nexus - capla · meeting dates article submission deadline mailout november 2005 november 2, 2005...

NEXUSWATERPART 1: WATER RESOURCE

MANAGEMENT IN ALBERTA

mailing address goes in this box

RETURN UNDELIVERABLE CANADIAN ADDRESSES TO1600, 144 – 4 Avenue S.W. Calgary, AB T2P 3N4Office email: [email protected]

PM 40825561

October 2005

ALSO IN THIS ISSUEw Royalty Trusts, Mineral Trusts & Agencies

w Benefits of Volunteering

w Tips for a Successful Job Search

The 2006 CAPLA Conference Committee

Requires Volunteers!

Everybody is working harder, land admin is more onerous, and our time for volunteering certainly suffers. In order to alleviate some of the burdens associated with organizing past Conferences, we are proposing

some changes to the 2006 Conference such as hiring instructors and utiliz-ing CAPLA’s office personnel. We hope that with these changes everyone can breathe a sigh of relief as to the volunteer time commitment!! As well, we would like to see a mentorship program in place during the Conference. We are hoping every Co-ordinator partners with someone inexperienced with the Conference. What a great way to share your knowledge, as a mentor, or gain confidence in a leadership role as a mentee!

Val Anderson, the Conference Volunteer Co-ordinator, can answer any questions you have about the Conference and discuss your role with the Conference. The Conference needs committee volunteers and your time commitment will be as much as you can afford. Please contact Val at [email protected].

This is your chance to say, “Yes, I want to volunteer with the 2006 Conference”. The CAPLA membership is at an all time high with almost 2,000 members!

We have the ability to make the 2006 Conference the best yet for our members (though that will be hard to beat!) while providing our volunteers with the highest amount of recognition and appreciation ever! Are you with us?

We sure hope so! W

The 2006 CAPLA Conference Committeer

1600, 144 – 4 Avenue S.W. Calgary, AB T2P 3N4

Ph: (403) 571-0640 Fax: (403) 571-0644

Website: www.caplacanada.org

Office Email: [email protected]

NEXUS Email: [email protected]

Board of Directors President Audrey Atkins

Vice-President Ty Hansen

Secretary Barbara MacBeath

Treasurer Sherry Sturko

Certification Kevin MacFarlane

Communication Karen Pugsley

Education Margarita Cowan

Events Vacant

Government Relations Lynn Gregory

Industry Relations Gordon Dainard

Member Services Brandy Brhelle

Special Events Deb Waterhouse

Technology Kathy Ward

CAPLA NEXUS is a publication of CAPLA

Produced by the Communication Committee

NEXUS Email: [email protected]

Director Karen Pugsley

Editor Wendy Walker

Assistant Editor Nadine Campbell

Design Folio Publication Design

Printing McAra Printing

Editorial Team Sally Jackson, Hannah Krtolica,

Shane Raman, Alima Sanogo

Maarnie Shakespeare, Melissa Sadal

Nancy Howes-Olmstead

Publication Schedule Meeting Dates Article Submission Deadline Mailout November 2005 November 2, 2005 December 7, 2005

January 2006 January 12, 2006 February 21, 2006

March 2006 March 16, 2006 April 25, 2006

Effective September 12, 2005 CAPLA’s membership was 2038.

All articles printed under an author’s name represent the views of the author.Publication neither implies approval of the opinions expressed nor accuracy of the facts stated.

IN THIS ISSUE

NEXUS OCTOBER 2005

The 2006 CAPLA Conference Committee

Requires Volunteers! . . . . . . . . . . . . . . . . . . . . . . . Inside Cover

Water Resource Management In Alberta . . . . . . . . . . . . . . . . . 2

Government Relations Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . 5

Special Events Update . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

CAPLA 2006 Membership Fee Changes . . . . . . . . . . . . . . . . . . 9

You Wanted To Know . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Upcoming CAPLA Courses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

CAPLA’s Anniversary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Royalty Trusts, Mineral Trusts and Agencies . . . . . . . . . . . . . 16

CAPLA Crossword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Mentoring Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Events Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Letter from STARS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

A Message from Kevin MacFarlane . . . . . . . . . . . . . . . . . . . . . 25

But That’s Not What I Meant! . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

Benefits of Volunteering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

Tips For A Successful Job Search . . . . . . . . . . . . . . . . . . . . . . . . 31

Election Time is almost upon us again! . . . . . . . . . . . . . . . . . . 33

CAPLA information at a glance . . . . . . . . . . . . . . . . . . . . . . . . . 34

Upcoming Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

NEXUS w October 20052

Water:Part 1: Water Resource Management In AlbertaIntroduction

The true test of stewardship for any government is how it manages the interests associated with competing natural resources. Water, while generally considered

the source of life on this planet, is nevertheless subject to competing demands and usage. Oil and gas are also funda-mental to life on earth, at least as we now know it. Present practices and demands for oil and gas present a clear trade off between water on the one hand and oil and gas on the other, due to the limited supply of both resources. At times these competing demands can lead to conflicts. Recent disputes involving potential impacts from coalbed methane develop-ment in British Columbia and Wyoming have once again brought oil/water issues to the public’s attention. This article assesses the emerging issues relating to coalbed methane development, oil sands processing and related impacts upon water resource management in Alberta.

HistoryThe Government of Alberta owns the rights to all surface water and groundwater since the management of natural resources in Alberta, including water, was transferred to

the Province of Alberta in 1931. The Water Resources Act was passed that year and became the first provincial water resources legislation. The Water Resources Act was extended to apply the surface water provisions to groundwater in 1962. Other changes were made to the Water Resources Act in 1978 and groundwater diversions for enhanced recovery processes after 1981 became only temporary in nature. However, licenses to divert and use surface water for enhanced recovery continued into perpetuity. In 1990, the Ground Water Allocation Policy for Oilfield Injection Purposes was announced, which placed additional restrictions on the diversion and use of groundwater specifically for oilfield enhanced recovery in an area called the “White Area” of the province.

The new Water Act was proclaimed in 1999 and replaced the Water Resources Act. The Water (Ministerial) Regulation and the Water (Offences and Penalties) Regulation also came into force that year. The Water Act introduced a number of significant changes to the former

3NEXUS w October 2005

regime, the result of extensive public consultation, and expressly adopts the principles of multipurpose use of water resources as the cornerstone of the legislation. This recog-nition has resulted in additional licensing requirements under the Water Act that includes ongoing monitoring and reporting of the quantity of groundwater diverted and of the water levels in the water source well. Authorizations for temporary water diversions became term licenses with an expiry date based on their expected use and water management plans were introduced. The Water Act also introduced penalties for contravening provisions of the legislation as well as a right to appeal a decision made by the Director to the Environmental Appeal Board (EAB).

Surface WaterUnder the Water Act, any use of surface water other than household uses as defined in the Act, and uses of water for traditional agricultural purposes, require a Water Act licence however small the quantity of water diverted may be. Even if surface water is supplied by a water hauler on a temporary basis, the water hauler is responsible for ensuring compliance with the Water Act. In order to initiate a licensing process, the proponent must submit a water licence application. Alberta Environment will then review the application and if it is deemed feasible to proceed, will outline requirements to the proponent in order to obtain a licence. These may include an explana-tion as to the use of the water, hydrological studies by specialists confirming the water at the proposed location is available and the advertising of public notice request-ing interested citizens to file a Statement of Concern.

There are a few exemptions from the licence require-ment in the Water Act. A diversion of water from a dugout for any purpose is exempted from the licence requirement if the water is naturally impounded in the dugout, the dugout is not situated in a river, lake or wetland, the capacity is less than 12,500 cubic metres and the total diversion is less than 6250 cubic meters. The Water Act also exempts the diversion of surface water

for work camps. This exemption allows up to 1,250 cubic metres per camp per year for purposes of human consumption, sanitization, fire protection and other uses related to the camp for the requirement of a licence. A further exemption in the Green Area of the province also permits the diversion of up to 5,000 cubic metres of water.

Ground WaterThe Water Act and its regulations govern the use of ground-water by the oil and gas industry. Notably, the diversion of saline groundwater as defined in the Water Act is exempted from the requirement of a Water Act licence and the diversion of groundwater for different purposes may have different licensing procedures depending upon whether the diversion is located in the Green Area or the White Area of the province. The Ground Water Allocation Policy for Oilfield Injection purposes has been expressly adopted by the Water Act and has several key components. Prior to applying for a licence to divert groundwater, alternate sources of supply including surface water, saline groundwa-ter and treatment of effluent must be evaluated. Any issued licence to divert groundwater will be for one year. If the diversion proceeds without affecting the source adversely, the licence can be renewed for a period of five years. Further extensions, though usually for the five-year terms, can only be issued where the licence conditions are being fulfilled.

A variety of safeguards in the policy include limita-tions on water quantity withdrawals, time limit restric-tions and monitoring information being available to public scrutiny. If the drawdown on the existing licence exceeds the capacity of the aquifer, the licence holder has five years to identify an alternate source. The licence holder is also required to limit the drawdown in observa-tion water wells located in the same aquifer to 35% of the available water during the first year of water produc-tion and 50% over the life of the project.

