April 26, 1982 ALBERTA HANSARD 781 LEGISLATIVE ASSEMBLY OF ALBERTA Title: Monday, April 26, 1982 2:30 p.m. [The House met at 2:30 p.m.] PRAYERS [Mr. Speaker in the Chair] head: INTRODUCTION OF VISITORS MR. STEVENS: Mr. Speaker, today it is a privilege for me to reintroduce to you, and through you to members of the Assembly, two visitors in your gallery. The first visi­ tor is Mr. Gerry Lawrence, principal of Canmore elemen­ tary school. Gerry and his family have made their home in Canmore since 1972.

He is accompanied by Miss Toshie Honda, a 22-year-old teacher from Kyoto, Japan, who is part of a teacher visitation program intended to provide Japanese professionals with an opportunity to share their culture with Canadians. While here, they learn about our life style and, of course, they are ambassadors for their own culture and way of life. Mr. Speaker, in this day and age in North America, when so many people are seeking assistance or grants to travel or go on programs, I think it's interesting that Miss Honda is one of 400 Japanese people who applied for the opportunity to visit North America.

Of the 400, 50 appli­ cants were accepted, five for Canada. Miss Honda is the only visitor here in Alberta. The interesting thing about this is that these visitors pay all their costs for transporta­ tion and contribute toward their accommodation. Mr. Speaker, would you and the members join me in welcoming Miss Honda and Mr. Lawrence to the Assem­ bly today. head: INTRODUCTION OF BILLS Bill 35 Special Waste Management Corporation Act MR. COOKSON: Mr. Speaker, this afternoon it's a pleasure to introduce, for first reading, a Bill known as the Special Waste Management Corporation Act.

This particular Bill has two major objectives: first of all, to ensure the establishment and operation of suffi­ cient corporation facilities, as well as other facilities in the province, to deal with the hazardous waste problem; and secondly, to ensure that the facilities established are oper­ ated and maintained in a manner protective to the health and safety of the public in the province of Alberta. [Leave granted; Bill 35 read a first time] Bill 36 Alberta Corporate Income Tax Amendment Act, 1982 MR. HYNDMAN: Mr.

Speaker, I request leave to intro­ duce a Bill, being the Alberta Corporate Income Tax Amendment Act, 1982. The main purposes of this Bill are three in number: firstly, to exempt some 30,000 small corporations from paying monthly income tax instalments, which was men­ tioned in the budget; secondly, to implement the signifi­ cant boost of the royalty tax credit, effective September 1, 1981, an element of the activity plan; and thirdly, to provide for the extended Alberta rental investment incen­ tive tax credit, which is enriched. Other administrative and technical amendments are in the Bill as well, Mr. Speaker.

Because of the complex nature of this Bill, if any members wish to ask questions of a very detailed nature in committee, I'd appreciate their sending me a note in that regard shortly. [Leave granted; Bill 36 read a first time] Bill 39 Election Finances and Contributions Disclosure Amendment Act, 1982 (No. 2) DR. REID: Mr. Speaker, I request leave to introduce a Bill, being the Election Finances and Contributions Dis­ closure Amendment Act, 1982 (No. 2).

This Bill has a very simple concept: to increase the financial limits in the Act by approximately 50 per cent throughout. [Leave granted; Bill 39 read a first time] MR. CRAWFORD: Mr. Speaker, I move that Bill No. 39 be placed on the Order Paper under Government Bills and Orders. [Motion carried] head: TABLING RETURNS AND REPORTS MR. HYNDMAN: Mr. Speaker, I wish to table four copies of the 1981 annual report of the Alberta Municipal Financing Corporation. And in respect of the General Revenue Fund, I wish to file the financial

summary for the nine months ended December 31, 1981. MR. KOZIAK: Mr. Speaker, I would like to file with the Legislature Library the required copies of the 1981 annu­ al report of the Superintendent of Insurance. head: INTRODUCTION OF SPECIAL GUESTS MR. NOTLEY: Mr. Speaker, today it's my pleasure to introduce four guests from the town of Fairview: His Worship Mayor Vasseur, councillors Don Tarzwell and Sandy McLeod, and town administrator George Moojel- sky. They are seated in the members gallery, and I ask them to stand and be welcomed by the members of the House. MR. CLARK: Mr.

Speaker, today it's a pleasure for me to introduce one guest from my constituency. Mr. Gor­ don Maulton is president of the Alberta Surface Rights Federation, and I believe he is here to listen to the debate on the surface rights motion today. He's in the public gallery, and I ask him to rise and receive the welcome of the House.

782 ALBERTA HANSARD April 26, 1982 DR. BUCK: Mr. Speaker, this afternoon it is my honor to introduce to you, and through you to members of the Assembly, 70 grade 6 students from the Rudolph Hennig school in Fort Saskatchewan. They are accompanied by their teachers Mr. Fraser and Mrs. Whitelock, and by four adults: Mrs. Labrie, Mrs. Bobosky, Mrs. McPher- son, and Miss Jasman. They are seated in the members gallery, and I would like them to rise and receive the recognition of the Assembly. Mr.

Speaker, I would also like to introduce to you, and through you, four members of the Hutterian Brethren of Scotford, who are here to watch the proceedings of the Assembly. They're already standing, because the gallery is full; they're in the public gallery. I'd like the Legislature to welcome them. MR. MAGEE: Mr. Speaker, it gives me great pleasure to introduce to you, and through you to members of the Assembly, a group of 30 students from the Red Deer Adventist Academy, a private school established about a year ago in the city of Red Deer.

Accompanied by their group leader Leo Goltz and teacher Linda Proud, they're in the public gallery and are supervised by Jeanette Trites and Mrs. Kaligithi. I ask that they rise and receive the welcome of the House. MR. PAHL: Mr. Speaker, today it's my privilege to introduce to you, and through you to other members of the Assembly, 25 grade 6 students from Satoo elementary school in the constituency of Edmonton Mill Woods. They are in the public gallery, accompanied by their teacher Mr. Fairfield and one or more parents; I know the name of one, Mrs. Shirley Scott.

I wonder if they would rise and receive the welcome of the Assembly. MR. DIACHUK: Mr. Speaker, I wish to take this oppor­ tunity to introduce to you and to members of the Assembly some 25 grade 6 students from St. Jerome school. They are seated in the public gallery, accom­ panied by their teacher Mr. Landry and parent Mrs. Diane Humeniuk. I ask them to rise and receive the welcome of this Assembly. head: ORAL QUESTION PERIOD Oil Sands Development DR. BUCK: Mr. Speaker, my first question is to the hon. Minister of Federal and Intergovernmental Affairs.

I'd like to know if the minister can indicate to the Assembly if his department has made any arrangements for the Premier of this province to meet with the Prime Minister of Canada, as to the final outcome of the Alsands negotiations. MR. JOHNSTON: Mr. Speaker, I believe whether or not the Premier would be meeting with the Prime Minister would depend upon the outcome of the meetings. At this point, the meeting is only with Mr. Davis, the Premier of Ontario. I can't give any more information as to what kind of meetings are scheduled by the Prime Minister and the Premier. DR. BUCK: Mr.

Speaker, can the hon. minister indicate what meetings dealing with Alsands are going on at present? Are the two ministers of energy meeting at this time? MR. JOHNSTON: Mr. Speaker, that information will unfold as events unfold throughout this week. I think all members of the Assembly are aware of the time compres­ sion the government is facing, in terms of meeting the April 30 deadline. As those meetings are required, enough meetings will take place.

I can't give information as to which meetings the Premier will attend or what the minister is doing, except to say that the government is attempting, with all effort, to expedite the successful conclusion of the Alsands agreement. We don't know what will happen or what the events will be, but we're doing our best to see that the interests of Alberta are well represented. DR. BUCK: Mr. Speaker, a supplementary question. Is the minister saying to the Assembly that he cannot tell us if the provincial and federal ministers of energy are in the process of meeting, or contemplating meeting, at this time? MR.

JOHNSTON: Mr. Speaker, I can say that if meet­ ings are necessary, Mr. Leitch and Mr. Lalonde will be meeting during the week. I can't give the dates and the times of those meetings. They are expected to meet, because the minister and the Premier are in the east. Those meetings will take place, but I can't give a

schedule of events. MR. NOTLEY: Mr. Speaker, a supplementary question to the hon. minister. In light of the Ontario government's investment in the Suncor corporation, are the discussions between the hon. Premier and the hon. Premier of On­ tario related in any way, shape, or form to possible Ontario participation in an Alsands rescue package? MR. JOHNSTON: Mr. Speaker, it's a touch too late for the province of Ontario to participate in an equity way.

