that Officer may order the beginning, continuation or increase of petroleum production at any rates and in any quantities that are specified in the order.
Ceasing production
(2)  If the Chief Conservation Officer, on reasonable grounds, is of the opinion that an order under this section would stop waste, that Officer may order a decrease or the cessation or suspension of petroleum production for any period specified in the order.
(3)  A person who is subject to an order under subsection (1) or (2) must, on request, give the Chief Conservation Officer or a person designated by that Officer access to premises, files and records for all reasonable purposes related to the order.
Investigation
(4)  Before making any order under subsection (1) or (2), the Chief Conservation Officer must hold an investigation at which interested persons are to be given an opportunity to be heard.
Peremptory order
(5)  Despite subsection (4), the Chief Conservation Officer may, without an investigation, make an order requiring all operations to be shut down if, in that Officer's opinion, it is necessary to do so to prevent damage to persons or property or to protect the environment, but as soon as feasible after making the order, and in any event within 15 days after the day on which the order is made, that Officer must hold an investigation at which interested persons are to be given an opportunity to be heard.
Order after inquiry
(6)  At the conclusion of the investigation under subsection (5), the Chief Conservation Officer may set aside, vary or confirm the order made under that subsection or make a new order.
Application for review by Boards
148.  (1)  A person who is aggrieved by an order of the Chief Conservation Officer after an investigation under section 147 may apply to the Boards for a review of the order.
Powers
(2)  After hearing the application, the Boards may
(a)  set aside, confirm or vary the order that is the subject of the application;
(b)  order any works to be undertaken that are considered necessary to prevent waste, the escape of petroleum or any other contravention of the provisions of this Division or the regulations; or
(c)  make any other order that the Boards consider appropriate.

#### Waste

Waste prohibited
149.  (1)  A person must not commit waste.
Definition of "waste"
(2)  In this Part, "waste", in addition to its ordinary meaning, means waste as understood in the petroleum industry and in particular includes
(a)  the inefficient or excessive use or dissipation of reservoir energy;
(b)  the locating, spacing or drilling of a well within a field or pool or within part of a field or pool or the operating of any well in a manner that, having regard to sound engineering and economic principles, results or tends to result in a reduction in the quantity of petroleum ultimately recoverable from a pool;
(c)  the drilling, equipping, completing, operating or beginning of production of any well in a manner that causes or is likely to cause the unnecessary or excessive loss or destruction of petroleum after its removal from the reservoir;
(d)  the inefficient storage of petroleum above ground or underground;
(e)  the production of petroleum in excess of available storage, transportation or marketing facilities;
(f)  the escape or flaring of gas that could be economically recovered and processed or economically injected into an underground reservoir; or
(g)  the failure to use suitable artificial, secondary or supplementary recovery methods in a pool when it appears that those methods would result in increasing the quantity of petroleum ultimately recoverable under sound engineering and economic principles.
Prevention of waste
150.  (1)  If the Chief Conservation Officer, on reasonable grounds, is of the opinion that waste, other than waste as defined in paragraph 149(2)(f) or (g), is being committed, that Officer may, subject to subsection (2), order that all operations giving rise to the waste cease until that Officer is satisfied that the waste has stopped.
Investigation and appeal
(2)  Subsections 147(4) to (6) and section 148 apply, with any modifications that the circumstances require, to the order as if it were an order under subsection 147(1).
Taking over management
151.  (1)  For the purpose of giving effect to an order made under section 150, the Chief Conservation Officer may authorize any person, as necessary, to enter the place where the operations giving rise to the waste are being carried out and take over the management and control of those operations and any connected works.
Managing operations
(2)  The authorized person must manage and control the operations and do all things necessary to stop the waste.
Costs
(3)  The cost of stopping the waste is to be borne by the person who holds the exploration licence or the production licence and constitutes a debt recoverable by action in any court of competent jurisdiction as a debt due to Her Majesty in right of Canada.
When waste occurs
152.  (1)  When the Chief Conservation Officer, on reasonable grounds, is of the opinion that waste as defined in paragraph 149(2)(f) or (g) is occurring in the recovery of petroleum from a pool, that Officer may apply to the Boards for an order requiring the operators within the pool to show cause at a hearing to be held before the Boards on a date specified in the order why the Boards should not make a direction in respect of the waste that is occurring.
Hearing
(2)  On the date specified in the order, the Boards must hold a hearing at which the Chief Conservation Officer, the operators and other interested persons are to be given an opportunity to be heard.
Order
(3)  If, after the hearing, the Boards are of the opinion that waste as defined in paragraph 149(2)(f) or (g) is occurring in the recovery of petroleum from a pool, the Boards may, by order, direct one or both of the following:
(a)  the introduction of a scheme for the collection, processing, disposition or re-injection of any gas produced from the pool;
(b)  the repressurizing, recycling or pressure maintenance for the pool or any part of it and, for or incidental to that purpose, direct the introduction or injection of gas, water or any other substance into that pool or any part of it.
(4)  The Boards may, by order, direct that the operation of the pool or any part of it that is specified in the order made under subsection (3) be shut down if the requirements of that order are not met or unless a scheme is approved by the Boards and in operation on the day fixed in the order.
Continued operation — conditional
(5)  Despite subsections (3) and (4), the Boards may, by order, permit the continued operation of a pool or any part of a pool after the day fixed by an order under this section if, in the opinion of the Boards, any scheme or other action described in paragraphs (3)(a) and (b) is in the course of preparation; however, the continued operation is subject to any conditions imposed by the Boards.

