Notifications required for amalgamating corporations in the oil and gas business
By Jon Ozirny and Alanna Wiercinski (Student-at-Law)
Amalgamations can be a headache for oil and gas companies when it comes to notifying authorities. Generally, this is due to two changes that occur in an amalgamation; name change and corporate number change.
Depending on the situation, a name change will affect at least one of the amalgamating entities (and possibly all of them). For example, if ACo and BCo amalgamate under the name of ACo, registrations under the name of BCo will need to be updated with various governmental bodies to the name of ACo. If ACo and BCo amalgamate under the new name of "XCo", the registrations for both entities will require updating.
A corporate number change affects all entities involved in an amalgamation. Corporations registered in Alberta, British Columbia and Saskatchewan are all assigned a unique corporate number. The corporate number goes by various names across the provinces – a "Corporate Access Number" in Alberta, an "Incorporation Number" in British Columbia, and an "Entity Number" in Saskatchewan – but they all serve the same purpose, which is to create a simple means of identifying a corporation. When corporations in a given province amalgamate, a new corporate number is issued to the resulting amalgamated corporation and the registrations need to be updated for each of the amalgamating entities.
As procedures, and sometimes the governmental bodies themselves, change over time, each of the bodies listed below should be contacted to confirm current requirements. Additionally, for amalgamations affecting a large number of registrations it is advisable to consult with the applicable bodies to devise a plan for completing all requirements efficiently.
Alberta Energy Regulator (AER)
The AER is responsible for administering activities and issuing licences, permits and approvals under a number of provincial energy enactments including the Mines and Minerals Act, the Responsible Energy Development Act, the Environmental Protection and Enhancement Act, the Water Act, and numerous other pieces of provincial legislation.
The AER requires corporations to keep corporate information up to date. Under AER Directive 067, a corporation must update Schedule 1 to AER Directive 067 within 30 days of an amalgamation. Notification may result in the AER revoking eligibility or restricting eligibility by imposing terms and conditions where, in its opinion, the change has resulted in an unreasonable risk. Subject to the foregoing, once notified of an amalgamation, the AER will transfer licences from the pre-amalgamation entities to the amalgamated entity. OneStop is the AER's online tool for submitting pipeline applications, Water Act applications, daily tour reports, and various notifications. Changes to well names can be made by the amalgamated entity in OneStop (https://www1.aer.ca/onestop/).
A corporation may request an advance ruling on whether the AER will consider an amalgamation to present an unreasonable risk, which generally takes about ten business days to process. More information on Directive 067 is available at www.aer.ca.
The AER also requires corporations to complete an application for licences under the Water Act to transfer to the amalgamated entity, which can be found on the AER's website. The application should be submitted via email to [email protected]
Alberta Tax and Revenue Administration (ATRA)
ATRA is responsible for issuing Tax Exempt Fuel User Certificates (Certificates). The Certificates automatically expire upon notification of an amalgamation, as ATRA views an amalgamation to terminate the existence of the Certificate-holding entity. Therefore, the amalgamated corporation must re-register with ATRA in order to receive an exemption.
Surface Rights Board (SRB)
The SRB is responsible for right of entry orders and surface agreements between energy companies and freehold landowners. The SRB does not need to be notified of changes to the Corporate Access Number. It is also not mandatory to update a corporate name resulting from a name change or amalgamation, but if a holder wants an order to reflect its current name, it must apply to amend the order to reflect the change by submitting a "Request to Amend Operator Information" application. This must be done for each order and a certificate of name change or amalgamation from the Alberta Registrar of Corporations must be included in the application. Further information on the application is available at www.surfacerights.alberta.ca.
The Electronic Transfer System (ETS) facilitates a range of services governed by Alberta Energy, including transfers of Crown mineral and surface leases, continuation of mineral leases, bidding on mineral rights, and other energy-related services. Alberta Energy updates ETS with amalgamations reported in the Alberta Gazette – Registrar's Periodical. Therefore, a corporation does not need to issue a notification. If a corporation would like to expedite changes to the ETS it can email [email protected] and advise them of the change.
Land Titles manages freehold mineral titles in Alberta. Land Titles does not need to be advised of changes to a Corporate Access Number, but in order to reflect the proper corporate name on certificates of title following a name change, the following must be submitted by mail:
- a letter by the corporation on corporate letterhead requesting the name change and including legal land descriptions for all affected titles. The letter must either be under corporate seal or signed by a director, officer, or solicitor of the corporation;
- a Document Registration Request – corporations must go to www.spin.gov.ab.ca, fill out a document registration request, and print it off for mailing; and
- a Certificate of Amalgamation – an amalgamated corporation must submit its certificate of amalgamation. If the amalgamated corporation is an extra-provincial corporation and the Alberta Registrar refuses to issue a certificate, a comparable certificate from the corporation's home jurisdiction may be accepted.
