Compliance Assurance  - Enforcement FAQs

On September 1, 2010, the Energy Resources Conservation Board (ERCB/Board) released the revised edition of Directive 019: Compliance Assurance. This revised edition is effective November 1, 2010, and will replace the previous edition of Directive 019: ERCB Compliance Assurance—Enforcement.  

Directive 019 outlines the ERCB's Compliance Assurance program ensuring compliance with all ERCB requirements and processes through its monitoring, enforcement, and education activities. It ensures that industry conducts resource activities in the province in a manner that protects public safety, minimizes environmental impact, ensures effective conservation of resources, and ensures stakeholder confidence in its regulatory process.

What follows are frequently asked questions (FAQs) about Directive 019 policies and processes. The ERCB will continue to update these FAQs as necessary.

DISCLAIMER: The frequently asked questions that follow are intended to assist in the general understanding of Directive 019 and is not a substitute for the latest version of the directive. Readers are reminded that the ERCB's directives and other official regulatory documents should be consulted for all purposes relating to the interpretation and application of ERCB's requirements; and how the ERCB will response to a finding of noncompliance of such requirements.

General
Compliance Assurance and the Risk Assessment of ERCB Requirements
Process for Low and High Risk Noncompliance
Persistent Noncompliance
Directive 019 Appeals

General

Question 1-1: What is the purpose of the Directive 019 ?

Answer 1-1: Directive 019 explains the ERCB's Compliance Assurance program, which includes the ERCB's

• compliance assurance principles;
• Risk Assessment Matrix it uses to risk its requirements and associated noncompliant events (see Section 3);
• processes and consequences of low and high risk noncompliant events (see Section 4);
• Directive 019 appeal process (see Section 5);
• Voluntary Self-Disclosure policy, including the rules and benefits of voluntary self-disclosure (see Section 6); and
• availability of compliance performance information (see Section 7).

Question 1-2: Who does Directive 019 apply to?

Answer 1-2 : Directive 019 applies to all licensees designated as the responsible duty holder (e.g., licensee, operator, company, applicant, approval holder, or permit holder) as specified in legislation.

Question 1-3: Are the compliance assurance principles in Directive 019 legally binding?

Answer 1-3: No. As part of Directive 019 and the Compliance Assurance program, the compliance assurance principles form the foundation upon which all compliance assurance activities operate (see Section 2). ERCB staff follow the principles in conducting compliance assurance activities as a best management practice strategy.

Question 1-4: How do I find out the ERCB Branch or Group responsible for a specific compliance category?

Answer 1-4: To assist its stakeholders, a list of contacts for each compliance category is available on the ERCB Web site www.ercb.ca under Industry Zone : Compliance and Enforcement : Compliance Categories and Contacts .

Question 1-5: How can licensees and stakeholders (including the public) provide input on the ERCB's Compliance Assurance program and processes?

Answer 1-5: To comment on the ERCB's Compliance Assurance program and processes, anyone may send an e-mail at anytime to compliancecoordination@ercb.ca . Please include the related section title and page number of Directive 019 with your comment.

Question 1-6: Can all Directive 019 responses, letters, documents, and correspondence, be directed to a specific person or central regulatory group within a licensee's company?

Answer 1-6: Whether the ERCB can accommodate this request or not depends on the specific compliance category and will need to be determined by the ERCB group responsible. For these requests, please contact the individual responsible for that c ompliance category.

Compliance Assurance and the Risk Assessment of ERCB Requirements

Question 2-1: How was the R isk Assessment Matrix developed?

Answer 2-1: The ERCB based the development of its Risk Assessment Matrix on a standard risk assessment methodology used throughout North America. Industry stakeholders assisted the ERCB during its development and testing phase.

Question 2-2: Why is equity not included in the Risk Assessment Matrix?

Answer 2-2: It is included. It is considered under the Stakeholder Confidence in the Regulatory Process column of the Risk Assessment Matrix.