Importantly, the procedure to obtain a licence to divert groundwater for enhanced recovery in the Green Area is not subject to the Ground Water Allocation Policy


for Oilfield Injection purposes. This policy is based on the belief that there are few other resource users in this area and adverse impacts are unlikely. Requirements to divert groundwater for a facility or camp uses in the Green Area may also vary considerably. This will depend upon the quantity of the water required and the number of existing groundwater users in the area. There is also an exemption for a temporary diversion and use of up to 5000 cubic metres of water in the Green Area of the province, provided that the diversion is made in accordance with the condi-tions and the time period specified by the Forestry Office. Diversions of groundwater for rig supply requires the approval of Alberta Environment usually in the form of a temporary diversion licence. The licensing requirements for water diversion in the White Area of the province can also vary considerably depending upon a variety of factors such as the number of nearby groundwater users, the quantity and duration of water usage and local concerns.

The real issue associated with enhanced recovery involves the removal of water resources from the hydro-logic cycle as a result of deep well injection. While technically, no water is lost from the hydrologic cycle, in the case of deep injection wells, that water may be gone for a long time. Groundwater contamination is also an issue in Alberta and can occur in a number of ways. Oilfield waste disposal by spreading on land and roads are officially condoned practices that receive only limited regulatory oversight. Faulty well casings can cause under-ground leakage, spills happen during operations, faulty storage structures have been reported, pipelines can fail and improper transport and disposal can occur.

Future Water DemandsMost of the present enhanced oil recovery processes

are variations on the water flooding scheme. The Water Act requires the oil and gas industry to investigate the use of saline water whenever possible. However, there is a general tendency not to use saline groundwater for enhanced recovery in the Green Area due to the relative ease with

which fresh water approvals are obtained. In addition, the current trend is toward a decrease in the use of groundwa-ter for enhanced recovery purposes. However, according to Alberta Environment, the use of saline groundwater in the White Area of the province is presently increasing and this gradual increase is expected to continue.

With many conventional oil fields entering later stages of exploitation, and with fewer and fewer discoveries being made, water usage for enhanced recovery is expected to remain at current levels or decrease over the next few years. This decrease will be due to the increased costs associated with the use of water and the availability of other options such as the expected use of CO2 for enhanced recov-ery purposes. Carbon dioxide flooding and Toe to Heel Air Injection serve as exciting new alternatives to water flooding and deep water injection that may result in a significant decrease in water usage. This is not without cost of course as CO2 transportation infrastructure would be required. In fact, much of the present Alberta oil produc-tion is subject to high water to oil ratios. Issues respecting recycling have direct impacts to water handling costs and will render some of these mature wells less economical. This is especially so with heavy oil fields and in situ oil sands production processes which involves steam assisted gravity drainage (SAGD). SAGD usually utilizes parallel pairs of horizontal wells for steam injection and oil recov-ery. Steam assisted oil recovery is far more intensive than conventional oil extraction because it involves batteries of wells in close proximity and it requires large quantities of water and power for generating steam. W

Glen L. Nazaruk LL.MMineral Land Analyst, IBM Consulting ServicesProviding Services to BP Canada Energy(403) 355-9474

Thank you to Glen Nazaruk for providing permission to reprint this two-part article that originally appeared in the November and December 2004 issues of The Negotiator.


Government Relations Portfolio

The details below reflect the current status of each of the working committees within this Portfolio. Please remember that volunteers are always welcomed!

Should you have any questions or ideas for new initiatives, please feel free to contact me via email at [email protected] or directly to the specific committee chair.

Alberta1. PNGTenureAdvisoryTaskForce w Industry Advisory Committee is Alberta Department

of Energy (“DOE”) name for this group w Last meeting June 16, 2005 included discussion

on: w mandating Monthly Statement Process early in

2006 w updates on the e-Business initiatives currently

underway including e-Transfers (turnaround time is now 2-5 days for registration), e-Postings (launched successfully March 30, 2005) and e-Bidding (number of meetings held with sub-group with launch scheduled for May 3, 2006)

w update on Freehold Mineral Tax working group (some improvements made to the current process, proposed changes identified that could be implemented in early 2006 and a potential new system developed in 2007)

w feedback from the P&NG Tenure Information Exchange. See http://www.energy.gov.ab.ca/docs/tenure/pdfs/IB_2005-02_Mineral_Rights.pdf for a link to the feedback for the entire Exchange

w accessing mineral landowner information using third party vendors. Concern was raised by a number of companies that information previ-ously available at no cost to them is no longer available from those third party vendors. The DOE cannot assist Industry with resolving this.

2. PNGTenureTaskForce w Consideration being given to holding a Round

Table with respect to the administration of Holdings including the application, recording, and maintaining of the information.

w As well, the AB Crown is considering an upcom-ing review of the Continuation Form and its technical guidelines

w Linda Westbury welcomes any ideas or comments you might have on either of these initiatives.

3. e-TenureCommunicationsWorkingGroup w participants ensure communication on all elements

of e-Tenure is distributed efficiently through dinner meetings, newsletters, website updates

w Last meeting June 23, 2005 w Overview and update to the various e-initiatives

underway with AB Crown; check the e-Tenure times at: http://www.energy.gov.ab.ca/1045.asp for all publications; most recent is August 9, 2005

4. BrokerDocumentsTaskForce w In a prior NEXUS article you were advised that a

Task Force was preparing a number of documents to be used between Brokers and Industry compa-nies when acquiring land at Crown Sales. We are pleased to announce that these documents have been endorsed by CAPLA and will be available on the website very soon. Once they have been posted, you will receive notification through an email.

w It is expected that the posted documents will include the Agency and Trust Agreement, the


Posting/Acquisition Service Order Form, and the Transfer Service Order Form together with a list of Questions & Answers for each document to assist users in completing the Forms and providing addi-tional details and explanations that may be help-ful. There will also be a “package” that contains a summary, the three Forms and the three Q&A.

5. e-PostingsWorkingGroup w launched successfully March 30, 2005 w first electronic posting received at 9:38 a.m. on

the first day of the electronic posting period for the July 27, 2005 Sale.

w The working group wound up a successful project on April 28 and their dedication and hard work is appreciated by everyone involved!

6. e-BiddingWorkingGroup w numerous meetings have been held to develop the

“as is” and “to be” models resulting in a Business System Design document

w system launch scheduled for May 3, 2006 for the June 28, 2006 Crown Sale

7. NaturalGasinCoalTenure–WorkingGroup w The Final Draft Report of the Natural Gas

in Coal/Coalbed Methane Mineral Tenure Recommendations has been posted on the DOE website. This report should be read as background to the MAC Preliminary Findings document. The direct link is http://www.energy.gov.ab.ca/docs/naturalgas/pdfs/cbm/PF-TenurePaper.pdf

w The Alberta Department of Energy website http://www.energy.gov.ab.ca/335.asp continues to be updated.

8. SurfaceTaskForce w SRD is working with its developers to determine

how it might proceed with e-Transfers on Surface.

CAPLA is in contact with SRD and has offered its assistance when SRD is ready to start the dialogue.

w Roxanne Hodgson has volunteered to be our Government Relations Surface Contact. Special thanks to Lenita Gutiw who graciously held the position for quite some time.

w Alberta Sustainable Resource Development will be implementing digital integrated disposition mapping on public land. Please refer to Information Letter 2005-02 dated July 15, 2005 for additional information.

w Road Use Fees: Your input is appreciated regard-ing the potential for creating a database containing comparable road use fees. If you have ideas, concerns or wish to volunteer for a Task Force, please contact Roxanne Hodgson.

w Changes to the Alberta Pipeline Regulation (Crossing Pipelines at Undeveloped or Unopened Road Allowance) were announced on May 31, 2005 with the issuance of Bulletin 2005-12 from AEUB: http://www.eub.gov.ab.ca/BBS/requirements/gbs/bulletin2005-12.htm

The new change clarifies for industry that the Pipeline Regulation DOES require consent from a pipeline licensee before crossing a pipeline that exists at undevel-oped or unopened road allowances.

9. FreeholdMineralTax w On June 20 & 21, the FMT Business Design Group

reviewed the ‘To Be’ models of the Freehold Mineral Tax business processes and how the proposed busi-ness rules will improve the freehold mineral tax business for both DOE and industry. The feed-back was either incorporated into the models, or was documented for further discussion during the detailed requirements and design stages of the FMT system build in 2006.

w Next meeting will be October 13, 2005. w Consultation with industry will continue in order to

determine a methodology for the Crown to calculate


a Unit Value which will reduce industry reporting requirements.

British Columbia1. MineralTenureTaskForce w No update at this time

Manitoba w Members are encouraged to use their website (www.

gov.mb.ca) as a window into the opportunities offered in Manitoba. Check out www.gov.mb.ca/itm/petro-leum/gis/index.html to view a web-enabled Manitoba map displaying crown dispositions, wells, ownership to name a few.

Saskatchewan1. MineralTenureTaskForce w No update at this time

2. OilShaleandOilSandsRegulationReview w SIR has advised its “The Oil Shale Regulations,

1964” are in need of updating with respect to fiscal, administrative and technical realities and is embark-ing on consultation with all stakeholders in the development of new regulations.

w Until those regulations are in place, a Crown Reserve has been created along the western boundary of the Province. This Reserve brings a temporary suspension in the issuance of new oil sands dispositions until new regulations can be developed. The expectation is for these regulations to be in place by mid-2006 at which time the Crown Reserve will be lifted and orderly dispositioning of the resource can proceed.