Fees will apply for each updated title. Land Titles may have more cost effective options if there are a large number of titles to be updated.
Ministry of Energy, Mines and Petroleum Resources (Ministry)
A corporation with a tenure agreement with the Province of British Columbia should notify the Ministry of an amalgamation by sending a certificate of amalgamation along with a letter outlining the amalgamation and the affected titles to [email protected]
The Ministry utilizes "ePayments" to collect all annual petroleum and natural gas tenure payments. A corporation can access ePayments with its Business BCeID. If a corporation is changing its name, it may require a new BCeID account to set up ePayments under the new name. A corporation should contact the Ministry at [email protected] to determine if it needs a new BCeID for its ePayments account.
BC Oil & Gas Commission (BC OGC)
BC OGC is responsible for the issuance and tenure of Crown mineral leases, Crown surface leases, as well as activities, permits and approvals under the Environmental Management Act, the Petroleum and Natural Gas Act, and the Oil & Gas Activities Act.
Corporations can update their corporate information through BC OGC's "eSubmission" system, an online platform for submitting operational data directly to BC OGC. The Transfers, Amalgamations and Name Changes (TANC) menu allows a corporation to view, create and edit its corporate structure. The transferor will initiate the Corporate Amalgamation Application. Once the transferor has assigned the Corporate Amalgamation Application to the transferee, the transferee will receive an email notification that it can continue the amalgamation in eSubmission.
The following are mandatory for the eSubmission Corporate Amalgamation Application:
- BC certificate of amalgamation;
- proof of insurance;
- an asset transfer fee of $100 per Oil and Gas Activities Act permit – payment occurs through AMS Payment, which is the online payment portal for the system; and
- for pipelines, sites or facilities regulated by the Canada Energy Regulator (the CER), the following additional documents are required:
- a copy of the applicable order of the CER;
- a copy of the approval letter pertaining to the order of the CER;
- an assignment of surface rights between the amalgamating entities and the amalgamated entity; and
- a surface assignment schedule in the form prescribed by the CER.
Well name changes will occur automatically after submitting the amalgamation information in eSubmission. Any additional name changes that occur as a result of a change in working interests can be updated in eSubmission under the "Corporate Name Change Application" tab.
Please see additional requirements for federally regulated pipelines, sites and facilities under the heading "Federal", below.
The Waste Management and Reclamation Division of BC OGC handles waste discharge permits and registration for oil and gas facilities (which would otherwise be handled by the Ministry of Environment). In the event of amalgamation or corporate name change, a corporation must contact the Waste Management and Reclamation Division of the BC OGC to discuss the amalgamation of the subject facility's Waste Discharge Permit or Waste Discharge Registration by calling 1-250-794-5200.
For further information and instructions, see the BC OGC's Submission User Guide available at www.bcogc.ca.
BC Land Title and Survey Authority (LTSA)
The LTSA administrates freehold mineral titles and charges against freehold mineral titles in British Columbia. The LTSA requires notification for changes to the Incorporation Number or the registered name, the following should be submitted:
- a copy of the certificate of amalgamation;
- a duly-completed Form 17 Application;
- A duplicate of the official certificate of title maintained in the land title register must be surrendered if not on file at the land title office;
- an Indefeasible Fee of $74.87 for each parcel or charge affected;
- a PTT Return (FIN579S). An amalgamation might qualify for an exemption under paragraph 14(4)(u) of the Property Transfer Tax Act, depending on the structure, however a form must still be submitted;
- a Transparency Declaration; and
- a Transparency Report.
The LTSA offers online submission for most of the listed requirements. All of the above are available at www.ltsa.ca.
Ministry of Finance (Ministry)
Ministry of Energy and Resources (Ministry)
The Ministry establishes, implements, and reviews the BC government's economic, fiscal, financial management and taxation policies. A change to a corporation's business name should be submitted using the Notice of Change Business/Location Address or Business Name form. The form is available at www2.gov.bc.ca. Other information may be required depending on your circumstances. Please contact the Ministry at [email protected] or 1-877-388-4440 for more information.
The Ministry governs oil and gas activities, licensing, approvals and Crown leases in Saskatchewan under the Oil and Gas Conservation Act, the Mineral Resources Act, and the Crown Minerals Act. Amalgamating corporations should advise the Ministry of amalgamations for both Entity Number changes and name changes by email to [email protected] The Ministry will require a PDF version of the certificate of amalgamation and articles of amalgamation. Petrinex is the online system that the Ministry uses to receive monthly volumetric, valuation and royalty taxpayer information from oil and gas industry participants. The Ministry will complete the necessary changes in Petrinex (www.petrinex.ca) on behalf of the amalgamated corporations.
