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Inuvialuit Energy Security Project – Application for Authorization for Early Site Works, CER Reasons for Decision Approval OA-1414-001

Link to Decision Summarized

Oil and Gas – Facilities

Application

By a letter decision issued on June 28, 2023, the CER approved an application from Inuvialuit Energy Security Project Ltd. (“IESPL”) for authorization for early site works (the “ESW Application”) for the Inuvialuit Energy Security Project (“IESP”). The CER approved the ESW Application subject to certain conditions and with reasons to follow. This decision contains the reasons for the ESW Application approval.

The ESW Application included the following activities:

  • construction of a 4 kilometer all-weather gravel access road;
  • placement of a 33.5 metre (110 feet) long bridge to cross a creek;
  • construction of the Energy Centre pad; and
  • installation of adfreeze piles for some of the Energy Centre structures or modules.

Decision

The CER  provided the reasons for its prior decision to approve the ESW Application.

Pertinent Issues

Assessment of the Application
  1. IESPL Engagement Activities

The CER found that IESPL appropriately identified and engaged those potentially impacted by the early site works, including Indigenous Peoples, landowners, communities, organizations, co-management boards, and other stakeholders. The CER was satisfied with IESPL’s approach to engagement and engagement activities, including the sufficiency of the notice provided of the ESW Application.

The CER imposed Condition 11 (Commitment Tracking Table), requiring IESPL to track and fulfill all the commitments it made in the ESW Application and related submissions, including an update on the status of each commitment. This condition also required IESPL to file with the CER a list of its commitments and post the list on its IESP website, at least 45 days prior to commencing early site works activities, and continue to update it on a quarterly basis.

The CER was also satisfied that the engagement and consultation was adequate for the purpose of the CER’s decision on the ESW Application, which consultation was consistent with s 35 of the Constitution Act, 1982.

The CER found that the early site works were unlikely to adversely affect the rights of Indigenous Peoples because of the small size and scope of the infrastructure to be constructed, and the low potential for negative impacts on the environment and socio-economic factors during and after construction.

  1. Environment Matters

IESPL submitted an Environmental Protection Plan (“EPP”) comprised of the following six environmental management plans: Archaeological Site Management Plan, Wildlife Management and Monitoring Plan, Permafrost Protection and Management Plan, Fish and Fish Habitat Protection Plan, Waste Management Plan, and Erosion and Sediment Control Management Plan.

The CER was satisfied that IESPL identified and committed to implementing appropriate mitigation and avoidance measures to protect the environment during the early site works. IESPL stated that several environmental procedures were not available when the application was filed but would be available when the application was evaluated in June 2023. Based on IESPL’s confirmation that it would complete all outstanding procedures by June 2023, the CER imposed Condition 9 (Environmental Procedures) requiring IESPL to file the outstanding procedures at least 45 days before commencing early site works activities.

Further, to be satisfied that post-construction environmental monitoring is thorough and effective, the CER imposed Condition 18 (Post-Construction Environmental Monitoring Report), which set out the requirements for IESPL’s post-construction environmental monitoring program for the IESP.

  1. Socio-Economic Matters

The CER found that the early site works for the IESP will have no or negligible negative effects on socio-economic matters and that it will likely result in overall positive social and economic impacts. In reaching this conclusion, the CER considered the small size and scope of the early site works and their location on Inuvialuit private lands, the low potential for impacts on socio-economic valued components, as well as IESPL’s proposed mitigation measures to address any potential negative residual effects of the early site works.

The CER was also satisfied that IESPL addressed all concerns raised to date to the satisfaction of interested parties, including its commitment to continued engagement throughout the CER regulatory processes and the lifecycle of the IESP.

  1. Financial Matters

The CER approved the use of a parental guarantee from the Inuvialuit Petroleum Corporation (“IPC”) as proof of financial responsibility for the ESW Application. To ensure the continued and ongoing financial position of IPC, as the entity providing the parental guarantee to the IESPL, the CER imposed two conditions.

Condition 5 (Financial Statements) required IESPL to file, no later than 10 days after the authorization for early site works was issued, signed and audited 2022 financial statements and notes for IPC, as well as confirmation that no material changes have occurred from the end date of the financial statements.

Condition 7 (Financial Material Changes) required IESPL to update the CER if there were any material changes in the financial position of the guarantor or its proof of financial responsibility.

Further, the CER imposed Condition 6 (Parental Guarantee and Insurance), which required IESPL to submit a final, signed and executed copy of the parental guarantee for approval, at least 45 days before early site works construction.

  1. Engineering Matters

The CER acknowledged that northern infrastructure is subject to the effects of unique land attributes, harsh environments and climate change. The CER was satisfied that IESPL appropriately considered the permafrost and other conditions in its engineering design matters. The CER imposed Condition 19 (Permafrost Monitoring and Protection Report) to obtain updates on how IESPL monitors, documents, reports and mitigates the permafrost conditions within the IESP area on an annual basis and throughout the life of the project.

IESPL stated that the Energy Centre site plan, including the detailed foundation layout plans, were almost complete but not yet submitted to the CER. Therefore, the CER imposed Condition 14 (Energy Centre Pad and Foundation Design Drawings), requiring IESPL to file the site plan and the detailed foundation layout plans for the Energy Centre at least 60 days before commencing construction of the Energy Centre pad and the installation of civil foundation and adfreeze piles for the Energy Centre structures and modules.

To understand how IESPL will ensure that the early site works are constructed as planned and that any changes required are properly designed and implemented, the CER imposed Condition 10 (Quality Assurance/Quality Control Plan), requiring IESPL to file a Quality Assurance/Quality Control Plan at least 45 days before commencing early site works construction.

To make sure that any changes that are required to the design and construction of the early site works were properly implemented, the CER imposed Condition 15 (Post-Construction Report), requiring IESPL to file a post-construction report within 270 days after completing early site works construction.

  1. Safety and Emergency Response Matters

The CER found that IESPL will sufficiently manage the safety of the early site works and that the identified hazards, the evaluation of risks and proposed mitigation measures were logical and appropriate for the proposed work activities.

To provide transparency and confidence that IESPL will complete the necessary processes and procedures to protect the health and safety of workers before early site works construction begun, the CER imposed Condition 8 (Safety and Emergency Management Documents), requiring IESPL to file updated copies of its Contractor Management Procedure, and its Incident Accident Reporting and Management Procedure, at least 45 days prior to commencing early site works construction, specifically reflecting the early site works.

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