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ARTICLE · 18 JUNE 2019

Operators May Reduce Annual Compensation Under Surface Lease Agreements

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On March 19, 2019, the Alberta Court of Queen's Bench (ABQB) ruled in Karve Energy Inc. v Drylander Ranch Ltd., 2019 ABQB 298 that the Surface Rights Board (Board)

CanadaLitigation, Mediation & Arbitration
Daron Naffin
Daron Naffin
Laura Gill
Laura Gill
Gregory Whiteside
Gregory Whiteside
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On March 19, 2019, the Alberta Court of Queen's Bench (ABQB) ruled in Karve Energy Inc. v Drylander Ranch Ltd., 2019 ABQB 298 that the Surface Rights Board (Board) does not have the authority to interfere with the amount of compensation determined in a bilateral agreement between a lessor and an operator if that agreement is otherwise not in conflict with the Surface Rights Act, RSA 2000, c S-24. Overturning both the Board's original decision and reconsideration decision, Karve Energy Inc. (Karve) successfully argued that Karve was not in conflict with the Act by exercising a provision under its surface lease agreement to reduce the amount of annual compensation for adverse effect.

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