Federal Methane Rules Stand Down in B.C.

Summary#

The Government of Canada made an order that, in most cases, the federal Regulations Respecting Reduction in the Release of Methane and Certain Volatile Organic Compounds (Upstream Oil and Gas Sector) will not apply in British Columbia because the province has its own, equivalent rules. The order took effect on March 25, 2020, with a small set of provisions delayed until January 1, 2023.

What it does#

• Stops the federal methane and VOC rules (the Regulations Respecting Reduction in the Release of Methane and Certain Volatile Organic Compounds (Upstream Oil and Gas Sector)) from applying in British Columbia, except for federal works and undertakings (for example, pipelines that cross provincial borders).
• Does this because the federal Minister and the Government of British Columbia signed an equivalency agreement saying provincial rules achieve comparable outcomes. The agreement is called the “Agreement on the Equivalency of Federal and British Columbia Regulations Respecting the Release of Methane from the Oil and Gas Sector in British Columbia, 2020”.
• Most of the order came into force on the registration date, March 25, 2020; a subset of the declaration (certain sections) comes into force on January 1, 2023.
• The equivalency agreement and the standing-aside of the federal rules last up to five years unless ended earlier with three-month notice. The agreement will be reviewed at least annually.

Who's affected#

• Oil and gas companies and facilities operating in British Columbia.
• The B.C. Oil and Gas Commission, which enforces the provincial rules.
• Environment and Climate Change Canada, which will no longer apply the federal rules in B.C. for the covered facilities.
• Operators of federal works or undertakings in B.C. (including interprovincial pipelines) — they still must follow the federal rules.
• Environmental groups and other stakeholders who monitor methane and VOC emissions (the order responds to consultations and some raised concerns about data and enforcement).

Why it matters#

• It avoids duplicate rules and cuts some paperwork. The federal government expects about $80,000 in savings over five years on its enforcement and administration in B.C., and industry will see administrative savings (average annualized savings of about $70,647, or roughly $785 per business).
• The government estimates the B.C. rules will deliver at least as much methane reduction as the federal rules. For 2020–2024 the provincial rule is estimated to cut 2.85 megatonnes (Mt) CO2e vs 2.76 Mt under the federal rules; for 2025–2029 the estimate is 5.75 Mt vs 5.25 Mt.
• There may be a small increase in volatile organic compound (VOC) emissions under the provincial rules — about 240 tonnes for 2020–2024 (around 5% of the VOC reductions the federal rules would have achieved). The government says this increase is expected to have negligible health or environmental costs.
• The agreement is time-limited and will be reviewed each year. Stakeholders, especially environmental groups, raised concerns about data, modelling and enforcement during consultations — the order does not remove those ongoing questions.