I think the Premier and the Premier of Ontario are meeting simply to have a full understanding as to the ramifica­ tions and potential of the deal with respect to Alsands. As we have stated in this House before, there are implications for Canada. We have noted specifically the way in which the spinoff benefits will benefit other parts of Canada.

Since this is a megaproject, in the true sense of a Canadian, important-to-Canadians project, I think it's important that the Premier of Ontario fully under­ stands how negotiations are proceeding so, if necessary, he can respond in his own Assembly and to his own population, depending on which way Alsands goes. He should have as much information as possible. That is the reason the Premier of Alberta is meeting the Premier of Ontario today. MR. NOTLEY: Mr. Speaker, a supplementary question for clarification. The minister ruled out any equity partic­ ipation.

During the discussions, has any consideration been given to any other type of Ontario participation, through debt instruments of one kind or another, for example? MR. JOHNSTON: As far as I know, Mr. Speaker, that's not one of the potentials. DR. BUCK: Mr. Speaker, a supplementary question. Is the Minister of Federal and Intergovernmental Affairs in a position to indicate if negotiations to look at the possi­ bility of Nova Corporation being involved in the Alsands

April 26, 1982 ALBERTA HANSARD 783 project are still going on? Has that situation changed within the last three days? MR. JOHNSTON: Mr. Speaker, I can't give any com­ ment more than the comments which the Minister of Energy and Natural Resources gave last Thursday in this Assembly, I believe. As I say, that was one of the poten­ tials. Nothing is ruled out, but I can't give you any update as to the weekend negotiations. DR. BUCK: Mr. Speaker, a supplementary question to the Provincial Treasurer.

In light of the fact that the taxpayers of Alberta have $4 million invested in carrying on with engineering and maintaining staff, is the minister in a position to indicate if he has in place a contingency plan to extend the deadline past the end of this month and have public funds extended, to carry on if negotia­ tions are required for an additional 15 or 30 days? MR. HYNDMAN: Mr. Speaker, at this time, there are no plans to carry out any further involvements past the end of this month. DR. BUCK: Mr. Speaker, a further supplementary ques­ tion.

In the discussions that have been going on between the two ministers of energy, can the Minister of Federal and Intergovernmental Affairs indicate to the Assembly and to the people of the province as to the possibility of setting up a Crown corporation, so the people of Canada could participate directly in the Alsands project? MR. JOHNSTON: Mr. Speaker, I think any number of creative possibilities have been explored. I think the Minister of Energy and Natural Resources and the Pre­ mier stated that they want to be sure the private sector maintains a key position in this economic activity.

As well, the province has indicated that they're interested in a broad equity position. As well, we know that PetroCan has an equity position. So we've explored many of the possibilities. If you move toward a utility system or a Crown corporation system, another set of circumstances takes place, another set of pay-offs is required, and another set of calculations is required. At this point, Mr. Speaker, it's my judgment that the best bet is that the existing struc­ ture must be attempted, must be challenged. That struc­ ture will have to be considered first of all.

Should any other opportunities exist in the future, I'm sure they'll come forward in a new way. It should be noted that there's an awful lot of bitumen in that area, and there will be an awful lot of proposals still to come in the next few years, whether or not Alsands goes. DR. BUCK: Mr. Speaker, a supplementary question. Can the Provincial Treasurer indicate to the Assembly if any or all of the $4 million promised has been given to the participating companies in the Alsands consortium? Was that just a promise that the funds would be availa­ ble, or have they been directly paid at this time? MR.

HYNDMAN: I don't have exact information on that right now, Mr. Speaker, but I certainly will have in the days ahead. Postsecondary Education Study DR. BUCK: Mr. Speaker, my second question is to the Minister of Advanced Education and Manpower. In the minister's statement on postsecondary educational tuition fees, the minister indicated that the government intends to study the patterns of participation, by individuals, in postsecondary education. Can the minister indicate why the government has undertaken a study after a long-term tuition fee policy has been set in place? MR. HORSMAN: Mr.

Speaker, we had determined that requests we had received with respect to tuition fees and their impact upon students should be studied. At the same time, we'd also received requests from many boards of governors throughout the system to provide a me­ chanism for increasing tuition fees, so they would know the situation with more accuracy each year. We decided to proceed with both matters simultaneously.

As I indi­ cated, I think, and on other occasions, the results of that review of participation patterns in postsecondary educa­ tion will certainly be considered by the Department of Advanced Education and Manpower and by the institu­ tions, once they are known. It is anticipated that the review may take some consid­ erable length of time, perhaps up to two years. It was certainly not desirable to withhold a tuition fee policy, pending the outcome of such a review. DR. BUCK: Mr. Speaker, a supplementary question.

Can the minister indicate to the Assembly why an out­ side, independent agency was not commissioned to under­ take the study? The government studying itself is like contemplating your navel. MR. HORSMAN: Mr.

Speaker, perhaps it's not included in the ministerial statement, but certainly I have indicated otherwise that there will in fact be an advisory group to the Department of Advanced Education and Manpower, which will include representatives from interested organi­ zations, including the postsecondary institutions them­ selves, students, and other people within the private sec­ tor, to review with the departmental officials and give advice as to the best method of conducting the survey. DR. BUCK: Mr.

Speaker, when the study is complete and after the minister or the department has had an opportunity to look at it, will this report be made public? MR. HORSMAN: Mr. Speaker, it is certainly the inten­ tion of the department to make that information availa­ ble, specifically to the postsecondary institutions, of course, but certainly to all members of this Assembly and the general public. Student Loans DR. BUCK: A final supplementary question, Mr. Speak­ er. Has the minister given any further consideration to looking at the age of independence?

In our fast-moving society, it seems that there are cases where people at the age of majority are quite independent of their families. Is the minister giving any consideration to having these people qualify for loans on their own, once they reach the age of majority? MR. HORSMAN: Mr. Speaker, that has been part of the consideration taken with respect to student financial as­ sistance by the federal/provincial task force on financial assistance to students. The provincial governments have reached a conclusion as to the best system for Canada, and we have made that information available to the

784 ALBERTA HANSARD April 26, 1982 government of Canada. As yet, Mr. Regan, the federal minister responsible for the Student Loans Act has not yet responded to the provincial governments' position on the entire question of student financial assistance. Until such time as we receive a response, I'm not in a position to outline the provincial governments' position at this stage. Art Acquisition for Legislature Grounds MR. NOTLEY: Mr. Speaker, I'd like to direct this ques­ tion to the hon. Minister of Culture, with respect to the art acquisition program for the Alberta Legislature grounds.

Is the minister in a position to confirm for the House this afternoon that the approximate cost of the art acquisition program for the Legislature grounds will be about $1.35 million? MRS. LeMESSURIER: Mr. Speaker, the approximate figure is $1.35 million for the total project; that is, the acquisition and installation of the works of art. MR. NOTLEY: Mr. Speaker, a supplementary question. In view of the government's inability to move in other essential areas, like an ambulance program, for example SOME HON. MEMBERS: Order. MR.

NOTLEY: . . . has any consideration been given to delaying this program until such time as our rainbow has begun to rise again? MRS. LeMESSURIER: No, Mr. Speaker. MR. NOTLEY: Mr. Speaker, a supplementary question. Is the minister in a position to outline to the Assembly who, or what group, made the representation and de­ signed the program now being advertised for? MRS. LeMESSURIER: Mr. Speaker, there are six committee members, chosen from the artistic community in the province of Alberta. MR. NOTLEY: Mr. Speaker, a supplementary question.

Is the minister in a position to advise the Assembly as to the reason for three major projects? As I understand it, there will be 15 semifinalists and three finalists for the three major projects. So you're going to have three major projects, as opposed to a program that would have a number of projects and would benefit a larger number of artists in this province. MRS. LeMESSURIER: Mr. Speaker, this year we are only referring to phase one of the overall project, and that is for the central plaza, the east-west pedway, and the north-south pedway.

After this phase has been complet­ ed, there is a much larger forecast for future acquisitions. MR. NOTLEY: Mr. Speaker, a supplementary question. Is the minister in a position to tell the Assembly the estimated cost of the much larger forecast for future acquisitions? MRS. LeMESSURIER: Mr. Speaker, I think I said ear­ lier that the total budget allocated to the overall acquisi­ tion is $1.35 [million]. In this year, for phase one, the budget has been set at $900,000. MR. NOTLEY: Mr. Speaker, a supplementary question.

