encana shallow gas infill development ...robert drummond, esq. ) natural resources canada,)...

Mainland Reporting Services [email protected]

3392

ENCANA SHALLOW GAS INFILL DEVELOPMENT PROJECT

AND EUB APPLICATION NO. 1435831

___________________________________

JOINT REVIEW PANEL HEARING CONDUCTED PURSUANT TO:

SECTION 4.5 OF THE "AGREEMENT TO ESTABLISH A PANEL

FOR THE ENCANA SHALLOW GAS INFILL DEVELOPMENT PROJECT"

AND THE EUB'S RULES OF PRACTICE

_______________________________________

PROCEEDINGS AT HEARING

OCTOBER 23, 2008

(Evening Session)

VOLUME 15

PAGES 3392 TO 3504

________________________________________

Held at:Energy Resources Conservation BoardGovier Hall, 640-5th Avenue S.W.

Calgary, Alberta


3393

APPEARANCES

JOINT PANEL:

Robert (Bob) Connelly, Panel ChairBill Ross, Panel MemberGerry DeSorcy, Panel Member

CANADIAN ENVIRONMENTAL ASSESSMENT AGENCY (CEAA):

Marie-France TherrienJeff DavisLucille Jamault

ENERGY RESOURCES CONSERVATION BOARD (ERCB):

JP Mousseau, Esq., Board CounselMeighan LaCasse, Board CounselJodie SmithJennifer FitzGeraldMirtyll AlbiouPeter HuntBruce GreenfieldCarrie DickinsonShaunna CartwrightKen BanisterTom ByrnesSteve ThomasKarl JorsLawrence JonkerDarin BarterBob Curran

PROPONENT

Shawn Denstedt, Esq. ) For EnCana CorporationMs. Terri-Lee Oleniuk )Ms. Leanne Campbell )


3394

INTERVENERS:

Kirk Lambrecht, Esq. ) For Government of Canada,Jim Shaw, Esq. ) Environment Canada,Robert Drummond, Esq. ) Natural Resources Canada,

) Department of National) Defence, Parks Canada,) Agriculture Canada,) Department of Fisheries) and Oceans

Ms. Jennifer J. Klimek ) For the EnvironmentalMr. H. Binder ) Coalition

)

John McDougall, Esq. ) For the SuffieldMs. Kelly Lemon (student) ) Environmental Advisory

) Committee

Keith Miller, Esq. ) For the Suffield Industry) Range Control

REALTIME REPORTING:

Mainland Reporting Services, Inc.Nancy Nielsen, RPR, RCR, CSR(A)Tambi Balchen, CRR, CSR No. 9166


3395

INDEX OF PROCEEDINGS

DESCRIPTION PAGE NO.

Department of National Defence, EnvironmentCanada, and Natural Resources CanadaWitness Panel Stood Down

3397

Opening Submissions of the SuffieldEnvironmental Advisory Committee ("SEAC"),by Mr. McDougall

3397

Suffield Environmental Advisory Committee("SEAC") panel:

Olaf Jensen (on former affirmation)Rob Kennedy (duly sworn)

3400

Presentation of the Suffield EnvironmentalAdvisory Committee ("SEAC"), by Mr. Kennedy

3401

Presentation of the Suffield EnvironmentalAdvisory Committee ("SEAC"), by Mr. Kennedy

3412

Cross-examination by the Coalition, byMs. Klimek

3439

Cross-examination by the Government ofCanada, by Mr. Lambrecht

3460

Cross-examination by EnCana, byMr. Denstedt

3474

Cross-examination by the Panel Secretariat,by Mr. Mousseau

3487

Questions by the Joint Review Panel, byDr. Ross

3496

Questions by the Chairman 3499

(SEAC PANEL EXCUSED) 3502


3396

INDEX OF EXHIBITS

DESCRIPTION PAGE NO.

EXHIBIT No. 007-008: Curriculum Vitaeof Mr. Rob Kennedy

3399

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3397

(PROCEEDINGS COMMENCED AT 6:30 P.M.)

(DEPARTMENT OF NATIONAL DEFENCE, ENVIRONMENT CANADA, AND

NATURAL RESOURCES CANADA WITNESS PANEL STOOD DOWN)

THE CHAIRMAN: Good evening, Ladies and

Gentlemen. We are ready to begin once again and we

will just -- one announcement. We will take a very,

very quick break for maybe just a minute or two in

about an hour just to change something with the

reporters and then we'll continue on roughly until

about 8:30 and we'll take a longer break at that

point, about 15 minutes.

Mr. McDougall, you may begin, please.

OPENING SUBMISSIONS OF THE SUFFIELD ENVIRONMENTAL ADVISORY

COMMITTEE ("SEAC"), BY MR. MCDOUGALL:

MR. McDOUGALL: Thank you, sir.

Distinguished Panel, Ladies and Gentlemen, my

name is John McDougall. I act on behalf of the two

individuals that are, are here from, from SEAC, and

who have agreed to give evidence to the Joint Review

Panel on the Project in issue; Mr. Kennedy from the

ERCB and Mr. Jensen from Environment Canada.

As has been identified several times to the

Panel, the third member of SEAC is Rob Burland from

Alberta Environment and is not in attendance this

evening.

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3398

Further, just for further confirmation,

Mr. Burlind and Alberta Environment have not been

involved in the submission to the JRP. They have not

been involved in the input to the information request

answers provided by the two members from SEAC and they

have not been involved in the preparation or the

presentation of tonight's material.

Given that SEAC operates under a requirement

of unanimity, SEAC per se cannot give formal evidence

qua SEAC as Mr. Burlind is not here. Notwithstanding

that fact, the two remaining members, Mr. Kennedy and

Mr. Jensen, thought it was important to provide

information that the Panel requested of them about

SEAC to the JRP, and have agreed not only for the --

to provide the submissions and the Information

Requests, but also to give evidence here this evening.

However, while we may refer to tonight's

evidence as "SEAC's" and questions in cross may be

directed to "SEAC", what is in fact meant is that this

is an informal submission and evidence of two members

of SEAC rather than, in fact, SEAC qua SEAC.

Sorry, I know that's a lot of "SEACs" and

"quas". Thank you.

THE CHAIRMAN: I think we understand,

Mr. McDougall.

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3399

MR. McDOUGALL: Thank you. I was just about

to say, and having said that, and on the assumption

that everyone understands that and certainly there

were no objections to our filing both of the

submission and of the Information Requests, we'll now

proceed with, with SEAC's presentation.

Firstly, a couple of housekeeping matters,

introduction of the two members from SEAC, sitting

closest to the Panel is Mr. Rob Kennedy from the ERCB,

and to his left, who has also been -- should be known

to the Panel and everyone here, has been giving some

evidence in the last couple days is Mr. Olaf Jensen

from Environment Canada.

Next, I have the Curriculum Vitae for

Mr. Kennedy which I propose to, to give to

Mr. Mousseau and to the Panel to mark as an exhibit.

I have already given a copy to my friends.

THE CHAIRMAN: That should be

Exhibit 007-008.

EXHIBIT NO. 007-008: Curriculum Vitae of

Mr. Rob Kennedy

MR. McDOUGALL: That's, that's what I have as

well, sir.

And Mr. Jensen's CV is already marked as, as

I understand it, Exhibit 003C-004. I don't propose to

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3400

mark that as a separate exhibit under, under SEAC's

list of exhibits.

MR. McDOUGALL: Now, Mr. Kennedy and

Mr. Jensen, I understand that you have a presentation

to give this evening?

A. MR. KENNEDY: Yes, we do.

Q. And perhaps it may be an appropriate time to swear the

witness?

THE CHAIRMAN: Yes. I believe Mr. Jensen is

already -- has already sworn in, so I just remind you,

Mr. Jensen, that remains to be the case but we will

need to swear Mr. Kennedy in.

MR. McDOUGALL: Thank you, sir.

SUFFIELD ENVIRONMENTAL ADVISORY COMMITTEE PANEL:

Olaf Jensen (on former affirmation)

Rob Kennedy (duly sworn)

THE CHAIRMAN: Please proceed.

MR. McDOUGALL: Thank you. Gentlemen, was

the presentation that you are about to, to give this

evening to the JRP prepared and authored solely by the

two of you.

A. MR. KENNEDY: Yes, it was.

A. MR. JENSEN: Yes, it was.

Q. And is the evidence you are about to provide true and

correct to the best of your belief?

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3401

A. MR. KENNEDY: Yes, it will be.

A. MR. JENSEN: Yes.

Q. And do you adopt the presentation you are about to

give as the -- your evidence on behalf of SEAC

subject to my earlier caveat?

A. MR. KENNEDY: Yes.

A. MR. JENSEN: Yes.

Q. Thank you. Please proceed.

PRESENTATION OF THE SUFFIELD ENVIRONMENTAL ADVISORY

COMMITTEE ("SEAC"), BY MR. KENNEDY:

A. MR. KENNEDY: Thank you. Mr. McDougall.

Good evening, Mr. Chairman, Panel Members,

Ladies and Gentlemen. My name is Rob Kennedy and I'm

here with Olaf Jensen. We're both members of the

Suffield Environmental Advisory Committee, which we

will hereinafter refer to as "SEAC", and we are here

today at your behest to present an overview of SEAC's

roles and responsibilities as it relates to past and

present natural gas developments in the NWA, including

the proposed Project.

As requested we will also be, be providing

some history and context of SEAC as well as some

comments on our role in Pre-disturbance Assessments

and in reclamation.

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3402

Presentation Summary

In this presentation, we intend to first

summarize those sections of our submission, which is

Exhibit No. 007-002, Registry No. 470, which are

especially relevant to these hearings for the Joint

Review Panel.

Next, we intend to provide the current

operational context at CFB Suffield and the NWA. And

the role of SEAC in the Environmental Assessment to

date.

Finally, we intend to provide a detailed

discussion on current considerations and observations

of the two SEAC members at this hearing, importantly,

considerations as to why the Memorandum of Agreement

1975 should be replaced by a successor agreement and

considerations if the Project is to proceed.

Mr. Jensen will now summarize relevant

extracts from our submission.

Summary of Submission

A. MR. JENSEN: Thank you, Panel Members. We

will now summarize our submission presented to the

JRP. We intend to provide the introduction to the

report in order to set the context for our submission.

Next we intend to provide extracts from the executive

summary and follow that with a summary of salient

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3403

extracts from the background.

Finally, we will summarize some of the

especially relevant points from the practice section

of the submission.

We feel it is important that this information

be read into the record as it provides relevant

background to the material that will follow and form

the bulk of our Opening Statement.

Introduction

The Joint Review Panel, respecting the

proposed EnCana Suffield Shallow Gas Infill

Development Project, requested SEAC to present

evidence at the public hearings on the Project and in

particular on the committee's, and I quote:

"Roles and responsibilities as it

relates to past and present natural

gas developments in the National

Wildlife Area and especially to the

proposed Project."

THE CHAIRMAN: Mr. Jensen, just one word of

caution. If you could slow down a little bit, I think

that would be appreciated, please.

A. MR. JENSEN: My apologies.

THE CHAIRMAN: Especially when you're

reading, it's -- there's a tendency of course for all

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3404

of us to read quicker so.

A. MR. JENSEN: Thank you.

THE CHAIRMAN: Thank you.

A. MR. JENSEN: The Panel is particularly

interested in learning more about SEAC's role in

Pre-disturbance Assessments and in the reclamation and

closure phases.

Executive Summary

SEAC was established and its roles flow from

the 1975 and 1977 memorandums of understanding signed

between the Province of Alberta and the Department of

National Defence. In recognition of the fragile

nature of CFB Suffield and its ecological value, SEAC

was created as an oversight and advisory body at CFB

Suffield.

SEAC's primary geographic area of

responsibility is the restricted development zone but

it also provides advice with respect to activities on

the remainder on the Base.

SEAC's role is defined in four documents:

the Oil and Gas Master Agreements, the Suffield

Environmental Protection Objectives and the

Environmental Protection Regulations.

The committee is comprised of an employee

from Environment Canada, an employee of Alberta

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3405

Environment and an employee from Energy Resources

Conservation Board. The committee provides advice to

the Base Commander at CFB Suffield who obtains a

recommendation from SEAC for decisions with ecological

implications.

SEAC is primarily responsible for considering

applications with regards to environmental factors and

making a recommendation to the Base Commander as to

whether or not a specific project should be approved.

Additionally, the committee causes inspections to be

made.

The current members of the committee have

been representatives on SEAC since approximately

January of 2007. It is our understanding that SEAC

has, as per the terms of the agreements, provided

regular advice through the Base Commander, as requests

caused inspections to be made in the form of annual

field reconnaissance and heard submissions from

industrial operators at annual general meetings.

Background

In the Memorandum of Understanding signed

between the Minister of Defence and Alberta Minister

of Energy and Natural Resources in 1975, with respect

to access to oil and gas at CFB Suffield, and I quote:

"Portions of the Base are extremely

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3406

fragile in nature and valuable from

an ecological point of view and

have not heretofore been used for

Military purposes and should be

preserved to the extent possible."

Further, in the South Saskatchewan River Bank

Zone, and I quote:

"Natural gas development should be

limited to wells recommended for

approval by the Suffield

Environmental Advisory Committee."

