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ARTICLE · 24 FEBRUARY 2016

New Offshore Liability Regime Effective February 26, 2016

Osler, Hoskin & Harcourt LLP
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While the establishment of a pooled fund presents a number of challenging commercial issues, its benefits to participants would be significant.

CanadaEnergy and Natural Resources
Simon Baines
Simon Baines
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The Energy Safety and Security Act (ESSA), passed in 2014 by the Harper government, introduced changes to the liability regimes governing Canada’s offshore oil and gas industries. These changes are slated to be effective on February 26, 2016, and include increasing the amount of security required to be provided to $100 million, raising the cap on absolute, or no-fault, liability from $30 million ($40 million in the Arctic) to $1 billion and empowering offshore regulators to issue administrative monetary penalties. We have discussed these changes in greater length in a previous Osler Update.

Since the legislation was passed, the offshore regulators (the National Energy Board, the Canada-Newfoundland and Labrador Offshore Petroleum Board and the Canada-Nova Scotia Offshore Petroleum Board) have issued draft regulations and guidelines in respect of the changes implemented by ESSA.

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