Can the minister tell the House why the committee making recommendations on this project settled on what will be three major projects, as I understand the informa­ tion, as opposed to a number of smaller projects which would allow more Canadian and Alberta artists to partic­ ipate and undertake their work? MRS. LeMESSURIER: I think I already answered that first part. I said that the second phase is going to be for exterior sites — and at this stage it's too early for me to outline them all — and some more indoor situations.

So I think many artists in Alberta, and national artists, will have the opportunity of having their works displayed. MR. NOTLEY: Mr. Speaker, a supplementary question. The minister has indicated that phase one is going to cost $900,000 and the entire project, $1.35 [million], so ap­ proximately two-thirds of the project will be in phase one. With that in mind, Mr.

Speaker, my question again is: on what basis was a recommendation made to the minister that we should be looking at three projects for two-thirds of the cost, as opposed to a program that would have many smaller projects and would allow Al- bertans and Canadians to participate? MRS. LeMESSURIER: I think the committee, which has met often since July 1981, felt that the chosen areas are going to be of such a visual concept that many people will see them, and they felt that this is the amount of dollars that should be allocated to this project. I'd like to explain to the Legislative Assembly what will be happening.

This brochure that the hon. member showed in his hand has been sent throughout the 10 provinces in Canada. After the artists have made their submissions, the acquisition committee will bring down the total number of artists to, say, five per site. Then an independent jury will be established to go through the works of these artists, and they will be choosing works for one of these three phases. DR. BUCK: Mr. Speaker, a supplementary question. Just so I don't miss something here, is the minister indi­ cating that the art is going to go in that jogging track between the parking lot and the Assembly?

Is that where the art is going to go? MRS. LeMESSURIER: The central plaza, the exterior foundation sculpture, the east-west pedway, and the north-south pedway. MR. NOTLEY: Could the minister outline to the Assem­ bly the reasons for placing the emphasis in the pedways, which by and large are not used by the general public but, in the case of one pedway, by members of the Legislature, not exclusively but largely? What portion of the $900,000 is going to be allocated to the pedways? MRS. LeMESSURIER: Mr. Speaker, we'll have to wait and see. When the works of art come in, we'll see what each piece costs.

When the artists submit their proposal to the committee, everything — the amount of work, their budget — will be included in their submission. So at this time, I can't say what each piece is going to cost. MR. NOTLEY: Mr. Speaker, a supplementary question. Can the minister assure the House that the total cost will not go a dime beyond $1.35 million? I ask that because

April 26, 1982 ALBERTA HANSARD 785 the minister seemed to indicate that they would have to evaluate the different projects to know how much should be spent on the pedways, how much on this, and how much on that. Can we be assured that not a dime's worth of special warrants will be passed to authorize this art acquisition? MRS. LeMESSURIER: Mr. Speaker, I said that the budget for this year's submission is $900,000. The total budget for phase one and phase two is $1.35 million. As I stand here, I would like to assure the House that as far as possible, I would like to see it stay at $1.35 million. DR. BUCK: Mr.

Speaker, I hope we don't get any Roloff Benys. What studies has the minister's department done as to the traffic volumes? Surely somebody must have done a study, to have adequate exposure. What studies have been done by the minister's department to see what out­ side traffic volume there is to see this Alberta and Canadian art in what I call my $60 million jogging track, from the parking lot to the Legislature? Outside Alber- tans, what traffic volume will there be to see that art? MR. STEVENS: The Social Credit leaving. MRS. LeMESSURIER: Mr. Speaker, I will take that question as notice.

I'm not aware if a study has been done, or what it revealed, if it was done. DR. BUCK: The way they're wasting money, there'll be a lot of PCs leaving too. MR. SPEAKER: Order please. MR. NOTLEY: Mr. Speaker, a supplementary question. Is the minister saying that apart from the committee of six, no studies were undertaken by the government, be­ fore the design of this art acquisition program was devel­ oped, to indicate its usage and where the money could be placed to ensure that the maximum number of Canadians and Albertans who visit can take advantage of it? MRS. LeMESSURIER: Mr.

Speaker, I said I'd take that question as notice, and I will. Lawyers' Trust Funds MR. CLARK: Mr. Speaker, my question is to the Attor­ ney General. I wonder if the minister could inform the Assembly as to what progress, if any, has been made by the Law Society in dealing with the people in Carseland who are being foreclosed on, in what I refer to as the Petrasuk affair. MR. CRAWFORD: Mr. Speaker, I don't have at my fingertips today any information with regard to that matter. I'm going to have to take the question as notice. ORDERS OF THE DAY head: GOVERNMENT MOTIONS 10. Moved by Mr. Schmidt:

Be it resolved that the report of the select committee on surface rights, presented to the Assembly on November 30, 1981, be received, and that the government give considera­ tion to the advisability of introducing the necessary legislation. MR. SCHMIDT: Mr. Speaker, it's interesting to look at the history of right of entry and surface rights in the province of Alberta, which dates back to 1947 and the discovery of Leduc No. 1, the basic start of the acce­ lerated energy package in this province.

Various statutes and amendments have taken place over the years, up to and including the last amendment in Bill 34, which brought the last amendments to the Surface Rights Act and generated sufficient interest to set up a select commit­ tee to study surface rights throughout the province of Alberta. It's also interesting to note that in 1947, the responsibil­ ity of the mineral owner and the rights of the surface owner differed somewhat. In '47, the owner of the minerals had the right to mine the same, and the property owner had a basic right only on the claim and substantia­ tion of damage.

Of course, we're all aware of the various changes that have taken place since that time, not only to the basic rights of the individual but to the actual cost factors that have come about. First of all, we recognize the change in land prices and the escalation due to the value of agricultural land, or land in general, and the escalation through inflation. In 1980, being responsible for the legislation on surface rights, I was pleased to recognize that the workload facing the Surface Rights Board in the activities through­ out the province had escalated quite dramatically between the years 1977 and 1980.

On that assumption, Bill 34 was brought before this Legislature in early 1980, asking the Legislature to give consideration to the establishment of some change to surface rights that would relieve some of the workload pressures building up within the board. At that time, I was also pleased about the interest shown, not only within the Legislature but without. Bill 34 generated sufficient activity, interest, and suggestions that a select committee was established in this Legislature to study, review, and bring back their recommendations on surface rights.

The terms of reference set up for that select committee were quite broad. Recognizing the prob­ lems that exist in surface rights and the numbers of questions and suggestions made at that time, it was right­ fully so that the terms of reference be broad. Within the province of Alberta, the surface rights committee, which handles the total workload with regard to right of entry through surface rights, is made up of the Surface Rights Board, which at present has a chairman, an executive director, nine members, and all the staff necessary to make that Surface Rights Board work: a total of 34 in number.

It's also interesting to note that the complement of people and the expertise in the field of surface rights since 1947 has brought us to provide, from 1977 to 1980 but perhaps peaking in 1981, the greatest number of applications ever brought before the board since its inception in 1947. That workload has reached the peak of 2,694 in number of applications outstanding, as of the end of March this year.

That brings to each and every one of us the necessity that, first of all, either the numbers far exceed the workload of those people who now make up the Surface Rights Board, or else the system of handling applications is due for review; and thirdly, perhaps the setting up of the special committee and their report. For those awaiting the outcome of some of the suggestions made to that special committee, recog­ nizing that from report must come the legislation that will

786 ALBERTA HANSARD April 26, 1982 be the basis for the new Surface Rights Act, has caused a number to wait for the future, and perhaps has led to some of the numbers that make up the outstanding appli­ cations to date.

It's interesting to note that of the applications received and those I just gave you, of 2,694 outstanding as of today, under normal operation during the year, roughly 63 per cent would be completed in the year they were submitted, 18 per cent would be settled privately or cancelled but would have been solved during that particu­ lar period of time, and about 19 per cent would be postponed or adjourned. Within reason, those percent­ ages are held year after year, indicating the percentages of those that have been handled and solved to the total satisfaction of the individuals concerned.

It will also give you the indication as to the total number handled, recog­ nizing that at the present time the outstanding number is still at 2,694. On behalf of all concerned producers throughout the province and certainly on behalf of the Department of Agriculture, which is responsible for the surface rights legislation, I would like to pass on our congratulations to the board and to its chairman, first of all, recognizing that the job was going to be interesting, challenging, and certainly full.