3. ISCTaskForce w No update at this time W

Submitted by Lynn Gregory as Government Relations Director, with input from Committee Chairs


Special Events UpdateCommittee MembersDeb Waterhouse (Director)Jacquie Burke Tina Caldwell Anna Chu Stacey Ecklund Kerrie Etson Daphne de GrootMarc Huggard Donna Rector Peter Sambu

The Special Events Committee is a new committee respon-sible for the organization and implementation of the bi-annual Management & Supervisory Summit, the bi-annual CAPLA Conference, the Management Night Dinner, the Annual General Meeting and any topical breakfast/lunch sessions. We welcome feedback and encourage CAPLA members to let us know what YOU would like to see, and who you would like to hear, at these special events.

2006 CAPLA Conference UpdateThe 2006 CAPLA Conference to be held on May 11 & 12, 2006 at the Calgary Round-Up Centre, will be sport-ing a new and exciting format as well as new topics and subjects. There will be some returning favorites but we hope that you will enjoy and embrace the many wonderful changes that the Conference Committees have in store for you. We will keep you posted on content and registration!

On September 7, 2005, we held a “Casting Call” for volunteers for the 2006 CAPLA Conference. Over fifty volunteers so far, have expressed an interest in volunteer-ing for the Conference.

On behalf of the Special Events Committee, we would like to say THANK YOU to all the volunteers who freely give their time and expertise, in order to make a difference within CAPLA. W

Kerrie Etson

GROUP BENEFITS REMINDER

EVERYONE BENEFITS!

CAPLAhasarrangedforitsmemberstobeeligibleto

belongtoacomprehensivebenefitsprogram,including:

Group LifeDependant Life

Accidental Death & DismembermentLong & Short Term Disability

Extended Healthcare (Major Medical & Prescription Drugs)

Vision CareDental

Health Spending Account

These benefits are available to you as a CAPLA Member, and in addition to the benefits listed

above, CAPLA members can feel free to contact Dann Kepford for quotations for personal/

corporate life insurance, disability and critical illness quotations. Dann is a broker and can

obtain quotes for the entire insurance market.

Please contact: Dann Kepford @ (403) 264-6690


CAPLA 2006 MembershipFeeChanges

Membership Renewal for 2006 will be upon us soon. We wanted to let you know about a couple of changes that are coming.

For new members, the anniversary date of your membership will be the date you joined the organization. What does that really mean? A new member, joining in May 2006, will get a renewal notice in May 2007, May 2008, etc.

This change gives all new members a full 12 months for the first year’s membership.

For ease of transition all existing members will keep a renewal date of January.

There will also be a fee increase this year. The cost to join CAPLA has not changed in the 12 years since we started. Over those 12 years, both inflation and the requirements of running our organization have resulted in increased costs. As a result, in order to ensure that CAPLA continues to be a sustainable organization, an increase is needed. The cost for a member to renew in 2006 will be $125.00 plus GST.

This fee includes all the benefits of membership that you receive today, as well as one free CAPLA lunch meet-ing of your choice.

Starting in January 2006, the cost for non-members to register for CAPLA courses will also increase. The non-member will pay an additional $125.00 plus GST for each course taken. W

CAPLA Executive

You Wanted To KnowWhat is the FHOA?I recently directed a colleague to the FHOA website for some information and the response was “What is the FHOA?” The FHOA stands for Freehold Owners Association and was set up in 1999 to provide informa-tion and support to owners of freehold oil and gas inter-ests. As outlined on their website (www.fhoa.ca):

The principle goals of the Freehold Owners Association are to: w provide information and education which will help

freehold owners protect their valuable resources;w research issues of concern to freeholders…;w promote fairer treatment for all freehold owners by acting as

their common voice, by bringing their legitimate concerns to the attention of the oil and gas industry, industry regulators, governments and the general public, and by advocating reasonable resolutions to these concerns.

The FHOA is a non-profit organization administered by volunteers and is overseen by a Board of Directors comprised of ordinary citizens, legal representatives and oil and gas professionals. They offer their membership access to an excellent website, regular seminars on timely topics and an informative and comprehensive newsletter.

If you are working in the area of Freehold Leases, a browse through the website will provide you with information on the history of the oil and gas industry, the workings of the freehold lease and an overview of freehold landowner concerns. The information and ideas presented help to broaden the reader’s understanding of issues that affect the relationship between freehold owners and the oil and gas industry. W

Wendy Walker, Land Analyst


Upcoming CAPLA CoursesThefollowingarealistoftheupcomingcoursesofferedbyCAPLA.PleaseseetheCAPLAwebsiteforcourseinforma-tionortoregister–www.caplacanada.org.

Administration of Indian Oil & Gas Lands – Mineral

Course Date(s) Registration Deadline

October 25, 2005 October 15, 2005 @ 04:30pm

Location & Lunch Duration & Check-in Time

Rotary House located at the North end of the Big Four Building Stam-pede Grounds – Victoria Park/Stam-pede LRT Station or Parking $8.00

09:30 am – 1:00 pm Check-in begins 1/2 hour prior to start

Member Fee Non-Member Fee

$187.25 ($175.00 + $12.25 GST) $272.85 ($255.00 + $17.85 GST)

WhattoBringParticipants are encouraged to bring their own samples and questions, which will be examined if time permits.

DescriptionMineral RightsIntroduction to land ownership and issues with regard to exploration and production on Indian Reservations. There will be a review of legislation pursuant to mineral rights as well as Indian Oil and Gas Canada’s mission and mandate. We will review the types of mineral agree-ments, methods of disposition and issuance. Topics such as compensation, continuances, pooling, drainage notices and administrative transactions will be discussed. The implications of Treaty Land Entitlement for the Oil and Gas Industry will also be discussed.

TargetAudienceThis is an advanced course for people working on Indian Reserves or who have experience working with Freehold lands.

Instructor(s)Wendy Dunn – Contractor:Wendy has worked in the Oil and Gas Industry for twenty-two years. A former employee of IOGC, she has been contracting with the crown corporation for the last eight years. Wendy has worked in almost every capacity within the land department and now concentrates on project work such as Treaty Land Entitlement.

Wendy is an active member of CAPLA. She has a Bachelor of Arts Degree, Management of Business Certificate from the University of Calgary and her Canadian Securities accreditation.

Doug Meeking:Until recently, Doug was Manager, Environment and Surface Land, at IOGC; having retired after five years with the organization. He has presented the surface land component of this CAPLA course for the past three years.

Doug has an Honors BSc and MSc, with thirty-one years experience in the environmental industry focussed primarily on large energy projects in Canada and overseas. He is a member of the Alberta Society of Professional Biologists

Administration of Indian Oil & Gas Lands – Surface




Rotary House located at the North end of the Big Four Building Stampede Grounds – Victoria Park/Stampede LRT Station or Parking $8.00

02:00 pm – 05:00 pm Check-in begins 1/2 hour prior to start


$187.25 ($175.00 + $12.25 GST) $272.85 ($255.00 + $17.85 GST)



DescriptionSurfaceRights&EnvironmentalComplianceIntroduction to land ownership and issues with regard to exploration and production on Indian Reservations. There will be a review of legislation pursuant to surface rights and the environment as well as Indian Oil and Gas Canada’s mission and mandate. We will review various types of surface agreements, application and approval process, compensation, abandonment and administra-tive transactions. The Canada Environment Assessment Act (CEAA) will be discussed. The implications of Treaty Land Entitlement for the Oil and Gas Industry and more particular to surface rights will also be discussed.

TargetAudienceThis is an advanced course for people working on Indian Reserves or who have experience working with Freehold lands.

Instructor(s)Wendy Dunn – Contractor:Wendy has worked in the Oil and Gas Industry for twenty-two years. A former employee of IOGC, she has been contracting with the crown corporation for the last eight years. Wendy has worked in almost every capacity within the land department and now concentrates on project work such as Treaty Land Entitlement.

Wendy is an active member of CAPLA. She has a Bachelor of Arts Degree, Management of Business Certificate from the University of Calgary and her Canadian Securities accreditation.

Doug Meeking:Until recently, Doug was Manager, Environment and Surface Land, at IOGC; having retired after five years with

the organization. He has presented the surface land compo-nent of this CAPLA course for the past three years.

Doug has an Honors BSc and MSc, with thirty-one years experience in the environmental industry focussed primarily on large energy projects in Canada and overseas. He is a member of the Alberta Society of Professional Biologists.

Administration of RoyaltiesCourse Date(s) Registration Deadline






$187.25 ($175.00 + $12.25 GST) $272.85 ($255.00 + $17.85 GST)

WhattoBringParticipants are asked to bring a calculator. We also recommend that Land Administrators invite their Production Accountants to attend as one of the main objectives of this course is to provide common terms of reference for Land and Accounting groups. Note: Production Accountants who are members of CAPPA will be offered this course at the CAPLA Member fee.