#### Spills and Debris

Definitions
153.  (1)  The following definitions apply in sections 154 to 164.
"actual loss or damage"
« perte ou dommages réels »
"actual loss or damage" includes loss of income, including future income, and, with respect to any Aboriginal peoples of Canada, includes loss of hunting, fishing and gathering opportunities, but does not include loss of income recoverable under subsection 42(3) of the Fisheries Act.
"debris"
« débris »
"debris" means any installation or structure that was put in place in the course of any work or activity required to be authorized under paragraph 106(1)(b) and that has been abandoned without an authorization that may be required by or under this Part, or any material that has broken away or been jettisoned or displaced in the course of that work or activity.
"spill"
« rejets »
"spill" means a discharge, emission or escape of petroleum other than one that is authorized under subsection 159(1), the regulations or any other federal law, but does not include a discharge from a vessel to which Part 8 or 9 of the Canada Shipping Act, 2001 applies or a ship to which Part 6 of the Marine Liability Act applies.
Immunity
(2)  Her Majesty in right of Canada incurs no liability whatever to any person arising out of the authorization by regulations made by the Governor in Council of any discharge, emission or escape of petroleum.
Spills prohibited
154.  (1)  A person must not cause or permit a spill in or from any portion of the joint management area.
Duty to report spills
(2)  If a spill occurs in any portion of the joint management area, any person who at the time of the spill is carrying on any work or activity related to the exploration for or development or production of petroleum in the area of the spill must, in the prescribed manner, report the spill to the Chief Conservation Officer.
Duty to take reasonable measures
(3)  Every person who is required to report a spill must, as soon as feasible, take all reasonable measures consistent with safety and the protection of health and the environment to prevent any further spill, to repair or remedy any situation resulting from the spill and to reduce or mitigate any damage or danger that results or may reasonably be expected to result from the spill.
Taking emergency action
(4)  The Chief Conservation Officer may take any action or direct that it be taken by any person that may be necessary if that Officer is satisfied on reasonable grounds that
(a)  a spill has occurred in any portion of the joint management area and immediate action is necessary in order to effect any reasonable measures referred to in subsection (3); and
(b)  action is not being taken or will not be taken under subsection (3).
Taking over management
(5)  For the purposes of subsection (4), the Chief Conservation Officer may authorize and direct any person, as necessary, to enter the place where the spill has occurred and take over the management and control of any work or activity being carried on in the area of the spill.
Managing work or activity
(6)  The person so authorized and directed must manage and control that work or activity and take all reasonable measures that are referred to in subsection (3) in relation to the spill.
Costs
(7)  Any costs incurred under subsection (6) must be borne by the person who obtained the authorization under paragraph 106(1)(b) in respect of the work or activity from which the spill emanated and, until paid, constitute a debt recoverable by action in any court of competent jurisdiction as a debt due to the Her Majesty in right of Canada.
Recovery of costs
(8)  If a person, other than a person referred to in subsection (7), takes action under subsection (3) or (4), the person may recover from Her Majesty in right of Canada the costs and expenses reasonably incurred by them in taking the action.
Application for review by Boards
(9)  A person who is aggrieved by any action or measure taken or authorized or directed to be taken under subsections (4) to (6) may apply to the Boards for a review of the action or measure.
Powers
(10)  After hearing an application, the Boards may
(a)  set aside, confirm or vary the action or measure that is the subject of the application;
(b)  order that any of the measures under subsection (3) be taken; or
(c)  make any other order that the Boards consider appropriate.
Personal liability
(11)  No person who is required, directed or authorized to act under this section is personally liable either civilly or criminally in respect of any act or omission in the course of complying with this section unless it is shown that the act or omission was due to that person's gross negligence or wilful misconduct, or gross or intentional fault.
Spill-treating agents
155.  (1)  The provisions referred to in Schedule 3 do not apply to the deposit of a spill-treating agent and those referred to in Schedule 4 do not apply in respect of any harm that is caused by the spill-treating agent or by the interaction between the spill-treating agent and the spilled oil, if
(a)  the authorization for a work or activity permits the use of the spill-treating agent;
(b)  the Chief Conservation Officer approves the use of the agent in response to the spill and it is used in accordance with any requirements set out in the approval; and
(c)  the agent is used for the purposes of subsection 154(3) or (4).
Clarification
(2)  The provisions referred to in Schedule 4 continue to apply to the holder of an authorization referred to in paragraph (1)(a) in respect of any harm that is caused by the spill or, despite subsection (1), by the interaction between the spill-treating agent and the spilled oil.
Net environmental benefit
(3)  Other than in the case of a small-scale test, the approval required under paragraph (1)(b) must be in writing and is not to be granted unless
(a)  the Chief Conservation Officer has consulted with the Ministers with respect to the approval;
(b)  the Federal Minister has consulted with the Minister of the Environment with respect to the approval; and
(c)  the Chief Conservation Officer determines that the use of the agent is likely to achieve a net environmental benefit.
156.  Section 123 and subsections 124(1) to (3) of the Canadian Environmental Protection Act, 1999 do not apply in respect of a spill-treating agent.
Fisheries Act — civil liability
157.  For the purpose of section 42 of the Fisheries Act, if subsection 36(3) of that Act would have been contravened but for subsection 155(1),
(a)  subsection 36(3) of that Act is deemed to apply in respect of the deposit of the spill-treating agent;
(b)  the holder of the authorization referred to in paragraph 155(1)(a) is deemed to be the only person referred to in paragraph 42(1)(a) of that Act; and
(c)  those persons who caused or contributed to the spill are deemed to be the only persons referred to in paragraph 42(1)(b) of that Act.
Notice
158.  The Federal Minister must, as soon as possible after a list of spill-treating agents is established by regulation, notify the Provincial Minister and the Boards of the making of the list and any amendment to it.
Scientific research
159.  (1)  For the purpose of a particular research project pertaining to the use of a spill-treating agent in mitigating the environmental impacts of a spill, the Minister of the Environment may authorize, and establish conditions for, the deposit of a spill-treating agent, oil or oil surrogate if the Federal Minister has obtained the Provincial Minister's approval.
Oil surrogate
(2)  The Minister of the Environment must not authorize the deposit of an oil surrogate unless that Minister determines that the oil surrogate poses fewer safety, health or environmental risks than oil.
Non-application
(3)  If the conditions set out in the authorization are met, the provisions referred to in section 156 and Schedules 3 and 4 do not apply in respect of the spill-treating agent, oil and oil surrogate required for the research project.
Recovery of loss, damage, costs or expenses
160.  (1)  If any discharge, emission or escape of petroleum that is authorized by regulation, or any spill, occurs in any portion of the joint management area,
(a)  all persons to whose fault or negligence the spill or the authorized discharge, emission or escape of petroleum is attributable or who are by law responsible for others to whose fault or negligence the spill or the authorized discharge, emission or escape of petroleum is attributable are jointly and severally, or solidarily, liable for
(i)  all actual loss or damage incurred by any person as a result of the spill or the authorized discharge, emission or escape of petroleum, or as a result of any action or measure taken in relation to the spill or the authorized discharge, emission or escape of petroleum,
(ii)  the costs and expenses reasonably incurred by either of the Boards, Her Majesty in right of Canada or of Quebec or any other person in taking any action or measure in relation to the spill or the authorized discharge, emission or escape of petroleum, and
(iii)  all loss of non-use value relating to a public resource that is affected by the spill or the authorized discharge, emission or escape of petroleum or as a result of any action or measure taken in relation to the spill or the authorized discharge, emission or escape of petroleum; and
(b)  the person who is required to obtain an authorization under paragraph 106(1)(b) in respect of the work or activity from which the spill or the authorized discharge, emission or escape of petroleum emanated is liable, without proof of fault or negligence, up to the applicable limit of liability that is set out in subsection (5), for the actual loss or damage, the costs and expenses and the loss of non-use value described in subparagraphs (a)(i) to (iii).
Loss or damage caused by debris
(2)  If, as a result of debris or as a result of any action or measure taken in relation to debris, there is a loss of non-use value relating to a public resource or if any person incurs actual loss or damage as a result of debris or if either of the Boards or Her Majesty in right of Canada or of Quebec reasonably incurs any costs or expenses in taking any action or measure in relation to debris,
(a)  all persons to whose fault or negligence the debris is attributable or who are by law responsible for others to whose fault or negligence the debris is attributable are jointly and severally, or solidarily, liable for that loss, actual loss or damage and those costs and expenses; and
(b)  the person who is required to obtain an authorization under paragraph 106(1)(b) in respect of the work or activity from which the debris originated is liable, without proof of fault or negligence, up to the applicable limit of liability that is set out in subsection (5), for that loss, actual loss or damage and those costs and expenses.
Contribution based on degree of fault
(3)  The persons who are at fault or negligent, or who are by law responsible for persons who are at fault or negligent, are liable to make contributions to each other or to indemnify each other in the degree to which they are respectively at fault or negligent.
Vicarious liability for contractors
(4)  A person who is required to obtain an authorization under paragraph 106(1)(b) and who retains, to carry on a work or activity in respect of which the authorization is required, the services of a contractor to whom paragraph (1)(a) or (2)(a) applies is jointly and severally, or solidarily, liable with that contractor for any actual loss or damage, costs and expenses and loss of non-use value described in subparagraphs (1)(a)(i) to (iii) and subsection (2).
Limit of liability
(5)  For the purposes of paragraphs (1)(b) and (2)(b), the limit of liability is $1 billion. Increase in limit of liability (6) Subject to subsection 7(1), the Governor in Council may, by regulation, increase the amount referred to in subsection (5). Liability under another law — paragraph (1)(b) or (2)(b) (7) If a person is liable under paragraph (1)(b) or (2)(b) with respect to an occurrence and the person is also liable under any other Act, without proof of fault or negligence, for the same occurrence, the person is liable up to the greater of the applicable limit of liability that is set out in subsection (5) and the limit up to which the person is liable under the other Act. If the other Act does not set out a limit of liability, the limits set out in subsection (5) do not apply. Costs and expenses not recoverable under Fisheries Act (8) The costs and expenses that are recoverable by Her Majesty in right of Canada or of Quebec under this section are not recoverable under subsection 42(1) of the Fisheries Act. Action — loss of non-use value (9) Only Her Majesty in right of Canada or of Quebec may bring an action to recover a loss of non-use value described in subsections (1) and (2). Claims (10) All claims under this section may be sued for and recovered in any court of competent jurisdiction in Canada and must rank, firstly, in favour of persons incurring actual loss or damage described in subsection (1) or (2), without preference, and, secondly, without preference, to meet any costs and expenses described in those subsections and, lastly, to recover a loss of non-use value described in those subsections. Saving (11) Subject to subsections (8) and (9), nothing in this section suspends or limits (a) any legal liability or remedy for an act or omission by reason only that the act or omission is an offence under this Division or gives rise to liability under this section; (b) any recourse, indemnity or relief available at law to a person who is liable under this section against any other person; or (c) the operation of any applicable law or rule of law that is not inconsistent with this section. Limitation period (12) Proceedings in respect of claims under this section may be instituted within three years after the day on which the loss, damage, costs or expenses were incurred but in no case after six years from the day on which the spill or the discharge, emission or escape of petroleum occurred or, in the case of debris, from the day on which the installation or structure in question was abandoned or the material in question broke away or was jettisoned or displaced. Financial resources — certain activities 161. (1) An applicant for an authorization under paragraph 106(1)(b) for the drilling for or development or production of petroleum must provide proof, in the prescribed form and manner, that it has the financial resources necessary to pay the greatest of the amounts of the limits of liability referred to in subsection 160(5) that apply to it. If the Boards consider it necessary, they may determine a greater amount and require proof that the applicant has the financial resources to pay that greater amount. Financial resources — other activities (2) An applicant for an authorization under paragraph 106(1)(b) for any other work or activity must provide proof, in the prescribed form and manner, that it has the financial resources necessary to pay an amount that is determined by the Boards. Loss of non-use value not considered (3) When the Boards determine an amount under subsection (1) or (2), they are not required to consider any potential loss of non-use value relating to a public resource that is affected by a spill or the authorized discharge, emission or escape of petroleum or as a result of debris. Continuing obligation (4) The holder of an authorization for a work or activity must ensure that the proof referred to in subsections (1) and (2) remains in force for the duration of the work or activity in respect of which the authorization is issued. Extended obligation (5) The holder of an authorization for a work or activity must also ensure that the proof referred to in subsection (1) remains in force for a period of one year beginning on the day on which the Boards notify the holder that they have accepted a report submitted by the holder indicating that the last well in respect of which the authorization was issued is abandoned. The Boards may reduce that period and may decide that the proof that is to remain in force during that period is proof that the holder has the financial resources necessary to pay an amount that is less than the amount referred to in subsection (1) and that is determined by the Boards. Financial responsibility 162. (1) An applicant for an authorization for a work or activity must provide proof of financial responsibility in the form of a letter of credit, a guarantee or an indemnity bond or in any other form satisfactory to the Boards, (a) in the case of the drilling for or development or production of petroleum in the joint management area, in the amount of$100 million or, if the Boards consider it necessary, in a greater amount that they determine; or
(b)  in any other case, in an amount that is satisfactory to, and determined by, the Boards.
Continuing obligation
(2)  The holder of an authorization for a work or activity must ensure that the proof referred to in subsection (1) remains in force for the duration of the work or activity in respect of which the authorization is issued.
Extended obligation
(3)  The holder of an authorization for a work or activity must also ensure that the proof referred to in paragraph (1)(a) remains in force for a period of one year beginning on the day on which the Boards notify the holder that they have accepted the report submitted by the holder indicating that the last well in respect of which the authorization was issued is abandoned. The Boards may reduce that period and may decide that the proof that is to remain in force during that period is for an amount that is less than the amount referred to in paragraph (1)(a) and that is determined by the Boards.
Payment of claims
(4)  The Boards may require that moneys in an amount not more than the amount prescribed for any case or class of cases, or determined by the Boards in the absence of regulations, be paid out of the funds available under the letter of credit, guarantee or indemnity bond or other form of financial responsibility provided under subsection (1) in respect of any claim for which proceedings may be instituted under section 160, whether or not those proceedings have been instituted.
Manner of payment
(5)  If payment is required under subsection (4), it must be made in the manner, subject to any conditions and procedures and to or for the benefit of any persons or classes of persons, that may be prescribed for any case or class of cases or as may be required by the Boards in the absence of regulations.
Deduction
(6)  If a claim is sued for under section 160, there is to be deducted from any award made as a result of the action on that claim any amount received by the claimant under this section in respect of the loss, damage, costs or expenses claimed.
Lesser amount
163.  (1)  The Ministers may, by order, on the recommendation of the Boards, approve an amount that is less than the amount referred to in subsection 160(5) or paragraph 162(1)(a) in respect of an applicant for, or a holder of, an authorization for a work or activity.
Financial resources — exception
(2)  If the Ministers approve an amount that is less than the amount referred to in subsection 160(5) in respect of an applicant for an authorization for a work or activity, that applicant, for the purposes of subsection 161(1), need only provide proof that it has the financial resources necessary to pay the adjusted amount approved by the Ministers.
No contravention
(3)  No applicant for an authorization for a work or activity contravenes paragraph 162(1)(a) if that applicant provides proof of financial responsibility in the amount that is approved by the Ministers under this section.

#### Inquiries

Inquiries
164.  (1)  If a spill or debris or an accident or incident related to any work or activity to which this Part applies occurs or is found in any portion of the joint management area and results in death or injury or danger to public safety or the environment, the Ministers may direct an inquiry to be made and may authorize any person they consider qualified to conduct the inquiry.
Mandatory inquiry
(2)  The Ministers must, under prescribed circumstances, direct that an inquiry referred to in subsection (1) be made and must ensure that the person who conducts the inquiry — the investigator — is not employed in a part of the federal administration or the public service of Quebec for which either Minister is responsible.
Power of person conducting inquiry
(3)  For the purposes of an inquiry under subsection (1), the investigator has and may exercise all the powers of a person appointed as a commissioner under Part I of the Inquiries Act, other than the power to make a finding of, and impose a punishment for, contempt of court. The investigator may, however, apply to a judge of the Superior Court of Quebec to make a finding of, and impose a punishment for, contempt of court.
Contempt of court
(4)  Every person who contravenes an order of the investigator, or who refuses to answer questions that the investigator has the legal authority to ask or to produce documents or other things that the investigator has the legal authority to request, or who undermines the conduct of the hearing is guilty of contempt of court.
Compatible procedures and practices
(5)  The investigator must ensure that, to the extent feasible, the procedures and practices for the inquiry are compatible with investigation procedures and practices followed by any appropriate authority and, for those purposes, may consult with any of those authorities.
Report
(6)  As soon as feasible after the conclusion of the inquiry, the investigator must submit a report to the Ministers, together with the evidence and other material that was before the inquiry.
Publication
(7)  The report must be jointly published by the Ministers within 60 days after the later of the days on which it was received.
Copies of report
(8)  The Ministers may supply copies of the published report in the manner and on any terms that they consider proper.

### Division 3Production Arrangements

#### Interpretation

Definitions
165.  The following definitions apply in this Division.
"pooled spacing unit"
« unité d'espacement mise en commun »
"pooled spacing unit" means the area that is subject to a pooling agreement or a pooling order.
"pooled tract"
« parcelle mise en commun »
"pooled tract" means the portion of a pooled spacing unit defined as a tract in a pooling agreement or a pooling order.
"pooling agreement"
« accord de mise en commun »
"pooling agreement" means an agreement to pool the interests of owners in a spacing unit and to provide for the operation or the drilling and operation of a well on that spacing unit.
"pooling order"
« ordonnance de mise en commun »
"pooling order" means an order made under section 167 or as altered in accordance with section 169.
"royalty interest"
« droit à redevance »
"royalty interest" means any interest or right in, or the right to receive a portion of, any petroleum produced and saved from a field or pool or part of a field or pool or the proceeds from its sale, but does not include a working interest or the interest of any person whose sole interest is as a purchaser of petroleum from the pool or part of the pool.
"royalty owner"
« titulaire de redevance »
"royalty owner" means a person, including Her Majesty in right of Canada, who owns a royalty interest.
"spacing unit"
« unité d'espacement »
"spacing unit" means the area allocated to a well for the purpose of drilling for or producing petroleum.
"tract participation"
« fraction parcellaire »
"tract participation" means the share of production from a unitized zone that is allocated to a unit tract under a unit agreement or unitization order or the share of production from a pooled spacing unit that is allocated to a pooled tract under a pooling agreement or pooling order.
"unit agreement"
« accord d'union »
"unit agreement" means an agreement to unitize the interests of owners in a pool or part of the pool whose area is greater than the area of a spacing unit and includes a unit agreement as varied by a unitization order.
"unit area"
« secteur unitaire »
"unit area" means the area that is subject to a unit agreement.
"unit operating agreement"
« accord d'exploitation unitaire »
"unit operating agreement" means an agreement, providing for the management and operation of a unit area and a unitized zone, that is entered into by working interest owners who are parties to a unit agreement with respect to that unit area and unitized zone and includes a unit operating agreement as varied by a unitization order.
"unit operation"
« exploitation unitaire »
"unit operation" means operations conducted under a unit agreement or a unitization order.
"unit operator"
« exploitant unitaire »
"unit operator" means a person designated as a unit operator under a unit operating agreement.
"unit tract"
« parcelle unitaire »
"unit tract" means the portion of a unit area that is defined as a tract in a unit agreement.
"unitization order"
« ordonnance d'union »
"unitization order" means an order made under section 175.
"unitized zone"
« terrain »
"unitized zone" means a geological formation that is within a unit area and subject to a unit agreement.
"working interest"
« intérêt économique direct »
"working interest" means a right, in whole or in part, to produce and dispose of petroleum from a pool or part of a pool, whether the right is held as an incident of ownership in the petroleum or under a production licence, an agreement or another instrument, if the right is chargeable with and the holder of the right is obligated to pay or bear, either in cash or out of production, all or a portion of the costs in connection with the drilling for, recovery and disposal of petroleum from the pool or part of the pool.

