There is growing interest in the use of Unmanned Air Vehicles (UAVs) – often referred to as “drones” – for a variety of private and commercial uses. While there is considerable controversy over the military use of drones, commercial use is only in the early stages of development. The potential for commercial use for UAVs is extensive. In particular, there are many ways in which UAVs could be very useful to the oil and gas sector in Canada.

Applications in the Private Sector

There are limitless possibilities for commercial application of UAVs. They have a number of unique capabilities that make them very useful, including: the ability to stay in the air for extended periods of time, the ability to avoid putting flight crews at risk and the ability to access locations that would be virtually impossible to access by foot or vehicle. As the cost of operating UAVs continues to drop, they are also becoming more cost effective than helicopters and fixed-wing aircraft.

Transport Canada has indicated that UAVs “operate in diverse environments, in high risk roles, including but not limited to: atmospheric research (including weather and atmospheric gas sampling), scientific research, oceanographic research, geophysical research, mineral exploration, imaging spectrometry, telecommunications relay platforms, police surveillance, border patrol and reconnaissance, survey and inspection of remote power lines and pipelines, traffic and accident surveillance, emergency and disaster monitoring, cartography and mapping, search and rescue, agricultural spraying, aerial photography, promotion and advertising, weather reconnaissance, flight research, and firefighting monitoring and management.” From this list it is easy to envision that UAVs could have great utility in Canada’s oil and gas industry.

UAVs are particularly well suited to the needs of Canada’s energy industry. Canada has an incredibly vast landscape and the oil and gas industry requires regular safety checks in locations that are often difficult to access. Safety checks on pipelines, fracking fluid tanks, tailings ponds and other oil and gas sites are often done by foot or vehicle patrols and expensive fly-over inspections. The extreme weather of Canada’s north adds further challenge to accessing these sites. UAVs make it possible to gather information in dangerous and rural environments without risk to flight crews or to employees who would otherwise have to attend the site in person.

UAVs can contribute significantly to the safety of oil and gas operations. There are an estimated 825,000 km of pipelines crossing Canada and the safe operation of them requires significant monitoring. UAVs provide solutions to the challenges of pipeline monitoring. A UAV can be equipped with a specialized sensors to detect gas leaks, can be used to inspect oil tanks and can monitor wildlife. In the event of a release, a UAV can be used in conjunction with an infrared camera to survey an oil spill and detect on oil slick on water to provide critical information regarding the direction of the spill and the scope of the damage.

UAVs have already been used by a number of major Canadian oil and gas companies in different aspects of their operations. In addition, the U.S. Federal Aviation Administration has just recently started approving the use of UAVs for commercial use in the energy sector. In particular, UAVs have been used in Alaska for aerial surveys and monitoring of offshore drilling operations.

Canada has the added benefit of a regulatory structure that wants to regulate and not prohibit commercial use of UAVs. Transport Canada stated that “the ultimate goal is to ‘normalize’ UAV operations”; however, the regulatory structure is not currently in place to support routine operations. Transport Canada is currently looking at ways to liberalize the regime.

Recently, the Honourable Lisa Raitt, Minister of Transport, launched the Government of Canada’s safety awareness campaign for UAVs. The goal of the campaign is to help ensure that recreational and commercial users of UAVs understand their responsibilities and how to comply with Canada’s safety laws. On November 5, 2014 Transport Canada introduced two exemptions to simplify small UAV operations. The new exemptions permit the use of UAVs without a Special Flight Operation Certificate (“SFOC”) if the UAV is under 2 kilograms and certain operations involving UAVs under 25 kilograms. These exemptions apply to both commercial and recreational UAV use. Previously, every commercial UAV flight required an SFOC. The changes are expected to come into effect later this month. If Transport Canada continues to support this industry, Canada has the potential to become a world leader in the use of unmanned air vehicles.

The Regulatory Framework

Transport Canada is responsible for regulating the use of all aircraft, manned and unmanned, to keep Canada’s airspace safe. The Canadian Aviation Regulations, authorized under the Aeronautics Act, (the “Regulations”) defines a UAV as a “power driven aircraft, other than a model aircraft, that is operated without a flight crew member on board.” The Regulations state that no person shall operate an unmanned air vehicle in flight except in accordance with an SFOC. If you are using a UAV recreationally however, and the UAV weighs less than 35 kilograms, no SFOC is needed. However, compliance with the federal and provincial legislation including the Criminal Code and other laws including municipal by-laws is required.

There are two SFOC application processes available for commercial use of a UAV: one is the full SFOC application and the other is a simplified version. The simplified application is available to those who wish to fly UAVs that are remote-controlled with a maximum takeoff weight that is under 35 Kg and operated within visual range below 400 ft. above ground.

Initially, the SFOC is required for each flight of a UAV. Once an applicant has demonstrated that the operations can be conducted in a safe manner, Transport Canada may grant long-term approvals. In addition, Transport Canada may expedite SFOC applications after the initial application has been successful especially if the missions are essentially the same. For example, if the UAV system is the same with the same pilot or operator, Transport Canada will only assess the suitability of the area used for the operation.

SFOC applicants must provide details regarding the type and purpose of the operation, description of the aircraft, dates and times of the proposed flight, security plans and emergency contingency plans, and a detailed plan describing how the operation will be carried out including the altitude and routes, the location of any obstacles, and the exact boundaries of the area for the operation. The primary concern of Transport Canada is safety, so the applicant should strive to provide a comprehensive application appropriate to the scope of the operation and the complexity of the UAV system. Generally, Transport Canada requires that UAVs operating in Canada meet levels of safety that are equivalent to manned aircraft.

An application must be received by the appropriate Transport Canada regional office at least 20 working days prior to the date of the proposed operation or by a date mutually agreed upon by the applicant and Transport Canada.

Once a SFOC is issued, the certificate holder must, among other things, carry adequate liability insurance, report any incidents involving injuries or violations and continue to comply with the Canadian Aviation Regulations.

Possible Concerns with Safety and Privacy

In addition to complying with Transport Canada rules, other legislation may be applicable. The two most serious concerns relate to safety and privacy. With regard to safety, there is a risk that the UAV will crash and harm someone or their property. This risk makes maintaining adequate liability insurance mandatory and following flight plans essential. There are financial penalties for operating a UAV without an SFOC or operating a UAV that is not in accordance with the SFOC requirements. The unique nature of UAVs also requires the operator to respect privacy laws. As well, the use of UAVs over private property may be actionable as a trespass against the owner of the property. Because of this potential legal liability, being aware of those who are active or reside in the UAVs flight path is always good practice.

Whether the regulatory environment will remain in its current form is unclear. However, the production and use of UAVs is predicted to develop into a multi-million-dollar industry. As UAVs become more commercially viable, and the regulation adapts to demand, this is an area that will surely continue to grow.