DescriptionThe focus of this course is:1. interpretation of the royalty clauses in the land agree-

ments (including deductions);2. how to present this information to the Accounting

department;3. how the Accounting department applies this informa-

tion; and4. what the actual calculations will look like.Some of the royalty types to be reviewed are Lessor Royalties; Farmor Royalties; Gross Overriding Royalties; Net Profits Interests and Net Revenue Interests.


TargetAudienceIndividuals who require a basic understanding of royalties.

InstructorCurt HamrellCurt has been working within the Oil and Gas indus-try since 1981. He has a Petroleum Land Management Degree. His 20 plus years of Land experience includes Land Administration Contracts, A&D, Mineral Leases, Mineral Negotiations and maintenance of various Land Systems. Curt is currently consulting at Canadian Natural Resources and has been a CAPLA Education Committee Volunteer Since April 2002. He supports the CAPLA Education DACUM Process, 5 year Education Plan and Curriculum Development Program. Curt is also affiliated with CAPL, as an active member he also has volunteered on the CAPL Membership Committee.

Rights of First RefusalsCourse Date(s) Registration Deadline






$187.25 ($175.00 + $12.25 GST) $272.85 ($255.00 + $17.85 GST)


DescriptionFor the “novice”, this course provides an excellent introduction to ROFRs as well as a thorough overview for administrators who have had previous experience in this area of Land Contracts. Case studies will provide an opportunity for some hands-on experience. The topics to be addressed include the history of ROFRs; ROFR

provisions in CAPL Operating Procedures and other agreements; administration of ROFRs (i.e. complying or not complying with ROFR clauses); ROFRs as a part of the sale process and ROFRs in Asset Exchange transac-tions. The time frame within which a ROFR must be addressed and how to calculate the interests of the parties when a ROFR is exercised will also be discussed.

TargetAudienceNovice and experienced personnel interested in learning about ROFRs.

Instructor(s)Macleod Dixon, Barristers & SolicitorsThe law firm of Macleod Dixon will provide Instructors.

Know What You Own – The ABC’s of DOIsCourse Date(s) Registration Deadline

November 01, 2005 October 22, 2005 @ 04:30pm



09:00 am – 04:30 pmCheck-in begins 1/2 hour prior to start


$299.60 ($280.00 + $19.60 GST) $385.20 ($360.00 + $25.20 GST)

WhattoBringParticipants are asked to bring a calculator.

DescriptionThis course will outline how Division of Interests (DOIs) are affected by various agreements such as Mineral and Surface agreements; Joint Operating agreements; Working Interest Clarification agreements; Farmout and Farmin agreements; Poolings; Assignment and Novation/Notice of Assignments; Quit Claims; Unit agreements; Royalty agreements and Long Term Gas Purchase contracts. Each session will provide a brief summary (15 minutes maximum) of each type of agreement and following discussions will then relate how the agreement


affects a DOI at various stages in the life of a land asset. Exercises will be used to provide participants with hands-on experience.

TargetAudienceIndividuals in Land requiring an understanding of how DOIs are affected by various agreements.

Instructor(s)Dawn M. Jordan – Brimac Consulting Ltd.Dawn has worked in the oil industry since 1981. She moved to Halifax in 1988 to obtain her law degree from Dalhousie University. Dawn then practiced law in Vancouver for 4 years, specializing in Family and Personal Injury. Dawn returned to Calgary in 1995 working as a Consulting Landman, she presently specializes in Acquisitions and Divestitures. Dawn has taught Business Law classes for DeVry and the University of Calgary. In addition, Dawn is enrolled in a part-time LL.M. program in E-Business Law at Osgoode Hall Law School (U of T) and co-developed a course in E-Business Law for the University of Calgary, Faculty of Continuing Education. Dawn is a member of CAPLA, CAPL, and the BC Bar Association.

Think & Thrive: Mental Mastery at WorkCourse Date(s) Registration Deadline

November 08, 2005 October 29, 2005 @ 04:30pm





$315.65 ($295.00 + $20.65 GST) $395.90 ($370.00 + $25.90 GST)

EarlyRegistrationEarly Registration is required in order to complete the Herrmann Brain Dominance Instrument (HBDI) prior to the course. The HBDI will be provided to those attending by Dr. Herasymowych one month prior to the

commencement of the course. These are to be completed and returned to her 3 weeks prior to the course in order to have your assessment ready for the course date.

DescriptionWe respond to today’s rapidly changing work environ-ment in land administration by continually upgrading our computers, software and land systems, but how about our brain software? Adapting to standardization and streamlining processes is the major task facing us today. Recent brain research shows that you can increase your abilities to perform breakthrough thinking, influ-ence people and develop mental mastery in dealing with personal and professional challenges. In this seminar, you will:

w Determine your thinking style and find out how it affects communication and the feedback loop.

w Explore how adapting and flexing your communica-

tion style can create rapport with co-workers, partners and clients.

w Find out why becoming accountable for your think-ing and actions allows you to respond quickly and creatively to change and even thrive on the changes happening.

w Discover how to overcome mental fatigue and every-day stresses in your environment.

w Identify how you can add value by discovering a sense of purpose within your company.

w Begin a plan to create opportunities and become a master learner on your professional “learning road map”.


TargetAudienceIndividuals wishing to understand and enhance their brainpower in order to meet challenges of change and diversity. This seminar also assists you in enhancing your communication skills.

Instructor(s)Dr. Sonia Herasymowych – Self EnergeticsDr. Sonia is principal of Self Energetics, a consulting firm that assists organizations and teams in develop-ing high performance by incorporating diverse ways of thinking. Her academic qualifications include receiv-ing a BA with Honours in Chemistry, MSc in Physical Chemistry, and a PhD in Biochemistry. She is a certified practitioner in Myers-Briggs Type Indicator (MBTI)® and the Herrmann Brain Dominance Instrument (HBDI)®. In addition to her private practice, she is an associate of MHA Institute Inc., Calgary. She is noted for her dynamic presentations about the use of science in everyday life.

Freehold Lessor EstatesCourse Date(s) Registration Deadline

November 15, 2005 November 5, 2005 @ 04:30pm





$133.75 ($125.00 + $8.75 GST) $219.35 ($205.00 + $14.35 GST)

DescriptionThis course will provide Administrators a better understanding of the nature of different Lessor interests and the ways each interest can be affected by the rights of others or in certain situations, such as a death. Other topics to be reviewed are specific concerns regarding the Lessor, which could affect the validity of a lease and the preventative/curative steps that may be taken.

TargetAudienceAny individuals wishing to enhance their knowledge of Freehold Lessor interests.

Instructor(s)Burnet, Duckworth and PalmerThe law firm of Burnet, Duckworth and Palmer will provide instructors.

Beyond the Lease – Level One: The Land Professional and Stakeholder Consultation







$315.65 ($295.00 + $20.65 GST) $395.90 ($370.00 + $25.90 GST)

DescriptionGetting land access approval from stakeholders is an important issue facing today’s companies. Stakeholders are demanding more and better information and expect industry to respond in a structured and profes-sional manner.

Land professionals play a significant role in commu-nicating with all types of stakeholders. It is important for all land professionals to better understand strategic stake-holder consultation and communication planning and how both can improve relationships, further dialogue and eventually make a positive impact toward obtaining license to operate. Attendees will learn the basics of stakeholder consulta-tion and communication planning. This includes:

Communication Basics:w The communication plan – what is it?w The steps of a communication plan·


w How it makes communication more effective

Stakeholder Basics:· w What is stakeholder consultation? w Why stakeholders are important. w Who are stakeholders? w How you can consult with them. w When you should consult with them? w Where should you consult with them?

Planning Basics: w The stakeholder consultation plan – how to complete

one from start to finish

TargetAudienceJunior to Intermediate Land Administrators (Contract, Surface, Mineral) and Project Leaders, and Jr. Surface Land Agents.

InstructorDan Kane – The Dialogue GroupDan has over 25 years of experience with the Canadian oil and gas industry. His background includes manag-ing business, political, environmental and reputational issues with extensive experience in strategic planning, government and public relations, communications, regulatory analysis and stakeholder consultation. Dan is also a licensed land agent. Mr. Kane is the president of The Dialogue Group, a consultancy specializing in public affairs, communication and stakeholder relations.

Introduction to LandCourse Date(s) Registration Deadline






$187.25 ($175.00 + $12.25 GST) $272.85 ($255.00 + $17.85 GST)

DescriptionThis course is an introductory overview of the basic functions within a Land Department and includes the following topics: Overview of the Oil and Gas Industry; Departmental Roles; Ownership of Land; Title Searches; Legal Descriptions; Unique Well Identifiers and Land Documentation. There also is an overview of an explora-tion play, which will bring together the topics covered in a “real world” scenario.

TargetAudiencePersonnel wishing to have an overview of Land or the Petroleum Industry.