#### Pooling

Voluntary pooling
166.  (1)  The working interest owners who have separately owned working interests in a spacing unit and the royalty owners who own all the interests in the spacing unit may pool their working interests and royalty interests in the spacing unit for the purpose of drilling for or producing, or both drilling for and producing, petroleum.
Copy to Chief Conservation Officer
(2)  A copy of the pooling agreement and any amendment to it must be filed with the Chief Conservation Officer.
Pooling agreement
(3)  The Ministers may, on behalf of their respective governments, enter into a pooling agreement on any terms that they consider advisable, and, despite anything in Part 1, this Part or the Federal Real Property and Federal Immovables Act or any regulations made under those Parts or that Act, the pooling agreement is binding on the parties.
Application for pooling order
167.  (1)  In the absence of a pooling agreement, the owner of a working interest in a spacing unit may apply for a pooling order directing the other working interest owners and the royalty owners within the spacing unit to pool their interests in the spacing unit.
Hearing by Committee
(2)  The application must be made to the Ministers who must refer the application to the Committee for the purpose of holding a hearing to determine whether a pooling order should be made. At the hearing, the Committee must afford all interested parties an opportunity to be heard.
Information provided to Committee
(3)  Before the hearing, the applicant must provide the Committee, and any other interested parties that the Committee may direct, with a proposed pooling agreement and the working interest owners who have interests in the spacing unit to which the proposed pooling agreement relates must provide the Committee with any information that the Committee considers necessary.
Order of Committee
(4)  After the hearing, the Committee may order that all working interest owners and royalty owners who have an interest in the spacing unit are deemed to have entered into a pooling agreement as set out in the pooling order.
Contents of pooling order
(5)  Every pooling order must provide
(a)  for the drilling and operating of a well on the spacing unit or, if a well that is capable of or that can be made capable of production has been drilled on the spacing unit before the making of the pooling order, for the future production and operation of that well;
(b)  for the appointment of an operator, from among the owners of working interests in a spacing unit, to be responsible for the drilling, operation or abandoning of the well whether it was drilled before or after the making of the pooling order;
(c)  for the allocation to each pooled tract of a share of the production of the petroleum from the pooled spacing unit that is not required, consumed or lost in the operation of the well, the allocation being on a prorated area basis unless it can be shown to the satisfaction of the Committee that that basis is unfair, in which case the Committee may make an allocation on some other more equitable basis;
(d)  if no production of petroleum is obtained, for the payment by the applicant of all costs incurred in the drilling and abandoning of the well;
(e)  if production is obtained, for the payment of the actual costs of drilling the well, whether it was drilled before or after the making of the pooling order, and for the payment of the actual costs of the completing, operation and abandoning of the well; and
(f)  for the sale, by the operator, of the petroleum that is allocated under paragraph (c) to a working interest owner if that working interest owner fails to take in kind and dispose of the production of that petroleum, and for the deduction from the proceeds of the sale, by the operator, of the expenses reasonably incurred in connection with the sale.
Provision of penalty
(6)  A pooling order may provide for a penalty for a working interest owner who does not, within the time specified in the order, pay the costs attributable to the working interest owner as their share of the cost of the drilling and completing of the well, but the penalty must not exceed an amount equal to one-half of that working interest owner's share of the costs.
Recovery of costs and penalty
(7)  If a working interest owner does not, within the time specified in the pooling order, pay their share of the costs of the drilling, completing, operating and abandoning of the well, that portion of the costs and the penalty, if any, are recoverable only out of their share of production from the spacing unit and not in any other manner.
Effect of pooling order
168.  If a pooling order is made, all working interest owners and royalty owners who have interests in the pooled spacing unit are, on the making of the pooling order, deemed to have entered into a pooling agreement as set out in the pooling order and that order is deemed to be a valid contract between the parties who have interests in the pooled spacing unit and all its terms and provisions, as set out in the pooling order or as altered in accordance with section 169, are binding on and enforceable against the parties to the pooling order.
Application to alter pooling order
169.  (1)  The Committee must hear any application to vary, amend or terminate a pooling order if the application is made by the owners of more than 25% of the working interests in the pooled spacing unit, calculated on a prorated area basis, and may, in its discretion, order a hearing on the application of any working interest owner or royalty owner who has an interest in the pooled spacing unit.
Alteration of pooling order
(2)  After the hearing, the Committee may vary or amend the pooling order to supply any deficiency in the pooling order or to meet changing conditions and may vary or revoke any provision that it considers to be unfair or inequitable or it may terminate the pooling order.
Tract participation ratios protected
(3)  If a pooling order is varied or amended, no change is to be made that will alter the ratios of tract participations between the pooled tracts as originally set out in the pooling order.
Prohibition
170.  (1)  A person must not produce any petroleum within a spacing unit in which there are two or more production licences or two or more separately owned working interests unless a pooling agreement has been entered into in accordance with section 166 or is deemed to have been entered into in accordance with a pooling order made under section 167.
Saving
(2)  Subsection (1) does not prohibit the production of petroleum for testing in any quantities approved by the Chief Conservation Officer.

#### Unitization

Unit operation
171.  (1)  Any one or more owners of a working interest in a pool or part of the pool whose area is more than the area of a spacing unit may, together with the royalty owners, enter into a unit agreement and operate their interests in accordance with the terms of the unit agreement or any amendment to it.
Copy to Chief Conservation Officer
(2)  A copy of the unit agreement and any amendment to it must be filed with the Chief Conservation Officer.
Ministers may enter into unit agreement
(3)  The Ministers may, on behalf of their respective governments, enter into a unit agreement on any terms that they consider advisable and, in case of any inconsistency or conflict between the terms of the unit agreement and any regulations made under this Act or the Federal Real Property and Federal Immovables Act, the terms of the unit agreement take precedence.
Unit operator's relationship to parties
(4)  If a unit agreement filed under this section provides that a unit operator must be the agent or mandatary of the parties to the agreement with respect to their powers, duties and functions under this Part, the unit operator's exercise or performance of, or their failure to exercise or perform, those powers, duties and functions is attributed to the parties otherwise having those powers, duties and functions under this Part.
Requiring unitization to prevent waste
172.  (1)  Despite anything in this Part, if, in the opinion of the Chief Conservation Officer, the unit operation of a pool or part of the pool would prevent waste, the Chief Conservation Officer may apply to the Committee for an order requiring the working interest owners concerned to enter into a unit agreement and a unit operating agreement.
Hearing
(2)  If the application is made, the Committee must hold a hearing at which all interested persons are to be given an opportunity to be heard.
Order
(3)  If, after the hearing, the Committee is of the opinion that the unit operation of a pool or part of the pool would prevent waste, the Committee may by order require the working interest owners concerned to enter into a unit agreement and a unit operating agreement.
Cessation of operations
(4)  If, within a period of not less than six months after the day on which the order is made, the working interest owners and royalty owners have not entered into a unit agreement and a unit operating agreement approved by the Committee, all drilling and production operations within the pool or part of the pool in respect of which the order was made must cease until a unit agreement and a unit operating agreement have been approved by the Committee and filed with the Chief Conservation Officer.
Permission to continue operations
(5)  Despite subsection (4), the Committee may permit the continued operation of the pool or part of the pool after the time specified in the order if the Committee is of the opinion that a unit agreement and unit operating agreement are in the course of being entered into, but any continuation of operations must be subject to the conditions established by the Committee.

#### Compulsory Unitization

Who may apply for unitization order
173.  (1)  One or more working interest owners who are parties to a unit agreement and a unit operating agreement and own in total 65% or more of the working interests in a unit area may apply for a unitization order with respect to the agreements.
Application for unitization order
(2)  The application must be made to the Ministers who must refer it to the Committee for the purpose of holding a hearing in accordance with section 175.
Application by proposed unit operator
(3)  The application may be made by the unit operator or proposed unit operator on behalf of the working interest owners referred to in subsection (1).
Contents of unitization application
174.  (1)  An application for a unitization order must contain
(a)  a plan showing the unit area to be made subject to the order;
(b)  one copy each of the unit agreement and the unit operating agreement;
(c)  a statement of the nature of the operations to be carried out; and
(d)  a statement showing
(i)  with respect to each proposed unit tract, the names and addresses of the working interest owners and royalty owners in respect of that tract, and
(ii)  the tracts that are entitled to be qualified as unit tracts under the provisions of the unit agreement.
Details required in unit agreement
(2)  The unit agreement referred to in subsection (1) must include
(a)  a description of the unit area and the unit tracts included in the agreement;
(b)  a provision respecting the allocation to each unit tract of a share of the production from the unitized zone that is not required, consumed or lost in the unit operation;
(c)  a provision specifying that the share of the production from a unit area that has been allocated to a unit tract is considered to have been produced from that unit tract; and
(d)  a provision specifying the manner in which and the circumstances under which the unit operation is to end.
Details required in unit operating agreement
(3)  The unit operating agreement referred to in subsection (1) must make provision
(a)  for the contribution or transfer to the unit, and any adjustment among the working interest owners, of the investment in wells and equipment within the unit area;
(b)  for the charging of the costs and expenses of the unit operation to the working interest owners;
(c)  for the supervision of the unit operation by the working interest owners through an operating committee composed of their duly authorized representatives and for the appointment of a unit operator to be responsible, under the direction and supervision of the operating committee, for the carrying out of the unit operation;
(d)  for the determination of the percentage value of the vote of each working interest owner; and
(e)  for the determination of the method of voting on any motion before the operating committee and the percentage value of the vote required to carry the motion.
Hearing on application
175.  (1)  If an application made under section 173 is referred by the Ministers to the Committee, the Committee must hold a hearing at which all interested persons are to be given an opportunity to be heard.
Unitization order
(2)  The Committee may order that the unit agreement is a valid contract enuring to the benefit of all the royalty owners and working interest owners who have an interest in the unit area and binding on all those owners, and that the unit operating agreement is a valid contract enuring to the benefit of all the working interest owners who have an interest in the unit area and binding on all those owners, if the Committee finds that
(a)  on the day on which the hearing begins
(i)  the unit agreement and the unit operating agreement have been executed by one or more working interest owners who own in total 65% or more of the total working interests in the unit area, and
(ii)  the unit agreement has been executed by one or more royalty owners who own in total 65% or more of the total royalty interests in the unit area; and
(b)  the unitization order applied for would accomplish the more efficient or more economical production of petroleum from the unitized zone.
Effect
(3)  Subject to section 176, the unit agreement and the unit operating agreement have the effect given to them by the unitization order.
Variation by unitization order
(4)  In a unitization order, the Committee may vary the unit agreement or the unit operating agreement by adding, deleting or amending provisions.
Effective date of unitization order
176.  (1)  Subject to subsection (2), a unitization order becomes effective on the day that the Committee indicates in the order, but that day must be not less than 30 days after the day on which the order is made.
Amendment to agreement
(2)  If a unit agreement or unit operating agreement is varied by the Committee in a unitization order, the order becomes ineffective if, before the effective date, the applicant files with the Committee a notice withdrawing the application on behalf of the working interest owners or there are filed with the Committee statements in writing objecting to the order and signed
(a)  in the case of the unit agreement, by
(i)  one or more working interest owners who own in total more than 25% of the total working interests in the unit area and were included within the group owning 65% or more of the total working interests as described in subparagraph 175(2)(a)(i), and
(ii)  one or more royalty owners who own in total more than 25% of the total royalty interests in the unit area and were included within the group owning 65% or more of the total royalty interests as described in subparagraph 175(2)(a)(ii); or
(b)  in the case of the unit operating agreement, by one or more working interest owners who own in total more than 25% of the total working interests in the unit area and were included within the group owning 65% or more of the total working interests as described in subparagraph 175(2)(a)(i).
Revocation of order
(3)  If a unitization order becomes ineffective under subsection (2), the Committee must immediately revoke the order.
Technical defects in unitization order
177.  A unitization order is not invalid by reason only of the absence of notice or of any irregularities in giving notice to any working interest owner and any royalty owner in respect of the application for the order or any proceedings leading to the making of the order.
Amending unitization order
178.  (1)  A unitization order may be amended on the application of a working interest owner, but before amending a unitization order the Committee must hold a hearing at which all interested parties are to be given an opportunity to be heard.
Voluntary proposal for amendment by owners
(2)  If the Committee finds that, on the day on which the hearing begins, one or more working interest owners who own in total 65% or more of the total working interests in the unit area and one or more royalty owners who own in total 65% or more of the total royalty interests in the unit area have consented to the proposed amendment, the Committee may amend the unitization order in accordance with the amendment proposed.
Protection of tract participation ratios
179.  No amendment is to be made under section 178 that will alter the ratios between the tract participations of those tracts that were qualified for inclusion in the unit area before the beginning of the hearing and, for the purpose of this section, the tract participations are to be those indicated in the unit agreement when it became subject to a unitization order.
Production prohibited except in accord with unitization order
180.  After the day on which a unitization order comes into effect and while the order remains in force, a person must not carry on any operations within the unit area for the purpose of drilling for or producing petroleum in the unitized zone, except in accordance with the provisions of the unit agreement and the unit operating agreement.
Determination of percentages of interests
181.  The percentages of interests referred to in subsections 173(1), 175(2), 176(2) and 178(2) must be determined
(a)  in the case of royalty interests, on a prorated area basis; and
(b)  in the case of working interests, on the basis of tract participations shown in the unit agreement.

