On October 24, 2012, the Alberta government introduced legislation to unify upstream energy resource regulation in Alberta under the control of a single regulator. Under Bill 2, the Responsible Energy Development Act, the Alberta Energy Regulator will be created, combining the existing regulatory functions of the Energy Resources Conservation Board and Alberta Environment and Sustainable Resource Development. The new regulator will have responsibility for the regulation of all upstream activities “from initial application to reclamation” in the oil, natural gas, oil sands and coal industries, including matters relating to air, water, land, mine and facility authorizations.

The Alberta Energy Regulator will introduce a single-window approach to energy resource regulation, and will operate under the policy guidance of a unified Policy Management Office. This new body, another part of the Alberta government’s effort to integrate resource management, will set energy-related policy, develop industry performance measures and provide policy guidance to the sole regulator. The introduction of Bill 2 follows recent government announcements of a regional land-use plan for the Lower Athabasca Region (August 2012), an integrated environmental monitoring system (October 2012), and the issuance of a discussion paper on potential amendments to Alberta’s Aboriginal consultation guidelines.

Bill 2 arose from a three-year government initiative aimed at improving Alberta’s competitiveness in the oil and gas industry. In March 2010, the government released a report entitled Energizing Investment: A Framework to Improve Alberta’s Natural Gas and Conventional Oil Competitiveness, in which it identified regulatory overhaul as a key objective in “re-staking” Alberta’s competitive position. This led to the creation of the Regulatory Enhancement Task Force, mandated to comprehensively study the regulatory framework applicable to the upstream oil and gas industry in Alberta. In its December 2010 final report, the Task Force made six recommendations, all subsequently accepted by the government, aimed at harmonizing the development and implementation of energy resource policy, risk management and performance evaluation. The unified regulator envisioned in Bill 2 is a direct response to these six recommendations; the Policy Management Office is another.

The announcement of the new regulator will likely be welcomed by industry in its attempt to streamline and simplify the existing process of obtaining multiple approvals from various regulators for a single project. It is anticipated that the Alberta Energy Regulator will be operational by June, 2013; however, it will undoubtedly be some time after that before it is known how well the single regulator is functioning and whether the Provincial Government was successful in achieving its goals.

View the current Bill 2.