Instructor(s)Deborah Godfrey – Northrock Resources Ltd.Deborah began her career in Land Administration in 1997. A CAPLA Education Committee member since 1997, Deborah was one of the original members of the ISC-CAPLA Task Force, assembled in 2001 and has facilitated all of the ISC Land Titles courses offered by CAPLA. Deborah is currently Supervisor of Lease Administration at Northrock.W

CAPLA’s Anniversary

CAPLA was incorporated 12 years ago on November 8, 1993. Not only is it the anniversary of CAPLA’s incorporation, but November 15 also marks the 12th Anniversary of the release of the Industry Agreement and Assignment Procedure. It is amazing to see the dramatic impact these two initiatives have made on Land Administration. W


Royalty Trusts, Mineral Trusts and AgenciesIntroduction

Throughout the 1940s and 1950s, thousands of mineral title holders set up trusts of various types, conveying their royalty and/or mineral interests

to these trusts for administration by a trustee. Although decades have passed, thousands of these trusts continue to be valid, binding interests; the lands may or may not be in production, but the trusts continue to be reflected through caveat registration or title ownership by the trustee. This article reviews three types of royalty admin-istration accounts:

1. Royalty Trusts2. Mineral Trusts3. Agencies

The characteristics of each type of account, the reasons for setting up an account, and the responsibilities of the trustee, the beneficiaries and the oil companies with respect to the various forms of account are explained below.

1. Royalty Trusts (Freehold)In the late 1940s and early 1950s, the oil business had become very active following large discoveries in Leduc and Turner Valley, Alberta. Oil company agents traveled the countryside entering into leases with freehold owners of mineral titles. At that time, the standard lease royalty rate was 12 ½% of production and most leases were for a term of 10 years. An owner of a freehold mineral title would often set up some form of royalty trust to administer the

lessor royalty resulting from his lease. Royalty trusts became common on lands in Alberta, Saskatchewan and Manitoba – however, there are significant differences in each province.

AlbertaGrossRoyaltyTrustsThe true gross royalty trust is primarily an Alberta form from the 1950s. There were a number of trust compa-nies involved in the business of setting up gross royalty trusts in that period. The main companies were Montreal Trust Company, Prudential Trust Company, Toronto General Trust Company, Canada Permanent Trust Company and Security Trust Company. Each of these had its own generic form or forms, some of which were far superior to others. All of these companies have gone through amalgamations, liquidations, name changes, purchases and sales with the result that the trusts that originated at these five trustees are now administered by Computershare Trust Company of Canada.

The two main competitors for gross royalty trust business in Alberta in the 1950s were Montreal Trust Company and Prudential Trust Company, with Montreal Trust Company operating primarily in northern Alberta and Prudential Trust Company operating mostly in southern Alberta.

Setting up a royalty trust in Alberta in the 1950s was a straightforward process. The freehold owner, either themselves or through a lawyer, contacted a trust company and asked that a gross royalty trust be set up. The freehold owner signed an agreement with the trustee conveying the interest to the trust. The trustee filed a caveat against the freehold mineral title to protect the right of the trust to royalty from production according to the terms of the trust agreement – most often 12 ½%.

After the caveat was filed, the trustee issued unit certificates in the trust upon the direction of the freehold owner (“trust settlor”). The most common arrangements in respect of the issuance of certificates were:


w Trusts with 12 ½ units. The leases at that time almost exclusively provided for a royalty of 12 ½ % – one unit would therefore equal 1% of royalty. The smallest interest issued under these agreements is generally 1/40th of one unit.

w Trusts with 500 units. In this case, 1 unit repre-sents 1/40% royalty and the smallest interest issued was one full unit.

CaveatsIf a trust company’s caveat appears on a mineral title, any prospective purchaser or lessee should contact the appro-priate trustee to determine the nature of the interest claimed. It is highly probable that, if production occurs on a land on which there is a trust company caveat registered, particularly if the caveat dates to the 1950s, a 12 ½% royalty is payable to a trust. Gross royalty trusts can be confusing to those who are not familiar with them. These trusts can be overlooked or ignored because they are believed to be antiquated and no longer valid. However, it is important to note that if there is a trustee caveat on the title it must be investigated to ensure that royalty payments are made properly.

AdvantagestoGrossRoyaltyTrustsIn the case of an Alberta gross royalty trust, the freehold owner retains the ownership of the mineral title and assigns the royalty to a trustee. There are a number of benefits to establishing a gross royalty trust:

w the freehold owner can sell units to raise funds or gift them to family members;

w units can be easily traded with others to share the chance of a discovery;

w the collection, accounting and distribution of royal-ties and the filing of the tax return is handled by professionals; and

w because the freehold owner retains the mineral title he continues to be respon-sible for, and retain the benefits from, leasing of the mineral title including bonus consideration and annual rental payments.

It is important to note that neither the responsibility for leasing of the lands, nor any of the bonus or rental payments associated with leasing are vested in the unit holders of gross royalty trusts. These benefits and responsibilities remain with the mineral title owner(s). The only time a gross royalty trust unit holder receives any money is if the land goes into production and royalty is paid. Further, in recent years the royalty rate for a lease is usually much more than 12 ½% because of the competitive nature of the leasing business. If this is the case, the gross royalty trust unit holders still share in the royalty interest claimed under the trust, most often 12 ½% only, with any royalty over and above that being paid to the mineral owner directly.

Most gross royalty trusts date back to the 1950s. There are not many being established today because:

w freehold-owned mineral titles are not all that common in Alberta, making up only 5% of the mineral prop-erty in the province. Other provinces do not deal with royalty trusts in the same way.

w the gross royalty trust vehicle has been involved in long-running legal challenges as to its validity. The legal situation has been resolved for the most part, and this may result in a resurgence of this type of trust, but

Although decades have passed, thousands of these trusts

continue to be valid, binding interests; the lands may or may

not be in production, but the trusts continue to be reflected through caveat registration or title ownership by the trustee.


this has certainly been a contributing factor to people’s discomfort with this type of form.

w These trusts do not address fragmentation of the mineral title through time and inheritance through estates. This type of fragmentation is becoming a defi-nite issue for many families as the original settlors, and perhaps the next one or two generations, have passed away, leaving the mineral title to their beneficiaries – who may be numerous and widespread. This fragmen-tation can be more easily dealt with through a mineral trust, (see the following Mineral Trust section).

SaskatchewanandManitobaRoyaltyTrustsIn Saskatchewan and Manitoba, the interests of the unit holders in the royalty was ensured by actual or promised transfer of the mineral title to the trustee.

There are two major types of accounts administered in these provinces:

w the mineral trust or the mineral and royalty trust (combination) which will be discussed in the Mineral Trusts Section below; and

w the royalty trust in which the trust interest is in the royalty only, usually 12 ½%. This type of trust is the same as an Alberta gross royalty trust. However, the trustee of the royalty trust is the registered owner of the land, and acts as agent for the beneficial owner of the mineral property. This will be dealt with further in the section on Agencies.

2. Mineral TrustsThis form of trust is most often set up as a result of an estate settlement in which a mineral title forms an asset of the estate and would become fragmented due to multiple beneficiaries claiming small interests. There are a number of disadvantages to having a large number of mineral title owners:

w a single owner can delay or prevent the leasing of the prop-erty even if all of the other owners agree to a proposal;

w Land Titles in Alberta will not issue a mineral title for less than 1/20 interest and some other provinces are even more restrictive;

w lease offers may be discounted if extreme effort is required to locate title owners, particularly if one or more resides outside of Canada;

w Land Titles transfer fees can become excessive and the requirements rigorous. Probates are absolutely required in order to transfer ownership of a title at Land Titles. This is not required for transfer of beneficial interest under a mineral trust;

w Individual leases must be prepared for each beneficiary, increasing the paperwork involved for the lessee; and

w l essees may be reluctant to issue numerous small cheques and tax forms to title owners. Issuing one cheque to a trustee reduces this administration greatly.

The establishment of a mineral trust can alleviate many of these disadvantages in the following ways:

w the title remains intact in the name of the trustee – a single registered owner easily contacted by prospective lessees;

w the beneficial interest in the title can continue to be divided through succeeding generations, or can be sold or traded easily and inexpensively;

w a majority of unit holders can lease the title without being hindered by missing or uncooperative parties; and

w a freehold mineral owner can establish a mineral trust during his lifetime, retaining a life interest in the proceeds, with the interest almost automatically being transferred to beneficiaries upon his death.

In the case of an estate, the mineral trust agreement is executed by the executors of the estate, with consent in writing from all of the beneficiaries. If a living freehold owner sets up the trust, he is the sole person who must execute the agreement itself although a Dower is necessary if the settlor is married.


The mineral title is then transferred to the trustee, and mineral trust certificates are issued to the beneficiaries based on their share in the estate, or as directed by the freehold owner.

Mineral trusts are very flexible and can be easily modified to suit the diverse needs of a variety of clients. For example:

w The number of units is entirely flexible, and can be set in each case as required to ensure ease of transfer and splitting as time goes by;

w There are mineral trusts in which the holders are concerned that the units stay within the family and clauses in the agreement are added to try to ensure that this is done. If anyone wishes to sell his units, he must offer them to the rest of the beneficiaries first prior to selling them outside the family (i.e. the family has the right of first refusal on any sale); and

w In some instances, two initial sets of certificates are issued when the trust is set up with specific notation made on the certificates to indicate a life interest to a parent or parents, with the beneficial ownership going to the children upon the death of the parent(s). A separate life interest agreement is entered into between the parent(s), the children and the trustee, and during the lifetime of the parent(s) all benefits are paid to them. Upon death of the parent(s) all of the certificates are sent in for cancella-tion and the units are reissued to the children according to their shares.