In holding its hearings, the board was broad in its views and acceptance and has taken those into consideration when the actual report was filed in the Legislature. Surface rights always can, always has, and I'm sure certainly will in the future, generate a certain amount of activity and anxiety. It's certainly a credit to the board holding those hearings that the activities of question and concern were held at a minimum during the period of time that their hearings were held throughout the province.

On behalf of all producers, I should also pass on our sincere thanks to the board which, even after the presen­ tation and submission of their recommendations to this Legislature, has continued hearing individuals and select groups that still had some basic concerns once the recommendations were made public.

They have again had that opportunity to make representations to the board per se and to various other interested groups of govern­ ment, giving us not only the benefit of their original submissions that made up part of the presentation and findings to this Legislature but, on behalf of producer groups, have also had the opportunity to review some of those recommendations and give their views as to how they see surface rights affecting the producer in the province. Mr.

Speaker, I fully recognize that the recommenda­ tions presented on behalf of the producers throughout the province, because of those hearings, may in some cases create some understandings and agreement. I'm sure some comments and suggestions will be made in some areas as to how amendments should be made to some of the recommendations.

I guess that's the key and the opportunity which the motion placed before you will provide us with: first of all, the opportunity of saying thank you to the committee that has done an excellent job; secondly, within this Legislature, the opportunity of taking the recommendations — to the extent that they've been presented — and adding those views, whether they're for or against, to the presentations already made. Mr.

Speaker, I look forward to the debate, recognizing that it will be not only a total review of ongoing debates but the comments of not only producers but members of this House that will give us the opportunity to review, and hopefully come up with, the new legislation that will set the pace and take the place of the existing surface rights legislation. Once again, on behalf of producers, I wish to say thanks to the committee for doing such an excellent job. I look forward to the debate that will be following in this Legislature this afternoon and, hopefully, this evening. MR. KOWALSKI: Mr.

Speaker, April 26, 1982, is a few days past May 23, 1980, when this Assembly of the Alberta Legislature appointed a nine-person committee to undertake a total review of surface rights in the province of Alberta.

This afternoon, I would like to provide all members of the Assembly with a brief overview, in terms of what was undertaken by the select committee on sur­ face rights, and to point out and highlight a number of the 70 different recommendations that a remarkable small, democratic committee arrived at on the basis of nearly 18 months of public hearings, evaluation of testi­ mony, reading of reports and, finally, zeroing-in on a select number of recommendations.

In introducing the motion this afternoon, the Minister of Agriculture pointed out that, in essence, surface rights legislation in Alberta did not come into vogue until 1947, when the first Act of its kind was passed by this Legisla­ tive Assembly. It was known as the Rights of Entry Arbitration Act. After 1947 and through to 1972, several modifications were made to that original Act.

When it sought election in 1970, part of the philosophy, the prin­ ciples, and the platform of the Progressive Conservative Party was a commitment that a total undertaking would be made on the whole question of surface rights in Alberta. Of course, following election in June 1972, the Alberta Surface Rights Act was passed. Comparing that Act of 1972 with any other surface rights Act in the jurisdiction of Canada is a bit detrimental to those other jurisdictions. Because until recently, most other provin­ cial jurisdictions in our country did not have

an Act that clearly outlined the responsibilities of those in industry and those who are landowners, in the whole question of dealing with surface rights. Mr. Speaker, since 1972 a number of modifications have been made to that original Act. As a result of growing energy development in our province in the oil and gas, power line, and coal development sectors, in the latter years of the decade of the 1970s increasing attention to this whole question of surface rights prompted this Legislature to endorse a motion, in the spring of 1980, which sought the setting up of a select committee on surface rights. Mr.

Speaker, I felt very fortunate to have been appointed by the Legislature to be the chairman of that committee. Over the past 18 months, that committee has undertaken a considerable degree of work. I recall that in the first committee meeting, held in the spring of 1980, the question really was: how involved did this committee want to become, and how determined did we really want to be, in terms of writing a report on the whole question of surface rights? In terms of the response of the committee, Mr.

Speaker, I think a concluding statement could be none other than that the committee did the best it was capable of doing. As the former chairman of that committee, I'm very thankful to pay recognition to the outstanding contribu­ tions made by a number of excellent men and women who are sitting in this Legislature today and one who is no longer with us. To the MLAs for Grande Prairie, Drumheller, Drayton Valley, Bonnyville, Red Deer, Cal­ gary McKnight, Three Hills, and the former MLA for Olds-Didsbury, the former leader of the opposition party

April 26, 1982 ALBERTA HANSARD 787 in the Alberta Legislature: my sincere thanks for the large number of hours each and every one of them gave, of themselves, to our committee work. This afternoon, no doubt several members of the committee might highlight some of our activities and journeys through the province of Alberta, and might even exaggerate in terms of the intensity of the time spent in driving from one community to another and having to work into the late hours of the morning. But it was all worth it, because we were all serving the people of Alberta. Mr.

Speaker, some 45 days of public hearings were held in the province of Alberta. The committee really began its first hearing on December 9, 1980, in Vegreville, and concluded its public hearings on March 20, 1981, in Cochrane. From all conceivable sectors in the province of Alberta, the committee received over 360 submissions on the question of surface rights.

Submissions were received from landowners, people who leased private land and public land, municipalities, agricultural development committees, rural gas co-ops, province-wide power com­ panies, those involved in the oil and gas industry, the coal sector in the province of Alberta, and those province- wide organizations which represent all the types of people I've just talked about. I have to say that the quality of the submissions throughout, in all parts of Alberta, was really super- professional. Few people came before the select commit­ tee on surface rights really to flog a personal concern.

Most came to put forward their concern, their items of recommendation, on the whole subject area of surface rights. Mr. Speaker, I wish to repeat that few came simply to flog a particular concern that affected only them. Most had a very, very wide spectrum, and a real empathy for the whole situation in the province. Mr. Speaker, when this Legislature established the se­ lect committee, it gave it five specific areas to take a look at.

I'd like briefly to highlight those five specific areas, comment on the recommendations of the report, then make mention of the fact that the select committee went beyond the five specific recommendations given it by this Legislature and in fact looked at eight other areas of activity within the province of Alberta. The first major area that the Legislature directed that the committee should take a look at is one dealing with the "review of existing and proposed methods of expedit­ ing claims directed to the Alberta Surface Rights Board".

In the select committee report, there are several major areas of recommendations with respect to that. The first subject area of recommendation on this sub­ ject was a series of recommendations put forward, look­ ing at the membership on the Surface Rights Board. The view of the committee was that the appointment of members to the Surface Rights Board be made by the Lieutenant Governor in Council.

That recommendation was made because, as members of the committee, we believe that a wide-ranging spectrum of different Alber- tans should be involved, in a very professional manner, sitting as arbitrators on the Alberta Surface Rights Board. Only through that mechanism could you ensure a geographical representation and an industry-sector repre­ sentation for those people who would sit on the board.

The second area of recommendation with respect to membership on the Surface Rights Board really called for the Surface Rights Board to expand itself, in the sense that a series of local surface rights boards should be created in the province of Alberta.

Some of these people from various parts of the province of Alberta, whether they lived in an improvement district, a municipal dis­ trict, a county, or a Special Area, for that matter, might find themselves in a position to provide a very sincere local input when arbitration hearings were held on a particular problem between a developer and a landowner in a particular area. As well, we provided recommendations that we believe will greatly improve the procedures of the board.

Essen­ tially many of them are very administrative in nature and, for the most part, common-sense recommendations: a recommendation that would allow both participating par­ ties in an arbitration hearing to have advance notice of that; a recommendation calling for an evaluation of the actual site in question, by the surface rights arbitration board, before it makes a recommendation in an arbitra­ tion problem, calling for situations whereby both parties should be present at the site inspection; and a recommen­ dation calling for decisions of the board to be submitted within 14 days of the compensation hearing.

Currently that 14-day situation is not being met in the province of Alberta. In some cases, it takes upwards of six, seven, eight, and nine months before the Surface Rights Board finds itself in a position to rule on an arbitration prob­ lem. We believe that public servants in the province of Alberta can respond within 14 days, when arbitration hearings are held.

As well, and as recommended, we believe that the awarding of costs be left to the discretion of the board, but that when the board looks at the awarding of costs, it recognizes the landowner, rancher, and farmer as an agri­ cultural expert at any of the hearings. By the same token, the Surface Rights Board must recognize that the land agent who represents the industry in question also serves as an expert in submitting testimony before the Surface Rights Board.

