Arctic Offshore Oil and Gas Pause Extended

Summary#

The federal government made the Order Amending the Order Prohibiting Certain Activities in Arctic Offshore Waters (SOR/2021-272). It extends a ban on oil and gas work in parts of the Canadian Arctic until December 31, 2022, and came into force when it was registered on December 21, 2021.

What it does#

• Keeps in place a pause on any person or company beginning or continuing oil and gas work in specified Canadian Arctic offshore waters.
• Freezes the terms of 11 active exploration licences in the Beaufort Sea so those licences do not expire while the pause is in effect.
• Acts as a temporary measure while the government and northern partners complete climate- and marine-based assessment reports in 2022.
• States the order will be repealed (end) on December 31, 2022.

Who's affected#

• Oil and gas licence holders who hold the 11 frozen exploration licences in the Beaufort Sea. Companies named as licence holders include Imperial Oil, BP Canada, Chevron Canada, ConocoPhillips Canada, and Franklin Petroleum Canada Limited.
• Territorial governments and northern organizations involved in the review: Yukon, Northwest Territories, Nunavut, the Inuvialuit Regional Corporation, and Nunavut Tunngavik Incorporated.
• Northern communities and Indigenous peoples whose lands, rights or local economies could be linked to future offshore development.
• It is unclear from the order whether other nearby industries or private landholders are affected; the measure targets federally regulated offshore oil and gas activities.

Why it matters#

• It preserves the legal status and timing of existing exploration licences so companies do not lose their rights while the government completes reviews.
• It prevents new or continuing offshore oil and gas work in the affected Arctic areas for the one-year period, which affects industry planning and any immediate investment decisions.
• It gives time for climate and marine science reports — prepared with territorial and Indigenous partners — to be considered before longer-term decisions are made about Arctic offshore oil and gas.
• For the public, the order means continued protection from potential environmental risks from offshore oil and gas activity in these Arctic waters, at least until the order expires.