GrossRoyaltyTrustandMineralTrustontheSameLandIt is possible to have both a gross royalty trust and a mineral trust set up on the same land. In these cases, the trust royalty (most usually 12 ½ %) is paid to the gross royalty trust unit holders, and any additional royalty over and above the trust royalty and any and all lease benefits are paid to the mineral trust beneficiaries.

DifferencesinAdministrationBetweenGrossRoyaltyTrustsandMineralTrustsFor the trustee, administratively, the difference between a producing mineral trust and a producing gross royalty trust is negligible. Royalty payments are received, fees withheld and the remainder is distributed to the unit holders. For both types of accounts, the same tax return is filed, a T3 Trust return.

However, if the lands are not producing, the differ-ence between the trusts is substantial. As indicated above, the trustee does not become involved in the leasing of lands of gross royalty trusts; the benefits and responsi-bilities associated with this activity are retained by and belong solely to the mineral owner(s).

However, in the case of a mineral trust, the involve-ment of the trustee is substantial. Because the regis-tered owner of the mineral title is the trustee, it will be approached by prospective lessees, and must proceed to negotiate the lease through the beneficiaries. Extensive follow up is often required which further slows the process. However, once the terms of the proposed lease are acceptable to both the lessee and the trust holders, bonus consideration and annual delay rental payments are then sent to the trustee for distribution to the benefi-ciaries, and a payment schedule is diarized.

3. AgenciesThese types of accounts most often arise from two differ-ent circumstances:

w an “Administrative” Agency set up for the purpose of having the accounting and administration of the royalty and other payments handled by a professional company; and

w an Agency arising from the creation of a royalty trust account on Saskatchewan or Manitoba lands.


“Administrative”AgencyAccountsThe Agent representing the assignor of an “Administrative” Agency has no registered interest on the mineral title; neither caveat nor title ownership is vested in the name of the trust company acting as Agent. Rather, the Agent, acts under appointment through a simple agency agreement. Notice of the Agent’s appointment is served on all lessees and operators to ensure that payments are directed to the Agent for handling. There are no certificates issued as there are in gross royalty and mineral trusts. The Agent receives royalty for distribution in accordance with the instructions of the assignor of the interest.

In the 1950s this type of account was set up primar-ily because under the terms of a lease, a lessee was not obligated to recognize the transfer of any less than the full interest of the minerals. As a result, the lessee would issue only one cheque per lease, and if a property was subsequently broken up and sold and assigned to a number of different owners, an agent was required to receive the funds and distribute them to the owners according to their shares.

Oil companies today are quite a bit more flexible, and in many instances are willing to pay more than one mineral title owner directly, even though the leases do not require that they do so. For this reason, many of the old 1950s agencies are being “terminated”. When this happens with notice to all parties, records are amended and there are no issues. Unfortunately, in many cases no notice of the termination is sent to the Agent, either by the lessee or the owner, to advise that the oil company is paying the lessor(s) directly. This often happens when a lease or working interest is assigned to a new company. If the documentation of the original lessee is unclear, the lessee sometimes overlooks or has no knowledge of the previous practice of paying the Agent. Royalty payments are commenced to the mineral owners directly, without notice to the Agent. If the Agent also acts as trustee under a different account on a separate interest in the same lands, and continues to receive royalty for that

account, errors can happen, particularly if the trustee is given general summary statements of royalty and production rather than details of the payments. This happens all too frequently and is a reason why the Agent often requests the detail statements.

Today, agencies continue to be set up to ease the administrative burden of the collection and distribution of royalty payments on a single party, to assist operators in the payment of royalties to large number of minerals owners, and to provide assistance to royalty interest hold-ers who do not wish to do the accounting and follow up required with royalty distribution.

Saskatchewan/ManitobaAgencyAccountsAs mentioned in the Gross Royalty Trust section, agency accounts can also arise as a result of the setting up of a royalty trust. This primarily occurred when the lands were located in Manitoba or Saskatchewan. Historically, when a mineral owner wished to set up a royalty trust on lands in these provinces, conveying a royalty interest only to the trust, the trustee required that the mineral title be transferred into the name of the trustee to ensure that the royalty would be paid to the trust unit holders. As a result, the trust company became not only the trustee for the unit holders of the royalty trust, which interest was most often a 12 ½% royalty, but also Agent for the beneficial owner(s) of the mineral title with respect to lease proposals and overriding royalty payments.

ConclusionIn conclusion, there are various forms of trust agree-ments and other royalty payment arrangements for which trust companies act on behalf of groups of hold-ers. These arrangements can be complex and can appear confusing. If any questions arise upon review of title ownership, the trustee should be contacted to ensure that royalty payments are being made appropriately. W

Computershare Trust Company of Canada


Across 1. An agreement used to clarify current parties interest 3. Key element of a contract 6. First day of the second month following the month in which

the NOA is served 8. A lease that is acquired while a valid and existing lease is in

place 9. Who are we 10. Selling of assets 12. CAPL 1990 Operating Procedure Clause 2401Alt B 13. Grouping lands for production 15. Payable to lessor on a freehold lease 17. The Crown will penalize you $50,000 if you do this 18. An act or an instance beyond a parties control

Down 2. Used to claim an interest in land 3. _________ royalty – when a party has option to switch to

working interest 4. The party appointed to conduct operations on behalf of part-

ners 5. The depth to which the farmee must drill to earn 7. Partners share of interest 9. Natural gas from coal 11. Payment used to defer termination of a lease 14. A connection or link associating two or more people or things 16. CAPL 91 and 99 are examples of this

(Answers to be published in the December issue of NEXUS)Thank you to Sally Jackson for this putting together this Crossword.

CAPLA Crossword


Mentoring ProgramMission Statement“The CAPLA Mentoring Program is dedicated to furthering personal and career growth of CAPLA members, through the sharing of knowledge and experience.”

Join The Program – Reap The BenefitsHere’s what some CAPLA Members have to say about their experience in the program:

Mentors:“ I am able to share my enthusiasm for land with others.”

“Reinforces my own ability.” “I get a sense of pride in helping others.”“It gives me a chance to give back to this industry.” “Keeps me learning new things.”“I have met some wonderful people!”

Mentees:“ Gives me an immediate start to my network of people.”

“ The ability to contact my mentor by phone or email is invaluable to me.”

“This program gives me a feeling of belonging.”“ Being able to get precedent documents from my mentor is a great stress reliever.”

“ If you’re considering becoming a mentor, be assured your time and expertise are appreciated.”

“I feel I have begun a career, not a job!”W


Please see future issues of NEXUS and the CAPLA website for details on these events.For registration information please visit the Events Page on the CAPLA web site at www.caplacanada.org.

Events CommitteeCommittee Members

Nicky Cook Frank Courtright Bev Curley Shannon Facey Andrea Foster Katerina Gilbert

Kris Luft Shelley McInnis Nicole Patry Debra Wade Shyanne Woroniuk

The Events Committee is responsible for planning quality networking oppor-

tunities through social functions in an enjoyable and fun environment.

Membership feedback is welcome and encouraged; suggestions and

comments from our members assist us in the planning of CAPLA events.

We encourage you to contact anyone on the Events Committee if you have

an idea or a suggestion for a future event or would like to provide feedback

on a recent event. The names are listed above and their contact informa-

tion can be found on the CAPLA website at www.caplacanada.org.

MARCH CAPLA/IRWA Ski trip

APRILGolf Clinic Starts

JUNECAPLA Family Day

at the Zoo

CAPLA Golf Tournament

Monday Night Golf League Begins

CAPLA/CAPL Pre-stampede Party

AUGUST Monday Night Golf League Ends

OCTOBERCAPLA/IRWA Wine Tasting

DECEMBERCAPLA Christmas Cheer

Networking Events


These monies were raised at the CAPLA Golf Tournament and “THANKS” to everyone at the Tournament who participated by buying mulligans and 50-50 tickets. Shyanne Woroniuk


A Message from Kevin MacFarlaneChair of the CAPLA Certification Committee

Thanks to all the CAPLA members who joined us on June 25, 2005 at SAIT to pilot exam questions for the Minerals Administration Certification Exam data-base. The Certification Committee was very pleased with the reception our pilot received and the feedback we obtained. The balance of the exam database is being developed with adjustments based upon your feedback.

Box lunches were provided to all who participated. However, some could not attend the event as planned and others could not stay after the exam for the feedback session. So about a third of the lunches were gratefully received when I delivered them to the Mustard Seed that afternoon on 11th Avenue and Centre Street South. Consider contacting them if you have food to donate after an event. You too may receive a letter for CAPLA like the one I did! You can serve both our members and the broader community at the same time. Warms your heart a little doesn’t it? W


But That’s Not What I Meant!

The really interesting part (acknowledged to be a relative concept) about law school is that the first week or so is really your best week. This is the

week you learn about all the legal “rules” which are going to help you understand your courses over the next three years and well into your professional career if you decide to pursue one. After your first week you generally pause and reflect that armed with all these rules, understanding the law won’t really be as hard as you thought it would be. You surmise that you are simply going to be faced with a series of legal problems against which you apply one or more of the recently revealed and rigid legal rules and voilà … the problem is either solved or forever goes away.