Too often, in too many parts of Alberta, we heard that when two in conflict — a landowner or a producer and a representative of an energy company — came before the board, both had to bring in experts to prove their arguments. It's our view that those responsi­ ble, and those who meet in a responsible nature to try to arrive at contractual situations, should be recognized as experts in the particular fields they are in. Mr. Speaker, from an administrative nature, we also recommend that a library of surface rights agreements be established in the province of Alberta.

Currently in each and every given year, perhaps upwards of 10,000, 11,000, or 12,000 surface rights agreements are taken in the province of Alberta. We're suggesting that a synopsis or precis of each of those agreements should be filed in a library where all individuals in the province of Alberta would have access to them, if they desired. That recom­ mendation would accomplish a decrease in misunder­ standing that currently exists in many parts of Alberta.

All too often, we heard of situations whereby two or three landowners would meet one another at a social, someplace on a Saturday night, and late in the evening would start comparing what each had received as a result of negotiation with a particular company doing a particu­ lar type of work in their area. Invariably, one might tend to exaggerate a little, or the other one might tend to underestimate the actual agreement they had received.

The result was that three good neighbors got into an argument with one another and on Monday morning were calling their MLA or submitting a petition to the Surface Rights Board saying, how come we are all being compensated for basically the same kind of event but we're all receiving a different type of compensation? So to eliminate that confusion and that kind of situation, which all too often leads to minute animosity among neighbors,

788 ALBERTA HANSARD April 26, 1982 we're recommending that copies of all surface rights agreements be set up in a library. From a purely adminis­ trative point of view, Mr. Speaker, we're also recom­ mending that the Surface Rights Board act solely in the area of compensation. I want to mention that a little later during my portion of comments on this debate.

The second major area we took a look at was the one in which we were charged by the Legislature to "examine the role of appointed surface rights mediators and make recommendations concerning their terms of reference and appropriate professional qualifications in the context of surface rights mediation". A suggestion was made — and the Minister of Agriculture referred to it in Bill 34, introduced in the Legislature several years ago — that in fact what we really needed was a new kind of person, a mediator, who would bring a landowner and a represent­ ative of an energy developer together.

They would sit in a room, and the mediator, who would be an unbiased person, would try to have the two of them come together and resolve the situation. The committee believes mediators are totally unneces­ sary. There are a number of excellent opportunities with­ in the existing system in the province that certainly fulfil that.

In our report, we made mention of the role of the office of the Farmers' Advocate in the province, the Independent Petroleum Association of Canada, the Canadian Petroleum Association, the International Right-of-Way Association, groups like Unifarm, the Christian Farmers Federation, and the recently created Alberta Surface Rights Federation, which provides advice to their various memberships. The committee did not believe there was need for a new type of civil servant, to be known as a mediator.

Thus it became totally redun­ dant for the committee even to take a look at the qualifi­ cations that would be necessary in terms of creating this new type of individual known as the mediator. Mr. Speaker, the third major area we were instructed to look at was the present levels of compensation to landowners, and to make recommendations for means by which these levels might be adjusted. I guess it is in this area that the one recommendation made by the select committee received the greatest amount of play in the media.

It's not the area that I, as the former chairman of that committee, really believe members at large, in all parts of Alberta, suggested was the one that had to be highlighted as the most important. In the area of com­ pensation, essentially the committee recommends that on the fourth anniversary of all leases, it must be the respon­ sibility of the operator, the energy developer, to give notice to the lessor that the contract can be renegotiated at the end of that current year. The committee then made a recommendation with re­ spect to a new type of compensation factor, called the force-take concept.

The committee recommends that all operators pay an up-front payment to the landowner in recognition of the force-take aspects of an operator's activity. We outlined a formula, which basically said that in the initial year, the amount of this force-take payment would be equal simply to multiplying by $1,000 the number of acres described in the lease agreement, but recognizing that the maximum number of acres that could be used for it would be five.

In essence, we're calling for an up-front force-take payment of a minimum of $1,000 and a maximum of $5,000 per agreement, per land title and, further, that these minimum or maximum amounts are to be reviewed on a five-year basis by the Alberta Surface Rights Board. There has been considera­ ble debate on this one subject. No doubt, later this afternoon, various members of the Legislature would like to comment on that.

The other areas dealing with compensation were essentially clarification matters: iden­ tifying market value, how it should be identified, what it is, and what the parameters of identifying this one con­ cept of market value should be. Mr. Speaker, a fourth area we were asked to take a look at was the whole question of landmen and surface rights negotiations. The select committee report contains a number of comments and recommendations on that.

There are three basic areas of recommendations dealing with land agents, all calling for additional improvements to be made necessary: one, that all land agents be re­ quired to write an examination before receiving their land agent's licence; secondly, that a manual be prepared by the Land Agent Advisory Committee that will contain the information one would be expected to know in order to be successful on the examination; thirdly, that the Land Agent Advisory Committee determine a code of ethics and standards of conduct for land agents in Alberta. Those three recommendations are already in place.

They have been fulfilled, through the good offices of the Associate Minister of Public Lands and Wildlife. In the last several months, these called-for changes dealing with land agents have been implemented. They were imple­ mented in consultation with the land agents and the various land agent organizations in the province of Alber­ ta. There now is a code of ethics, a manual, and stand­ ards of conduct that land agents in Alberta must fulfil and follow.

A fifth area was looking at various sections of the Alberta Surface Rights Act that would require amend­ ment and to making a series of recommendations in that area. The committee looked at five basic areas. The first dealt with the roles of both the Surface Rights Board and the Energy Resources Conservation Board. Three specific recommendations dealt with improvements that could be made.

The committee also took a look at the question of right of entry, a concept whereby an energy developer, when he makes application to undertake a particular type of work on a landowner's parcel of property, and if the landowner and the energy developer cannot get an agreement with one another, currently has the right to go before the Alberta Surface Rights Board and seek per­ mission from that board to receive a right of entry onto the landowner's land. We believe some administrative things could be changed to improve that situation.

We're asking chiefly that the Energy Resources Conservation Board be the responsible jurisdiction to award those rights of entry. On the question of assignment of compensation, the report basically says that compensation for leases and land development should be paid to whom it is due. The committee believed that landowners who have a well site development or a pipeline development on their land should be the ones who receive the compensation for those leases. The committee did not believe those leases should be assigned to other people.

A simple example to illustrate the point: an individual landowner today, who has a lease on his property, chooses to sell his property but not to sell the lease for the development on his former land. The new landowner now owns the land. He has the problem of farming around the lease but receives no compensation for it. It was the committee's view that that assignment of compensation should not occur. Some might argue that that's a real infringement on the contractual rights of individuals. But perhaps the most blatant example of stupidity that the committee ran

April 26, 1982 ALBERTA HANSARD 789 across in this area was a situation where land had changed hands three or four times in the last 20 years. Successive people had been willed lease revenue, and fin­ ally it turned out that the lease compensation was now willed to a public institution in the province of Alberta. So the poor landowner who was having the problem farming around the lease four times ago, because the land had changed hands four times, can't have it resolved. The company in question doesn't know how to resolve it either.

This particular area was brought to our attention by large numbers of people in industry saying, look, there's need to clarify this. A fourth area, in terms of legislative requirements, dealt with annual compensation. Currently the Surface Rights Act says that compensation on all leases must be reviewed every five years. That recommendation was maintained by the select committee in its report. A fifth area we looked at, in terms of legislative changes, dealt with the levels of dollars and damage occurring. We made some very specific recommendations on that. Mr.

Speaker, those were the five major areas the select committee was charged with taking a look at. But in hearing the people of Alberta, in meeting with the people, in travelling about Alberta, we were asked to take a look at a number of other major areas by those who made representations to us. The committee did. In fact the select committee took a look at eight other areas. The first dealt with reclamation, restoration, and land conservation. We believed that the most widespread feel­ ing of interest by anybody in the province of Alberta dealt with this one question.

Because of that, we have 11 very specific recommendations in the report, which essen­ tially call for increased vigilance by all in terms of the preservation of agricultural land in the province of Alber­ ta, but recognizing that when agricultural land must be used for energy development, we must have reclamation which restores the land to as good or better use than originally. Members might say, well, how can it possibly be in better condition after an energy development than before? I submit that it's essentially the area of drainage that can be improved upon when land can be dealt with in that manner. Mr.