#### General

Pooled spacing unit included in unit area
182.  (1)  A pooled spacing unit that has been pooled in accordance with a pooling order and on which a well has been drilled may be included in a unit area as a single unit tract and the Committee may make any amendments to the pooling order that it considers necessary to remove any conflict between the provisions of the pooling order and the provisions of any unit agreement, unit operating agreement or unitization order.
Effect of including pooled spacing unit
(2)  If a pooled spacing unit is included in a unit area, the provisions of any unit agreement, unit operating agreement and unitization order prevail over the provisions of the pooling order in the event of a conflict.
Exceptions
(3)  Despite subsection (2),
(a)  the share of the unit production that is allocated to the pooled spacing unit must in turn be allocated to the separately owned tracts in the pooled spacing unit on the same basis and in the same proportion as production actually obtained from the pooled spacing unit would have been shared under the pooling order;
(b)  the costs and expenses of the unit operation that are allocated to the pooled spacing unit must be shared and borne by the owners of the working interests on the same basis and in the same proportion as would apply under the pooling order; and
(c)  the credits allocated under a unit operating agreement to a pooled spacing unit for adjustment of investment for wells and equipment on the pooled spacing unit must be shared by the owners of the working interests in the same proportion as would apply to the sharing of production under the pooling order.

#### Appeals

Orders and decisions final
183.  (1)  Except as provided in this Division, every decision or order of the Committee is final and binding.
Decision or order defined
(2)  Any minutes or other record of the Committee or any other document issued by the Committee is, for the purpose of this section, considered to be a decision or an order of the Committee.
Stated case for Superior Court of Quebec
184.  (1)  The Committee may of its own motion or at the request of the Ministers state a case, in writing, for the opinion of the Superior Court of Quebec on any question that in the opinion of the Committee is a question of law or of the jurisdiction of the Committee.
Proceedings
(2)  The Court must hear and determine the case stated and remit the matter to the Committee with its opinion on it.
Ministers may review orders of Committee
185.  The Ministers may, at any time, in their discretion, of their own motion or at the request of any person concerned, vary or rescind any decision or order of the Committee, and any order that the Ministers make becomes a decision or order of the Committee and, subject to section 186, is binding on the Committee and on all parties.
Appeal to Superior Court of Quebec
186.  (1)  An appeal lies from a decision or order of the Committee to the Superior Court of Quebec on a question of law, on leave for the appeal being obtained from that Court, on application made within 30 days after the day on which the decision or order sought to be appealed from was made or within any further time that the Court may allow.
Order stayed
(2)  If leave to appeal is granted, any order of the Committee in respect of which the appeal is made must be stayed until the matter of the appeal is determined.
Powers of the Court
(3)  After the hearing of the appeal, the Court must give its opinion to the Committee and the Committee must make any order necessary to comply with that opinion.
Order subject to section 185
(4)  Any order made by the Committee under subsection (3) is subject to section 185 unless the order has already been varied or rescinded under that section by the Ministers.

#### Safety and Conservation Officers

Designation
187.  (1)  Subject to subsection (3), the Ministers must designate from among the Boards' officers and employees an individual who has been recommended by the Boards as a safety officer or conservation officer for the purposes of the administration and enforcement of this Part. The Ministers must make the designation within 30 days after the day on which they receive the name of the individual from the Boards.
Notice of designation
(2)  The Ministers must, without delay after making a designation, notify the Boards, in writing, that the designation has been made.
Restriction
(3)  The Ministers must not designate an individual if they are not satisfied that the individual is qualified to exercise the powers and perform the duties and functions of a safety officer or a conservation officer under this Part. If an individual is not designated, the Ministers must so notify the Boards, in writing, without delay.
Certificate to be produced
(4)  The Boards must provide every safety officer and conservation officer and the Chief Safety Officer and the Chief Conservation Officer with a certificate of appointment or designation and, on entering any place under the authority of this Part, the officer must, if so required, produce the certificate to the person in charge of the place under section 188.
Orders for verifying compliance
188.  (1)  A safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer may, for the purpose of verifying compliance with this Part, order any person who is in charge of a place that is used for any work or activity in respect of which this Part applies or a place in which that officer has reasonable grounds to believe that there is anything to which this Part applies
(a)  to inspect anything in the place;
(b)  to pose questions, or conduct tests or monitoring, in the place;
(c)  to take photographs or measurements, or make recordings or drawings, in the place;
(d)  to accompany or assist the officer while the officer is in the place;
(e)  to produce a document or another thing that is in their possession or under their control, or to prepare and produce a document based on data or documents that are in their possession or under their control, in the form and manner that the officer may specify;
(f)  to provide, to the best of their knowledge, information relating to any matter to which this Part applies, or to prepare and produce a document based on that information, in the form and manner that the officer may specify;
(g)  to ensure that all or part of the place, or anything located in the place, that is under their control, not be disturbed for a reasonable period that is established by the officer pending the exercise of any powers under this section; and
(h)  to remove anything from the place and to provide it to the officer, in the manner that he or she specifies, for examination, testing or copying.
Powers on entry
(2)  A safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer may, for the purpose of verifying compliance with this Part, and subject to section 191, enter a place that is used for any work or activity in respect of which this Part applies, or a place in which that officer has reasonable grounds to believe that there is anything to which this Part applies, and may for that purpose
(a)  inspect anything in the place;
(b)  pose questions, or conduct tests or monitoring, in the place;
(c)  take samples from the place, or cause them to be taken, for examination or testing, and dispose of those samples;
(d)  remove anything from the place, or cause it to be removed, for examination, testing or copying;
(e)  while in the place, take or cause to be taken photographs or measurements, make or cause to be made recordings or drawings and use systems in the place that capture images or cause them to be used;
(f)  use any computer system in the place, or cause it to be used, to examine data contained in or available to it;
(g)  prepare a document, or cause one to be prepared, based on the data;
(h)  use or cause to be used any copying equipment in the place to make copies of the data;
(i)  be accompanied while in the place by any person, or be assisted while in the place by any person, that the officer considers necessary; and
(j)  meet in private with any person in the place, with the agreement of that person.
Clarification
(3)  For greater certainty, an officer who enters a place under subsection (2) may order any person in the place to do anything described in paragraphs (1)(a) to (h).
Return of things removed
(4)  Anything that is removed under paragraph (1)(h) or (2)(d) for examination, testing or copying must, if requested by the person from whom it was removed, be returned to that person after the examination, testing or copying is completed, unless it is required for the purpose of a prosecution under this Part.
Assistance to officers
189.  (1)  The owner and every person who is in charge of a place that is entered by a safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer under subsection 188(2), and every person found in that place, must give all assistance that is reasonably required to enable the officer to verify compliance with this Part and provide any documents, data or information that is reasonably required for that purpose.
Transportation, accommodation and food
(2)  If the place referred to in subsection 188(2) is a marine installation or structure, as defined in subsection 145(1), the person who is in charge of the marine installation or structure must provide to the officer, and to every person accompanying the officer, free of charge,
(a)  suitable transportation between the usual point of embarkation on shore and the marine installation or structure, between the marine installation or structure and the usual point of disembarkation on shore, and between marine installations or structures, if the marine installation or structure or marine installations or structures are situated in the joint management area; and
(b)  suitable accommodation and food at the marine installation or structure.
Reports to holder of authorization
190.  A safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer, as the case may be, must provide to the holder of an authorization for a work or activity written reports about anything inspected, tested or monitored by or on the order of the officer for the purpose of verifying compliance with this Part in any place that is used for a work or activity in respect of which the authorization is issued.
Entering living quarters
191.  (1)  If the place referred to in subsection 188(2) is living quarters
(a)  neither a conservation officer nor the Chief Conservation Officer is authorized to enter those quarters for the purpose of verifying compliance with the provisions of this Part; and
(b)  a safety officer or the Chief Safety Officer is not authorized to enter those quarters without the consent of the occupant except
(i)  to execute a warrant issued under subsection (4), or
(ii)  to verify that those quarters, if on a marine installation or structure, as defined in subsection 145(1), are in a structurally sound condition.
Notice
(2)  The officer must provide reasonable notice to the occupant before entering living quarters under subparagraph (1)(b)(ii).
Exception
(3)  Despite subparagraph (1)(b)(ii), any locker in the living quarters that is fitted with a locking device and that is assigned to the occupant must not be opened by the officer without the occupant's consent except under the authority of a warrant issued under subsection (4).
Authority to issue warrant
(4)  On ex parte application, a justice of the peace may issue a warrant authorizing a safety officer who is named in it or the Chief Safety Officer to enter living quarters subject to any conditions specified in the warrant if the justice is satisfied by information on oath that
(a)  the living quarters is a place referred to in subsection 188(2);
(b)  entry to the living quarters is necessary to verify compliance with this Part; and
(c)  entry was refused by the occupant or there are reasonable grounds to believe that entry will be refused or that consent to entry cannot be obtained from the occupant.
Authority to open locker
(5)  The warrant may also authorize a locker described in subsection (3) to be opened, subject to any conditions specified in the warrant, if the justice is satisfied by information on oath that
(a)  it is necessary to open the locker to verify compliance with this Part; and
(b)  the occupant to whom the locker is assigned refused to allow it to be opened or there are reasonable grounds to believe that the occupant to whom it is assigned will refuse to allow it to be opened or that consent to opening it cannot be obtained from that occupant.
Use of force
(6)  The officer who executes a warrant issued under subsection (4) must not use force unless the use of force has been specifically authorized in the warrant.
Telewarrant provisions to apply
(7)  A warrant may be issued under this section by telephone or other means of telecommunication on information submitted by a safety officer or the Chief Safety Officer by one of those means and section 487.1 of the Criminal Code applies for that purpose with any modifications that the circumstances require.
Definition of "living quarters"
(8)  For the purposes of this section, "living quarters" means sleeping quarters provided on a marine installation or structure, as defined in subsection 145(1), and any room for the exclusive use of the occupants of those quarters that contains a toilet or a urinal.
Obstruction and false statements
192.  A person must not obstruct or hinder, or make a false or misleading statement, either orally or in writing, to a safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer while the officer is performing his or her duties or functions under this Part.
Authority to issue warrant
193.  (1)  On ex parte application, a justice of the peace may issue a warrant if the justice is satisfied by information on oath that there are reasonable grounds to believe that there is in any place anything that will provide evidence or information relating to the commission of an offence under this Part.
Powers under warrant
(2)  The warrant may authorize a safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer, and any other person named in the warrant, to at any time enter and search the place and to seize anything specified in the warrant or do any of the following as specified in the warrant, subject to any conditions that may be specified in the warrant:
(a)  conduct examinations, tests or monitoring;
(b)  take samples for examination or testing, and dispose of those samples; or
(c)  take photographs or measurements, make recordings or drawings and use systems in the place that capture images.
Warrant not necessary
(3)  A safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer may exercise the powers described in this section without a warrant if the conditions for obtaining the warrant exist but by reason of exigent circumstances it would not be feasible to obtain the warrant.
Exigent circumstances
(4)  Exigent circumstances include circumstances in which the delay necessary to obtain a warrant would result in danger to human life or the environment or the loss or destruction of evidence.
Operation of computer system
(5)  A person authorized under this section to search a computer system in a place may
(a)  use or cause to be used any computer system in the place to search any data contained in or available to the computer system;
(b)  reproduce or cause to be reproduced any data in the form of a printout or other intelligible output;
(c)  seize any printout or other output for examination or copying; and
(d)  use or cause to be used any copying equipment in the place to make copies of the data.
Duty of person in possession or control
(6)  Every person who is in charge of a place in respect of which a search is carried out must, on presentation of the warrant, permit the individual carrying out the search to do anything described in subsection (5).
Transportation, accommodation and food
(7)  If the place that is searched is a marine installation or structure, as defined in subsection 145(1), the person who is in charge of the marine installation or structure must provide to the individual who is executing the warrant, free of charge,
(a)  suitable return transportation between the marine installation or structure and any location from which transportation services to that marine installation or structure are usually provided, and between marine installations or structures, if the marine installation or structure or marine installations or structures are situated in the joint management area; and
(b)  suitable accommodation and food at the marine installation or structure.
Telewarrant provisions to apply
(8)  A warrant may be issued under this section by telephone or other means of telecommunication on information submitted by a safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer by one of those means and section 487.1 of the Criminal Code applies for that purpose with any modifications that the circumstances require.
Storage and removal
194.  (1)  A thing seized under this Part may be stored in the place where it was seized or may, at the discretion of a safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer, be removed to any other place for storage. The owner of the thing or the person who is lawfully entitled to possess it must pay the costs of storage or removal.
Perishable things
(2)  If the thing seized is perishable, a safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer may destroy the thing or otherwise dispose of it in any manner the officer considers appropriate. Any proceeds realized from its disposition must be paid to the Receiver General.
Dangerous operation
195.  (1)  If a safety officer or the Chief Safety Officer, on reasonable grounds, is of the opinion that continuation of any work or activity related to the exploration or drilling for or the production, conservation, processing or transportation of petroleum in any portion of the joint management area is likely to result in serious bodily injury, that safety officer or the Chief Safety Officer, as the case may be, may order that the operation cease or be continued only in accordance with the terms of the order.
Notice
(2)  The officer who makes an order under subsection (1) must affix at or near the scene of the work or activity a notice of their order in the form approved by the Boards.
Expiry of order
(3)  The safety officer's order expires 72 hours after it is made unless it is confirmed before that time by order of the Chief Safety Officer.
Modification or revocation
(4)  A safety officer who makes an order under subsection (1) must immediately advise the Chief Safety Officer that the order has been made. The Chief Safety Officer may modify or revoke the order.
Reference
(5)  The person carrying out the work or activity to which an order under subsection (1) makes reference or any person having a pecuniary interest in that work or activity may by notice in writing request the Chief Safety Officer to refer the order to the Boards for review and the Officer must do so.
Inquiry
(6)  The Boards must inquire into the need for the order and may confirm it or set it aside. The Boards' decision is final.
Burden of proof
(7)  If an order has been referred to the Boards under this section, the burden of establishing that the order is not needed is on the person who requested that the order be so referred.
Prohibition
(8)  A person must not continue a work or activity in respect of which an order has been made under this section, except in accordance with the terms of the order or until the order has been set aside by the Boards under this section.
Priority
196.  An order made by a safety officer or the Chief Safety Officer prevails over an order made by a conservation officer or the Chief Conservation Officer to the extent of any inconsistency between the orders.