The reality is that after the first week, armed as you are with all your helpful rules, you spend the balance of your law school and professional days being exposed to the infinite number of exceptions to the rules, the exceptions over an infinitely short period of time and for the most part rendering your previously prized and rigid rules almost entirely useless.

All but a long segue into the topic of today … the language of your contracts.

Before adventuring into the rules, let’s consider this oil and gas example on the topic.

Party A and Party B enter into a Farmout Agreement pursuant to which Party A will, at its sole cost, drill the test well with the resultant working interests in the Farmout Lands being Party A 75% and Party B 25%. Party A is a little conservative and wants to share some of the farmout risk with Party C who at one point during discussions and negotiations agreed to cover half of the test well costs in return for earning half of Party A’s earned interest. This notwithstanding, negotia-

tions between Party A and Party C on the participation arrangement continued and were eventually concluded, the Participation Agreement between Party A and Party C providing in part that:

Party C accepts and agrees to all of the terms and conditions of the Farmout Agreement as though it were a party to the Farmout Agreement, and the terms and conditions of the Farmout Agreement are hereby adopted and apply mutatis mutandis to this Agreement. The parties agree to participate in the drill-ing of the Test Well pursuant to the terms of the Farmout Agreement on any equal cost and expense basis and upon earning Party C shall have acquired a 50% working interest in and to the Farmout Lands. (emphasis mine)

Although it may never have been the intention of the parties that Party C would end up with a 50% working interest in the Farmout Lands (rather it may have been intended that Party C would acquire 50% of whatever Party A earned, being 75% or a net 37.5% working interest to Party C upon earning), the Participation Agreement has been signed, sealed and delivered and Party C is claiming an after-earning 50% working inter-est in the Farmout Lands.


What now?The first words out of your mouth are quite rightly, “but Party C’s position is not what the parties intended!”. But does intention matter at this stage, the business deal having been reduced to writing in a legal contract?

Enter the legal “rule” we call the parol evidence rule. Simply put, this rule provides that in the absence of ambiguity in a contract, the intention of the parties is irrelevant and not admissible. Many would argue that our Participation Agreement is not ambiguous as it expressly states that Party C shall acquire a 50% working inter-est in the Farmout Lands. The argument continues that therefore there is no need or ability to go outside the four corners of the document itself and impute into it what the parties may have actually or originally or at one time intended. It follows on application of the parol evidence rule and if it is concluded that there is no ambiguity in the Participation Agreement, Party C marches off with a 50% working interest regardless of what the business people might otherwise have at one time intended.

Simple rule, simple application, simple solution … but because of a seemingly inequitable or unfair result in our example scenario, enter the world of exceptions to the rule.

The parol evidence rule has been modified over time (although courts rarely ever admit to this) as follows. The rule may only apply (i.e., exceptions to rules are not universally applied, being a material and further complication) if the primary meaning of the unambigu-ous language used in the contract is not excluded by context and is sensible with reference to the extrinsic circumstances in which the drafters of, in this case the Participation Agreement, found themselves in at the time of pulling the agreement together.

That is to say, we are not looking at extrinsic evidence of the parties’ intention (as God forbid that runs afoul of the parol evidence rule) but rather we are looking at the commercial setting of the Participation Agreement as no contracts are made in a vacuum and there is always a setting in which they have to be placed. Which again and

of course, is not to be confused with evidence of the inten-tion of the parties. If you are having difficulty grasping the distinction between evidence of commercial context and evidence of intention of the parties you are not alone. I for one am not going to attempt to justify the distinction on a legal basis other than to suggest that it seems to me that consideration of commercial context is employed by a Court when an otherwise strict application of the parol evidence rule produces an untoward or unfair result.

But the fact remains, if Party C forces the issue by maintaining that the earning provision is correct and that there was no mistake in the drafting, Party A is going to have to convince a Court to go outside the four corners of the Participation Agreement, massaging as this is going to require the application of the parol evidence rule. And here that commercial context is that Party C was paying half of Party A’s costs so does it make any contex-tual or commercial sense that Party C would pay 50% of the farmout costs to earn 75% of the earned interests? Most would argue that such a position, being the position taken by Party C, does not make much, if any commer-cial sense and as a result this contextual “evidence” should serve as a basis upon which the Court should vary the Participation Agreement. You would probably agree.

A cautionary note, however, and as found in a rela-tively recent Alberta court decision. The Court states in its reasons:

We cannot find ambiguity, equivocal references, absurdity, contradiction, or significant lack of clarity, in the relevant parts of the written agree-ments. Even if there were ambiguity, we have considerable doubts whether that would open the door to so far-reaching use and effects of parol evidence as one finds in the trial reasons for judgment here. For example, clarifying ambiguity, or covering points not dealt with, is not the same as flat contradiction of the express terms of the contract.


We will take some time to expand here on such topics, because attempts to admit this kind of perversion of parol evidence under the guise of “context” appear to be fairly common in Alberta at the moment. Wrongful admission of such evidence can swell trials on simple issues about written contracts to weeks of historical investi-gation. And oral evidence admitted for a very limited purpose sometimes ends by supplanting the words of the contract. (emphasis mine)

Party A best hope that the Court it is trying to convince as to the appropriateness of commercial and/or contex-tual evidence is not a member of the “perversion of the parol evidence” club for otherwise the Court might quickly respond that:

(a) there is a written contract between the parties which governs and defines their relationship; and

(b) the contract is capable of being understood as it reads.

So the lesson is that a simple retort by Party A that the application of the plain words of the Participation Agreement need to be modified or “supplanted” so as to reflect the intention of the parties opens up a huge legal can-of-worms and has no guarantee of success. The simple solution being that if you decide to reduce a business deal to writing, write down in the written contract all that you mean and mean all that you write down. W

Michael A. ThackrayThackray Burgess

Thackray Burgess monitors current regulatory, statutory and judicial developments in the energy sector. Any such developments that could be of interest to oil and gas counsel or industry participants are widely circulated electronically and generally on a weekly basis as an “Alert and Update” at no cost to the recipients. If you would like to be added to our email Thackray Burgess Alert and Update distribution list simply request by email to [email protected].

Benefits of Volunteering

I’m just a volunteer.” How many times have you heard that, or even said it yourself? It’s a common attitude, even among people who know better. However, you

are not just a volunteer at CAPLA.Traditionally, CAPLA volunteers were people who

wanted to make a difference in the Land Administration profession. People volunteered purely because it was worthwhile. While this might still be true, volunteers are no longer involved purely for altruistic reasons. Volunteers are realizing that personal satisfaction is just one of the many benefits they receive from volunteering with CAPLA. Volunteering is not just a charitable act, but also an opportunity for advancement in all areas of your life.

Why Volunteer:Whether it is important to you to solve a Land issue, give back to CAPLA or develop as a person, volunteering offers many benefits in appreciation for the gift of your time and expertise. By volunteering, you can:

w gain invaluable networking contactsw acquire important management skills w develop leadership skillsw refine your presentation skillsw improve your business writing abilityw learn important mentoring and coaching skillsw learn new skillsw gain work experience w build self-esteem and self-confidence w improve your health w help you meet new people w feel needed and valued


w express gratitude for help you may have received in the past from CAPLA

Volunteering And Your Career:Still need more motivation to volunteer? Research into the benefits of volunteering indicates volun-teers who develop additional skills while volunteer-ing, actually enhance their employability. A recent survey revealed the following about volunteering and your career:

w 73% of employers would employ candidates with volunteering experience over one who does not,

w 94% of employers believe that volunteering can add skills, and

w 94% of employees who had to learn new skills while volunteering, benefited either by getting their first job, improving their salary, or being promoted.

In the current economic climate, more and more employers are looking for people who have acquired skills beyond their academic qualifications, and have shown initiative in being involved in outside activities.

Volunteering with CAPLA brings you into contact with professionals from every level in the energy sector. Volunteering shows you have real commitment and provides contacts. What’s more, the networking oppor-tunities it can provide are one of the most exciting benefits of all. A good networking system is invaluable to your career. Up to sixty percent of job vacancies are not advertised, and are filled through internal or external networking.

You can find volunteer opportunities in all facets of CAPLA. It gives you noted experience on your resume, which prospective employers will not be able to over-look. Volunteering validates you are ambitious and enthusiastic about your discipline. It also shows you take your work seriously and are interested in keeping your skills honed. Whether you volunteer with CAPLA or on some other volunteer project, your resume will stand out with the reference.

Volunteering And Your Health:There are even health benefits to volunteering. In “The Healing Power of Doing Good”, writer Allan Luks, found medical and scientific documentation supporting the health benefits of volunteering, such as:

w A heightened sense of well-being,w A more optimistic outlook,w Increased energy, w A decrease in insomnia,w A stronger immune system, and evenw Speedier recovery from surgery.


In his book, Mr. Luks analyzed the experi-ences of volunteers. Most volunteers reported they had a physical and emotional sensa-tion of euphoria that lasted for days or even weeks, which he termed “helper’s high”. Mr. Luks also found the sensation returned when the “act of good” was remem-bered. The more you volunteer and do things for others, the more benefits you receive.

CAPLA volunteers are vital to our organization and they make outstanding contributions to the Land profes-sion. The entire membership benefits from their accom-plishments!