Speaker, in my view reclamation is simply the repaying of a debt to the land. We can repay that debt, because technology now exists that will allow us to heal surface scars. Reclamation has not been a dirty word in the province of Alberta for a large number of years. The first legislation in this area, essentially very good legisla­ tion, was introduced by the former government in 1963. It has been improved upon since then and can be further improved upon. We have to be cognizant of the very important role our prime agricultural land plays in the tradition, history, and future of this province.

We should not avoid spending as much time and attention on that one matter as we possibly can. The second area we looked at dealt with major electri­ cal transmission lines. The recommendations that came forth in that area followed through to ensure that policies dealing with oil, gas, and coal should also apply to major electrical transmission lines if land was to be taken for the development of a new form of energy corridor. The third activity, in addition to the previous five, dealt with seismic activity.

Legislation dealing with seismic operations is very different from that which deals with the other type of energy activity we have in this province. If a seismic operator wants to come on an individual's land, under the laws of Alberta the individual can simply say no and the seismic operator cannot go on that individu­ al's land. Most people in the seismic industry in Alberta and those who made submissions to us said, look, that's a good system; that really doesn't have to be changed.

However, municipalities did argue that they should be in a position to provide some degree of permit of explora­ tion to seismic operators, so there would be some respon­ sible operator who might then repair the roads damaged in terms of seismic operations. The local municipality would be in a position to clearly identify who the seismic operator was. Entry for surveying and test drilling was another area the committee made mention of.

Basically we suggested and recommended that there should be at least a two- week written notice provided to all landowners if survey­ ing and test drilling must be made on that particular individual's land. Currently there is no prescribed legal requirement to have anybody come two weeks before, or anything else. Essentially it is good manners on behalf of a large number of people in the business of surveying and test drilling, to let a landowner know.

The committee also made mention of its interest in energy development on public lands, and I've no doubt at all that one of the members of the committee might wish to comment on that this afternoon. In the area of well-site locations, the committee was very pleased with the work of the Energy Resources Conservation Board in recent years, in looking at the whole question of where well sites should be located. Traditionally in North America and certainly in the prov­ ince of Alberta, well-site locations tended to be in the centre of quarters.

In recent years, because of public hearings and public interest — first in the Grande Prairie area in the spring of 1980 and then public hearings in the Edmonton area in March 1981 — the Energy Resources Conservation Board has moved to see site locations moved to the boundaries of quarters. That, of course, really reduces the impact of energy developments on agri­ cultural land. Mr. Speaker, our report has recommendations on the question of water wells and, finally, concludes with a

section dealing with surface mining, including four specif­ ic areas of recommendation. On the question of surface mining — that is, essentially open-pit mining, opencast mining — everybody has to recognize and appreciate that only relatively small areas are being disturbed at any one time for the purpose of coal mining in western Canada. Watching television and reading newspapers from time to time, one gets the impression that half of all of western Canada is being ripped up for coal mine development.

Compared with other land uses, the specific number of acres used for surface mining are quantitatively minute, if that's an expression one can use. In British Columbia, in any given year, only approximately 450 acres are used for surface mining, all in the mountainous area in that prov­ ince; in Alberta, 130 acres in the mountain and foothills regions and some 300 acres in the plains; and in Sas­ katchewan, approximately 320 acres on the plains. Mr.

Speaker, that's a very, very quick overview of 70 recommendations, over 10,000 pages of testimony, 363 submissions, 45 days of public hearings in the province of Alberta, and several more weeks of discussions with offi­ cials and people in energy-related matters in the states of California, Wyoming, and Montana. Our committee also had the opportunity to review the coal mining develop­ ments in the Midlands area of the United Kingdom, as well as the gas field areas, diking areas, and land use surface areas of Holland, and the coal mining area of northern Germany.

790 ALBERTA HANSARD April 26, 1982 In concluding, I want to make mention of and give my thanks to all Members of the Legislative Assembly, who were very co-operative through the select committee when it was setting up its time frame for public hearings. It was very positive to all nine members on the select committee on surface rights to know that in some areas, in fact in most areas, members of the Assembly were in a position to be in attendance at the public hearing held in their constituency and to be very active, in fact asking their constituents to be in a position to come forward with good ideas.

That expression of appreciation and thanks extends to all Members of the Legislative Assembly. All were very, very co-operative and positive in that area. Mr. Speaker, I'm very proud of this report of the Select Committee to Review Surface Rights. In fact it's almost a best seller. The original press run printed 2,500 copies. They were made public on November 30, 1981, and were out of stock by January 10, 1982. So we had to go to a second printing. Our total number of copies in existence was 3,500. It's a good report, Mr.

Speaker, and I hope all Members of the Legislative Assembly can support the recommendations in the report. Thank you. MR. MUSGREAVE: Mr. Speaker, it was an interesting task to serve on this committee. I'm not sure I'd want to do it again, though. There were too many meetings in too many places. I would like to commend the chairman, though, who set the tone for the meeting in an informa­ tive manner. He was very able in summarizing why we were having the review. In spite of the loquaciousness of some members of the committee, he was able to complete his task in a reasonable time.

At best, I would say he tried very hard to be neutral and ensure that both landowners and industry representatives received fair hearings. In my view, he did an excellent job, and we should all be thankful for his work. At the urging of the Farmers' Advocate, many farm groups were heard. I'm sorry the Farmers' Advocate has left. Some district agriculturists even used the same form letter urging people to attend. Similarly, committee members — and I was one of them — urged particular interest groups to be sure their views were put forth. So we heard from many people and organizations. Mr.

Speaker, today I want to speak primarily on the views of the oil and gas industry. Speaking from an industry point of view, I was impressed by the reminder to the committee that many thousands of leases are in existence and have been renewed so that the majority are now for five years or less, and have all been completed in a fair and equitable manner. There was no hassle, just excellent relations continuing with farm people, who, after all, are the industry's best customers. Now this has changed.

Some owners, using a familiar union device, have banded together to demand more, not because they've suffered a greater loss but because, in the words of Samuel Gompers, that old labor union pioneer of the garment workers in the city of Chicago, when asked what the unions want, had one simple answer: more. Already we have some owners saying that the up-front charge should not have either a limit of $1,000 an acre or a limit of $5,000. In spite of the feelings of some of my rural colleagues, I believe we have to become more aware that the days of increasing oil and gas prices are over.

Western industrial consumption is down 16 per cent, partly because of markets and partly because of conservation. No one, in the industry or throughout the world, expects consump­ tion to rise again to its former level. This is why OPEC is in trouble and why the British government recently lo­ wered the price of oil from the North Sea by $4.50 a barrel. I'd like to read a story that appeared in The Calgary Herald last week. It's headed, "Oil, gas land sales drying up": . . . the already-dismal record of 1982.

In its latest fortnightly auction of oil and gas li­ cences and leases, the Alberta government [received] $5.8 million [compared to] $19.4 million collected . . . last year . . . During the first quarter of 1981, oil companies paid the province about $105 million for petroleum rights. In the same period this year, it's down to $72.5 million. And the amounts collected in 1982 have been shrink­ ing during each auction.

Now if the government does believe that there should be an up payment for a right of entry, in my opinion it should be at the expense of the Crown and it should be paid for all who acquire land, whether it is the highways department, the oil industries, or a municipality. Mr. Speaker, as one who has lived in Alberta for most of his life and who remembers when international com­ pany meant men and women of good will working throughout the world looking for opportunities, I find that some of the opinions and positions regarding oil companies expressed at the hearings were distressing, to say the least.

Many of them were valid, but others were certainly open to question. Governments and people everywhere must realize that the oil industry produces a product that is liable to the pressures of the market place. It is a commodity and, as OPEC is realizing, when the price is too high, people will cut back and look for other products. With this in mind, Mr. Speaker, I want to give the Legislature some of the reaction of the group of professional people who are the front-line troops of the industry, the landmen and landwomen.

I might say that we as a committee had a consensus but, I emphasize, we did not have unanimous agreement on many issues. Also I should say there are some in­ stances where I do not agree with the petroleum landmen, even though they agreed with the committee's recommen­ dations. Some of the stories we heard were of disputes that occurred not recently. On investigation and question­ ing, we found that some were as many as 15 years old. Times are changing, and both landowners and govern­ ment should be aware of this. The landman of old is no more.

