New offshore legislation comes into effect in Canada

2/29/2016

OTTAWA -- The Honourable Jim Carr, Canada’s Minister of Natural Resources, announced that new measures to strengthen environmental protection and safety in Canada’s offshore came into effect on Feb. 26, 2016.

The Energy Safety and Security Act enshrines the polluter-pays principle in legislation and increases absolute liability in the offshore. Operators’ liability will remain unlimited in cases of fault or negligence and increase to $1 billion, regardless of fault. The legislation requires emergency planning, environmental plans and other documents to be made available to the public. This will ensure that the public can review and understand the steps operators will take to prevent and respond to incidents.

Minister Carr also announced the publication of three new regulations necessary to fully implement the legislation. First, the Financial Requirements Regulations require applicants to demonstrate that they have the means to cover any claims in the event of an accident or spill. Second, the Administrative Monetary Penalties Regulations provide the offshore regulatory boards with an additional tool to strengthen compliance and enforcement with regulatory requirements. Third, the Cost Recovery Regulations establish a framework through which the Atlantic offshore regulatory boards will recover their operating costs from industry and reduce the cost for governments.

These amendments to the two Accord Acts and the associated regulations are the result of extensive collaboration between the governments of Canada, Newfoundland, Labrador and Nova Scotia.

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