In the Middle Sand Hills Zone:

"No natural gas development for

this zone should be undertaken

until the completion of an

Environmental Impact Assessment of

the zone."

SEAC is not a legal entity but was established

and its membership defined in the 1975 Gas Master

Agreement which states in Section 12.3, and I quote:

"Canada and Alberta hereby

establish a Committee called the

"Suffield Environmental Advisory

Committee" consisting of three

members: one appointed by Canada,

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3407

being an employee of the Department

of the Environment (Canada); one

appointed by Alberta, being an

employee of the Department of the

Environment (Alberta); and one whom

Alberta will cause to be appointed

from the Board [AEUB]."

Section 12.4(a) and (b) contain the following

direction regarding SEAC, and I quote, Section 4:

"The Suffield Environmental

Advisory Committee:

(a) shall in accordance with

the Suffield Environmental Surface

Protection Objectives prescribed in

Appendix 2 to Schedule 'D' of this

Agreement, cause inspections to be

made to ensure the proper

application of the Suffield Oil and

Gas Environmental Protection

Regulations prescribed in

Appendix 3 to Schedule 'D' of this

Agreement.

(b) shall give to Alberta, or

its assignees the opportunity to be

heard and to make representations

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3408

in respect of matters being

considered by the Committee."

12.6:

"The Suffield Environmental

Advisory Committee is responsible

to and shall report annually upon

its activities to Canada and

Alberta, and to the Base

Commander."

Section 12(7):

"Notwithstanding any provisions of

the Suffield Oil and Gas

Environmental Protection

Regulations, the Base Commander may

in any particular case, for the

purpose of Appendix 2 and the

application of Appendix 3, but only

upon the recommendation of the

Committee,

(a) give or refuse to give

such consent or approval for the

performance or doing of such an act

or thing or

(b) order the performance or

the cessation of such act or

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3409

thing."

Suffield Environmental Surface Objectives form

part of the Oil and Gas Master Agreements.

Section 12.4 of the Master Agreements refers SEAC to

apply the Environmental Protection Regulations. There

are two sets of regulations: The Suffield Oil and Gas

Environmental Protection Regulations and the Suffield

Oil Environmental Protection Regulations. Although

these documents are titled "regulations", neither

document appears to be legislative.

Section 2.2 of both regulations contains the

following statement and I quote:

"Whenever the Land Conservation

Regulations refer to the

Development and Reclamation Review

Committee [or DRRC], the reference

shall, for the purposes of the

Agreement and the application of

these regulations, be deemed to be

a reference to the Suffield

Environmental Advisory Committee

instead and in lieu of the DRRC as

constituted under Section 21 of the

Land Conservation Regulations."

The role of the DRRC is to make a recommendation

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3410

to an approving authority with regards to applications

for development and reclamation approval having regard

to environmental factors. The Provincial legislation

from which the DRRC is established, the Land Surface

Conservation and Reclamation Act and the Land

Conservation Regulations have since been repealed.

In 1993 the Land Surface Conservation and

Reclamation Act was repealed and replaced by

Section 247 of the Environmental Protection and

Enhancement Act. No provision was introduced into the

new Act for the continuation of the Land Conservation

Regulation.

Our understanding is that in the past SEAC

has taken on the role of the DRRC by reviewing an

applicant's development and reclamation plans

including review, in certain cases, of surface

disturbance reports and water management reports.

SEAC was then responsible for providing a

recommendation, both with regard to development and

reclamation to an approving authority as defined by

the now repealed LSCRA.

Practice

As mentioned, SEAC consists of Rob Kennedy

with the Energy Resources Conservation Board, myself

with Environment Canada Canadian Wildlife Service and

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3411

Rob Burlind with Alberta Environment. Each of these

members is new to SEAC as of January, 2007. Since

that time SEAC has received two requests for advice

and have made one annual, now two annual field

reconnaissances, and have written one annual report

which was presented verbally in draft form to the Base

Commander at the AGM, Annual General Meeting, in

August, 2007 and in final form in January, 2008.

A second annual report was tabled at the

Annual General Meeting this September at Suffield.

Past SEAC activities are understood by the current

SEAC members to be as follows:

- review development and reclamation

applications;

- review other applications and proposals

such as land spray while drilling,

holding cells, subsurface applications,

seed mixes for reclamation and spill

remediation;

- attend annual field reconnaissance;

- provide annual report;

- attend Annual General Meeting;

- attend other meetings as requested;

- participate in other activities,

including appropriate dispute

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3412

resolution and the reclamation

subcommittee;

- provide advice to the Base Commander

and educate parties in areas of

knowledge.

Operational Context

On July 9, 1973 the first well was spudded on

a Suffield Block. In this photo, for your interest, a

British Army Training Unit Suffield, or BATUS,

helicopter is seen hovering near this first well in

the attached picture. A number of evaluation wells

were drilled up to the period ending in 1975 when the

governments of Alberta and Canada drafted the Gas and

Oil Memorandum of Agreement.

Since the inception of SEAC with the signing

of the agreements, drilling has continued reaching a

brief plateau during the period from 1990 to 1995 and

picking up pace after the year 2000. As we have heard

during these proceedings, an MOU to establish the NWA

was signed in 1992 and the NWA was formally created in

2003.

As indicated by EnCana, there was no drilling

in the National Wildlife Area during the decade from

1987 through to the end of 1997. Drilling in the

restricted zones resumed in 1998 when the current well

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3413

density of 8 wells per section, or roughly 1100 wells

in the National Wildlife Area was achieved.

In addition, there are at present more than

10,000 wells on CFB Suffield. Mr. Rob Kennedy will

now read into the record the final part of our

presentation to the JRP.

PRESENTATION OF THE SUFFIELD ENVIRONMENTAL ADVISORY

COMMITTEE ("SEAC"), BY MR. KENNEDY:

A. MR. KENNEDY: Thank you, Olaf.

We have summarized our submission that was

provided to the JRP and we feel it is vital that we

now provide the Panel with our observations and

suggestions that the JRP may wish to consider while

formulating its recommendations.

During our annual SEAC reconnaissance, we

routinely look at specific sites and review, in

detail, issues at these sites. At the end of these

field tours, we present an annual report to the Base

and industry at the annual Oil and Gas Meeting.

Within the SEAC annual reports we have tried

to capture the bigger issues, those issues that

present themselves after a review of all of the sites.

In our submission and presentation to the JRP, we have

taken a similar approach.

We have identified what we feel are the big

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3414

issues. We believe this is necessary so that the JRP

has relevant information in making its recommendations

as it may pertain to the role of SEAC. In making our

observations, we hope to aid the parties involved in

the development of oil and gas to work together in an

atmosphere of cooperation and common understanding.

We hope that will contribute to ensuring the

protection of the environment at Suffield and

especially the NWA. We hope to help clarify matters

in fairness to ourselves as current SEAC members and

for those who might one day replace us.

We should be so lucky.

We are going to split this presentation into

observations of the current situation and observations

for the future.

Current

The current situation. It is our observation

that in regards to SEAC there are two large issues:

One is an overall lack of clarity which has resulted

in differing interpretations and thus disconnects

amongst the parties. In our opinions, the second

large issue for SEAC is that of resources for SEAC.

With respect to a lack of clarity we refer

specifically to the following:

(1) the role of SEAC;

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3415

(2) the geographic area of responsibility

for SEAC;

(3) the reporting structure or

responsibility for SEAC;

(4) the authority of SEAC;

(5) the environmental standards and

expectations for SEAC, and perhaps that

can be identified as a regulatory gap;

and

(6) the processes for development

applications and approval, reclamation

and requests for review.

We would now like to expand on those items.

Role of SEAC

Since we took the role in about January, 2007

it became apparent to us that each party, primarily

the Base and EnCana, have had differing views as to

the role of SEAC.

In fact, we, too, have puzzled over our role

and due to the pressure of being caught in the middle

of the two parties and with limited resources, we

intended to develop our own terms of reference. This

did not occur because of individual work loads in

2007. In 2008 SEAC was invited to participate in the

present hearing and we believed that the JRP would be

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3416

faced with reviewing the role of SEAC and this would

potentially lead to changes for SEAC; thus we have not

pursued the concept of creating our own terms of

reference.

The Panel has heard evidence from EnCana

stating that the 1975 Memorandum of Agreement provides

the role of SEAC in clear terms. The Panel has also

heard evidence from the Department of National Defence

regarding their view of the role of SEAC. While we

believe there is a common thread in that they both

view SEAC as providing some form of environmental

oversight, there are differences in interpretation as

to when, where and how that oversight is implemented.

It appears to us that there is a lack of

agreement on the Memorandum of Agreement and its

interpretation. In short, there is no agreement on

the Agreement. As a result, SEAC gets caught in the

middle trying to balance the expectations of the

parties to the Agreement, Canada and Alberta and its

assignees.

We have taken the approach that SEAC exists

to provide environmental advice to the Base Commander.

This view is based on the customary practice of SEAC,

the way in which previous SEAC members did business

and relate that role of SEAC to us. Indeed, on

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3417

cross-examination on October 17th, we believe

Mr. Protti of EnCana observed that SEAC was originally

created to provide support to the Base Commander.

Further, the Base Commander seems to have the

same view. He feels that SEAC is only to provide

advice as per his request. For example, as per his

evidence regarding the role of the Base's range

sustainability section and the accompanying flow chart

for the development applications, it becomes apparent

that SEAC only provides review when requested by the

Base Commander because the range sustainability

section has taken the main role in reviewing and

providing recommendations for approval on applications

from industry for oil and gas development.

It should be noted that to date the current

SEAC has not received any applications for development

for us to review. We believe that SEAC is often seen

by both EnCana and the Base as at least a partial

solution to their differing views, an arbiter in the

case of disputes, if you will.

Geographic Area of Responsibility

The Memorandums of Agreement outline some

geographic areas for which reviews by SEAC are

required. However, as testimony has been presented

throughout this hearing, it appears evident that some

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3418

of the special geographic areas are no longer

identified. The maps of the areas of concern vary and

differ. The mixed grasslands area, for example,

appears in early reports but is absent in the

Memorandum of Agreement and then re-appears in the

D and R applications during the initial development

period.

Reporting Structure

As per the 1975 agreement, SEAC is comprised

of one person from the Energy Resources Conservation

Board, one from Alberta Environment and one from

Environment Canada which is provided through Canadian

Wildlife Service.

Further, in Section 12(6), it states that

SEAC is to report to the Base Commander, Alberta and

Canada. Certainly SEAC can identify the Base

Commander, but we are not aware of any specific

individuals to whom we report when we report to

Alberta or Canada. The issue that this creates is

that when SEAC feels it needs resolution to an issue

such as the need for more resources, there is

uncertainty as to who SEAC should approach.

Similarly, when it comes time to replace a

SEAC member, how that person is chosen and on what

qualifications is unknown. At this point in time, it

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3419

appears that each member is identified within its

agency by the person vacating SEAC. A process is not

identified nor is a chairperson for the SEAC

identified although, by customary practice, the

chairperson is the member from the ERCB.

It should be noted that the chair of SEAC is

nothing more than a contact person for parties wishing

to contact SEAC and there are no further

responsibilities attached to the position of the

chair.

Authority of SEAC

Over the course of the hearing there has been

some discussion over the ability of SEAC to create

regulations as per parts of the Memorandums of

Agreement. Yet we cannot envision under what

statutory authority we would be empowered to be able

to make a regulation. Importantly, how would SEAC

ensure compliance with any such regulation as there is

no provision for determining compliance and nor are

there any enforcement provisions.

Currently SEAC does not create regulations,

rules or policies, nor do we intend to. SEAC provides

advice and recommendations to the Base Commander. It

has been our view from the beginning that we are

advisory in capacity and that the Base Commander can

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3420

either accept or reject our recommendations. We don't

believe that the Memorandums of Agreement allow us to

exercise any direct control over either industry or

the Base.

Environmental Standards and Expectation (Regulatory Gap)

The Memorandums of Agreement speak of certain

environmental considerations for different parts of

the Base, specifically the environmental surface

protection objectives identifies that the major

surficial resources, and that is a quote, for the two

restricted zones are the geological features, the

native flora and fauna, birds of prey, and ungulates.

Today we have the Species At Risk Act, the

National Wildlife Area, and concerns about

biodiversity. In short, the expectations for the

protection of the environment have changed

significantly, yet this is not captured in the

Memorandums of Agreement and there is little to

provide guidance and terms of reference for SEAC.

Similarly, the issue of reclamation was

investigated extensively during this hearing. At

present time, SEAC does not have clear direction on

reclamation standards and what standards apply on the

Base. It was recognized that the standards appear to

have changed over time and that existing standards may

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3421

not be applicable to the unique situation at Suffield.

And, finally, who is responsible for

reclamation? Alberta Environment has stated that they

no longer have any responsibility for reclamation at

Suffield. The Memorandum of Agreement appears to

delegate responsibility for reclamation to the ERCB

while others point to SEAC and the Base Commander.

These uncertainties need to be addressed.

The effect of all this is that no single

document provides the necessary guidance to SEAC in

order that the committee might determine its role and

purpose on how to discharge its duties. The multiple

documents that might give direction appear

contradictory.