There are now over 100 landwomen and, in many instances, our landmen are university graduates born and raised on Alberta farms. So you have more responsive and more responsible people in the land business than you had in the past. I would now like to deal with some of the specific recommendations and responses of the landmen's associa­ tion. I'm not going to deal with those in the report that they favor. I just want to deal with the ones they objected to. The first one is: . . . membership of the Surface Rights Board needs to be expanded to ensure local expertise.

During our hearings, you got the feeling that in some areas maybe political appointments were made to the board with not too much concern about the problems they were going to be faced with. The landmen's associa­ tion points out that there's a possible conflict of interest, a lack of continuity between districts, and a possible lack of expertise.

April 26, 1982 ALBERTA HANSARD 791 Moving on to the committee's recommendation that the board implement a policy of holding actual compensation hearings in convenient locations with­ in the proximity of the subject site and further avoids the holding of hearings on-site, The CAPL disagrees with this recommendation in that it is inconsistent with the previous recom­ mendation [of our committee].

In the case where an inspection is requested and the hearing is at some town or place distant from the site, the workload of the Landmen would be substantially increased in that he would have to attend on-site as well as at the hearing, at different locations and at different times. It is our recommendation that hearings be held on- site where possible and at the same time as the inspection . . . Another recommendation of our committee — and our chairman pointed this out — was that the decisions of the board be issued within 14 days.

They point out that because of the difficulties the board is having getting out its orders now, they feel that 30 days is sufficient. They would actually prefer 60 days. So you can see some of the dilemmas we're faced with. Another recommendation, 2.5, is: The Committee recommends that the awarding of costs be left to the discretion of the Board, and in this context the Board recognize the landowner- farmer-rancher as an agricultural expert and the Board recognize the land agent representing the company in question as an industry expert. That was our recommendation as a committee.

The asso­ ciation strongly disagrees with this recommendation, for several reasons. First of all: The recommendation is capable of being interpreted in such a way as to disqualify landmen from giving evidence with respect to agricultural damages, losses and values, areas in which many landmen are now expert. Secondly, in the opinion of landmen, it's a direct attempt to qualify a landowner to ask for and receive expert witness fees for appearing on his own account. There is no current standard by which such fees may be set.

The Surface Rights Board's current practice of awarding reasonable out-of-pocket ex­ penses to the landowner for his time is sufficient. Also they want go on to point out that the recommendation offends the basic legal position that in order to be an expert, you have to prove yourself an expert. Just as many landmen are not experts . . . many landowners are not experts. This section, in the opinion of the CAPL, would do away with the necessity of proving expertise and confuse the long-established format for dealing with expert evidence.

Again, The Committee recommends that the Surface Rights Board receive all evidence under oath. Mr. Speaker, if every one of us were under oath at many of our hearings, I suggest they would have been much briefer. But they do make one point. If you are going to have them under oath, make sure the appropriate en­ forcement of breaches of this is taken. If someone gives evidence under oath and is found to be wrong, he should be charged under the Criminal Code. As our chairman mentioned, we recommended a li­ brary of surface rights agreements.

There is an area here of concern to the landmen; that is, under the Land Agents Licensing Act confidentiality of negotiations and agreements is required of a licensed landman. Obviously this con­ flict would have to be resolved. Another area of concern is the notice of review of surface lease rentals. We recommended that the Surface Rights Act be amended to make it neces­ sary that the operator give written notice . . .

But The existing legislation requires that each party re­ present their own best interests as prudent business­ men operating within a free enterprise system, there­ fore, the [association] disagrees with this recommendation. Now we come to the tough one, the recommendation for force-taking. As I mentioned earlier, I would agree with the oil and gas companies, the power companies, and anybody else who wants to force-take land, only if the Crown agrees to pay the compensation. I think we've hit the oil industries, and many other industries, too hard and too often and too long.

The recommendation was that there be an up-front payment of $1,000 and a maximum of $5,000. As I said, they are against this for many reasons. First of all, I mentioned the fact of common law. You have a right to enter upon land in order to recover the minerals. We are now creating a new compensation, yet there's no transfer of title. We are really getting into a very difficult area with many legal implications that would have to be carefully considered before the government would adopt this suggestion.

Another recommendation was that the interest rate . . . be the prime rate as determined by the Bank of Canada on the date of right-of-entry They point out that when the bank rate changes — and it can change every week — this can be a very difficult measure to use in determining compensation. Another one that I strongly support the CAPL on is: That the Land Agents Advisory Committee deter­ mine a code of ethics and standards of conduct for land agents in Alberta. I agree with the general feeling of it, but the concern I have is: what about a code of ethics for landowners?

Perhaps we could even get the Farmers' Advocate to draw up a code of ethics for farmers. That would be an interesting challenge for him. Another recommendation is: That a complete package of information relative to surface rights in Alberta be prepared by the, and this is important, Mr. Speaker, Energy Resources Conservation Board, the Alberta Surface Rights Board, the Office of the Farmers' Advocate, and the Registrar of Land Agents . . . Surely we will also contact the landmen's association and have some input from the industry.

On right of entry, we say that right of entry should be a mandatory part of the application. They are concerned with part (

c) of this recommendation, because we have to have the respondent's rejection and objection, and rea­ sons for the objections. What they point out is that the respondent — the farmer, landowner, or whoever he may be — could delay the application indefinitely simply by not responding. They suggest that a specific time limit be given in which he can respond, and I'm sure the Minister of Agriculture will take this into consideration. [Mr. Purdy in the Chair]

792 ALBERTA HANSARD April 26, 1982 Another recommendation they are having some trouble with is 2.2: That prior to the granting of a right-of-entry order, the Board shall have in their possession a written offer from the applicant to the respondent . . . It goes on to say that the amount of money paid should be up to 85 per cent.

The problem in relation to the recommendation is that they feel the applicant would pay 85 per cent of his written offer to the respondent in all cases, and it would substantially increase the number of cases going to a hearing, thereby making the compensa­ tion hearing a farce from the company's and industry's point of view. Another item was recommendation 2.4, where it pointed out: that the order stipulate line or lines, well or wells, and describe those surface structures that might be anticipated in the future.

That's like us trying to answer the rhetorical questions the opposition sometimes lobs at us; we always defend our­ selves by saying we can't answer those. The industry is saying the same thing. How do they know what's going to be recommended in the future? They don't have crystal balls. On review of annual compensation, the committee's recommendation is that

Section 36(2) be deleted from The Surface Rights Act, and that The Surface Rights Board accept applications and

schedule hearings for the updating of agreements signed prior to 1972. Mr. Speaker, this generated a fantastic amount of debate in our committee's deliberations, and I agree with the position of the landmen on this. They do not support retroactive legislation of any kind. I have a few more here. First of all, recommendation 1.1, on conservation. We recommend: That the Land Conservation and Reclamation Council become more aggressive and vigilant . . . The CAPL believes that the Reclamation Council is doing a good job and ought not be required to become more aggressive and vigilant.

Secondly the Council, in our view, has no mandate to preserve prime agricultural land; it only ensures that when any land is occupied for industrial land, including prime agricultural land, that such land be restored in a reasonable facsimile of its original economic and/or ecological capability. Moving on, recommendation 1.2 ties into the previous one. They do not support the recommendation: That the Energy Resources Conservation Board in­ clude as part of its licensing requirement, strict reclamation-restoration guidelines to be known as the 'Soil Protection Order' . . .

Another area of concern is entry for surveying and test drilling. I think the chairman mentioned our conversation with the surveyors. There was quite a bit of input on this matter, particularly from some members of our own committee who had some rather disastrous experiences to tell us. The CAPL says: Surveying requirements are covered both under the Surveyors Act and

Section 14 of The Surface Rights Act and this recommendation would only serve as another delay tactic. On public lands, they cannot go along with our recommendation of the force-take because, as they men­ tioned previously, they oppose the concept. Another area of concern they have is occupied public lands. We recommend: That the present system which necessitates an opera­ tor to deal with both the Crown and the lessee, be retained.

The petroleum landmen disagreed with this recommenda­ tion, because they felt there's going to be rapidly escalating costs of acquiring surface rights and the trend towards increasing periods of opera­ tional delay, and I hope my colleagues, particularly my rural col­ leagues, are listening, at a time when the industry is faced with the task of achieving Canadian self-sufficiency within an ever diminishing time frame. Mr. Speaker, I think those are most of the areas I'd like to speak on, and the concerns I wanted to bring to the attention of the members.