#### Installation Manager

Installation manager
197.  (1)  Every holder of an authorization issued under paragraph 106(1)(b) with respect to a work or activity for which a prescribed installation is to be used must put in command of the installation a manager who meets the prescribed qualifications. The installation manager is responsible for the safety of the installation and the persons at it.
Powers
(2)  Subject to this Act and any other Act of Parliament, an installation manager has the power to do anything that is required to ensure the safety of the installation and the persons at it and, more particularly, may
(a)  give orders to any person who is at the installation;
(b)  order that any person who is at the installation be restrained or removed; and
(c)  obtain any information or documents.
Emergency
(3)  In a prescribed emergency situation, an installation manager's powers are extended so that they also apply to each person in charge of a vessel, vehicle or aircraft that is at the installation or that is leaving or approaching it.

#### Offences and Penalties

Offences
198.  (1)  Every person is guilty of an offence who
(a)  contravenes any provision of this Part or the regulations made under it;
(b)  makes any false entry or statement in any report, record or other document that is required by this Part or the regulations made under it, or by any order made under this Part or those regulations;
(c)  destroys, mutilates or falsifies any report, record or other document that is required by this Part or the regulations made under it or by any order made under this Part or those regulations;
(d)  produces any petroleum from a pool or field under the terms of a unit agreement, as defined in Division 3, or any amended unit agreement, before a copy of the unit agreement or amended unit agreement is filed with the Chief Conservation Officer;
(e)  undertakes or carries on a work or activity without an authorization under paragraph 106(1)(b) or without complying with the approvals or requirements, determined by the Boards in accordance with the provisions of this Part or granted or prescribed by regulations made under this Part, of such an authorization; or
(f)  fails to comply with a direction, requirement or order of a safety officer, the Chief Safety Officer, a conservation officer or the Chief Conservation Officer or with an order of an installation manager or the Committee or with an order of the Boards made under this Part.
Punishment
(2)  Every person who is guilty of an offence under subsection (1) is liable
(a)  on summary conviction to a fine of not more than $300,000 or to imprisonment for a term of not more than 18 months, or to both; or (b) on conviction on indictment to a fine of not more than$6,000,000 or to imprisonment for a term of not more than four years, or to both.
Sentencing principles
(3)  In addition to the principles and factors that the court is otherwise required to consider, including those set out in sections 718.1 to 718.21 of the Criminal Code, the court must consider the following principles when sentencing a person who is found guilty of an offence under this Part:
(a)  the amount of the fine should be increased to account for every aggravating factor associated with the offence, including the aggravating factors set out in subsection (4); and
(b)  the amount of the fine should reflect the gravity of each aggravating factor associated with the offence.
Aggravating factors
(4)  The aggravating factors are the following:
(a)  the offence caused harm or risk of harm to human health or safety;
(b)  the offence caused damage or risk of damage to the environment or to environmental quality;
(c)  the offence caused damage or risk of damage to any unique, rare, particularly important or vulnerable component of the environment;
(d)  the damage or harm caused by the offence is extensive, persistent or irreparable;
(e)  except in the case of an offence referred to in paragraph (1)(a) that is in respect of the contravention of subsection 93(2) or of paragraph 136(1)(b) or the case of the offence of falsifying referred to in paragraph (1)(c), the offender committed the offence intentionally or recklessly;
(f)  the offender knowingly failed to take reasonable steps to prevent the commission of the offence despite having the financial means to do so;
(g)  by committing the offence or failing to take action to prevent its commission, the offender increased their revenue or decreased their costs or intended to increase their revenue or decrease their costs;
(h)  the offender has a history of noncompliance with federal or provincial legislation that relates to safety or environmental conservation or protection; and
(i)  after the commission of the offence, the offender
(i)  attempted to conceal its commission,
(ii)  failed to take prompt action to prevent, mitigate or remediate its effects, or
(iii)  failed to take prompt action to reduce the risk of committing similar offences in the future.
Absence of aggravating factor
(5)  The absence of an aggravating factor set out in subsection (4) is not a mitigating factor.
Meaning of "damage"
(6)  For the purposes of paragraphs (4)(b) to (d), "damage" includes loss of use value and non-use value.
Reasons
(7)  If the court is satisfied of the existence of one or more of the aggravating factors set out in subsection (4) but decides not to increase the amount of the fine because of that factor, it must give reasons for that decision.
Due diligence defence
(8)  In a prosecution of a person for an offence under this Part, other than an offence referred to in paragraph (1)(a) that is in respect of the contravention of subsection 93(2) or of paragraph 136(1)(b) and other than the offence of falsifying referred to in paragraph (1)(c), it is a defence for the person to prove that they exercised all due diligence to prevent the commission of the offence.
Offence of waste
(9)  A prosecution for the offence of waste may be instituted for that offence only with leave of the Boards. For the purpose of paragraph (1)(a), no person commits an offence by reason of committing waste as defined in paragraph 149(2)(f) or (g) unless that person has been ordered by the Boards to take measures to prevent the waste and has failed to comply.
Liability of officers, etc.
199.  (1)  If a corporation commits an offence under this Part, any of the following individuals who directed, authorized, assented to, acquiesced in or participated in the commission of the offence is a party to and guilty of the offence and is liable on conviction to the punishment provided for the offence whether or not the corporation has been prosecuted or convicted:
(a)  an officer, director or agent or mandatary of the corporation; and
(b)  any other individual exercising managerial or supervisory functions in the corporation.
Offence by employee or agent or mandatary
(2)  In a prosecution for an offence under this Part, it is sufficient proof of the offence to establish that it was committed by an employee or an agent or mandatary of the accused, whether or not the employee or the agent or mandatary is identified or has been prosecuted for the offence.
Imprisonment precluded in certain cases
200.  If an individual is convicted of an offence under this Part on proceedings by way of summary conviction, no imprisonment may be imposed in default of payment of any fine imposed as punishment.
Order of court
201.  (1)  If a person is found guilty of an offence under this Part, the court may, having regard to the nature of the offence and the circumstances surrounding its commission, in addition to any other punishment that may be imposed under this Part, make an order that has any or all of the following effects:
(a)  prohibiting the offender from committing an act or engaging in an activity that may, in the opinion of the court, result in the continuation or repetition of the offence;
(b)  directing the offender to take any action that the court considers appropriate to remedy or avoid any harm to the environment that results or may result from the act or omission that constituted the offence;
(c)  directing the offender to carry out environmental effects monitoring in the manner established by the Boards or directing the offender to pay, in the manner specified by the court, an amount of money for the purposes of environmental effects monitoring;
(d)  directing the offender to make changes to their environmental management system that are satisfactory to the Boards;
(e)  directing the offender to have an environmental audit conducted by a person of a class specified by the Boards and at the times specified by the Boards and directing the offender to remedy any deficiencies revealed during the audit;
(f)  directing the offender to pay to the Boards an amount of money that the court considers appropriate for the purpose of conducting research, education and training in matters related to the protection of the environment, conservation of petroleum resources or safety of petroleum operations;
(g)  directing the offender to publish, in the manner specified by the court, the facts relating to the commission of the offence and the details of the punishment imposed, including any orders made under this subsection;
(h)  directing the offender to notify, at the offender's own cost and in the manner specified by the court, any person aggrieved or affected by the offender's conduct of the facts relating to the commission of the offence and of the details of the punishment imposed, including any orders made under this subsection;
(i)  directing the offender to post a bond or pay an amount of money into court that the court considers appropriate to ensure that the offender complies with any prohibition, direction, requirement or condition that is specified in the order;
(j)  directing the offender to perform community service, subject to any reasonable conditions that may be imposed by the court;
(k)  directing the offender to pay, in the manner specified by the court, an amount of money to environmental, health or other groups to assist in their work;
(l)  directing the offender to pay, in the manner specified by the court, an amount of money to an educational institution including for scholarships for students enrolled in studies related to the environment;
(m)  requiring the offender to comply with any conditions that the court considers appropriate in the circumstances for securing the offender's good conduct and for preventing the offender from repeating the same offence or committing another offence under this Part; and
(n)  prohibiting the offender from taking measures to acquire an interest or from applying for any new licence or other authorization under this Act during any period that the court considers appropriate.
Coming into force and duration of order
(2)  An order made under subsection (1) comes into force on the day on which the order is made or on any other day that the court may determine, but must not continue in force for more than three years after that day.
Publication
(3)  If an offender does not comply with an order requiring the publication of facts relating to the offence and the details of the punishment, the Boards may, in the manner that the court directed the offender, publish those facts and details and recover the costs of publication from the offender.
Debt due to Boards
(4)  If the Boards incur publication costs under subsection (3), the costs constitute a debt due to the Boards and may be recovered in any court of competent jurisdiction.
Variation of sanctions
202.  (1)  Subject to subsection (2), if a court has made, in relation to an offender, an order under subsection 201(1), the court may, on application by the offender or the Boards, require the offender to appear before it and, after hearing the offender and the Boards, vary the order in one or any combination of the following ways that the court considers appropriate because of a change in the offender's circumstances since the order was made:
(a)  by making changes to any prohibition, direction, requirement or condition that is specified in the order for any period or by extending the period during which the order is to remain in force, not exceeding one year; or
(b)  by decreasing the period during which the order is to remain in force or by relieving the offender of compliance with any prohibition, direction, requirement or condition that is specified in the order, either absolutely or partially or for any period.
Notice
(2)  Before making an order under subsection (1), the court may direct that notice be given to any persons that the court considers to be interested and may hear any of those persons.
Subsequent applications with leave
203.  If an application made under subsection 202(1) in relation to an offender has been heard by a court, no other application may be made under section 202 in relation to the offender except with leave of the court.
Recovery of fines and amounts
204.  If a person is convicted of an offence under this Part and a fine that is imposed is not paid when required or if a court orders an offender to pay an amount under subsection 201(1) or 202(1), the prosecutor may, by filing the conviction or order, as the case may be, enter as a judgment the amount of the fine or the amount ordered to be paid, and costs, if any, in the Superior Court of Quebec, and the judgment is enforceable against the person in the same manner as if it were a judgment rendered against them in that Court in civil proceedings.
Order to comply
205.  If a person is guilty of an offence under this Part, a court may, in addition to any other penalty it may impose, order that person to comply with the provisions for the contravention of which that person has been convicted.
Continuing offences
206.  If an offence under this Part is committed on more than one day or is continued for more than one day, the person who committed it is liable to be convicted for a separate offence for each day on which it is committed or continued.
Time limited for summary proceedings — summary conviction
207.  Proceedings by way of summary conviction in respect of an offence under this Part may be instituted at any time within five years after the day on which the subject matter of the proceedings arose.
Evidence
208.  In any prosecution for an offence under this Part, a copy of any order or other document purporting to have been made under this Part and purporting to have been signed by the person authorized under this Part to make that order or document is, in the absence of any evidence to the contrary, proof of the matters set out in the order or document.
No proceedings without consent
209.  No proceedings in relation to an offence under this Part are to be instituted except by or with the consent of the Attorney General of Canada or the Attorney General of Quebec.
Action to enjoin not prejudiced by prosecution
210.  (1)  Even if a prosecution has been instituted in respect of an offence under this Part, the Ministers may commence and maintain an action to enjoin the committing of any such offence.
Civil remedy not affected
(2)  No civil remedy for any act or omission is suspended or affected by reason that the act or omission is an offence under this Part.
Information
211.  In any proceedings in respect of an offence under this Part, an information may include more than one offence committed by the same person and all those offences may be tried concurrently and one conviction for any or all those offences may be made.