If SEAC reviews development applications, is

it zero impact we are trying to achieve, is it minimal

impact? Are we okay to allow a 50 percent loss of

habitat and species? Add to this mix all of the

various land uses that impact Suffield and it becomes

obvious to us that it is difficult at best for SEAC to

determine acceptable impacts of development.

And if SEAC is to review and approve

reclamation, what standards are we going to use?

Processes for Application/Approval; Reclamation, Requests

for Review; Appeals

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3422

It is our observation that there is a lack of

clarity and agreement on the processes for

applications for development, reclamation, requests

for review, and there is not an appeal process for any

recommendation that SEAC arrives at. It is our

observation that there is confusion and disconnect

over the role of SEAC in the application process,

applications for reclamation, requests for review, and

appeals. One shouldn't need to go through minutes and

e-mails from the past years to determine the process.

It should be housed in one document that is agreed

upon by all the relevant parties, and as modifications

are made, they are likewise agreed upon and housed in

that document.

In anticipation of questions from the JRP, we

would like to note at this point in time the current

SEAC has not received a D and R Application, nor has

it received an application for reclamation, though we

understand industry is preparing to begin sending

reclamation applications for review by SEAC.

Further, we have not received a formal

application request to review the three wells that are

being applied for by EnCana and we do not consider

that information provided at the hearing is a request

to SEAC to review the application.

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3423

We don't believe there is currently an appeal

process for recommendations that SEAC may make nor are

we certain this is a necessary mechanism.

Resources

The current members of SEAC each have

full-time roles and responsibilities within their

respective organizations. Excuse me. This means that

SEAC, where it can, and does, become a secondary

consideration in light of those other

responsibilities.

This results in considerable delays and an

inability to undertake more than the annual tour,

annual report, and the occasional request for review,

and even those have become a stretch.

In summary, we have been doing the best we

can with what we have. SEAC is uncertain as to who

they would approach for more resources. Would it be

the respective organizations? Would it be the

provincial and federal governments?

Housed within the context of resources is the

question of the makeup of SEAC. Currently SEAC is

comprised of one person from each of the ERCB,

Canadian Wildlife Service, and Alberta Environment.

However, the jurisdictional role of Alberta

Environment seems to be problematic so there is some

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3424

question about the continuation of that role. Alberta

Environment states it does not have jurisdiction on

the Base as it is Federal land.

The current SEAC has advocated an increase in

resources for the range sustainability section as a

partial answer for the resourcing issue that SEAC

faces. Whether the increased capacities and abilities

of the range sustainability section amount to a

replacement or a complement to SEAC has yet to be

determined.

FUTURE

As we see it, the JRP will likely play a

major role in determining the future role of SEAC.

SEAC was created by the Government of Canada and the

Government of Alberta. The recommendations of the JRP

will, in our view, form any future discussions that

are necessary in creating a future agreement between

the parties. The two of the three SEAC members

present at this hearing do not have a preference as to

the role that SEAC plays in the future, if any role at

all. However, we do strongly feel that there is a

need for environmental oversight. We rely on the

expertise and wisdom of the JRP and the wishes of the

Government of Canada and the Government of Alberta.

The JRP may recommend that SEAC should retain

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3425

its current role, whatever that is. The JRP may

recommend that SEAC have an expanded role. The JRP

might recommend that SEAC have a lesser role than

present. Or the JRP may recommend that SEAC may have

no role at all if the JRP identifies an existing

structure or organization which would accommodate the

SEAC functions or if the JRP felt a new entity was the

better way to go forward.

What we want to do, though, is to provide the

Panel with our observations so that, whatever

governance model is recommended, it will create a

functional structure that is agreed upon by the

stakeholders and has the necessary clarity of

responsibility and role to avoid further confusion,

that it be supported by and agreed upon documented

processes and standards and it be properly resourced.

If SEAC is to remain in some role, then it is

our observation that two documents may be necessary.

One document would be a successor to the 1975 and 1977

Memorandums of Agreement in relation to SEAC's role,

geographic area of jurisdiction, reporting structure,

and authority of SEAC. The second document would

encompass standards and processes.

I - Successor to Existing Memorandums of Agreement

Firstly, the successor to existing

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3426

Memorandums of Agreement. It is our observation that

the issue around lack of clarity and lack of agreement

could be resolved through the creation of a successor

document to the Memorandum of Agreement. It is our

observation that the rewrite or modification should

encompass the following items:

- the role of SEAC;

- the geographic area of responsibility

for SEAC;

- the reporting structure or assignment

of responsibility for SEAC;

- and the authority of SEAC.

It is also our observation that a rewrite of

the Memorandums of Agreement with respect to the role

of SEAC should be undertaken by the governments of

Alberta and Canada and should include stakeholders,

including SEAC, and those with relevant expertise.

We also observe that a requirement for the

governments to routinely review the Memorandum of

Agreement for the purpose of applicability might avoid

a situation in which we find ourselves today.

The redrafting of the Memorandum of Agreement

should not dilute the environmental protections that

exist; rather, those protections should be re-affirmed

and even perhaps strengthened.

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3427

We have expanded on some of the points as

follows:

The Role of SEAC: The JRP would likely need

to closely review the role of the range sustainability

section, the existence of other organizations, and

then determine whether or not SEAC is necessary and/or

how to meld existing roles.

Geographic Area of Responsibility: It needs

to be determined if SEAC's role is limited to

clearly-identified geographic areas of Suffield,

including the NWA, or does it apply to all of

Suffield?

Reporting Structure: If SEAC is going to

continue to play a role, it will be necessary to

determine a clearly-identified party or parties who

can address issues such as resources, funding,

choosing successors, et cetera.

Authority of SEAC: If SEAC is to provide

more than advice or recommendations, then it should

have a clear authority and a means of enforcing any

requirements. This, in itself, leads to a need for

more administrative infrastructure and resources for

identifying non-compliances and levying enforcement.

II - Standards and Processes

With respect to the other areas where we

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3428

observed there to be a lack of clarity, once again,

our observation is that the governments of Canada and

Alberta, in consultation with the Base, industry,

Environmental Coalition, and SEAC, should create a

second separate document that provides the following:

- environmental standards and

expectations;

- processes for applications, reclamation

and special requests; and

- appeal processes, if any.

The reason for a separate document is that

these matters would likely change with more frequency

than those contained in the Memorandums of Agreement.

These documents need to be supported by the parties

and reviewed on a routine, periodic basis to ensure

applicability. Any subsequent modifications should be

rewritten in the document and would require the

sign-off by the appropriate parties. The document

should be such that, at any point in time, it can be

relied upon to accurately reflect the agreed-upon

standards and expectations and the processes.

Environmental Standards and Expectations (Regulatory Gap)

There is an immediate need to determine what

standards will apply for development and for

reclamation. We would anticipate some sort of gap

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3429

analysis to determine what legislation and regulation

exists and then, with stakeholders, determine which

will apply and identify environmental issues where

gaps still exist. For these areas, it may be that an

agreement will need to be reached on whether or not to

apply provincial standards to federal lands.

These new standards need to be documented and

housed in a document. Again, any changes need to be

signed off and the document should provide an accurate

reflection of the standards and expectations at any

given time.

Processes for Application/Approval; Reclamation; Requests

for Review; and Appeals.

Development Applications and Reclamation.

The processes for development applications

and for reclamation and for requests for review need

to be agreed upon and documented in one document in

order for SEAC to undertake any meaningful role.

Appeals

If SEAC is to become an integral part of the

approval process, we expect that industry will want an

appeal process especially for those instances where an

application is denied. This need for an appeal

process would also be important if SEAC becomes

involved in compliance matters.

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3430

Again, if a distinct and standard-alone

appeal system is implemented, it will create the need

for administrative infrastructure and resources and

the process will need to be clearly identified and

agreed upon and housed in a document.

III - Resources

We have reviewed the issue of resources from

the perspective of what is required for SEAC currently

and from the perspective of the application by EnCana

and its proposed PDA process. Even if SEAC was to

remain in the same role and function as today, it is

our view that it still requires further resources.

Each of the current members already has a full-time

role within their respective organization.

Additionally, the role of SEAC has changed

over time from the perspective of the number of issues

and from the perspective of the depth and complexity

of both technical and regulatory matters that need to

be considered.

It is our view, that dependent upon the

future role of SEAC, at the very least, each of the

three representatives should be in a full-time

position dedicated to SEAC and would need to be able

to effectively utilize other resources within each of

the respective agencies as required. This is

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3431

something that needs to be approved and supported by

each of the agencies, though, as we do not believe

there is currently the necessary capacity in our

respective agencies and, thus, funding for extra

resources may be required. In other words, we don't

think there's anybody sitting in an empty office

waiting for a job title and a role to play.

As an example of the current need for

resources, we are aware that there is likely to be a

deluge of reclamation applications coming in the very

near future. Even assuming clarity had been achieved

around roles, standards and expectations, and

processes, the current structure of SEAC would quickly

create an unmanageable backlog.

SEAC and its members have been praised and

repeatedly referenced throughout these hearings, which

kind of makes your head swell a little bit. If the

Project is approved, then SEAC will have a very heavy

responsibility placed on it. And if the environment

is negatively impacted as a result of that

development, it is our feeling that, quite suddenly,

SEAC would be seen as the responsible party. In other

words, we would be falling from grace.

The burden of responsibility, accountability

and professionalism necessitates a more robust, more

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3432

professional structure for SEAC if it is to continue

and to enjoy an expanded role.

EnCana has identified the need for additional

resources to carry out that role and function they

propose. We agree that extra resources would be

required but believe there is a need to better

understand some of the details. Given the

uncertainties about the current and future role of

SEAC, this is difficult to do. We do, however,

provide the following for the consideration of the JRP

with respect to resourcing SEAC as proposed by EnCana:

Subject matter experts

EnCana has employed a number of experts on

plants, animals, insects, et cetera, and presumably

each of them has field personnel working for them.

Indeed, the federal panel also consisted of many

experts. And as I look behind me...

If SEAC is to review the applications for

approval, it would need a battery of experts as well.

Under the cross-examination of Mr. Mousseau, we

believe EnCana stated it would be providing not only

the application but the alternatives that were

reviewed by EnCana in arriving at the application.

This will require significant expertise to review the

material in a thorough and independent manner that

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3433

would provide SEAC with the assurance it was making

the right recommendation. The importance of this

review and approval process is paramount. As

Mr. DeSorcy recognized, that we only get one chance to

get this right. It is our belief that the current

SEAC committee has neither the resources nor the

expertise to carry out all aspects of the necessary

review being proposed by EnCana.

The makeup of SEAC

Would SEAC contain representatives from the

public, such as the Environmental Coalition? Would it

contain members from the Base? Would it possibly

contain members from industry?

Appeal process

If SEAC is to become an integral part of the

process, we expect that industry and/or the Base will

want an appeal process. This need for an appeal

process would also be important if SEAC becomes

involved in compliance matters. Again, the need for

administrative infrastructure and resources becomes an

issue.

Costs

Additional resourcing means costs. Where

this financing comes from needs to be determined. If

it is government funded, then the governments need to

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3434

understand and support the SEAC structure, role and

need for resources. It also means that if a test

period is proposed, the purse strings need to be

opened for increased funding if it is proven necessary

during the test period that more resources are

required. Trying to resource SEAC from current

resources within government agencies is not likely a

good way to go forward.

Timing

EnCana has proposed a three-year plan for the

drilling of 1275 wells with a caveat provided by

Mr. Protti that this might be expanded to four or five

years, but no longer, in order to accommodate the

economics. As such, even if SEAC was only to review a

percentage of the applications, this would amount to

approximately 120 applications per year for review.

We arrived at that number by looking at 1275 wells

over three years, dividing that by three, which comes

out to 425 wells per year. Of those, 20 percent would

be non-routine. And 20 percent of 425 is 85. Ten

percent of the balance is 34. 85 plus 34 equals 119.

And with my math, I rounded it up to 120.

EnCana has proposed a one-month turn-around

time for the applications each year, though they would

provide information as it became available. This

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3435

timing in itself would necessitate a greater number of

resources. We heard the Base Commander say all NWA

applications would be considered non-routine. We also

heard the Base Commander say that he has met with the

ERCB Chairman regarding resources. To date, the ERCB

SEAC representative, me, has not been informed by

anyone in the ERCB about more resources being provided

to SEAC.

IV - Environmental Considerations

We want to remind the Panel that, as we

stated, there seems to be common agreement that in

some shape or form SEAC currently provides

environmental oversight at Suffield. On that note, we

have two observations:

Firstly, there has been much discussion on

the regulatory process, but we would like to remind

the JRP that one of the main drivers for this hearing

was the recognition by the former SEAC that

development in the NWA requires consideration of

environmental effects including cumulative effects.

The second observation is in regard to the

concept of a test period for the development process

proposed by EnCana. During the hearing, to this point

in time, the concept of testing the process of

application and approval, and then monitoring the

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3436

effects, has been discussed. We believe a test period

would be an appropriate methodology provided that the

test period began after the necessary roles,

responsibilities, processes, and resulting

infrastructure was agreed to by all the parties and

was in place, including a successor to the 1975

Memorandum of Agreement.