Question 2-3: Will the amount of media coverage for a specific incident affect a requirement's risk assessment?

Answer 2-3: No. The ERCB risk assesses all requirements prior to any Directive 019 response to a noncompliance event occurring (see Section 3). Please see the ERCB Web site www.ercb.ca under Industry Zone : Compliance and Enforcement : Risk Matrix .

Question 2-4: Will the ERCB issue a Directive 019 response to a noncompliant event if it has not risk assessed a requirement?

Answer 2-4 : No. ERCB requirements must be risk assessed in accordance with Directive 019 before the ERCB can issue a response to a noncompliant event. If requested, the ERCB group responsible for the assessment may share the result with the licensee.

Question 2-5: Will the ERCB issue a Directive 019 response to an identified noncompliant event if the noncompliance and its associated risk rating are not on the ERCB's list of noncompliances?

Answer 2-5: Yes. If the requirement has been risk assessed and given a risk rating in accordance with Directive 019 , the ERCB will issue a Directive 019 response. The ERCB updates its list of noncompliances as necessary to include any new noncompliant events. It is available on the ERCB Web site www.ercb.ca under Industry Zone : Compliance and Enforcement : Risk Assessed Noncompliance.

Question 2-6: How can a licensee change the risk rating of an ERCB requirement?

Answer 2-6: If a licensee disagrees with the risk rating of an ERCB requirement, it must submit a formal industry-supported written submission containing the reasons why the requirement should be re-risked. On receipt of the formal submission, the ERCB group responsible for administration of the requirement may establish an internal group to review and determine if the risk rating of the requirement should be changed.

Process for Low and High Risk Noncompliance

Question 3-1: How will the ERCB respond to low and high risk noncompliant events?

Answer 3-1: ERCB responses include prevention notices and enforcement actions for both individual events and persistent noncompliance (see Section 4 and Tables 1 and 2).

Question 3-2: If a noncompliant event did not result in harm or damage, why does the ERCB issue a prevention notice or enforcement action?

Answer 3-2: Issuing a prevention notice or enforcement action in response to a noncompliant event allows the ERCB to document the noncompliant events and effectively identify and address persistent noncompliance by a licensee.

Question 3-3: In Directive 019, why are the stated timeframes to respond to a given noncompliant event inconsistent?

Answer 3-3: A unique set of circumstances surround each identified noncompliant event and may warrant a different timeframe to respond. The ERCB group responsible determines the appropriate timeline to correct a noncompliance given the nature and the circumstances surrounding that noncompliant event.

Question 3-4: What happens if a licensee cannot achieve compliance by a deadline stated in the prevention notice or enforcement action?

Answer 3-4: A licensee should contact the ERCB as soon as it becomes evident it is unable to achieve compliance by the deadline to seek further direction. The ERCB's policy on granting extensions varies for each ERCB group and compliance category and it will consider any request for extension on a case-by-case basis.

Question 3-5: When does the ERCB impose a noncompliance fee?

Answer 3-5: See Section 17.010 of the Oil and Gas Conservation Regulations for a schedule of noncompliance fees. ERCB's Information, Collection, and Dissemination Group currently applies these fees.

Question 3-6: How will the ERCB ensure compliance with measurement and reporting requirements?

Answer 3-6: Each ERCB group establishes noncompliant event(s) specifically dealing with the ERCB's measurement and reporting requirements. The ERCB can then issue a Directive 019 response in order to achieve compliance.

Question 3-7: How does the ERCB handle prevention notices and enforcement actions if a licensee is undergoing a corporate amalgamation and/or transfer?

Answer 3-7: A licensee undergoing a corporate amalgamation and/or transfer will not be subject to an enforcement escalation for noncompliant events that the ERCB identified prior to or within the first 90 days after the corporate amalgamation date and/or transfer date.

Persistent Noncompliance

Question 4-1: What is persistent noncompliance?

