Decision Date: June 7, 2016

Panel: Gregory J. Tucker, James Hackett, Douglas VanDine

Keywords: Oil and Gas Activities Act – ss. 22(5), 24, 25(1), 72(2); pipeline; permit; due regard; standing

Robert and Maxine Dilworth, and Olaf and Francis Jorgensen, filed two appeals against a decision of the Oil and Gas Commission (“Commission”) to issue a permit authorizing Encana Corporation (“Encana”) to construct and operate a pipeline. The pipeline crosses parcels of land owned by the Dilworths and the Jorgensens, respectively, near Dawson Creek, BC.

Before the permit was issued, Encana consulted with the Dilworths and the Jorgensens about the proposed pipeline. During the consultation process, the Dilworths provided written submissions to the Commission expressing their concerns about Encana’s preferred route for the pipeline across their land. The Dilworths proposed two alternate routes. The Jorgensens did not provide written submissions to the Commission regarding the proposed pipeline, but they expressed their concerns verbally during discussions with Encana. Following the consultation process, Encana provided a consultation report to the Commission as part of its permit application. The consultation report stated that Encana was still negotiating with the Dilworths. It also stated that Encana had failed to reach an agreement with the Jorgensens but “no project specific concerns have been raised.”

The Commission’s decision to issue the permit included a written rationale for the decision. The rationale included a discussion of alternate routes for the pipeline, particularly in regard to the Dilworth’s land. Regarding the Jorgensens, the rationale stated that there were no objections or outstanding concerns.

The Dilworths appealed the permit on the basis that the Commission failed to give due regard to their written submissions. They also argued that Encana misled them to believe that it had an agreement with the previous owner of their land regarding the pipeline. The Jorgensens appealed on the basis that the permit was issued without due regard to their verbal objections and Encana’s consultation report. They also argued that the consultation report was defective because it did not include their verbal concerns. In both cases, the Appellants argued that, had the Commission given due regard to their respective submissions, an alternate pipeline route would have been required. The Appellants requested that the Tribunal rescind the permit. The appeals were heard together.

Before the appeals were heard, Encana applied to the Tribunal for summary dismissal of the Jorgensens’ appeal on the basis that they made no written submissions to the Commission, and therefore, they had no standing to appeal under section 72(2) of the Oil and Gas Activities Act (the “Act”). Section 72(2) provides that land owners may appeal on the basis that the Commission made its decision “without due regard” to either a submission made by the land owner under section 22(5) or 31(2) of the Act, or a consultation report submitted under the Act. In a preliminary decision, the Tribunal declined to summarily dismiss the Jorgensens’ appeal (Decision No. 2015-OGA-002(a)). However, at the hearing on merits of the appeals, Encana again raised the issue of the Jorgensens’ standing to appeal the permit.

Regarding the Dilworth’s appeal, the Tribunal found that a statement by an Encana representative at a consultation meeting left the Dilworths with the impression that the previous owner of their land had consented to the project and that, as a result, they were not entitled to object to the project. However, the Tribunal found that Encana’s representative did not intentionally mislead the Dilworths, and the Commission corrected their misunderstanding at a subsequent meeting. Moreover, the Dilworths lost no right or benefit, and Encana gained no benefit, as a result of the misunderstanding. The Tribunal concluded that those circumstances did not warrant rescinding the permit. The Tribunal also found that the Commission was aware that a land owner was entitled to object to a project even if the land owner had consented to Encana doing a survey on their land. Finally, the Tribunal found that the Commission gave due regard to the Dilworths’ submissions regarding the proposed pipeline route and possible alternate routes. Based on the evidence, the Tribunal found that the alternate routes were not better options.

Regarding the Jorgensens’ appeal, the Tribunal found that the legislation requires a consultation report to include information about the formal consultation process that is required by the legislation, but the report need not contain information about any informal consultations that may take place. The Tribunal found that although Encana had engaged in a lengthy informal consultation process with land owners affected by the project, including the Jorgensens, Encana had also complied with the legislation’s requirements regarding the formal consultation process and the contents of the consultation report. The Tribunal found that Encana’s notice and invitation to consult clearly indicated that land owners could provide written submissions to either the Commission or Encana, but the Jorgensens provided neither. The Tribunal found that the statement in the consultation report that Encana had not reached an agreement with the Jorgensens, and that they had not raised project specific concerns, was accurate. To the extent that the Jorgensens had verbally objected to the project, it was in support of their neighbour and not in regard to their own property. Consequently, the Tribunal concluded that the Jorgensens had no standing to appeal the permit under section 72(2) of the Act.

However, the Tribunal went on to consider the substantive issues raised by the Jorgensens. The Tribunal found that none of the issues that the Jorgensens raised during the appeal process were raised by them before the permit was issued, and even if those issues had been raised beforehand, they would not have justified an alternate pipeline route. The issues were relatively minor, and are the subject of compensation that Encana pays to land owners.

Accordingly, appeals were dismissed.