It is also our observation that, as this

would be a test, and if the test were to fail, then it

could have negative impacts to the sensitive

environment of the NWA. Therefore, we would suggest

that the testing of the process for application

approval and resulting monitoring be applied to

development outside the NWA but still on Suffield.

This would have the additional benefit of perhaps

developing a process and system which could be applied

to the whole Base and not just the NWA.

V - Conclusion

Over the course of our tenure on SEAC, and

over the course of the hearing in the past weeks, it

appears evident to us that there is wide disparity of

interpretations of agreements, roles,

responsibilities, standards, and processes amongst all

the parties. The overall effect of this, in our

opinion, is to create an atmosphere of confusion and

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3437

disconnect amongst the parties. Within this

atmosphere of confusion and disconnect, we feel that

the parties often look to SEAC to provide what might

be termed as an arbitration role in regards to

environmental matters. But, again, each party has a

different expectation of SEAC in regards to its role

and how it is exercised.

We understand that ADR amongst the parties

was attempted and failed. From our observations, an

alternative is for the governments of Canada and

Alberta to resolve the lack of clarity and agreement

through creating, firstly, a successor agreement to

clearly define roles, geographical areas of

jurisdiction, reporting structures, and authority for

SEAC; and, secondly, creating a document or documents

to clearly lay out the applicable environmental

standards as well as processes for development,

applications, reclamation, requests for review, and

any necessary appeal processes.

Finally, resources and funding for SEAC in

its current role, in an expanded role, or resources

and funding for an alternative environmental oversight

body can then be determined.

It is our hope that this Panel will recognize

these same issues that we have identified and address

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3438

them by providing the necessary recommendations.

It is also our hope that this will be the

first step towards clarification -- I can't say

"clarification", but you know what I mean -- the first

step toward clarification so that the parties can move

forward with a new sense of consensus and cooperation.

Thank you.

THE CHAIRMAN: Thank you, Mr. Jensen. And,

Mr. Kennedy, for the clarity of your presentation,

we've heard that word quite a bit, on the matter of

clarity of your mandate, I think we will hear quite a

bit more, actually, as we proceed through

cross-examination. But I think, given the -- just

before -- or, Mr. McDougall, I think we just need to

take a minute for the court reporters to do some

technical change and then we'll be right back.

MR. McDOUGALL: Exactly what I was going to

suggest, sir.

(BRIEF TECHNICAL BREAK - 7:33 P.M.)

THE CHAIRMAN: I think we're ready to go

again. Mr. McDougall, first, you wanted to add

something.

MR. McDOUGALL: Not at all. I was going to

suggest the five-minute break that you had suggested

at the beginning.

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3439

THE CHAIRMAN: Okay.

MR. McDOUGALL: So that concludes the direct

examination. And I turn it now over to my friends for

cross-examination.

THE CHAIRMAN: Right, thank you. We will

begin with you, Ms. Klimek, from the Coalition. And

just in order of, of others who may or may not wish to

cross-examine, we would have the Government of Canada,

EnCana, the Secretariat with Mr. Mousseau, and then

ourselves.

So, Ms. Klimek, please proceed.

CROSS-EXAMINATION BY THE COALITION, BY MS. KLIMEK:

MS. KLIMEK: Good evening, Mr. Chairman,

Panel Members. Good evening partial SEAC board.

Thank you for that presentation. I managed to take

about five pages out of my cross, so everybody will be

happy with that. Mr. Jensen, a marathon will be easy

after this day.

Q. Now, I understand from discussing with your counsel

that there is a draft 2008 report; is that correct?

A. MR. KENNEDY: Excuse me, yes, that is

correct. We presented the 2008 report at the Annual

General Meeting. I believe the dates were

September 10th and 11th of this year at Suffield.

Q. And would it be possible to get a copy of that?

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3440

MR. McDOUGALL: Yes, I have spoken to my

friend and we'll undertake to provide that. We

thought we had a copy, but one was not immediately

available, so I believe we will be able to find one

relatively quickly to provide to my friend.

THE CHAIRMAN: Okay, we'll add that as an

exhibit when we receive it.

MS. KLIMEK: Thank you.

Q. Now, I understand from all your discussions that all

decisions have to be unanimous; is that right?

A. MR. JENSEN: Yes, that's correct.

Q. And is there any provision, if you can't agree with --

does, does a recommendation go ahead or does it fall

off the table or is there any discussion about what

happens then?

A. There is a provision, a provision in the Memorandum of

Agreement if SEAC can't reach a unanimous decision.

Q. And it's sort of a pseudo appeal, am I right?

A. MR. KENNEDY: Sorry, if I might just add to

Mister...

A. MR. JENSEN: "Jensen."

A. MR. KENNEDY: Jensen's answer. Jensen's

statement was that, to this point in time, the current

SEAC has never had a situation where we've had a lack

of unanimity.

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3441

A. MR. JENSEN: And we're not aware of any

time in the past that that provision has been enabled.

But, according to the Agreements, what would happen in

the case after a lack of unanimity within SEAC is it

would be referred up to a board consisting,

essentially, of the chair of each of our respective

organizations or the CEO of our organizations.

MR. McDOUGALL: Panel, just for

clarification, that is set forth in Section 12(8) of

the '75 Agreement.


MS. KLIMEK:

Q. I was looking at that section, and I guess it says

what it says, and so I won't ask anything more about

it.

Now, did either of you receive any

explanation about why Alberta didn't participate in

the presentation or the, or the submission?

A. MR. KENNEDY: You know as much as we know.

They, they -- I believe that you had made a request

for Alberta to attend and you were presented with a

letter. And so you have the same understanding that

we do.

Q. So you didn't receive anything more than what I've

got?

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3442

A. No, we did not.

Q. Okay. Now, I'm just trying to understand a little bit

how you mesh your roles. And maybe I'll start with

you, Mr. Kennedy. Working with the ERCB, do you have

much work on the Base in your, your day-to-day job?

A. No, I don't.

Q. So this is truly a side job or, I don't say "a side

job", but it's an extra to what you have; it doesn't

dovetail with anything that you do at the ERCB, then?

A. The way I look at it is that, yes, it is an add-on job

to what I already have as I consider a full role on a

daily basis and, thus, the SEAC work becomes

secondary.

Q. Okay, now, Mr. Jensen, you, on the other hand, spend

quite a bit time at the Base, don't you, in your

other job?

A. MR. JENSEN: Well, these days I feel like

I live at Medicine Hat. With respect to my current

job and with SEAC, I do spend more time at Suffield

than the other two members of the committee, that's

correct.

Q. Now, I'm just trying to understand, when you're at the

Base, is there a clear delineation between what's a

SEAC role or a CWS role or Environment Canada role,

or, when you're out there, you're sort of getting

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3443

information for both jobs?

A. I think the Panel can appreciate the sort of difficult

position I'm in with this role and with the panel.

With respect to my work at Suffield, generally there

is a fairly clear distinction. I go there for SEAC,

specifically for SEAC reconnaissances, or I go there

for Suffield Grazing Advisory Committee, or for other

work with the Wildlife Service.

Q. And I guess if you see a problem or something you

think SEAC should be looking at when you're there in

your other job, do you take it over to SEAC, or how

do you work with that? I'm thinking, just -- but the

reason this comes about, I see there's a lot of, in

your submission, roles where SEAC has been involved

with problems on the site or, or things like that.

And I'm anticipating that you see some of them out

there. Do you take them over to SEAC or?

A. I think that would be a fair assumption.

Q. Okay. Now, I note that you -- maybe just -- before I

go into that, Mr. Kennedy, Mr. Jensen just

acknowledged some of the difficulties wearing two

hats and I'm wondering if this ever occurs in your

line of work that the ERCB ultimately may be the

approving body of these projects and yet you're at

the other end making a recommendation on whether it

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3444

should be approved. Is there any issues working

around working for an organization at both ends of

the approval?

A. MR. KENNEDY: To this point in time, there

has not been any what I'm going to term as a conflict

of interest. I think that's probably what you're

getting at. And to this point in time, when I put on

that SEAC hat, that's a separate entity.

Q. Okay. Now, do you see that raising any red flags if

you're getting 400 applications that are ultimately

going to end up in front of the ERCB down the way?

For not just you, but for anyone from the ERCB.

A. Could you just clarify that question a little bit?

Q. Well, if this Project gets approved, the ultimate

authority who is going to sign off at the end of the

day is the ERCB, right? As I understand the process,

the ERCB ultimately will be deciding whether or not

to give a licence on any particular well. You would

agree with me?

A. Any, any well that needs to be licensed by the ERCB.

Q. Yes.

A. Any well in this province here.

Q. And I, and I -- and this isn't personal to you, so

please don't take it that way.

A. No.

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3445

Q. It's anybody who is from the ERCB that, when these

Non-Routine Applications, whether it's all of them or

20 percent, come in to SEAC, they're going to make a

recommendation to the Commander, they work for the

organization that's going to make the decision at the

other end, so it seems they're at both ends of this

approval. And I'm just wondering if you see that as

being a problem or something that may have to be

dealt with in the future.

A. So far, and in my role I'm not involved with the

approval process at the ERCB end of it. And to this

point in time, there has not been any concern or

conflict that I'm aware of.

Q. Okay, now -- maybe we'll come back to this when we get

a little bit further in.

Now, when -- and I think you'd said you

hadn't received any applications for approval since

you were there since 2007. Am I right on that? Did

I understand that right?

A. MR. JENSEN: That's correct. To this

time, the two current SEAC members here have not

received an Application for Development for review.

Q. Okay. Now, I don't know if you've had an opportunity

to look back, but, or -- and, currently, you've

thought about this a little bit because you talked

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3446

about the future, but maybe -- I'm just wondering

what your thoughts are.

If you -- in the past, did SEAC have the

ability to access resources to look at these

non-routine if they needed a water expert or someone

to assist them in doing that recommendation; did they

have the ability to do that, do you know?

A. It's been -- as far as I know, there is an ability to

access other, other experts. I don't know how often

that's been acted upon. In the past, it appears, from

my understanding, that SEAC has identified as far back

as 15, 20 years ago their lack of resources with

respect to reviewing applications for development.

Q. Okay. Now, I'm going to talk a little bit about your

other role and that's the oversight and the

reconnaissance and the inspections. And I guess when

you come, when you go out to look at wells, and we've

seen some of the issues that you've dealt with in

your submission, are those referred to you or did you

just find them or how do you determine what you're

going to look at?

A. MR. KENNEDY: Prior to the tour, and '07

was probably somewhat of an anomaly in that we were

just new to the process, most of those sites were

chosen either by industry or by the Base. And,

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3447

typically, they are examples of something, you know,

we'll say either, I'm going to say "good" or "bad",

depending on who -- what's wanted to be showcased.

This last annual tour in 2008, we had

developed a better sense for the tour and we provided

recommendations as to what we would like to see on the

tour as well as industry and the Base choosing sites.

A. MR. JENSEN: And Ms. Klimek, I should make

it clear to the Panel, too, of course SEAC's role is

not limited only to EnCana's developments on the Base.

We also review sites from other industrial operators

on the Base. I believe the second largest corporation

on the Base is Harvest Energy. So we do spend time at

a number of different sites.

Q. And I saw that from your submission that you have gone

to other ones and I appreciate that we've got that

clarified.

Now, when you -- I guess, once you see -- you

go out and see these sites, you have some discussions

and do a report yourself on what you think has worked

well or not so well on recommendations; is that a

fair statement?

A. MR. KENNEDY: We look at each specific site

and look at the good or the bad aspects that may be

present at that site. And from that, we make

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3448

observations specific to that site, which may include

a return visit, and we also try to determine whether

or not there's a bigger picture issue that is arising

from those sites and identify that.

Q. Okay. Now, when you're out looking at the sites do

you take -- Mr. Jensen, I know you have some

ecological experience. Do you, Mr. Kennedy, on being

able to look at them and decide whether they're doing

what they should be doing?

A. If you're asking if I'm an expert, I was going to ask

you if there's such a thing as an expert generalist.

Q. So is it your own --

A. No --

Q. I'm sorry.

A. No, sorry, I'm not trying to be smart.

Q. No.

A. No, I, I rely on the expertise of Mr. Olaf and

Mr. Burland.

Q. Okay. Now, just from the sites you've seen in the

last -- you started in 2007, right, so you've had two

-- when you do these reviews in the tours generally,

are they the same time every year or --

A. MR. JENSEN: They're roughly the same time

of year. That being said, the 2007 was an anomaly

with all the pressures coming to bear on the Base with

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3449

workload and such, but generally it's a, it's a summer

tour and a fall meeting.

Q. Okay. Now, this is pertaining to the application

here. Have you seen or looked at any, I guess,

infractions or problems with EnCana's sites in 2007?

MR. McDOUGALL: Sorry, if I could just -- are

you talking about the three wells, is that what you're

talking about?

MS. KLIMEK: No, no, I'm just on -- on the

NWA is what I'm looking at. When they've gone out and

done their tour, have they seen anything there that's

caused them concern with the sites, on their

inspections.

MR. McDOUGALL: Okay. The current, existing.

Do you understand the question?

MS. KLIMEK:

Q. Yeah, the existing ones.

A. MR. JENSEN: I think I understand the

question. As I've mentioned, we have looked at sites

in the National Wildlife Area that are EnCana sites.

