Phase 1 Funding Allocation and Eligibility
Determination of Eligible Licensee Funding Allocation
Eligible licensees will receive a funding allocation established by considering the eligible licensee's total deemed inactive infrastructure liability as a percentage of the total deemed inactive infrastructure liability of all eligible licensees. This ratio will be applied to the $100 million Phase 1 funding tranche to arrive at a licensee's eligible funding allocation.
Each eligible licensee will receive a minimum funding allocation of $50,000 to support reclamation and abandonment activities.
Licensee Eligibility Criteria
In Phase 1 of the ASCP, eligible licensees are licensees who were in good standing in relation to debts owing to the Crown as of March 1, 2020. For the purposes of eligibility under ASCP, Crown debts include:
- Amounts owing for the Oil and Gas Administrative Levy;
- Amounts owing for the Orphan Well Levy;
- Amounts owing for Crown oil and gas royalties;
- Amounts owing for Crown mineral disposition rentals; and
- Amounts owing for Crown surface lease rentals.
The Ministry of Energy and Resources will determine licensee eligibility and funding allocations. Eligible licensees were notified of their funding allocation via their IRIS service administrator email address on June 1, 2020.
Well and Facility Site Eligibility
Any wells, facilities and flowlines nominated into the program (see: How to Apply) must meet the following eligibility criteria:
- The well, facility, or flowlines located in a municipality in which the eligible licensee owes municipal taxes will not be eligible; and
- If located on private lands, the licensee must be current on surface lease payments to the landowner with respect to the specific well, facility or flowlines.
When nominating wells, facilities and flowlines into the program, the eligible licensee will be required to submit two declarations:
- A declaration stating that the licensee does not have any outstanding municipal taxes owing with respect to the nominated wells, facilities and flowlines; and
- A declaration stating that the licensee is current on surface lease payments to private landowners with respect to the nominated wells, facilities and flowlines.
Submitting a false declaration may result in collection actions by the Crown and could render a licensee ineligible for future funding under the ASCP.
Eligible activities for Phase I will include:
- Abandonment of oil and gas wells, facilities and associated flowlines;
- Environmental site assessments (Phase 1 and Phase 2);
- Site remediation activities; and
- Site reclamation activities.
In Phase I, preference will be given to abandonment and reclamation activities that can be approved routinely to support the rapid roll-out of funding to the service sector. However, deploying an area-based closure model is still a priority under this program and exceptions will be considered.
Any work that commenced or was completed prior to the program launch date and/or has not been included in a work package issued by the SRC will not be eligible under the program. However, if the abandonment was completed prior to that date, the remaining remediation and reclamation work would be eligible under the program. The same principle will apply to the stages of remediation and reclamation for well and facility sites.
Eligible Service Companies
Service companies eligible under the program will be able to conduct well and facility abandonments, flowline abandonments, Phase 1 and Phase 2 environmental site assessments, remediation and reclamation.
Service companies that wish to participate in Phase I of the program must be Saskatchewan-based. This includes:
- Being located in Saskatchewan;
- Employing Saskatchewan people;
- Paying Saskatchewan taxes; and
- Sourcing their supplies from Saskatchewan-based businesses based upon capacity, quality and availability.
Service companies must also meet a number of technical requirements to be eligible for the program. This includes:
- Employ and keep current all safety programs or safety management systems;
- Maintain a minimum of $2,000,000 Comprehensive General Liability Insurance;
- Maintain a minimum of $1,000,000 Automotive Liability Insurance;
- Be registered with the Workers Compensation Board (WCB); and
- Where applicable, hold a valid Saskatchewan or home province Certificate of Recognition (COR) or Small Employer Certificate of Recognition (SECOR).
The ASCP will include a pre-qualifying process for service companies. This will ensure that eligible service companies are Saskatchewan-based and are capable of safely and effectively completing work under the program.
All expenses associated with completing the work, and in accordance with the procurement contract, will be eligible, including:
- Materials and supplies;
- Equipment rentals;
- Laboratory analysis; and
- Transportation of workers and equipment to and from sites.
Additional details on eligible and ineligible expenses will be made available as part of the procurement process set out by the SRC.