##### Powers
Regulations
212.  (1)  Subject to subsection 7(1), the Governor in Council may make regulations
(a)  designating as a violation that may be proceeded with in accordance with this Part
(i)  the contravention of any specified provision of this Part or of any of its regulations,
(ii)  the contravention of any direction, requirement, decision or order, or of any direction, requirement, decision or order of a specified class of directions, requirements, decisions or orders, made under this Part, or
(iii)  the failure to comply with any term, condition or requirement of
(A)  an operating licence or authorization or any specified class of operating licences or authorizations under this Part, or
(B)  any approval, leave or exemption or any specified class of approvals, leave or exemptions granted under this Part;
(b)  respecting the determination of, or the method of determining, the amount payable as the penalty, which may be different for individuals and other persons, for each violation; and
(c)  respecting the service of documents required or authorized under subsection 217(1), section 222 or subsection 225(2), including the manner and proof of service and the circumstances under which documents are considered to be served.
Maximum penalty
(2)  The amount that may be determined under any regulations made under paragraph (1)(b) as the penalty for a violation must not be more than $25,000, in the case of an individual, and$100,000, in the case of any other person.
Powers
213.  The Boards may
(a)  establish the form of notices of violation;
(b)  designate persons or classes of persons who are authorized to issue notices of violation;
(c)  establish, in respect of each violation, a short-form description to be used in notices of violation; and
(d)  designate persons or classes of persons to conduct reviews under section 224.
##### Violations
Commission of violation
214.  (1)  Every person who contravenes or fails to comply with a provision, direction, requirement, decision or order, or term or condition the contravention of which, or the failure to comply with which, is designated as a violation by a regulation made under paragraph 212(1)(a) commits a violation and is liable to a penalty of an amount to be determined in accordance with the regulations.
Purpose of penalty
(2)  The purpose of the penalty is to promote compliance with this Part and not to punish.
Liability of directors, officers, etc.
215.  If a corporation commits a violation, any director, officer or agent or mandatary of the corporation who directed, authorized, assented to, acquiesced in or participated in the commission of the violation is a party to the violation and is liable to a penalty of an amount to be determined in accordance with the regulations, whether or not the corporation has been proceeded against in accordance with this Part.
Proof of violation
216.  In any proceedings under this Part against a person in relation to a violation, it is sufficient proof of the violation to establish that it was committed by an employee or agent or mandatary of the person, whether or not the employee or agent or mandatary is identified or proceeded against in accordance with this Part.
Issuance and service of notice of violation
217.  (1)  If a person designated under paragraph 213(b) believes on reasonable grounds that a person has committed a violation, the designated person may issue a notice of violation and cause it to be served on the person.
Contents
(2)  The notice of violation must
(a)  name the person that is believed to have committed the violation;
(b)  set out the relevant facts surrounding the violation;
(c)  set out the amount of the penalty for the violation;
(d)  inform the person of their right, under section 222, to request a review with respect to the amount of the penalty or the facts of the violation, and of the prescribed period within which that right is to be exercised;
(e)  inform the person of the manner of paying the penalty set out in the notice; and
(f)  inform the person that, if they do not exercise their right to request a review or if they do not pay the penalty, they will be considered to have committed the violation and that they are liable to the penalty set out in the notice.
Certain defences not available
218.  (1)  A person named in a notice of violation does not have a defence by reason that the person
(a)  exercised due diligence to prevent the commission of the violation; or
(b)  reasonably and honestly believed in the existence of facts that, if true, would exonerate the person.
Common law principles
(2)  Every rule and principle of the common law that renders any circumstance a justification or excuse in relation to a charge for an offence under this Part applies in respect of a violation to the extent that it is not inconsistent with this Part.
Continuing violation
219.  A violation that is committed or continued on more than one day constitutes a separate violation for each day on which it is committed or continued.
Violation or offence
220.  (1)  Proceeding with any act or omission as a violation under this Part precludes proceeding with it as an offence under this Part, and proceeding with it as an offence under this Part precludes proceeding with it as a violation under this Part.
Violations not offences
(2)  For greater certainty, a violation is not an offence and, accordingly, section 126 of the Criminal Code does not apply in respect of a violation.
Limitation or prescription period
221.  No notice of violation is to be issued more than two years after the day on which the matter giving rise to the violation occurred.
##### Reviews
Right to request review
222.  A person who is served with a notice of violation may, within 30 days after the day on which it is served, or within any longer period that the Boards allow, make a request to the Boards for a review of the amount of the penalty or the facts of the violation, or both.
Correction or cancellation of notice of violation
223.  At any time before a request for a review in respect of a notice of violation is received by the Boards, a person designated under paragraph 213(b) may cancel the notice of violation or correct an error in it.
Review
224.  (1)  On receipt of a request made under section 222, the Boards must conduct the review or cause the review to be conducted by a person designated under paragraph 213(d).
Restriction
(2)  The Boards must conduct the review if the notice of violation was issued by a person designated under paragraph 213(d).
Object of review
225.  (1)  The Boards or the person conducting the review must determine, as the case may be, whether the amount of the penalty for the violation was determined in accordance with the regulations or whether the person committed the violation, or both.
Determination
(2)  The Boards or the person conducting the review must render a determination and the reasons for it in writing and cause the person who requested the review to be served with a copy of them.
Correction of penalty
(3)  If the Boards or the person conducting the review determines that the amount of the penalty for the violation was not determined in accordance with the regulations, the Boards or the person, as the case may be, must correct the amount of the penalty.
Responsibility
(4)  If the Boards or the person conducting the review determines that the person who requested the review committed the violation, the person who requested the review is liable to the penalty as set out in the notice issued under section 217 or as set out in the determination if the amount of the penalty was corrected under subsection (3).
Determination final
(5)  A determination made under this section is final and binding and, except for judicial review by the Superior Court of Quebec, is not subject to appeal or to review by any court.
Burden of proof
226.  If the facts of a violation are reviewed, the person who issued the notice of violation must establish, on a balance of probabilities, that the person named in it committed the violation identified in it.
##### Responsibility
Payment
227.  If a person pays the penalty set out in a notice of violation, the person is considered to have committed the violation and proceedings in respect of it are ended.
Failure to act
228.  A person that neither pays the penalty imposed under this Part nor requests a review within the period referred to in section 222 is considered to have committed the violation and is liable to the penalty.
##### Recovery of Penalties
Debt to Her Majesty
229.  (1)  A penalty constitutes a debt due to Her Majesty in right of Quebec and may be recovered in the Superior Court of Quebec.
Limitation period or prescription period
(2)  No proceedings to recover the debt are to be instituted more than five years after the day on which the debt becomes payable.
Certificate
230.  (1)  The Boards may issue a certificate of non-payment certifying the unpaid amount of any debt referred to in subsection 229(1).
Registration
(2)  Registration in the Superior Court of Quebec of a certificate of non-payment issued under subsection (1) has the same effect as a judgment of that court for a debt of the amount specified in the certificate and all related registration costs.
##### General
231.  In the absence of evidence to the contrary, a document that appears to be a notice issued under subsection 217(1) is presumed to be authentic and is proof of its contents in any proceeding in respect of a violation.
Publication
232.  The Boards may make public the nature of a violation, the name of the person who committed it and the amount of the penalty.
##### Regulations
Regulations
233.  Subject to section 7, the Governor in Council may make any regulations that may be considered necessary for carrying out the purposes of this Part.

## PART 3SHARING TAX REVENUES

### Interpretation

Definitions
234.  (1)  The following definitions apply in this Part.
« accord d'application »
"administration agreement" means an administration agreement, as amended from time to time, entered into by the Government of Canada, with the Government of Quebec, under Part III of the Federal-Provincial Fiscal Arrangements Act in respect of one or more taxes imposed under this Part.
"income tax enactment"
« texte sur l'imposition du revenu »
"income tax enactment" means the following Parts of the Taxation Act, CQLR, c. I-3, as amended from time to time:
(a)  Part I;
(b)  Part II;
(c)  Part III;
(d)  Part III.0.0.1;
(e)  Part III.0.1;
(f)  Part III.0.1.1;
(g)  Part III.0.2;
(h)  Part III.9;
(i)  Part III.9.0.1;
(j)  Part III.9.0.2;
(k)  Part III.10.1.1.2;
(l)  Part III.10.9.2;
(m)  Part III.10.10;
(n)  Part III.14; and
(o)  Part VI.3.1.
« texte sur la taxation des primes d'assurance »
"insurance premiums tax enactment" means Titles III, VII and VIII of An Act respecting the Québec sales tax, CQLR, c. T-0.1, as amended from time to time.
"payroll tax enactment"
« texte sur l'imposition de la masse salariale »
"payroll tax enactment" means subdivisions 1, 2 and 4 of Division I of Chapter IV of An Act respecting the Régie de l'assurance maladie du Québec, CQLR, c. R-5, as amended from time to time.
"selected enactments"
« textes déterminés »
"selected enactments" means
(a)  the payroll tax enactment;
(b)  the income tax enactment; and
(c)  the insurance premiums tax enactment.
« texte sur l'administration fiscale »
"tax administration enactment" means the Tax Administration Act, CQLR, c. A-6.002, other than sections 9 to 9.0.6, 16.1 and 94 to 94.0.4 and division VIII of chapter III of that Act, as amended from time to time.
Interpretation
(2)  For greater certainty, a reference in this Part to an Act of Parliament or of the legislature of Quebec includes a reference to regulations made under, or for the purposes of, that Act.
Non-application of certain provisions
(3)  Sections 7, 11 and 17 do not apply in respect of this Part.

### Corporate Income Tax

Imposition of tax
235.  (1)  There is imposed under this section in respect of the joint management area an income tax on a corporation for any taxation year that begins
(a)  after the day on which an administration agreement begins to apply in respect of the tax; and
(b)  before the day on which the agreement is terminated in respect of the tax.
Incorporation by reference
(2)  The provisions of the income tax enactment and the tax administration enactment that apply in respect of the tax imposed on a corporation under the income tax enactment are incorporated by reference — with any modifications that the circumstances require, including the adaptations set out in subsection (3) and section 238 — into this section for the purposes of subsection (1), including the determination of the tax imposed under this section and of any interest, penalties, charges, fees and amounts that, because of the incorporation by reference in this section of chapter III.1 of title III of Book IX of Part I of the income tax enactment, are deemed to have been paid on account of tax payable under this section by the corporation.
(3)  The following adaptations to the income tax enactment apply for the purposes of this Part:
(a)  a reference to "Canada" that is a reference to the territory of Canada is to be read as defined in section 255 of the Income Tax Act;
(b)  a reference to the "Minister" or the "Minister of Revenue" that is a reference to Quebec's Minister of Revenue
(i)  if the reference is in relation to an amount owed or payable — or to a person liable to pay an amount — to that Minister, is to be read as "Her Majesty in right of Canada",
(ii)  if the reference is in relation to the remittance of any amount referred to in subparagraph (i), is to be read as "Receiver General for Canada", and
(iii)  if the reference is in relation to any other matter, is to be read as "Minister of National Revenue";
(c)  a reference to "Québec" that is a reference to the territory of Quebec is to be read as "the joint management area";
(d)  a reference to "a province other than Québec" or "a province, other than Québec" is to be read as "a province, as defined in the Interpretation Act (R.S.C., 1985, c. I-21), the Nova Scotia offshore area or the Newfoundland offshore area, as these offshore areas are defined in subsection 248(1) of the Income Tax Act (R.S.C. 1985, c. 1 (5th Supp.)),"; and
(e)  a reference to "the State" is to be read as "Her Majesty in right of Quebec".
Tax not payable
(4)  Despite subsections (1) to (3), no tax is applicable under this section to a corporation for a taxation year in respect of income from activities carried on in the joint management area if, for that taxation year
(a)  the corporation has to pay an income tax under the income tax enactment in respect of that income; and
(b)   tax would have to be paid under this section if it were not for this subsection, by the corporation for that taxation year in respect of that income.

### Payroll Tax

Imposition of tax
236.  (1)  There is imposed under this section in respect of the joint management area a tax on an employer in respect of an employee who reports for work at an establishment situated in the joint management area in relation to work performed by the employee
(a)  after the day on which an administration agreement begins to apply in respect of the tax; and
(b)  before the day on which the agreement is terminated in respect of the tax.
Incorporation by reference
(2)  The provisions of the payroll tax enactment and the tax administration enactment that apply in respect of the contribution imposed on an employer under the payroll tax enactment in respect of an employee are incorporated by reference — with any modifications that the circumstances require, including the adaptations set out in subsection (3) and section 238 — into this section for the purposes of subsection (1), including the determination of the tax imposed under this section and of any interest, penalties, charges and fees.
(3)  The following adaptations to the payroll tax enactment apply for the purposes of this section:
(a)  a reference to the "Minister" or the "Minister of Revenue" that is a reference to Quebec's Minister of Revenue
(i)  if the reference is in relation to an amount owed or payable — or to a person liable to pay an amount — to that Minister, is to be read as "Her Majesty in right of Canada",
(ii)  if the reference is in relation to the remittance of any amount referred to in subparagraph (i), is to be read as "Receiver General for Canada", and
(iii)  if the reference is in relation to any other matter, is to be read as "Minister of National Revenue"; and
(b)  a reference to "Québec" that is a reference to the territory of Quebec is to be read as "the joint management area".
Incorporation by reference
(4)  The provisions of the income tax enactment that apply for the purposes of the payroll tax enactment are incorporated by reference into this section for the purposes of subsection (1) with any modifications that the circumstances require, including the adaptations set out in subsection 235(3).
Tax not payable
(5)  Despite subsections (1) to (4), if a contribution is payable under the payroll tax enactment in respect of an amount of wages that is attributable to an employee that mainly reports for work outside the joint management area and tax would, but for this subsection, be imposed under this section in respect of that amount, no tax is payable under this section in respect of that amount.