I certainly wouldn't say we've been looking at

infractions. We were looking at sites for a number, a

number of different reasons; either ones that have

been requested by EnCana as good examples of

reclamation or ones that have been requested by other

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3450

parties, or by EnCana, as examples of rutting and

trail degradation and the reclamation efforts that

follow.

Q. Okay. And that's what I'm looking at; for rutting and

those types of issues. Have you seen many of those

on the -- or what have you seen?

A. I think it's important to emphasize, too, a point

we've made in both of our annual reports, and that is

with regard to the number of sites we visit. So

putting it in context, there is roughly 1100 sites on

the -- 1100 wells in the National Wildlife Area.

I believe -- in 2007, I believe we didn't

visit any or maybe visited one site in the National

Wildlife Area. Last year we went to maybe a half a

dozen. So regardless of the, those sites we went to

in the National Wildlife Area, I don't think we got

any kind of a representative sample, especially with

reference to discussion the last few days on sample

size and significance. I certainly don't think our

6 out of 1100 give us any indication from our personal

point of view what's, what's going on on the ground.

Q. That's fair enough. And I appreciate that. But maybe

can you give us your observation, what you saw on

those sites that you were out? Were they reclaimed

well? Weren't they? I mean, you're getting some

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3451

from industry so I'm assuming some of those did well

and maybe some not so well?

MR. McDOUGALL: Perhaps I could ask the Panel

whether or not this is the necessary information that

they would need to hear. I mean, my understanding of

what was requested of the two members of SEAC was to

provide general roles or responsibilities of what they

do as opposed to provide specific examples and

particularities about each and every wellsite that

they may or may not have seen. So I'm not necessarily

objecting; I'm just questioning whether or not we need

to go down the road of the particularities of each and

every well site that they may have seen and whether it

was good, bad, or indifferent.

THE CHAIRMAN: Well, thank you,

Mr. McDougall. I wonder also if the sample size of 6

or 7 wells is really going to tell us anything,

Mrs. Klimek, but I'll leave that to you.

MS. KLIMEK: Well, I'm not going to

belabor this long. I'm just trying to get a sense of

what they're looking at out there and what they're

seeing, so.

Q. And I don't need a lot of detail, Mr. Jensen, but.

A. MR. JENSEN: Once we receive a copy of

that 2008 report and you can review the 2007 annual

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3452

report as well, you can quickly get a sense. We've

attached a photograph with every site we visited. I'm

just quickly flipping through our 2008 draft

agreement.

We flew over the National Wildlife Area and

viewed some sites from the area, very briefly. We

landed at a site in the, in the northern portion of

the National Wildlife Area to look at an example of a

shallow gas lease. And we were looking there at above

ground infrastructure in the National Wildlife Area,

some Crested Wheatgrass around the wellhead, and

example of the reclamation of the pipeline meeting to

a wellhead.

And I haven't found the other four sites,

I've referred to, but I don't believe we visited a

whole lot of other sites, except for a flyover, and

that was looking briefly at access trails in and out

of the well sites.

Q. Okay. Now, in your role as SEAC, do you have any role

with follow-up on non-compliance issues or -- what's

your -- do you have any involvement with those?

A. MR. KENNEDY: And this is from an ERCB

perspective is that if we encounter something that is

a non-compliance or if the Base alerts us to something

that they are concerned about, what I do is contact

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3453

the Medicine Hat field centre and have the folks from

there go out and investigate.

Q. Now, does the ERCB take -- do they deal with surface

non-compliance issues on the Base?

A. Could you define "surface non-compliance", please.

Q. Well, if there's a problem with an environmental

infraction. If there was rutting or some

degradation, would that go to the ERCB, on the Base?

A. No, that would not. What I am talking about are ERCB

non-compliances.

Q. Okay.

A. In other words, something that's in contravention of

our requirements, the ERCB requirements.

Q. Okay. Mr. Jensen, from your perspective?

A. MR. JENSEN: I'm sorry, my --you're asking

about my perspective relative to infractions in the

National Wildlife Area?

Q. Well, does SEAC -- what I'm trying to get at, if there

has been some breach of a regulation or a permit or

something like that, and SEAC, you know, it's been

reported to SEAC, you go out and look at it, or you,

for some reason, you see it on your tour, do you do

follow-up with that? What's your role in that after

you identify it?

A. At the present time we have not personally been

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3454

involved in any infractions in the National Wildlife

Area in respect to our role in SEAC. I keep -- I

should say, also, my understanding is that the

monitoring and enforcement, or at least surveillance,

is done by the Base at this point.

Q. Okay. I guess my next question is: Does the Base

draw in your expertise when they have an issue with a

well anywhere I guess in the NWA to provide any

advice or expertise or, on those issues?

A. Not -- I should say, if I understand your question, in

the past it is my understanding that SEAC has been

requested to provide advice where there has been a

perceived, I'll use the word loosely "infraction", or

some contravention of an existing policy or setback.

We have not personally been involved at any issues in

the National Wildlife Area.

Q. Okay.

A. But keeping in mind that SEAC's area of

responsibility, as we outlined in our presentation, is

the restricted development zones which may or may not

contain the National Wildlife Area, as well as some

portion, some other portions of the Base.

Q. Now, in your role as oversight, and as I see, one of

the things is oversight of environmental issue -- I

will slow down. In your role with oversight and

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3455

watching for environmental issues, do you have any

observations that would help the Board as to whether,

from a SEAC perspective, are they being dealt with,

is there some authority, or is there a gap in that

vis-a-vis things that are happening on the Base and,

in particular, the NWA?

A. This is a problem when you confer too long with your

colleague. Could you repeat the question?

Q. Well, what I'm wanting your observations that in

reviewing the inspections and seeing what's happening

out there, and your job being environmental

oversight, from where you sit, are there any gaps in

the in the scheme out there to deal with

non-compliance issues or infractions? From where

you're sitting what does it look like?

A. I think there's two components to the answer. There's

the question of do we have a role to play in

compliance. Am I correct? And secondarily are we out

there looking for issues that relate to compliance?

Q. And I think there's a third. If you are seeing those,

from where you're looking, do you see any gaps on who

is taking care of them in your annual reports and

when you're hearing from the Base or industry?

A. I'll try and answer your question and just steer me in

the right direction if I'm going way off track.

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3456

So I think we've tried to identify in our

presentation, Mr. Chairman, that there is a gap in the

sense that there's only, well, two, sometimes three of

us, that perform this oversight and oversight role,

but this is at this point in time done primarily upon

request. We're not in the field as field surveillance

officers. We visit the Base at the Base's request.

So we're not pretending at all that we're taking --

doing any kind of systematic survey of the Base to

look for possible infractions or to review successive

reclamation by any industrial operator on the Base.

When it comes to compliance, I think we've

been fairly clear that we're not quite sure what

compliance would entail. And I think that's come up

in the minutes, previous SEAC minutes, at least it's

my understanding it has, that when SEAC issues a

direction or a directive, what compliance follows?

So I believe I've answered I think two parts

of your question and I've already forgotten the third

but I'll blame that on the late hour.

Q. My third was, do you have any recommendations or, you

know, any observations on gaps that you would see

from your perspective?

A. And these are gaps with respect to compliance?

Q. Right.

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3457

A. Yes.

Q. Follow-up, I mean, maybe seeing if things are being

done properly and follow-up when they are not being

done properly.

A. MR. KENNEDY: The one gap that we've

identified is that Alberta Environment has

requirements that would apply in the rest of the

province but do not apply on the Base because it's

federal land. And, therefore, our understanding at

this point in time is that Alberta Environment will

not enforce compliance with their requirements. So

that the gap that exists is that there's places where

there isn't federal legislation or requirements to

address certain issues and that's the gap that we've

identified.

A. MR. JENSEN: I should point out that it's

also my understanding that these issues of a gap have

been identified as far -- for over a decade.

Q. My last question is: From your perspective, is there

enough auditing or actual, and, if not you, somebody

else, actually going out there and looking at the

sites to ensure that things are being done as they

should?

A. MR. JENSEN: Perhaps the best way to

answer this is to refer to our 2007 annual report.

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3458

This has been provided as an exhibit. And I believe

it was the appendices attached to our submission,

which is 007-002. And you'll forgive me if I don't

flip that up on the screen immediately, but I can cite

from the agreement here, if you'll just give me a

moment. So we've identified in the two years

that we've been on the committee that there is a

gap -- sorry, does the Panel wish to pull it up before

I cite from it? I don't think you need to, but.

THE CHAIRMAN: Maybe just identify from

where. We have the exhibit, but.

A. Sure. Hold on. It's a sad reflection on the state of

affairs when your computer goes to sleep before you

do. I don't know if you have it available, but here

it is. It's coming up slowly. All right. So I think

I gave you the Exhibit number which, our submission to

the Panel. It's on PDF page 52 out of 77.


A. So what we tried to address in the last couple years

is we -- the Base provides that, or invites SEAC to

participate in this annual field reconnaissance. It

has been our understanding that in the past, this, I

understand, was thought to be some sort of audit or

survey of sites that were problematic. I'll just read

from the Section 1.3 at the bottom of the page. So

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3459

(as read):

"As of 2007, CFB Suffield has had

over 15,000 wells drilled on the

federal land that encompasses the

Base. This includes almost 1200

wells drilled in the National

Wildlife Area. The selection of

serials for the annual

reconnaissance allows the committee

to visit only a tiny proportion of

wells, roads, pipelines and other

infrastructure on the Base. The

annual reconnaissance is a means of

providing the committee with some

operational context as well as some

concrete examples of practices

around which the committee can

frame its discussion. The

reconnaissance is not a replacement

for an auditing and review process

and it should not be considered as

such. The SEAC reconnaissance is

opportunistic, and from an auditing

and evaluation perspective, is

statistically invalid. The sample

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3460

size is simply too small to

adequately evaluate performance and

compliance without, for example, a

supporting independent audit."

And we have encouraged the Base I believe at both

meetings to perhaps contract an independent audit.

And also, we have supported their initiatives with the

range sustainability section to do field surveillance

and some sort of systematic audit.

MS. KLIMEK: Those are all my questions.

Thank you.

THE CHAIRMAN: Thank you, Ms. Klimek for

those questions to help us clarify our understanding

of SEAC's role.

Mr. McDougall.

MR. McDOUGALL: Sir, I can't remember whether

you wanted to take your break at 8:00 or at 9:00.

THE CHAIRMAN: I was thinking, actually,

about in between at 8:30.

MR. McDOUGALL: 8:30, okay, so the next is

Mr. Lambrecht, then, for cross-examination.

THE CHAIRMAN: Yes.

CROSS-EXAMINATION BY THE GOVERNMENT OF CANADA, BY

MR. LAMBRECHT:

MR. LAMBRECHT: Mr. Chairman, I don't think

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3461

I've ever had an experience in my career where a

witness who was sitting on a panel where I represented

that witness then changed hats and was represented by

another counsel and was cross-examined by myself.

I intend to ask questions solely of

Mr. Kennedy because I realize there's a lot of high

voltage here and I don't want to be accused of any

sweetheart deals.

So Mr. Kennedy -- and as I mentioned earlier,

counsel only controls the questions, they don't

control the answers. And I'm not attempting to

control the witnesses in any way; I'm attempting to

insulate the parties whom I represent in a

communication with you because I think you're an

employee of the Board. And I think, for my purposes,

the information, the limited information that I want

to ask of you is adequate if it comes from you.

So I note -- so I would like to start with

that preamble.

MR. McDOUGALL: Yeah, and Panel,

Mr. Lambrecht was kind enough to tell me that he was

going to do that prior to his cross-examination. I

have identified that to Mr. Kennedy. I have no

difficulty with that. I think that that's probably

fair. With the caveat that, to the extent that

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3462

Mr. Kennedy does require some discussion with

Mr. Jensen, that he be at least allowed to have that

discussion. I'm not sure that he's going to need it.

I suspect that my friend's questions are probably

directed more regulatory than not, but I guess I don't

want to foreclose the ability that my colleagues, my

clients have an ability to discuss that should it be

necessary.

THE CHAIRMAN: Understood, I think.

MR. LAMBRECHT:

Q. So the Panel has specifically asked SEAC to attend to

discuss its role in the PDA process. The most recent

demonstration of the PDA process is in Exhibit

002-117 at Appendix J. That's the reply of EnCana

filed on August 13th. And at page J12 of that

document, there's a sentence that I would like to

read to you. Now, if you would like to look at the

document, perhaps Mr. Jensen can assist you.

A. MR. KENNEDY: If you knew how technically

challenged I was, it's a good thing Mr. Jensen sits

beside me. I would like to read it if I could and if

Mister -- if it's allowable --

Q. Right. Let me -- it's a long document. And let me

focus specifically on what I would like to ask you to

read without limiting it in any way what you would

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3463

like to read.

It's on -- there are passages of this, and

I'm going to extend this into the document described

as the EPP, I think, about what's, what EnCana sees

SEAC doing. And so in the PDA process on page J12

there's a reference to this. And it appears in the

paragraph under the bullets.

A. MR. KENNEDY: I think I have it here if you

want to continue. I would just -- I would like to let

you know at the outset I have not reviewed this PDA

process, but by all means, go ahead.

