Tenure

Granting of Rights

The Minister of Natural Resources is authorized to allocate underground storage agreements on a first-come first-served basis. To explore for the purpose of evaluating an area for underground storage potential, agreements in the form of a geophysical licence  and geophysical permit  or an underground storage exploration licence are required. To develop and construct an underground storage facility for fluids, agreements in the form of an underground storage lease and a construction permit are required, an underground storage exploration licence or a lease, must be acquired from the Minister of Natural Resources.

Exploration Licence

A company or individual wishing to obtain an exploration licence for underground storage may apply in writing to the Minister of Natural Resources including the following:

• A description of the area requested (must conform to the Survey System Regulation 86-190 under the Oil and Natural Gas Act).
• An application fee of $250.00.

An underground storage exploration licence entitles the holder the right to explore and evaluate the area granted under the licence. The licensee must pay an annual rent of $0.50/ha and undertake minimum exploratory work of an established value annually. The licence is issued for a non-renewable three year term and may be converted to a lease at any time during the term of the licence.

Storage Lease

A storage lease entitles the right holder to the exclusive right to develop storage, if it is determined that a storage area may exist. The lessee must pay an annual rental fee. A lease is granted for an initial term of ten years with the right of renewal for consecutive ten year periods.

Construction Permit

A construction permit grants the right holder the right to construct an underground storage facility. The permit is issued for a term of three years, renewable for a maximum of two one year periods.

The following table provides highlights on the types of rights granted, fees and terms.

Reporting Requirements

The holder of an exploration licence or a lease shall submit, within the time frame established by regulations, a report containing a statement with respect to the total expenditures made by the licensee or lessee and other information obtained during the term of their agreements.

For additional information, please contact the Petroleum Tenure Manager.