Imposition of tax
237.  (1)  There is imposed under this section in respect of the joint management area a tax on a person in respect of insurance premiums paid
(a)  after the day on which an administration agreement begins to apply in respect of the tax; and
(b)  before the day on which the agreement is terminated in respect of the tax.
Incorporation by reference
(2)  The provisions of the insurance premiums tax enactment and the tax administration enactment that apply in respect of the tax on insurance premiums paid that is imposed on a person under Title III of the insurance premiums tax enactment are incorporated by reference — with any modifications that the circumstances require, including the adaptations set out in subsection (3) and section 238 — into this section for the purposes of subsection (1), including the determination of the tax imposed under this section and of any interest, penalties, charges and fees.
(3)   The following adaptations to the insurance premiums tax enactment apply for the purposes of this section:
(a)  a reference to the "Minister" or the "Minister of Revenue" that is a reference to Quebec's Minister of Revenue
(i)  if the reference is in relation to an amount owed or payable — or to a person liable to pay an amount — to that Minister, is to be read as "Her Majesty in right of Canada",
(ii)  if the reference is in relation to the remittance of any amount referred to in subparagraph (i), is to be read as "Receiver General for Canada", and
(iii)  if the reference is in relation to any other matter, is to be read as "Minister of National Revenue"; and
(b)  a reference to "Québec" that is a reference to the territory of Quebec is to be read as "the joint management area".
Incorporation by reference
(4)  The provisions of the income tax enactment that apply for the purposes of the insurance premiums tax enactment are incorporated by reference into this section for the purposes of subsection (1) with any modifications that the circumstances require including the adaptations set out in subsection 235(3).
Tax not payable
(5)  Despite subsections (1) to (4), if a tax is imposed under the insurance premiums tax enactment in respect of an amount of premium that is reasonably attributable to risks that may occur outside the joint management area and tax would, but for this subsection, be imposed under this section in respect of that amount, no tax is imposed under this section in respect of that amount.

238.  (1)  The following adaptations to the tax administration enactment apply for the purposes of this Part:
(a)  a reference to "Agence du revenu du Québec" is to be read as "Agency (as defined in section 2 of the Canada Revenue Agency Act (S.C. 1999, c. 17))";
(b)  a reference to the "Minister" or the "Minister of Revenue" that is a reference to Quebec's Minister of Revenue
(i)  if the reference is in relation to an amount owed or payable — or to a person liable to pay an amount — to that Minister, is to be read as "Her Majesty in right of Canada",
(ii)  if the reference is in relation to the remittance of any amount referred to in subparagraph (i), is to be read as "Receiver General for Canada", and
(iii)  if the reference is in relation to any other matter, is to be read as "Minister of National Revenue";
(c)  a reference to "president and chief executive officer" is to be read as "Commissioner (as defined in section 2 of the Canada Revenue Agency Act (S.C. 1999, c. 17))";
(d)  a reference to "Québec" that is a reference to the territory of Quebec is to be read as "the joint management area"; and
(e)   a reference to "the State"
(i)  in section 1.4 of the tax administration enactment, is to be read as "Her Majesty in right of Canada or of Quebec", and
(ii)  elsewhere in the tax administration enactment, is to be read as "Her Majesty in right of Canada".
Adaptations – references to Quebec legislation
(2)  If in a provision of a selected enactment or the tax administration enactment there is a reference to a particular Act of Quebec, or a provision of an Act of Quebec, that is incorporated by reference in this Act or the Canada Pension Plan to apply as incorporated in respect of the joint management area, for the purposes of this Part that reference is to be read as a reference to this Act or the Canada Pension Plan, as the case may be, to the extent that it incorporates by reference the particular Act or provision.
Effect of election
(3)  An election that is in effect in respect of a corporation, employer or person for the purposes of a selected enactment or the tax administration enactment is deemed to be in effect in respect of the corporation, employer or person for the purposes of this Part.
Taxpayer information
(4)  For the purposes of this Part, the selected enactments and the tax administration enactment are to be read without reference to any provision that relates to the protection of information that is obtained by or on behalf of Quebec's Minister of Revenue or that is prepared from information obtained by or on behalf of Quebec's Minister of Revenue.

Minister's duty
239.  (1)  The Minister of National Revenue must administer and enforce this Part and the Commissioner, as defined in section 2 of the Canada Revenue Agency Act, may exercise all the powers and perform the duties of the Minister of National Revenue under this Part.
Delegation
(2)  The Minister of National Revenue may authorize an officer or agent or a class of officers or agents to exercise powers or perform duties of the Minister of National Revenue under this Part.
(3)  If an administration agreement is entered into and applies in respect of any tax, interest, penalty or other amount imposed under sections 235 to 237,
(a)  Quebec's Minister of Revenue, on behalf of or as agent for the Receiver General or the Minister of National Revenue, is authorized to perform the duties and to exercise all the powers and any discretion that the Receiver General or the Minister of National Revenue has under the section imposing the tax in respect of which the agreement applies and section 238; and
(b)  the President and Chief Executive Officer of the Agence du revenu du Québec, on behalf of or as agent for the Commissioner, is authorized to perform the duties and to exercise all the powers and any discretion that the Commissioner has under the section imposing the tax in respect of which the agreement applies and section 238.
240.  (1)  In respect of a fiscal year (in this section having the same meaning as in subsection 2(1) of the Federal-Provincial Fiscal Arrangements Act), the Government of Quebec must, in accordance with the terms and conditions of an administration agreement, remit to the Government of Canada an amount equal to the amount by which
(a)  the total of all amounts each of which is an amount collected — as or on account of a tax, interest, penalty or other amount imposed under sections 235 to 237 — by the Government of Quebec on behalf of the Government of Canada during the fiscal year
exceeds
(b)  the total of all amounts each of which is
(i)  a rebate, refund, remission or other similar payment that is made by the Government of Quebec on behalf of the Government of Canada during the fiscal year in respect of an amount included in the total referred to in paragraph (a) for the fiscal year or an earlier fiscal year, or
(ii)  a payment that is described in subparagraph (i) for an earlier fiscal year and that has not resulted in a reduction in the amount remitted to the Government of Canada under this section in respect of an earlier fiscal year.
Payment to Quebec
(2)  In respect of a fiscal year, the Federal Minister must, in accordance with the terms and conditions of an administration agreement,
(a)  credit the Quebec Revenue Account — Joint Management Area with an amount equal to the amount remitted by the Government of Quebec to the Government of Canada under subsection (1); and
(b)  pay to the Government of Quebec the amount, if any, credited to the Quebec Revenue Account — Joint Management Area under paragraph (a).
Appropriation
(3)  In respect of a fiscal year, payments may be made to the Government of Quebec out of the Consolidated Revenue Fund on account of an amount payable under paragraph (2)(b).
Excess recoverable
(4)  If the Government of Quebec has received an amount in excess of the amount to which it is entitled under this section, the Federal Minister may recover as a debt due to Her Majesty in right of Canada an amount equal to that excess from any moneys that are or may become payable to the Government of Quebec under this Act or under any other Act of Parliament.
241.  (1)  If an administration agreement begins to apply in respect of a tax imposed under this Part, the Minister of National Revenue must cause to be published in the Canada Gazette a notice of the first day on which the agreement begins to apply in respect of the tax and the notice is to be published no later than 60 days before that day.
(2)  If an administration agreement is terminated in respect of a tax imposed under this Part, the Minister of National Revenue must cause to be published in the Canada Gazette a notice of the day of the termination in respect of the tax and the notice is to be published no later than 60 days after that day.
Debts due to Her Majesty
242.  For greater certainty, any tax, interest, penalty or other amount payable by a corporation, employer or person under this Part is a debt due to Her Majesty in right of Canada and is recoverable as such from the corporation, employer or person.

### Courts

Jurisdiction of courts
243.  (1)  Every court in Quebec has jurisdiction in respect of matters arising in the joint management area under this Part to the same extent as the court has jurisdiction in respect of matters arising within its ordinary territorial jurisdiction.
Presumption
(2)  For the purposes of subsection (1), the joint management area is deemed to be within the territorial limits of the judicial district of Montreal.
Saving
(3)  Nothing in this section limits the jurisdiction that a court may exercise apart from this section.
Definition of "court"
(4)  In this section, "court" includes a judge of the court and any provincial court judge or justice.

### Regulations

Regulations
244.  (1)  The Governor in Council may, on the recommendation of the Minister of Finance or the Minister of National Revenue, make regulations
(a)  providing that a reference to a word or expression used in a selected enactment or the tax administration enactment is to be read or interpreted in a specified manner;
(b)  adapting the manner in which a provision of a selected enactment or the tax administration enactment that is incorporated by reference into this Part is to be read, interpreted or applied, for the purposes of this Part;
(c)  providing that a selected enactment or the tax administration enactment is to be read without reference to one or more of its provisions for the purposes of this Part;
(d)  incorporating by reference all or part of any document that the Governor in Council considers appropriate for the purposes of this Part; and
(e)  generally to carry out the purposes and provisions of this Part.
Regulations – effect
(2)  A regulation made under subsection (1) has effect from the date it is published in the Canada Gazette or at such time after that date as may be specified in the regulation unless the regulation provides otherwise and
(a)  has a relieving effect only;
(b)  corrects an ambiguous or deficient regulation made under subsection (1) that is not in accordance with the object of this Part;
(c)  is consequential on an amendment to this Part, a selected enactment or the tax administration enactment that is applicable before the date on which the regulation is published in the Canada Gazette; or
(d)  gives effect to a budgetary or other public announcement, in which case the regulation may not, except where paragraph (a), (b) or (c) applies, have effect before
(i)  if the regulation applies in respect of a taxation period, the taxation period in which the announcement was made, or
(ii)  in any other case, the day on which the announcement was made.
Limitation
(3)  Despite subsection (2), a regulation made under subsection (1) has no effect at a time that is earlier than
(a)  in the case of a regulation made under any of paragraphs (1)(a) to (c) in respect of a provision of a selected enactment or the tax administration enactment, the date on which or the period in respect of which the provision begins to apply; and
(b)  in any other case, the date on which this Act receives royal assent.

### Amendments to this Act

245.  Section 111 of this Act is replaced by the following:
Net environmental benefit
111.  The Boards must not permit the use of a spill-treating agent in an authorization for a work or activity unless the Boards determine, taking into account any prescribed factors and any factors the Boards consider appropriate, that the use of the spill-treating agent is likely to achieve a net environmental benefit.
246.  (1)  Paragraph 155(1)(b) of this Act is replaced by the following:
(b)  other than in the case of a small-scale test that meets the prescribed requirements, the Chief Conservation Officer approves in writing the use of the agent in response to the spill and it is used in accordance with any requirements set out in the approval; and
(2)  Subsection 155(1) of this Act is amended by striking out "and" at the end of paragraph (b), by adding "and" at the end of paragraph (c) and by adding the following after paragraph (c):
(d)  the agent is used in accordance with the regulations.
(3)  Subsection 155(3) of this Act is replaced by the following:
Net environmental benefit
(3)  Other than in the case of a small-scale test, the Chief Conservation Officer must not approve the use of a spill-treating agent unless the Officer determines, taking into account any prescribed factors and any factors the officer considers appropriate, that the use of the spill-treating agent is likely to achieve a net environmental benefit.