Answer 4-1: It refers to an unacceptable rate, ratio, percentage, or number of noncompliant events by a licensee, either in the same or different compliance categories. Under its Persistent Noncompliance Framework, the ERCB will determine persistent noncompliance through either the unacceptable number of noncompliant events over an identified time period (Option 1) or the unacceptable percentage of noncompliance at a predetermined review period (Option 2). Information on the framework is on the ERCB Web site www.ercb.ca under Industry Zone: Compliance and Enforcement : Persistent Noncompliance.

Question 4-2: Why did the ERCB introduce a Persistent Noncompliance Framework?

Answer 4-2: The ERCB introduced the framework to address repeated noncompliant events by a licensee.

Question 4-3: How does the ERCB develop persistent noncompliance criteria for each compliance category?

Answer 4-3: Each ERCB group follows the Persistent Noncompliance Framework to develop persistent noncompliance criteria for each compliance category.

Question 4-4: How does the ERCB ensure consistent application of persistent noncompliance criteria?

Answer 4-4: To ensure consistency, the ERCB determines criteria for each compliance category under its Persistent Noncompliance Framework. Each ERCB group applies these criteria in determining persistent noncompliance. The ERCB annually reviews and updates these criteria. Both the criteria and framework are available on the ERCB's Web site www.ercb.ca under Industry Zone : Compliance and Enforcement .

Question 4-5: How long is the review period for determining persistent noncompliance?

Answer 4-5: Under the ERCB Persistent Noncompliance Framework, each ERCB group will measure and identify persistent noncompliance using either Option 1 or 2 and determine an appropriate review period based on their specific compliance assessment work processes.

Question 4-6: Why is the length of a review period for determining persistent noncompliance different between compliance categories?

Answer 4-6: In determining persistent noncompliance for a specific compliance category, the length of time for a review period will vary dependant on how, when, and with what frequency each ERCB group conducts its compliance assessment activities (audits, inspections, or investigations).

Question 4-7: Does the ERCB consider a licensee's size and activity when determining persistent noncompliance?

Answer 4-7: No. The ERCB publishes persistent noncompliance criteria and the potential consequences of a persistent noncompliance designation to encourage and give licensees the opportunity to monitor their own compliance and prevent such enforcement escalation. The Voluntary Self-Disclosure policy and process of Directive 019 also give considerable opportunity for all licensees to address noncompliant events irrespective of size or activity.

Question 4-8: Is a licensee required to meet with the ERCB prior to an enforcement escalation to persistent noncompliance?

Directive 019 Appeals

Question 5-1: What recourse does a licensee have if it disagrees with a Directive 019 response, including a notice of persistent noncompliance?

Answer 5-1: If a licensee disagrees with an ERCB prevention or enforcement response, it may file an appeal with the ERCB Enforcement Advisor (see Section 5). The ERCB encourages all licensees to fully discuss a prevention or enforcement response with the appropriate ERCB group prior to filing an appeal with the ERCB's Enforcement Advisor.

See Appendix 2 of Directive 019 for further guidance on the appeal process.

Question 5-2: On what grounds can a Directive 019 response not be appealed?

Answer 5-2: An ERCB Enforcement Advisor will not consider an appeal if the grounds relate to the predetermined risk ranking of an ERCB requirement or the ERCB's decision to issue a High Risk Enforcement Action rather than a Notice of High Risk Noncompliance or if the appeal raises a question of policy to be determined by the Board. The Enforcement Advisor will also not consider an appeal if it falls outside the 60 calendar day timeframe from the date of prevention notice or enforcement action sought to be appealed.

Question 5-3: Is a prevention notice or enforcement action and any direction(s) set out within held in abeyance during a Directive 019 appeal?

Answer 5-3: Any direction(s) set out in a prevention notice or enforcement action take effect at the time prescribed and will not be suspended during an appeal process. Only under exceptional circumstances that are supported by appropriate documentation and on request by a licensee will an ERCB group or Enforcement Advisor suspend a direction in whole or in part and for any period of time (see Section A2.20 in Appendix 2).