Q. All right. If I understand the PDA process as it is

proposed, and I appreciate that it's an evolving

process, so my description of it may not be perfectly

clear either in the way it currently is or the way it

will unfold, but my understanding is that the PDA

process is intended to assist in the location of

wells and trails in order to minimize or avoid

environmental impact and disturbance. But there are

a number of exceptions, wherever possible, wherever

feasible, wherever practical in exceptional

circumstances. And in those, in those situations,

there is a proposal to, in other words -- and it's

described here. If, if, if there's going to be a

desire to maximize recovery of the gas by placement

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3464

of a well within an area that might be considered

environmentally sensitive, the proposal is that

EnCana will evaluate the completion of that after the

completion of all wildlife surveys and alternate

locations and, ultimately, the decision to proceed to

SEAC with an application for infrastructure within

setbacks will be made after constructibility

assessments.

So if I understand this, in the broadest

terms, if, if EnCana feels that it's necessary to,

say, put a well within a setback from a Wetland, they

would proceed to SEAC. Now, with that general

understanding, my question to you is, has EnCana ever

discussed this proposed role with, with you?

A. We would observe that SEAC was not consulted during

the creation or development of EnCana's currently

proposed PDA process. However, EnCana did meet with

us in September 2008 to ask our view of the proposed

PDA process, but the third member of SEAC was not

present. We had not made ourselves familiar with the

proposed PDA process because this is something the

Panel will be considering and we declined feedback

except to express concerns about the resourcing for

SEAC.

Q. All right. That's helpful. May I ask you to have a

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3465

look at the other documents, then? This is the

document described as the Environmental Protection

Plan. And I'm sorry, I don't happen to have the

exhibit number of that handy. The copy that I have

is the draft dated January 2008, 002-077. And I hope

this is the correct -- the most current draft. It

is, thank you.

A. I'm still waiting for his computer which is evidently

still sleepy. Could you repeat the page,

Mr. Lambrecht, please?

Q. Well, let's start with the title page. My question

is: Has EnCana ever discussed this document with

you? You had mentioned that EnCana met with you

about a month ago to discuss their PDA process, but

my question, then, is and -- is that this is a sort

of a separate concept, this Environmental Protection

Plan. Was this ever discussed with you?

A. I do not believe it was.

Q. All right. Can we turn to, say -- and I'm going to

sample some pages here because it can speak for

itself. Page 2-4, Paragraph 14, under the heading

"Non-routine Siting Process". There's a phrase

there, at the second last sentence of that paragraph

"To be approved by SEAC". Do you see that?

A. I see it, but I haven't quite read it yet.

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3466

Q. Okay, no, take your time.

A. I've scanned over that paragraph.

Q. All right. This is one of the exceptional

circumstances mentioned and this is a sort of

assisting about rare plant species. And as I

understand it, the proposal is that, where they

cannot be avoided, EnCana would propose an alternate

site and route adjustment, together with mitigation

measures, and then the phrase is "to be approved by

SEAC".

Now, I already know this wasn't discussed

with you, so what I want to begin to try to explore

with you is your understanding of the different

perceptions of the role of SEAC by EnCana and the

government. The phrase here is "to be approved by

SEAC" which, in my mind, anticipates an approval

authority. You've been in the middle of what you've

described to the Panel as "the parties". Can you

describe what you understand to be EnCana's

perception of SEAC's role? Is it an approving

authority of some kind?

MR. McDOUGALL: I'm not really sure that it's

fair to this witness to ask him what he envisions the

proposal, EnCana's proposal is, especially after

having not read the document and only being advised of

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3467

what the PDA process is in September of 2008. So

while I appreciate -- and I don't want to restrict my

friend from asking certain questions, I think that

particular question is beyond the scope of this

witness.

THE CHAIRMAN: Mr. Lambrecht, I think you

agree by a nodding of your head.

MR. LAMBRECHT: Yes, I think -- I do --

placing the document in front of the witness invited

the perception that this was inviting the witness to

interpret what was intended in that document. And I

think what I'm trying to explore here is something

quite different; is this witness's perception of the

differences between the parties in the role of SEAC.

So perhaps I can approach it in a different way.

THE CHAIRMAN: Perhaps you can get to the

question you want to ask.

MR. LAMBRECHT: Yes, sir. I think that would

be a good idea.

Q. In the regulations that are attached to the 1975

Memorandum of Understanding, the Surface Rights

Access Agreement, Section 8 talks about applications

that will be referred to SEAC. And there are a

number of criteria there. Within -- setbacks from

wetlands is, is one of them. Could you have a look

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3468

at that?

A. MR. KENNEDY: Sorry, Mr. Lambrecht, could

you please repeat that section number again?

Q. Right. If you read Section 7, Subsection (2) of the

Regulations, it provides that:

"Within any area prescribed in

Section 8, the development and

reclamation application shall be

referred to the committee for

consideration by the committee."

And my understanding is that this is a reference

to SEAC.

Now the applications that are defined in

Section 8 are those within 300 feet of the high

watermark of a waterbody on a river floodplain within

a restricted development zone or within 300 feet of

the upper break of a coulee ravine or valley.

A. I'm reading that. Was that a question? I'm sorry,

I'm not trying to be smart when I say that, but.

Q. No, well, page 76 of 77 of your report expresses a

SEAC concern about the number of wells in wetlands,

at the bottom.

A. Sorry, could you please give us the page number again?

Q. Page 76 of 77.

A. And you're referring to the 2007 annual report,

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3469

Mr. Lambrecht?

Q. Yes, sir.

A. And could you read to me, please, the line that

you're, or the portion that you're referring to?

Q. Yes, sir. On my copy it's in red and it says:

"Overall, SEAC is concerned about

the number of old wells and

pipelines in wetlands as they

create a potential environmental

liability here as well as a

potential financial liability for

industry."

Do you see that?

A. Yes, I do.

Q. Now, my understanding of the scheme of the Surface

Access Agreement, whether it be the oil one or the

gas one, is the same; that wells that are in wetlands

are to go to SEAC. Now, SEAC is expressing concern

about the number of wells in wetland. Am I to

understand that these wells are getting placed in

wetlands without being referred to SEAC?

A. The wells that, and pipelines, that we referred to in

this report are pre-existing wells and pipelines, not

new ones.

Q. Right, so you're saying you have no knowledge of the

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3470

process that SEAC may have -- whether or not SEAC may

have had these referred to them?

A. That is correct.

Q. Okay. Were you involved in the Nishimoto well

situation, the more current one? A well in the

Nishimoto flats in 2004, a gas well in a wetland.

A. I don't believe I was.

Q. Were you involved in the oil well in a wetland at

Queenston in 2005?

MR. McDOUGALL: Again, Panel, I'll make the

same comment that I made with respect to Ms. Klimek;

and that is, is it my understanding of the information

that was to be provided to the Panel was more general

in nature and scope and it was not to be these

witnesses' responsibility to review and be cognizant

of all of the particular incidences that occurred on

the Base or, or elsewhere, especially when it's prior

to their tenure on SEAC, so I object to this line of

questioning.

THE CHAIRMAN: Thank you, Mr. McDougall.

Mr. Lambrecht? I think it's been very clear --

MR. LAMBRECHT: I don't want to override my

friend's objection, sir.

THE CHAIRMAN: -- that they are relatively

new to SEAC.

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3471

MR. LAMBRECHT: Yes.

THE CHAIRMAN: So I think that has an effect

on that line of questioning.

MR. LAMBRECHT: Absolutely.

Q. There was some reference to a well in a wetland called

Big Bob. I'm not sure the time of that. If I might

push my luck, just one more question on this, do you

have any knowledge of that one, sir?

MR. McDOUGALL: I renew my objections, sir.

MR. LAMBRECHT: Okay.

THE CHAIRMAN: My understanding it's been

there for some time, Mr. Lambrecht, so I guess the

same, the same problem arises for these gentlemen that

have recently been appointed.

MR. LAMBRECHT: All right. Not at all.

THE CHAIRMAN: I'm not sure "appointed" is

the right word, but have recently become members of

SEAC.

MR. LAMBRECHT: Sure.

Q. The Panel also asked SEAC to give information about

its role in reclamation and closure. Now, you've

spoken about the regulatory gap. And this is

described in two letters from the department of

Alberta -- from Alberta. The first one is

Exhibit 001-051 at Paragraph Number 2.

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3472

A. MR. KENNEDY: Is that the letter to Alberta

Sustainable Resources from the -- oh, the letter from

Alberta Justice back to --

Q. Yes, sir.

A. -- the Panel and the Coalition?

Q. Yes, sir. And you touched upon this in your evidence

that Paragraph 2 of the letter indicates that the

provisions of EPEA, the Environmental Protection and

Enhancement Act concerning conservation and

reclamation do not apply to federal lands.

A. I see that is written there, yes.

Q. Right. In -- I appreciate you may not have had

experience with this through SEAC, but in your role

with the ERCB, do you know what is meant by the

conservation provisions here in a general way?

A. I'm sorry, I do not.

Q. All right. I think you said it, but I would like to

be clear. There is an application before this Panel

for three well licences. My understanding of your

evidence is that this has not been referred to SEAC.

Is that correct?

A. That's correct.

THE CHAIRMAN: Mr. Lambrecht, just checking

the time. If you are close to completion of your

questions, we can continue on, but if you have a few

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3473

more, then perhaps it might be a good time to take a

15-minute break.

MR. LAMBRECHT: I think I'm done. What I

suggest is we take the break. If there's anything

arising afterwards, it will be very brief.

THE CHAIRMAN: Okay. Thank you,

Mr. Lambrecht for your contribution.

MR. LAMBRECHT: Thank you, sir.

THE CHAIRMAN: We will meet -- or for your

questions. We will meet again in 15 minutes at

quarter to 9:00.

(SHORT BREAK)

(PROCEEDINGS ADJOURNED AT 8:30 P.M.)

(PROCEEDINGS RECONVENED AT 8:44 P.M.)

THE CHAIRMAN: I believe we're ready to go

again. Mr. Lambrecht, did you complete your

examination or did you have further question?

MR. LAMBRECHT: I have completed my

examination, Mr. Chairman.

THE CHAIRMAN: Thank you, sir.

Then next, Mr. Denstedt, please.

MR. DENSTEDT: Thank you, Mr. Chairman. I

spoke to my friend about this and I just wanted to

confirm with the Panel that EnCana had made a number

of attempts to consult with SEAC, but as a concern in

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3474

relation to their status as regulators, prevented that

from occurring until sometime in I think it was August

and September. And I think my friend would agree with

that.

MR. McDOUGALL: I do. I don't -- my clients

and I have discussed when the first, first time that

EnCana requested that of us. And it may have been as

early as July or August. I'm not exactly sure. But I

was away on vacation for all of August. When I came

back, there was the meeting that Mr. Kennedy

identified in September.


CROSS-EXAMINATION BY ENCANA, BY MR. DENSTEDT:

MR. DENSTEDT:

Q. So, Mr. Kennedy and Mr. Jensen, when you came on to

SEAC in 2007 what did you do to inform yourself about

your obligations as a member of SEAC? You can take

turns.

A. MR. JENSEN: I suppose by now it's evident

to the Panel the volume of material associated with

SEAC in its 30-some year history. During the two

years or two-and-a-half years I've been involved with

SEAC, I endeavored to read the Memorandums of

Agreement, reviewed some of the minutes, the annual

reports, speak with some of the past SEAC members, and

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3475

try and familiar myself, familiarize myself with the

files associated with SEAC.

Q. Mr. Kennedy, did you do the same thing?

A. MR. KENNEDY: No.

Q. What did you do, sir?

A. I relied upon the information that was provided to me

by my predecessor, Ron Paulson, and his descriptions

of the activities and to some extent I undertook to

try and review the Memorandums of Agreement and

various documents, but I wouldn't say it was an

in-depth study by any means.

Q. And did Mr. Paulson give you a rundown of how the

contract worked? I'm speaking specifically about the

gas contract. I don't need to know about the oil

contract here tonight.

A. Just in very general terms. And it was, as it was

described to me, was that essentially SEAC was in an

advisory capacity to the Base Commander.

Q. And in your role as -- on SEAC -- I'll start with you,

Mr. Kennedy. If there's an issue arises at the Base,

sir, are you free to call an expert back here at the

ERCB and say, "Hey, Bob, this problem comes up. I

know you're an expert in this area. Can you give me

a hand on that?" Do you do that or can you do that?

A. I haven't done it. I have contemplated doing it.

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3476

And, in fact, in an effort to try and obtain some

assistance from a resourcing point of view, I

contacted the environment group and our operations

branch and contacted the manager. And I don't know

the exact timing, probably about a year ago. And at

that time the proceedings of this hearing were already

being started to put -- I'll back up and try that

again. The proceedings for this hearing were being

put together and that meant that the people in that

group were unavailable for me to deal with. And I

hope that made sense.

Q. Right, yeah, and that's because of their role in this

process?

A. Exactly. Thank you.

Q. Sure. And, Mr. Jensen, if you have an issue that --

A. Sorry.

Q. Sorry.

A. What I might add is that for the last two years I have

also involved the -- he was the assistant team leader,

he is now the team leader from the Medicine Hat field

centre, Mr. Bruce Haskayne, and he has accompanied us

on the field tours and at the Annual General Meeting.