### Consequential Amendments

R.S., c. C-8

247.  The Canada Pension Plan is amended by adding the following after section 4:
Establishment — petroleum resources joint management area
4.01  (1)  For the purposes of this Act, in particular subsection 4(4), an establishment of an employer that is located in the petroleum resources joint management area, as defined in section 2 of the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act, is deemed to be an establishment that is located in a province providing a comprehensive pension plan.
Application — provincial pension plan
(2)  Subject to this Act, the law of the province providing a comprehensive provincial pension plan applies to any establishment of an employer that is located in the petroleum resources joint management area.
Interpretation
(3)  For greater certainty, this section must not be interpreted as providing a basis for any claim by or on behalf of the Government of Quebec in respect of any right in or legislative jurisdiction over the petroleum resources joint management area or any living or non-living resources of the petroleum resources joint management area.
R.S., c. N-7

#### National Energy Board Act

2004, c. 25, s. 147(1)
248.  The definition "pipeline" in section 2 of the National Energy Board Act is replaced by the following:
"pipeline"
« pipeline »
"pipeline" means a line that is used or to be used for the transmission of oil, gas or any other commodity and that connects a province with any other province or provinces or extends beyond the limits of a province or the offshore area as defined in section 123 — other than a pipeline as defined in section 99 of the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act — and includes all branches, extensions, tanks, reservoirs, storage facilities, pumps, racks, compressors, loading facilities, interstation systems of communication by telephone, telegraph or radio and real and personal property, or immovable and movable, and works connected to them, but does not include a sewer or water pipeline that is used or proposed to be used solely for municipal purposes;
R.S., c. O-7; 1992, c. 35, s. 2

### Canada Oil and Gas Operations Act

249.  (1)  The definition "Accord Acts" in section 2 of the Canada Oil and Gas Operations Act is amended by striking out "and" at the end of paragraph (a), by adding "and" at the end of paragraph (b) and by adding the following after paragraph (b):
(c)  the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act;
1992, c. 35, s. 3(3)(E)
(2)  The definition "Provincial Minister" in section 2 of the English version of the Act is replaced by the following:
"Provincial Minister"
« ministre provincial »
"Provincial Minister" means the Provincial Minister as defined in any of the Accord Acts;
1992, c. 35, s. 12; 1994, c. 10, s.6; 2012, c. 19, s. 120(E); 2014, c. 13, s. 102
250.  Section 5.4 of the Act is replaced by the following:
Council established
5.4  (1)  There is established a council, to be known as the Oil and Gas Administration Advisory Council, consisting of the following seven members, namely, the Chairperson of the Canada-Nova Scotia Offshore Petroleum Board, the Chairperson of the Canada–Newfoundland and Labrador Offshore Petroleum Board, the Chairperson of the National Energy Board, a person designated jointly by the federal Ministers and a person designated by each of the Provincial Ministers.
Duty of Council
(2)  The Council shall promote consistency and improvement in the administration of the regulatory regime in force under this Act and Part III of the Canada–Newfoundland and Labrador Atlantic Accord Implementation Act, Part III of the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act and Part 2 of the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act, and shall provide advice respecting those matters to the federal Ministers, the Provincial Ministers and the Boards referred to in subsection (1).
1992, c. 35, s. 12
251.  Subsection 5.5(1) of the Act is replaced by the following:
Board established
5.5  (1)  The federal Ministers, with the approval of the Provincial Ministers, may establish a board, to be known as the Offshore Oil and Gas Training Standards Advisory Board, consisting of not more than 10 members, each of whom has special knowledge respecting offshore oil and gas operations or respecting training for those operations.
R.S., c. 1 (5th Supp.)

### Income Tax Act

252.  (1)  The portion of subsection 124(4) of the English version of the Income Tax Act before the first definition is replaced by the following:
Definitions
(4)  The following definitions apply in this section.

(2)  The definition "province" in subsection 124(4) of the Act is replaced by the following:
"province"
« province »
"province" includes the joint management area, the Nova Scotia offshore area and the Newfoundland offshore area.
(3)  Subsection (2) applies to taxation years that begin after the day on which an administration agreement in respect of tax imposed under section 235 of the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act comes into effect.
253.  (1)  Subparagraph 241(4)(d)(vi) of the Act is replaced by the following:
(vi)  to an official of the government of a province that has received or is entitled to receive a payment referred to in this subparagraph, or to an official of the Department of Natural Resources, solely for the purposes of the provisions relating to payments to a province in respect of the taxable income of corporations earned, as the case may be, in the Nova Scotia offshore area under the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act, in the Newfoundland offshore area under the Canada–Newfoundland and Labrador Atlantic Accord Implementation Act, in the joint management area under the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act or in similar areas under similar Acts relating to the exploration for or exploitation of offshore Canadian petroleum and gas resources,
(2)  Subsection 241(11) of the Act is replaced by the following:
References to "this Act"
(11)  The references in subsections (1), (3), (4) and (10) to "this Act" are to be read as references to "this Act, the Federal-Provincial Fiscal Arrangements Act or Part 3 of the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act".

254.  (1)  Subsection 248(1) of the Act is amended by adding the following in alphabetical order:
"joint management area"
« zone de gestion conjointe »
"joint management area" means the submarine areas within the limits described in Schedule 1 to the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act;
(2)  Subsection (1) applies to taxation years that begin after the day on which an administration agreement in respect of tax imposed under section 235 of the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act comes into effect.
2012, c. 19, s. 52

### Canadian Environmental Assessment Act, 2012

255.  Paragraph 15(b) of the Canadian Environmental Assessment Act, 2012 is replaced by the following:
(b)  the National Energy Board, in the case of a designated project that includes activities that are regulated under the National Energy Board Act, the Canada Oil and Gas Operations Act or the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act and that are linked to the National Energy Board as specified in the regulations made under paragraph 84(a) or the order made under subsection 14(2);
256.  Subsection 56(2) of the Act is amended by striking out "or" at the end of paragraph (a), by adding "or" at the end of paragraph (b) and by adding the following after paragraph (b):
(c)  the authorization issued or the approval given under the Canada–Quebec Gulf of St. Lawrence Petroleum Resources Accord Implementation Act in relation to the designated project.

### Coordinating Amendments

2015, c. 4
257.  (1)  In this section, "other Act" means the Energy Safety and Security Act.
(2)  On the first day on which both section 15 of the other Act and section 2 of this Act are in force, paragraph (a) of the definition "spill-treating agent" in section 2 of this Act is replaced by the following:
(a)  on the list established under section 14.2 of the Canada Oil and Gas Operations Act; and
(3)  On the first day on which both section 15 of the other Act and section 143.1 of this Act are in force, then that section 143.1 is repealed.

### Coming into Force

Order in council
258.  (1)  Subject to subsection (2), the provisions of this Act, other than section 257, come into force on a day or days to be fixed by order of the Governor in Council.
Order in council or 5 years after assent
(2)  Sections 245 and 246 come into force five years after the day on which this Act receives royal assent or on any earlier day or days that may be fixed by order of the Governor in Council.

## Schedule 1

(Section 2, subsections 6(1) and 16(1) and paragraph 32(b))

### Petroleum Resources Joint Management Area

(Except where otherwise indicated, all latitudes and longitudes are determined according to NAD 27.)
The limits of the petroleum resources joint management area, excluding any island, islet or rock up to their low-water line, are described as follows:
Beginning at the intersection formed by the limit between Quebec and Newfoundland and Labrador and the low-water line;
thence in a southerly direction, following the prescribed limit or limits to point 2047 located at the intersection of the parallel of latitude 51°11'56? North and the meridian of longitude 57°07'11? West;
thence southwesterly, in a straight line to point 2046 located at the intersection of the parallel of latitude 50°59'55? North and the meridian of longitude 57°44'14? West;
thence southwesterly, in a straight line to point 2045 located at the intersection of the parallel of latitude 50°34'27? North and the meridian of longitude 58°11'27? West;
thence southwesterly, in a straight line to point 2044 located at the intersection of the parallel of latitude 49°50'55? North and the meridian of longitude 58°56'29? West;
thence southwesterly, in a straight line to point 2043 located at the intersection of the parallel of latitude 48°46'53? North and the meridian of longitude 60°28'40? West;
thence southerly, in a straight line to tripoint 2015 located at the intersection of the parallel of latitude 47°45'41.8? North and the meridian of longitude 60°24'12.5? West (NAD 83);
thence southwesterly, in a straight line to point 2014 located at the intersection of the parallel of latitude 47°25'24? North and the meridian of longitude 60°45'49? West;
thence southwesterly, in a straight line to point 2013 located at the intersection of the parallel of latitude 47°19'46? North and the meridian of longitude 60°59'34? West;
thence southwesterly, in a straight line to point 2012 located at the intersection of the parallel of latitude 47°00'35? North and the meridian of longitude 61°21'05? West;
thence southerly, in a straight line to point 2048 located at the intersection of the parallel of latitude 46°50'24? North and the meridian of longitude 61°24'01? West;
thence due west, to point 2010 located at the intersection of the parallel of latitude 46°50'24? North and the meridian of longitude 62°18'03? West;
thence northwesterly, in a straight line to point 2026 located at the intersection of parallel of latitude 47°08'23? North and the meridian of longitude 62°59'14? West;
thence northwesterly, in a straight line to point 2027 located at the intersection of the parallel of latitude 47°36'21? North and the meridian of longitude 63°19'56? West;
thence northwesterly, in a straight line to point 2042 located at the intersection of the parallel of latitude 48°13'14? North and the meridian of longitude 63°47'33? West;
thence due west, to point 2041 located at the intersection of the parallel of latitude 48°13'14? North and the meridian of longitude 64°25'22? West;
thence northeasterly, in a straight line to a point located on the low-water line at the southeasterly extremity of the cape named Cap d'Espoir;
thence along the said low-water line to its intersection with latitude 48°51'22? North near longitude 64°12'04? West located near Cap des Rosiers (point A);
thence northwesterly, along the geodesic to the point on the low-water line of Anticosti Island located to the most westerly point of said island, said point located approximately at latitude 49°51'49? North and longitude 64°31'29? West (point B);
thence northeasterly, along the geodesic to the intersection of the low-water line of the eastern shore of the rivière Saint-Jean and the low-water line of the Gulf of St. Lawrence, said intersection located approximately at latitude 50°16'54? North and longitude 64°19'59? West (point C);
thence in a general northeasterly direction along the low-water line to the point of beginning.
Bays
In the case of bays along the coasts, the low-water line in this description is replaced by a straight line, more specifically:
La Malbaie Bay is excluded from the petroleum resources joint management area by enclosing it from a point on the low-water line in the vicinity of the cape named Cap Percé, said point located approximately at the intersection of the parallel of latitude 48°31'23? North and the meridian of longitude 64°11'43? West (NAD 83); thence northerly, to a point on the low-water line in the vicinity of the point named Pointe Verte, said point located approximately at the intersection of the parallel of latitude 48°36'59? North and the meridian of longitude 64°10'27? West (NAD 83).
The Gaspé Bay is excluded from the petroleum resources joint management area by enclosing it from a point on the low-water line in the vicinity of the place named Pointe-Saint-Pierre, said point located approximately at the intersection of the parallel of latitude 48°37'34? North and the meridian of longitude 64°10' 04? West (NAD 83); thence northerly, to a point on the low-water line in the vicinity of the cape named Cap de la Vieille, said point located approximately at the intersection of the parallel of latitude 48°44'55? North and the meridian of longitude 64°09'47? West (NAD 83).
In any bay where a straight closing line of 10 kilometres or less may be drawn between points on the low-water line of the bay so that the area of the bay landward of the closing line is greater than that of a semi-circle whose diameter is the closing line, the limit of the petroleum resources joint management area is the straight closing line. For the purposes of this paragraph,
(a)    "bay" includes creek, cove and basin;
(b)    the straight closing line must be drawn so as to enclose a maximum area of the bay; and
(c)    the area of the bay must be calculated as including any islands or parts of islands lying landward of the straight closing line but as excluding any area above the low-water line along the shore of the bay.
Indentations, river mouths, inlets and ports
Where the coast is deeply indented and cut into, the low-water line in this description is replaced by one or more straight lines joining the appropriate points so as to enclose the indentations. The drawing of those lines must not depart to any appreciable extent from the general direction of the coast and must not exceed 10 kilometres. The sea areas lying within the lines must be sufficiently closely linked to the land.
In the case of rivers and inlets, the low-water line in this description is replaced by a straight line across the mouth of the river or inlet between points on the low-water line of the banks of the river or inlet. The drawing of the line must not exceed 10 kilometres.
Any permanent installations that form an integral part of a port system and that extend beyond the low-water line or straight line establishing the limits of the petroleum resources joint management area, as well as any roadsteads, are excluded from the petroleum resources joint management area.

## Schedule 2

(Subsections 98(1) and (2))

1996PG963
1996PG964
1997PG483
1997PG484
1997PG485
1997PG486
1997PG487
1997PG488
1997PG489
1997PG490

## Schedule 3

(Subsections 143(1), 155(1) and 159(3))

### Provisions

Item
Column 1
Act

Column 2
Provisions
1.
187
2.
125(1) to (5)
3.
Fisheries Act
36(3)
4.
Migratory Birds Convention Act, 1994
5.1(1) and (2)

## Schedule 4

(Subsections 143(1), 155(1) and (2) and 159(3))

### Provisions

#### Part 1 — Provisions of Acts

Item
Column 1
Act

Column 2
Provisions
1.
Species at Risk Act
32(1), 33, 36(1), 58(1), 60(1) and 61(1)
2.
Fisheries Act
35(1)

#### Part 2 — Provisions of Regulations

Item
Column 1
Act

Column 2
Provisions
1.
National Parks General Regulations
10 and 16
2.
Migratory Bird Sanctuary Regulations
3(2)b) and 10(1)
3.
Migratory Birds Regulations
5(1) and 6a)