Surface Rights Board of Arbitration (SRB)
The SRB in Saskatchewan, like Alberta, is responsible for right of entry orders and surface agreements between energy companies and freehold landowners. Where an order holder will undergo a name change as a result of the amalgamation, the SRB requests a copy of the certificate of amalgamation and a list of all the orders that will be affected by the change. It also requests that notices be sent to each of the landowners associated with the affected orders advising them of the change. Contact information for the SRB is available at www.economy.gov.sk.ca/SurfaceRights.
Information Services Corporation (ISC)
Freehold mineral titles in Saskatchewan are managed by ISC. Since ISC is also the Corporate Registry in Saskatchewan, it will be aware of all amalgamations and do not need to be notified to update mineral titles if the land was registered or updated after 2001. If the land was not registered after, or has not been updated since 2001, a "Change of Name/Client Number Amalgamation Form" must be submitted, which is available at www.isc.ca.
Ministry of Finance (Ministry)
The Ministry's Revenue Division oversees taxation, revenue and government spending in Saskatchewan. Corporations should contact the Revenue Division to notify the Ministry of a change in business name and to determine any other changes that may be required as a result of the amalgamation. Contact the Revenue Division at [email protected] or 1-800-667-6102.
Canada Energy Regulator (CER)
The CER regulates certain national oil and gas activities, including interprovincial and international pipeline construction, operation, and abandonment, the export of petroleum substances, and certain drilling and exploratory activities in Canada's north. Under the Canada Energy Regulator Act, companies require leave of the CER to amalgamate if they (i) hold authorizations to construct or operate a pipeline; or (ii) own an abandoned pipeline. Companies can apply for leave by completing the "Change in Ownership Application" which is available at www.cer-rec.gc.ca.
The CER also requires a corporation holding the authorizations to provide the following information:
- an explanation that the transaction is due to an amalgamation;
- a map or maps of the pipeline and the relevant upstream and downstream facilities, and identification of any pipeline facility that could become stranded as a result of the transaction;
- a confirmation that a copy of the records set out in section 10.4 of Canadian Standards Association Z662-11 and section 56(e) to 56(g) of the Onshore Pipeline Regulations have been provided to the new owner of the facilities; and
- the estimated cost to abandon the facilities.
The corporation that will hold the authorizations post-amalgamation must provide the following information:
- identity of the new owner and operator of the pipeline including the appropriate contact information;
- the original cost of the asset, depreciation and net book value;
- the purchase price of the asset (if existent or allocable);
- a description of the intended long-term use of the facilities;
- a description of any changes in the conditions of service offered on the pipeline, including the estimated toll impact;
- if the records set out in section 10.4 of Canadian Standards Association Z662-11 and section 56(e) to 56(g) of the Onshore Pipeline Regulations do not exist, the applicant is to provide a plan detailing how it will acquire the information/records necessary to maintain and operate the facilities safely; and
- a description of its understanding of its financial liability for future abandonment costs.
Additional guidance on the above requirements is available in the Canada Energy Regulator Filing Manual, which is available on the CER website listed above.
With respect to operating licences granted for drilling and exploratory activities in northern regions governed by the Canada Oil and Gas Operations Act, the CER will require the amalgamated corporation to apply for a new operating licence and a change of well name where the amalgamation results in a name change to the licence holder.
Canada Revenue Agency (CRA)
The CRA administers tax laws for the Government of Canada and most provinces and territories. The CRA requires proof of amalgamation to update a corporation's business number (BN) and corporation income tax accounts following an amalgamation. Alberta, British Columbia, and Saskatchewan automatically send updates to corporate names and numbers to the CRA. The CRA will then contact the amalgamated entity for information about the changes to update BNs and corporation income tax accounts.
Other rules or payments may be required depending on your circumstances. Please visit the CRA website at www.canada.ca/en/revenue-agency.html for more information.
Indian Oil and Gas Canada (IOGC)
The IOGC is a special operating agency of Indigenous Services Canada which manages and regulates oil and gas resources on First Nations reserve lands. The IOGC collects oil and gas royalties for First Nations for all oil and gas production on First Nation reserve lands. The IOGC manages royalties in accordance with the Indian Act, the Indian Oil and Gas Act, and the Financial Administration Act.
The IOGC requires a corporation to submit a Notification of Change to Royalty Entity Form. Completion of this form will ensure accurate royalty submissions. The Notification of Change to Royalty Entity Form can be obtained by emailing [email protected]
For more information please visit www.pgic-iogc.gc.ca.
If you have any follow-up questions on amalgamating corporations in the oil and gas sector, please reach out to the authors of this article or your usual Business