Q. And did anybody at the ERCB ever attempt to constrain

your access to any of those resources?

A. No.

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3477

Q. And, Mr. Jensen, similarly with you, if there was an

issue came up, for example, if there was a

groundwater issue come up, were you free to pick up

the phone and call Dr. Nastev if you wanted to?

A. MR. JENSEN: Yes.

Q. And is it fair to say that SEAC is a creature of the

contract; it was created by the contract?

MR. McDOUGALL: I would ask my friend to

perhaps not use the word "contract". I think that has

a particular legal meaning. I think he is referring

to the '75 MOU -- or MOAs, Memorandums of Agreement.

I think whether or not it is in fact a contract is a

matter for argument at the end of the day, and so if

you could couch the agreement that he is referring to

as it is actually headed, I think that would be my

preference.

THE CHAIRMAN: Thank you, Mr. McDougall.

Mr. Denstedt, I'm sure you will use the title

of the document.

MR. DENSTEDT: I will respect my friend's

sensitivities.

Q. Mr. Kennedy and Mr. Jensen, I think it's fair to say

that SEAC's created by the Memorandum of Agreement?

A. Yes. We identified that in our Opening Statement as

well.

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3478

Q. And I guess I have a curiosity question, then. When

-- Mr. Kennedy, you said in the opening presentation

that you weren't sure who to call for resources. It

looks like you should have called Her Majesty the

Queen in Right of Canada represented by the Minister

of National Defence and Her Majesty the Queen in

Right of Alberta represented by the Ministry of

Energy and Natural Resources. You had two people you

could have called.

A. MR. KENNEDY: That may be your

interpretation. I have doubts as to whether I would

have got very far.

Q. But when you said you didn't know who to call if you

were looking for resources, wouldn't that have been

one venue; call up your bosses and say, "Hey, we need

help here"?

A. Again, who would you identify as my boss?

Q. As the appointee of Alberta, Minister of Energy

Natural Resources, wouldn't you start with your

leadership at the board?

A. I think, as we presented in our statement, that that's

what we're uncertain about ourselves, is who is our

boss or do we have one?

Q. Okay. And if you can turn -- if have the Surface

Access Agreement in front of you, Mr. Kennedy, I

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3479

think -- I'm asking you this question because you're

the one who made the statement in the Opening

presentation, so I'll ask this of you.

I think you indicated that it's your

understanding of this agreement that you provided --

SEAC provides advice to the Base Commander and he can

take or reject that advice. And I guess I'm just --

I just wanted to get you -- I wanted to understand

how you arrive at that conclusion when I look at the

words in Section 12(7) on page 19 and 20 which read

that:

"Notwithstanding any provisions of

the Suffield Oil and Gas

Environmental Protection

Regulations, the Base Commander

may, in any particular case, for

the purposes of Appendix 2 and the

application of Appendix 3, but only

upon the recommendation of the

committee, give or refuse to give

such consent or approval for the

performance or doing of such act or

thing as the committee in

particular case may recommend."

And I read that as saying the Base Commander can

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3480

give or refuse such consent or approval as the

committee recommends. And I guess I'm curious as to

your interpretation.

A. MR. KENNEDY: Well, that's certainly one

interpretation and I can appreciate that. However, we

don't feel that it's the same interpretation for us.

And as I've stated, the customary approach that was

provided to us was that we provided advice to the Base

Commander and that's what we've adhered to.

Q. And is that understanding based on the e-mail you

received on November of 2002 from Mr. Martins, the

G3, or Major Martins?

A. Did you say in 2002?

Q. 2002. It's referenced in your evidence, Mr. Kennedy.

A. That, that was something that we relied upon, but as I

said, I think I relied -- for myself I'm speaking -- I

relied more upon the advice of my former or former

SEAC member from the ERCB, which was Ron Paulson.

Q. Okay. And Mr. Kennedy and Mr. Jensen, both this time,

when I go through the minutes, and I went through all

of the minutes since 1975, it seems to me when I read

those minutes that things worked pretty well for

25 years. And do you have any thoughts of what

happened?

MR. McDOUGALL: Could we be a bit more

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3481

specific about the time frame about "what happened"?

MR. DENSTEDT:

Q. Well, 1975 to the year 2000 seemed, according to the

minutes, things seemed to be working pretty well.

And it's the, the, the difficulties between industry

and the Base seemed to be of more recent vintage.

And I wonder if you had any thoughts on why that had,

why that has occurred?

A. I haven't personally read the minutes for the past

25 years, so I can't comment on the relationship that

existed then. If you're asking about the present

relationship, I think that we've identified in our

2007, and I believe again in the 2008 report,

communication issues.

Q. Sure. Mr. Jensen, anything to add to that?

A. MR. JENSEN: With respect to the minutes,

I have reviewed the minutes in limited detail. My

sense is, this is my opinion based on having reviewed

the minutes and my limited experience with SEAC, is

that from 1975 to present, there has been an increase

in the number of wells and the complexity of issues at

the Base. And I think, in my opinion, for quite a

long time, things worked reasonably well because there

weren't too many issues to deal with, things could be

dealt with in a relatively small forum.

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3482

As we mentioned in our Opening Statement,

there's an increase in complexity, increase in demand

for professionalism, an increasing number of standards

with respect to reclamation. And, again, as we

mentioned in our Opening Statement, I think it's, it's

the lack of clarity and the compounding complexity of

issues at the Base that have, over time, developed the

current, the current situation or the relationship

between, between some of the parties.

Q. And in respect of the Surface Access Agreement, is it

your view that there needs to be some -- I think it's

your view -- that what you're saying is, provide some

clarity on SEAC's role and authority and enforcement,

those types of things, but you're not saying throw

out the entire agreement; your concern is with SEAC

in particular, isn't it?

A. That's a fair statement, yes. That was our position.

We were asked to speak about the role of SEAC. And

it's in that regards that we're looking for that

clarity in those agreements. Keeping in mind, of

course, that SEAC's role applies, applies to

Applications for Development, Development and

Reclamation Applications, and so the role of SEAC is

fairly broad within those agreements.

Q. And it's fair to say that the Surface Access Agreement

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3483

tries to deal with the shared jurisdiction between

the mineral rights holder and the surface holder; is

that fair?

A. That seems like a reasonable interpretation.

Q. And is it also fair to say that when you look at the

composition of SEAC with a member from Alberta Energy

and a member from Alberta Environment and a member

from the Canadian Wildlife Service that the

composition of SEAC attempts to reflect that shared

jurisdiction?

A. MR. KENNEDY: That would be an

interpretation. However, as we identified, there are

issues, I guess, with the Alberta Environment and the

applicability of that legislation and those

requirements to the federal land.

Q. But certainly in the agreement which was entered into

between the Province of Alberta and the Government of

Canada and approved by Order in Council and approved

by the Privy Council, the very highest levels of the

government, it appears it was their intention to

somehow address this jurisdictional issue in the

contract, or the Agreement?

A. It would seem a reasonable interpretation of that,

yes. As to whether or not that's working today, that

might be a different matter.

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3484

Q. You bet. Separate question, right?

A. MR. JENSEN: And keeping in mind that

there is a clause in the agreement that references it

has a 20-year expiry date.

Q. And renewable annually after that, right? And which

party can terminate it?

A. You've likely got the reference handy. I would just

have to double check.

Q. I can tell you it's Alberta that can terminate it, not

Canada.

MR. McDOUGALL: Again, I'm going to suggest

that that's a matter for final argument as opposed to

having this witness try to determine what the proper

termination clause of the Memorandum of Agreement is.

THE CHAIRMAN: I'm not sure there was a

question there anyway.

MR. DENSTEDT: There wasn't a question. My

friend weighed in with a term, with a term of the

agreement and I thought it might be helpful to direct

him to the actual clause.

Q. So I think you would agree, and maybe you won't, but

you can certainly understand if you don't agree why

EnCana would be so concerned about the Range

Sustainability group being put in charge at the Base

when they don't have the independence or they don't

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3485

have the -- reflect that shared jurisdiction

composition that currently is in SEAC?

MR. McDOUGALL: I don't think that's a fair

question to ask these witnesses. What EnCana thinks

about is something else that is within the power and

ambit of EnCana to provide, not, not these particular

witnesses.

MR. DENSTEDT: Okay.

Q. So Mr. Kennedy and Mr. Jensen, you suggested in your

opening presentation that the Range Sustainability

Unit might be an option. Does that reflect the

shared jurisdiction composition that SEAC currently

reflects?

A. MR. JENSEN: The Range Sustainability

section, in my understanding, yeah, of course is a

creature of the Base, it's an organization that exists

on the Base and reports to the Base Commander.

Q. All right. And you agree with that, Mr. Kennedy?

A. MR. KENNEDY: Yes. Just to clarify, I'm

agreeing, yes, with what Mr. Jensen said.

Q. Sure. And I think both of you talked about

independence and thoroughness and expertise. Is that

what you would suggest is a hallmark of the, whatever

organization supervised the -- supervises or oversees

the environmental obligations on the Base?

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3486

A. Sorry, maybe it's getting late. Can I get you to

repeat that, please, Mr. Denstedt?

Q. Sure. During the course of the opening presentation,

and then some of Mr. Jensen's comments to, I believe

it was Ms. Klimek, the words that struck me that I

heard a number of times were "independence",

"expertise", and "thoroughness" in respect of

whatever group might be overseeing the environmental

obligations on the Base. And I take it that one of

your recommendations -- or that you'd recommend that

this Panel make sure those three things are in place

on whoever is in charge of the environmental

obligations on the Base?

A. MR. JENSEN: Yes.

Q. And I think, Mr. Kennedy, you mentioned the, the

potential for both appeal and enforcement powers. Is

that another hallmark of whatever organization might

be charged with overseeing these environmental

obligations?

A. MR. KENNEDY: Those, those matters, or

those -- sorry, I'm a little loss for words here.

Anyway, the enforcement and, and the appeal process is

-- you said "appeals", right?

Q. Right.

A. Yeah, are not something that currently exist. And all

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3487

we're suggesting is that that might be something the

Panel may want to consider. I don't know if it's

necessary or not. If, if the overseeing governing

body will say for environmental concerns is in an

advisory capacity, it's likely not a necessity.

Q. And based on your experience with the, the ERCB,

Mr. Kennedy, it's fair to say that mineral rights

owners and surface owners sometimes get in disputes?

A. I think that would be fair to say.

Q. And what's needed to resolve those disputes sometimes

is an independent arbiter. Is that fair, too?

A. We have various means of resolving those disputes.

One is to get the parties together. And sometimes

that's as formal as an ADR session. Certainly

arbitration is one, one avenue that could be pursued.

We have the hearing process as well.

Q. All right. And, again, I think, I think it's fair to

say that sometimes reasonable people can and do

disagree and they need someone with a little more

wisdom and independence to settle their dispute. Is

that fair?

A. I think that's why the various processes exist is

that, yes, there's a hope that the parties can get

together and come to a solution or resolution on their

own, and that's the preferred way, but sometimes it

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3488

takes somebody else to help that occur.

MR. DENSTEDT: Great. Thanks, panel.

That's all I had, Mr. Chairman.

THE CHAIRMAN: Thank you, Mr. Denstedt, for

those questions. Mr. Mousseau?

CROSS-EXAMINATION BY THE PANEL SECRETARIAT, BY

MR. MOUSSEAU:

MR. MOUSSEAU: Thank you, Panel. I think

I'll be brief.

Q. Mr. Kennedy, I actually want to start with your

resume, sir. Or your CV. And the reason why is,

when you were answering questions for, for

Ms. Klimek, you sort of suggested you were a

generalist and didn't have any expertise. I'm

wondering if you can comment on what role generally

the ERCB representative plays on SEAC; what, what do

they bring to the table?

A. MR. KENNEDY: Typically, sorry is the mic

working? Typically it's the ERCB regulatory

background and that review of the operations, the oil

and gas operations.

Q. And that -- would that include knowledge about well

and pipeline inspections, how those are conducted and

what's looked for?

A. To some degree, yes. That, that is part of the reason

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3489

that I include Bruce Haskayne from the Medicine Hat

field centre on those tours is to help with the

technical side.

Q. Okay, sir, thank you. And you also had a discussion

about what the ERCB does with respect to inspections

on the Base and I think Ms. Klimek asked you, would

the ERCB enforce matters such as rutting and your

answer was "no." But if the ERCB intended on a well

site lease and there was drilling mud or other such

things on the ground, would the ERCB take any steps

in that respect?

A. Depending upon the situation, they would probably

contact the company and ask the company to clean up

the site. And depending on whether or not there was

contamination, they may contact Alberta Environment.

And, of course, that's -- I'm talking about off the

Suffield Base.

Q. Okay, sir. Under the Agreements, one of SEAC's

obligations is to cause inspections to be made to

ensure adherence to the Suffield regulations. We

talked to some degree on that. My understanding is,

currently, the SEAC practice is to do an annual

reconnaissance. My question is simply this: Do you

think the scope of inspection currently performed by

SEAC is that which was contemplated in the original

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3490

agreement?

