An environmental policy has been added by the Canada Energy Regulator (CER) to ensure there are net-zero emissions for some new oil and natural gas projects.

Annual Canada Oil and Gas Sector Greenhouse Gas Emissions

The rule surfaced in a revised filing manual for project sponsors that the CER wrote to obey a regulatory green new deal legislated by the national Liberal government’s 2019 Impact Assessment Act.

After nearly a year of consultations with the Alberta-based Canadian fossil fuel industry, which unsuccessfully fought the act as a “no more pipelines bill,” the 284-page rulebook sets limits on the clean-up requirement.

The new filing manual stated that the net-zero standard only needs to be satisfied by projects with planned lifespans that last past a target date of 2050 in the government policy. Pipeline and processing projects only have to devise emissions cleanups for their own facilities. Only forecasts are required for emissions from added oil- and gas-field activity that can be attributed to new delivery and handling services.

Definitions of actions eligible to be subtracted from emissions to hit the net-zero goal are left open. Industry and the CER remain free to evolve clean-up practices and accounting devices such as carbon capture and storage technology or purchases of offsets from carbon capture and trade exchanges.

The new project approval manual also derived regulatory rules from forays by the Impact Assessment Act beyond industry effects on land, air, water, and wildlife, into results for native culture, women, communities and health.

Like the definition of net-zero emissions, standards for society effects of oil and gas projects are left open to evolve. The new rulebook referred project sponsors to an array of lessons from government social programs and court precedents in gender equity and native reconciliation.

“Where the project may impact Indigenous communities and affect the use of traditional territory or potential or established treaty or Indigenous rights, applicants must identify the potentially affected Indigenous peoples and carry out effective engagement with them to determine their views and concerns,” according to the CER.

Applicants are required to gender-based analysis plus (GPA-plus) “to identify the potential for the project to impact diverse groups of people, including groups identified by gender in different ways, and to design engagement processes to facilitate the effective involvement of such groups.”

Like the native rights rule, GBA-plus makes projects cast a wide net to secure regulatory approval. “Individual and social identity factors can include sex, gender, religion, race, social position, income, age, ability, and education,” said the CER.

Test cases of industry ability to operate under the regulatory green new deal are underway, with early stages slowed down but not stopped by the Covid-19 pandemic.

The reform regime affects facility additions to TC Energy Corp.’s gas supply collection grid in Alberta and British Columbia (BC) and the Gazoduq pipeline proposed for liquefied natural gas (LNG) exports from eastern Quebec. BC has adopted a provincial version of the new federal assessment process for the native-owned Cedar LNG on the northern Pacific coast at Kitimat.