Shaping the future of hydraulic fracturing in the Canadian Arctic through environmental guidelines

Abstract

This paper addresses the regulation of energy resource projects on indigenous lands in the Canadian Arctic and the role of environmental impact assessment in these projects, specifically those involving hydraulic fracturing. Taking an environmental point of view, this paper argues that in the absence of specific territorial legislation applying to shale gas development in Nunavut and the onshore portion of the Inuvialuit Settlement Region in Northwest Territories the federal regulator, the National Energy Board, has a key role in promoting transparency, public participation, safety and sustainable use of natural resources. As part of its environmental protection responsibilities, the Board, inter alia, ensures that an environmental impact assessment is conducted before any proposed hydraulic fracturing activities commence on indigenous lands, which in some cases include an extensive public consultation. In 2013 the Board adopted rigorous guidelines for all onshore oil and gas projects involving hydraulic fracturing which address many of the concerns raised over shale gas development, including surface and groundwater contamination; impact on air quality; induced seismicity and reluctance of industry to disclose chemicals used in hydraulic fracturing. Although these guidelines are non-binding on the Board, their adoption means that it will be challenging for the operators to obtain an authorisation from the Board should they fail to conduct an environmental impact assessment. This paper argues that these guidelines exceed the best practices widely adopted by the Canadian shale gas industry. It concludes that because the guidelines address a number of concerns raised by the public they could potentially be used as the minimum standards for hydraulic fracturing operations in other regions outside Arctic Canada.