A. It's difficult for me to answer that because I really

don't know what was anticipated in an agreement that's

30 years old. Having said that, we've had the same

questions ourselves when it says "causes inspections

to be made". What does that mean?

Q. And I take it this may be one of the areas where

you're looking for some additional direction, or that

would be useful to SEAC at this point, additional

direction regarding the scope on quantity of

inspections it would be required to carry out to meet

its obligations under the Agreement?

A. MR. JENSEN: My understanding is, is that,

to answer your first question, is that the annual

reconnaissance does meet the requirements of the

"causing inspections to be made". At least that's the

customary practice of SEAC over the last 30-some

years. But you have to put that, I think, in context

of the scale and extent of development today. And

although that, that annual reconnaissance is customary

practice and might fit with the provisions of the Mast

-- the Memorandum of Agreement, I don't think it

matches necessarily with what is required today.

That, I think, reflects the concerns we've expressed

in the annual reports and in our submission this

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3491

evening.

A. MR. KENNEDY: I think what I might add is

that that might be another example of the lack of

clarity that exists in those memorandums. There isn't

that sufficient detail or sufficient description to,

to envision just what that meant.

Q. Okay. I'm going to refer you now to Section 5(2)(a)

of the Regulation. And this is the part of the

Regulation that essentially says, as I read it, that

SEAC is in control of developing and updating the

development and reclamation approval forms; in other

words, SEAC is the keeper and the decider of what

information is required to be filed with a

development and reclamation approval. I'll give you

a second to read that section.

A. Can you just repeat that observation again, please?

Q. Sure. Why don't I read subsection (a) and then ask my

question. So it says:

"A Development and Reclamation

Application shall:

- be in the form in the

schedule or such other form as the

committee may from time to time

prescribe and shall include such

additional information as the

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3492

committee may from time to time

prescribe."

And when I read that section, I understood it to

mean that SEAC has the authority under this section to

determine what information industry needs to include

in its D and R approvals. And I'm wondering if

that's, that's SEAC's understanding as well.

A. That certainly could be an interpretation. We don't

believe that's the reality of the way it's working

right now. The Base is the one that is setting the

requirements for what is in the, in the applications.

There may be some historic requirements based on SEAC

that are still part of that.

As we say though, today, the reality is, is

that the Base is the one dealing with those

applications and we ourselves have never been involved

with one.

Q. I have two questions to follow that up, sir. And the

first one --

A. Sorry, and I don't mean to cut you off. The only

thing that -- I have cut you off. The only other

thing I would like to add is that that's the question

of authority of SEAC, in that if SEAC was to try to

implement or, or exert some authority, we have a

question as to where that would go and how we would

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3493

ensure that authority was adhered to.

A. MR. JENSEN: And I think what my colleague

is referring to, if we were to draft a new application

or development and reclamation form, would it be

accepted by the parties? What would be the mechanism

for prescribing that form?

The Base has clearly developed their

Application for Development process. That is the form

for -- that is the form that exists right now. And

it's been led by the Base. Those may or may not be

reviewed by SEAC, depending on what the Base

Commander, depending on what the Base Commander needs.

Q. Okay. And I guess my two questions still remain. And

I have a number of other ones coming out of that, but

I don't think we need to get there. I guess the

first question is, is if you were to exercise this

authority, do you think SEAC, as currently

configured, has the resources to develop a

comprehensive and appropriate application process?

A. MR. KENNEDY: No. I suppose you would like

more explanation, wouldn't you?

Q. I know it's late, sir, but I think it -- to do justice

of what this Panel has to do, I think we need it.

A. No, I -- as we presented, resourcing is an, is an

issue. It's an issue right now. And to increase the

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3494

scope of work and role of SEAC would require

considerable resources. And, again, it's difficult to

say what those resources would be until you come up

with the details around what that -- what it's going

to look like, what it's going to involve, the timing.

I hate to be as vague as that but that's the reality

of them.

Q. And just so I understand that, the latest version of

the Base's approval process, I think what I've heard

in the evidence was that was developed through the

ADR process? Is that your understanding?

A. MR. JENSEN: My understanding is the ADR

process was never completed, but the Application for

Development form, to try and avoid a couple of

acronyms, it came out of that process in terms of it

had been discussed during the ADR and the Base came to

a final form that they could work with.

Q. And was SEAC involved in those discussions and in the

development of that form?

A. MR. KENNEDY: It's my understanding that my

predecessor was involved with that. I'm not sure

about other members of SEAC.

Q. Okay.

A. And I'm not sure -- I don't know specifically about

the form. I know that he was involved with the ADR.

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3495

Q. Okay. I just have one question left and it's for you,

Mr. Jensen. And I know that you're also a member of

SGAC, which is a horrible name, but what I really

want to know is, is that committee working any better

and is there anything that works there that can be

applied to SEAC to address some of the concerns

you've addressed, you've brought up?

A. MR. JENSEN: It is a horrible name, I

agree with you. It's an entirely different sort of

committee. It wasn't established under the terms of

necessarily the same kind of agreement as the 1975 Gas

Agreement. It's meant to provide technical advice to

the Base Commander to, to the Base with respect to

grazing activities. And the primary role of SGAC is

to, is to set the annual grazing limits for lands on

the Base that are grazed from cattle by the Prairie

Farm Rehabilitation Administration.

COURT REPORTER: Can you repeat that, please.

A. Prairie Farm Rehabilitation Administration, PFRA. Is

there anything that you can take from that

organization and apply to SEAC? They, they operate

within an entirely different context and entirely

different scales. I really don't think there's much

that's applicable from SGAC to SEAC.

I believe that's the short answer. It is a

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3496

functional organization, it provides technical advice,

but just there, there's so much more at stake I

believe and so much more operational complexity with

the gas operations at the Base that it's -- what

happens with Grazing Advisory Committee I just don't

think is applicable necessarily to SEAC.

MR. MOUSSEAU: Thank you, Mr. Chairman.

Those are my questions.

THE CHAIRMAN: Thank you, Mr. Mousseau, for

those questions. I'll turn to my Panel colleagues to

see if they have any. Okay. Dr. Ross?

QUESTIONS BY THE JOINT REVIEW PANEL, BY DR. ROSS:

DR. ROSS: Thank you, Mr. Chairman.

Q. First a comment. I would like to thank the two of you

for a thoughtful submission and presentation.

Second, a few questions. I'm not sure if I heard you

correctly, but early in your presentation I think you

indicated that in your tenure you had been asked for

advice by the Base Commander three times, or did I

misunderstand?

A. MR. JENSEN: I've learned in the past two

weeks not to use the word "subject to check", because

it results in homework. It is referenced in the

agreements and it's approximately three, four times,

yes.

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3497

Q. What was the subject? What were you asked to offer

advice on? That's what I was really heading towards.

A. MR. KENNEDY: One was a well on a wetland.

You can see you're taxing our memory and we apologize

for not being more on the ball. One was --

A. MR. JENSEN: The two that come first to

mind are a well in the wetland that we were asked to

look at. And also we were provided with the results

of an inspection program in Koomati, which was

following an, as you know, an infill development

program in Koomati. I believe there was, well, at

least two others, but they're not coming to, to mind

right away.

Q. That's close enough for my tastes. Thank you. Your

third member, I wonder if he has been participating

in other components. For example, did -- was he a

part of writing your last two annual reports and

going on the reconnaissance visits?

A. Yes.

Q. Okay, thank you. You indicated that there may be a

number of Reclamation Certificate applications coming

in sometime soon. If they came in tomorrow, what

would you do?

A. MR. KENNEDY: We anticipated that question.

And we're not certain, to be very honest with you. We

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3498

would have to go back and talk to our third SEAC

member. We're actually anticipating that there might

be one within the next few days. We got a heads-up

from SIRC about that. And we've explained to SIRC

that let the company know that there's probably not

going to be anything happening too quickly on that.

And again, that goes back to the lack of clarity

around the process. For the reclamation, it goes back

to the lack of standards that we would apply and who

would sign off on that.

A. MR. JENSEN: And maybe just to expand on

that, we've -- in reviewing some of the minutes over

the past years, reclamation comes up as a constant

theme in terms of what are the standards. And this is

the big question for our group is, when we're

presented with a Reclamation Certificate -- and, for

background, we have had the same conversation with

industry at the annual meetings, when we do get a

reclamation package, what are the standards we compare

it against?

And this has come up through the years for

the last 25 years as to what are the standards?

Different things have been tested, different standards

have been proposed, but no standard has ever been

agreed upon or, where it has appeared to be agreed

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3499

upon, it's been recorded in some minutes where the

details are lost or the appendix or annex is missing.

And I believe this is what we're referring to with the

problem with trying to sort through minutes and

e-mails to determine the correct process; is there's

no single document or registry that contains the

information that we or, hopefully our successor, will

one day refer to.

Q. Thank you. I sort of anticipated that response as

well. My last question relates to resources.

Sufficiency and so on you've really covered I think

fairly well. You indicated that the source of

additional resources was not likely to be successful

if it came from Her Majesty the Queen in Right of

your respective organize -- sorry, the two

organizations. Was that a subtle way of suggesting

polluter-pay principle ought to apply and perhaps

EnCana would be the source of funding? I, I just am

looking to see what you were getting at?

A. MR. KENNEDY: I don't think it was anything

specific, but I mean that's certainly something that

could be looked at. I think government is always

looking for extra money and, and that's certainly a

principle that's been used in the past.

Q. So is EnCana. Anyway, I, I, I have no further

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3500

questions. Thank you very much.

THE CHAIRMAN: Thank you, Dr. Ross. Just a

few questions.

QUESTIONS BY THE CHAIRMAN:

Q. You mentioned in your advice that you have sent or

passed on to the Base Commander. I presume that

advice would be in the form of a letter, would it,

the recent advice that you have been asked to provide

to the Base Commander, is this usually in writing at

this point?

A. MR. KENNEDY: Yes, it is typically.

Q. I've seen in the past there have been certain letters

written on letterhead, for example, Alberta

Environment and that sort of thing. Do you have any

kind of letterhead that you use or any, any

stationary? The organization sounds somewhat loose,

and these are my words, obviously, but I wanted to

clarify if there's any format that you use in these

kinds of procedures.

A. MR. KENNEDY: The ERCB, we do have some --

I don't know, I think it's on the computer,

essentially, the letterhead. I don't think I've got,

say, paper that's all printed out with SEAC

letterhead, but we do have a way of putting SEAC up at

the top, if that makes sense.

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3501

Q. Yes, that's what I'm really trying to --

A. But it --

Q. -- that's what I'm really trying to establish; that

you, when you send it off, it's very clearly coming

from the three members of SEAC and not necessarily

from a department of, of one of the governments.

A. MR. JENSEN: Yeah, that's correct. And

one of the other challenges we've had of course is

there's nothing in the Agreements that designate

necessarily who is the chairperson of the committee or

if that chair rotates, so.

But, yes, when advice is provided to the Base

Commander, it's clear it's coming from SEAC, at least

within our tenure, and my review of the files suggests

that that's been generally the case, with some

exceptions perhaps.

Q. Maybe this is more of a comment, but you can, you can

respond to it. My understanding is that there seems

to be no real procedure in place for your

appointment. I presume by that, then, that you are

quite independent. And I presume also that your

employers do not give you direction in terms of your

role on SEAC.

A. MR. KENNEDY: That's certainly correct for

me.

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3502

A. MR. JENSEN: And that's also the case for

me. My understanding is I'm appointed to SEAC and act

independent to provide technical advice to the Base

Commander.

Q. Maybe a final comment. I hope for your sake that

somebody pays you for this work you're doing in SEAC.

But that's --

A. MR. KENNEDY: Was that your subtle hint?

THE CHAIRMAN: In any case, I -- that,

that's my final question. And I guess Mr. McDougall,

did you want to redirect any questions back to the

witnesses?

MR. McDOUGALL: I have no further questions,

sir.

THE CHAIRMAN: Okay. This, then, is the end

of our questioning. And I would like to thank you,

gentlemen, once again for taking the time, especially

late this evening, to appear before us to make your

presentation and to respond to all of the various

questions.

(SEAC PANEL EXCUSED)

THE CHAIRMAN: This closes the session this

evening and we will meet again tomorrow morning at

8:30. Thank you for joining us this evening.

A. MR. KENNEDY: Thank you for the

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opportunity.

(PROCEEDINGS ADJOURNED AT 9:29 P.M.)

(PROCEEDINGS TO RECONVENE ON FRIDAY,

OCTOBER 24, 2008, AT 8:30 A.M.)

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3504

REPORTER'S CERTIFICATION

I, Tambi Balchen, CRR, CSR No. 9166, Official

Realtime Reporter in the Provinces of British Columbia

and Alberta, Canada, do hereby certify:

That the proceedings were taken down by me in

shorthand at the time and place herein set forth and

thereafter transcribed, and the same is a true and

correct and complete transcript of said proceedings to

the best of my skill and ability.

IN WITNESS WHEREOF, I have hereunto subscribed my

name this 24th day of October, 2008.

_____________________________________

Tambi Balchen, CRR, CSR No. 9166

Official Realtime Reporter

encana shallow gas infill development ...robert drummond, esq. ) natural resources canada,)...

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