What Rights, Responsibilities And Expectations Can I Expect?Volunteering is a two-way street; it is about what you give and what you receive. Here’s what you can expect from CAPLA and what CAPLA can expect from you in return.

As a volunteer, I have the right to:w a carefully planned volunteer position that is worth-

while and challenging and will help me learn, grow and develop

w information on CAPLA’s policies, structure and mission

w an orientation session and on-going training w support from a designated volunteer or staff person

w respectful treatment as a co-worker

w appropriate and timely recognition

w information about what is happening in CAPLA

w reimbursement for approved out-of-pocket expenses where funds are available

w receive feedback on the work I do

As a volunteer, I have the responsibility to:w only accept a position I feel will meet my needs, skills,

interests and available time w do my job to the best of my ability w ensure I understand CAPLA’s policies, structure and

mission w make suggestions, voice my honest opinion and seek

honest feedback w ask my supervisor when I have a problem or question

I cannot answer w fulfill my commitments w treat co-workers and clients with courtesy w use my creativity and enthusiasm to enhance the qual-

ity of CAPLA’s services

CAPLA currently has several volunteer opportunities available. Please see the CAPLA website for details. W

Deb WaterhouseSpecial Events Director

Volunteering validates you are ambitious and enthusiastic about your discipline. It also shows you take your work seriously and are interested in keeping your skills honed. Whether you volunteer with CAPLA or on some other

volunteer project, your resume will stand out with the reference.


Tips For A Successful Job Search

The only constant in the oil and gas industry is it’s constant change. As we all know, talent pools are shrinking with the baby boomer generation retiring

early or turning a profit by starting, growing and selling oil and gas assets up to 2000 BOE/D. The shift to energy trusts has also made a difference in how we invest and look at the market. The business has changed forever and candidates interested in obtaining an oil and gas career, or who would like to shift to another discipline in the indus-try, must be willing and able to change with the environ-ment. All aspects on how to approach the industry must be based around relationship building, networking and a solid profile delivered through a powerful resume.

When candidates are considering a move within the industry, I recommend using a chronological resume, either professionally written or compiled by the candidate. A professionally-designed resume is well worth the time and cost because the resume is, in essence, a marketing document. It also shows that the candidate is willing to hire professionals or contractors to achieve project success.

For candidates confident in their writing skills, the resume should start with a “letterhead/heading” at the top that includes your full name in bold and your current address, email address and telephone numbers. Directly below the heading, there should be a very clear Objective with three components: the title of the position, what you are able to deliver and what you want from a future potential employer. Candidates who do not have oil and gas experience and would like to join the industry should highlight transferable skills directly under the Objective.

Career Experience is next with the most recent posi-tion first (title, company, dates of tenure). Make sure there are no “holes” or “questioned space”. All experience must be accounted for to avoid raising questions for the recruiter that is screening resumes.

Education and Continuing Education (or Professional Development) would be the next heading with, again, the most recent first. Affiliations, Accreditations and Volunteer Experience follow. Volunteer Experience will certainly strengthen a candidate’s profile in this philanthropic city. Use the same format as the Career Experience (title, orga-nization, dates of tenure). Finish up with other interests and include items that will allow the potential employer to evaluate your complete personality.


Candidates who are in transition and do not have a current job should also include a solid list of References. This should be a separate document with the same “letterhead” that was created for the resume. Three busi-ness references are standard, with at least one past or current supervisor, one co-worker and one subordinate. Character references may also be an asset, particularly if it is a list of oil and gas contacts who would confirm your potential for certain types of teams or cultures.

It is vital to run a spell check and have another person proofread your resume. The spell check will catch most mistakes but will miss common typos such as manger/manager or, more embarrassingly, triple/tripe.

Candidates who choose to use a cover letter should keep it short or it will not be read. Again, the same “letterhead” should be used for the top of this document. Making quick reference to the highlights of your resume and to the strengths that you will bring to the company is beneficial; as well as when it will be possible to follow up to ensure receipt of the documents. Double check to ensure correct spelling, title and complete address of the person who should be receiving the documents, typically the Vice-President, President or the Manager who would be a direct report after being hired. Avoid addressing the cover letter or email to a “general employee” or to the Human Resources Department. It is important to address the letter to the person who will be making the hiring decision.

International professionals with oil and gas experi-ence outside the Western Canadian Sedimentary Basin are starting to be considered for more entry-level posi-tions, as long as their English and communication skills are strong. This pool of talent will be tapped into more and more over the next few years as a large number of candidates with Canadian experience will be retiring and leaving the business.

Once these International candidates have strong documents to showcase their credentials and profiles, they must begin building a network to support their future

development. Joining professional associations and volun-teering for industry functions or conferences is highly effective. Consider also oil and gas corporate-hosted Stampede and Christmas Events. A good quality business card with all of the candidate’s particulars and contact information is crucial to effective networking. Follow up with every connection within a week. Taking the contact for a coffee or lunch will help you gain knowledge and direction, recommendations, and/or other contacts.

Assistance with resume writing, cold calling tips, interview styles and networking tips are offered by many personnel agencies, in addition to networking gatherings that are industry specific. Although most oil and gas companies and industry associations such as CAPL and CAPLA advertise positions directly on their websites, networking has proven to be one of the most effective ways to find out about unadvertised positions and to gain valuable information about a company’s corporate culture and organizational structure. Job seekers today also have the advantage of a variety of information at their fingertips through the use of the Internet. The majority of companies, organizations and agencies use the Internet as a marketing tool and, in so doing, provide the potential candidate with an oppor-tunity to research their prospect and to gain valuable insight and skills that will prove advantageous during the interview process.

Interviews in the industry consist of everything from a casual coffee to a conservative Behavioral Description Interview. Candidates should be ready for all types of interview styles and arrive prepared with answers that make strong reference to events and situations relevant to the position applied for. It is also wise to bring a copy of your resume and references to every meeting in the event they do not have a copy of your documents or are interested in contacting references right away.

The following are examples of areas that may be explored during an interview and types of questions that you may be asked:


Election Time is almost

upon us again!

Knowledge of the company you are applying to:What do you know about our company? Why do you want to work for our company? What opportunities can our company offer you? Describe how your skills and abilities will be a good fit for our company?

Details relating to the information provided on your resume:Describe your present position and your major respon-sibilities. Why did you or do you want to leave your present position? What has been your biggest accomplish-ment and how were you recognized? If you could change something about a previous job, what would it be?

Characteristics that are specific to the job and your future goals:What are your strongest qualities, skills and abilities? What types of work environments do you thrive in? What characteristics do you look for in a supervisor? Where do you see yourself in five years?

Exploration of your ability to handle various types of situations: What steps would you take to manage a high workload and competing deadlines? Describe a difficult deci-sion you had to make and how you handled it. Give an example of a conflict that you have had and the steps you took to resolve it.

Every interview situation is unique and the more infor-mation you collect and the more preparation you do prior to that big day, the greater the likelihood that you will be chosen as the successful candidate. W

Catherine BrownleeProminent Personnel

CAPLA information at a glance

October 20, 2005Wine Tasting

6th Annual Joint Networking Night with CAPLA and IRWA

MYNT Ultralounge

November 2, 2005NEXUS Submission Deadline

November 30, 2005CAPLA Xmas Cheer at Oh Canada

November 2005 & January 2006Breakfast or Lunch Meeting

March 2006Annual General Meeting

May 11 & 12, 2006CAPLA Conference 2006

Le Monde des AdministrateursLa profession de [Land] Administrateur est une profession

exaltante qui offre à ses professionnels l’opportunité de traiter de sujets complexes couvrant les aspects juridiques, financiers et techniques des différentes opérations, de même qu’elle permet un enrichissement personnel puisque faite de rapports humains.

Ceux qui sont dans la profession devraient se réjouir d’avoir une profession si enrichissante. Car le monde des Administrateurs est un monde assez particulier. Ceux qui veulent intégrer ce monde doivent savoir une fois le diplôme en poche qu’il faudra faire son propre apprentissage auprès des aînés. La voie recommandée est celle de volontaire. Le CAPLA pour ce faire, est l’organisation toute désignée pour apprendre, un lieu, où vous serez confronté aux réalités de la profession. De nombreux comités sont ouverts aux étudiants et autres membres.

En fréquentant le CAPLA, vous découvrirez que ce monde fermé cache en fait des personnes sympathiques et dévouées, souvent très expérimentées dans leur domaine.

French Text by Alima Sanogo

The World of the Land Administrator

The role of the Land Administrator offers exciting career opportunities to its professional members. As a Land Administrator you will have the opportunity to deal with complex issues, working closely with professionals such as lawyers, finance and technical experts. Some of the qualifica-tions required in this role are assertiveness, excellent people skills and the ability to work in a fast-paced environment.

If you want to be a part of this profession you should have a Land Administration certificate complemented with some related work experience. To develop your knowledge it is recommended that you volunteer with CAPLA. CAPLA is an organization that can assist you with learning from its members. Many committees are available to students and members.

By being part CAPLA, you will have the opportunity to meet a wide range of people and learn from the experts.

Translation by Guylaine Langelier

UPCOMING EVENTS:

Watch for details of all posted events on the CAPLA website and in upcoming editions of The NEXUS!