I'm sure other members will touch on other areas, such as the concerns of trans­ mission companies and some of the other companies who are concerned with pipeline and power line rights of way. In conclusion, I would again like to say I'm pleased I was able to serve on the committee. I thank the Minister of Agriculture for asking me to do that. I do want to say once again that I think our chairman did an excellent job, and he should receive the praise of all the members of this House. MR. MAGEE: Mr.

Speaker, in speaking today on Mo­ tion No. 10, on the report of the Select Committee to Review Surface Rights, I would first like to say it was indeed an experience to be part of this endeavor of assess­ ing the problems that exist between Albertans who are part of our two most important resources in this province — agriculture and the various types of energy that exist underground and from our rivers — and through this report establish considered recommendations that will guide this and future governments in improved relations between these two great industries, and at the same time ensure to all Albertans, whether living in a rural or urban setting, the use of these agricultural and energy resources to the economic benefit of all, and that the surface of our province will suffer the least possible disturbance, so that the present generation will turn over to future generations a land surface which will continue to have the capability of providing food, forestry, clean air, and unconta- minated water, with the least possible disruption to the operations of these two industries while the extraction of underground minerals and river energies are being uti­ lized for the benefit of all Albertans.

A large assignment you might say, Mr. Speaker, and indeed it is. Many worth-while laws now in effect have largely stood the test of time. Nevertheless, fine-tuning of these laws is necessary, as well as some rather dramatic changes to improve these laws to meet the changing conditions of the present and the future, as we see them today. The future is oftentimes cloudy. I guess that is why the old adage was coined by some now-forgotten sage, who remarked that hindsight is to have 20/20 vision.

Because of the many subjects in this report to be debated, and because of a very long list of speakers who wish to debate and comment, I would like to restrict my contribution today to the subject of above-ground trans­ mission lines. A good deal of interest has been exhibited on this subject during this 19th Legislature. Two years ago, Motion 204, presented by the hon. Member for Three Hills, provided a very interesting debate on the problems associated with agricultural concerns for the location of transmission lines. While the agricultural community recognized the necessity of these lines, their

April 26, 1982 ALBERTA HANSARD 793 main concern was not so much with the local distribution systems, which generally follow the road allowances and quarter

section and

section lines throughout the province, but the proliferation of major hydro transmission lines, which often follow the most direct line; that is, cross­ country routes, taking the shortest point from source to destination. These often cut diagonally across their farm­ lands and create many problems in their farming opera­ tions. I will not go into this specific matter today, as the previous debate certainly brought the problem into high perspective. In addition, on October 26, 1979, the electric transmis­ sion line committee was established to make recommen­ dations to the Minister of Utilities and Telephones.

This report was developed by in-house members of the de­ partments of Environment, Utilities and Telephones, Ag­ riculture, the Attorney General, and the public lands divi­ sion of Energy and Natural Resources. It was commis­ sioned to bring in a report by the summer of 1980 and provide a policy statement of its recommendations, which was tabled in this House by the Minister of Utilities and Telephones on October 27, 1981, as a statement of policy respecting the location and approval procedures for major electric transmission lines.

It was very enlightening to observe the close relation­ ship of recommendations this in-house group and the select committee were able to produce. One was based on the experience of specialized personnel in the departments and one on the concerns and recommendations of indi­ viduals, associations, and utility company representatives, as expressed in their briefs to this committee.

Its recom­ mendations were compiled after it had had the opportuni­ ty to observe and consult with other jurisdictions, as relayed by the chairman of the committee, in California, Wyoming, and particularly in and surrounding Los An­ geles, and as well its study of agricultural activities and the impact of transmission lines on its operation in the United Kingdom, the Netherlands, and the federal Re­ public of West Germany. Mr. Speaker, the committee members were particularly impressed with the agricultural activities in and around electrical transmission line corridors.

To name a few, there were tree nurseries, private gardening, market gar­ dening of vegetables, hay and grain growing, as well as commercial and recreational facilities, public parks, and parking areas. As a result of its study, the committee received no information whatsoever which indicated any adverse effects on the non-electrical activities being oper­ ated within the transmission rights of way in America, Canada, or the western Europe jurisdictions. As a result, the committee made the following recom­ mendations on this matter, under two headings. One is under Planning and Systems.

It's recommended that the ERCB hold public hearings regarding the overall system of planning for electrical energy transmission corridors. These hearings should give all Albertans an opportunity for input. As you'll recall from the previous speakers, these hearings were generally held with the farming community and the individual companies who had a direct concern. But the committee suggests that all Alber­ tans now have an opportunity for input. Alberta Envi­ ronment and Alberta Agriculture should actively partici­ pate in these public hearings.

Once these initial hearings are made, the Energy Re­ sources Conservation Board should initiate a set of public hearings to make recommendations of specific major elec­ trical transmission lines. In determining the overall pro­ vincial system, every effort should be made to avoid crossing prime agricultural land. But where such situa­ tions cannot be avoided, multi-use corridors should be developed for use by both the private and public sectors.

Secondly, on the matter of compensation, the commit­ tee came forward with three basic recommendations: That improved guidelines and procedures be estab­ lished to enable potential intervenors to make appli­ cation for reimbursement for costs of intervention prior to their preparation and presentation at Energy Resources Conservation Board hearings. That legislation provide the right to landowners to seek annual compensation for all major transmission line surface structures erected by utility companies, regardless of their date of placement.

That the time frame for the overall review of com­ pensation be five years. Mr. Speaker, I have taken members' time today in referring to Motion 204 and the policy statement on this subject, previously mentioned. However, I feel that this is the opportunity for an appeal to all interested Albertans to read and absorb all they can on this subject, as a proliferation of single high-voltage transmission lines will create, in years to come, an obstruction to our view over this beautiful province as we drive around it.

As well, while wells and pipelines disappear or are out of sight by being buried beneath the surface, transmission lines will be with us for decades to come and will create a blight on our landscape in every direction unless we take steps at least to reduce their visual obstruction as much as possi­ ble. As well, in our important black soil areas surround­ ing our cities and larger urban areas, the lands under these transmission lines should be put to use rather than lie idle as they are now in most cases; that is, within our city limits and the outer peripheries in the areas of undeveloped subdivisions.

New technology in the design of hydro transmission poles will, if used, contribute much to the correction of some of these problems. The evolution of tapered steel transmission poles will assist in many ways to reduce site problems as well as obstructions farmers have to face, rather than having the regular lattice type of structure we see today. Because of their very small base, these tapered poles can be located on fence lines, even with very high capacity requirements such as the 765 kv. lines now being developed in Quebec, the 500 kv. lines which are now becoming common in this province.

Up to even 1,220 kv. load lines can be located on this slim, high, single- pedestal type of structure. Also their slim, high profile will permit much less use of land area within the cities, which can have a measur­ able impact on the costs of servicing which has to cross these lines. I personally feel that this added height feature that can be attributed to these slim structures with a small base will even permit the building of residential houses under these these lines. So while we still have more things to study and improve on, Mr.

Speaker, I feel we can quite easily improve on our present system in the years to come. I urge all members to approve this report and, in particu­ lar, this

section as tabled. Thank you. MR. CLARK: Mr. Speaker, as a former member of the legislative committee on surface rights, it's a pleasure for me to take

part in the debate today. As a committee, we travelled the length and breadth of this province, and sat down with both the rural people and the industry. To say the least, it was a learning experience. I must say that

794 ALBERTA HANSARD April 26, 1982 some of us on that committee learned a little quicker than others, but it was a learning experience. At this time, I would like to say how much I appre­ ciated the committee. It was made up of people of dif­ ferent occupations. Some of the industry accused us that it was loaded with farmers. I said that, if anything, it was loaded with schoolteachers; I didn't see many farmers on it. Anyway it was an interesting committee and was chaired by a very capable person, the Member for Barr­ head. I know we all appreciated his input and hard work on the committee.

We affectionately called him Chairman Mao. He sometimes even let us win an argument or two, and I thought that was kind of nice of him at the time. I would like to say a personal thank you to all members of the committee for allowing me the privilege of being a member of that committee. I guess it was members like the hon. Member for Bonnyville and the hon. Member for Calgary McKnight who made it so interesting. Some­ times when we sat down in Red Deer to put this altogeth­ er, I wondered if they had been at the same hearings.

When we speak of surface rights in Alberta, we imme­ diately think of the gas and oil industry. The gas and oil industry is really only a part of surface rights acquisition in the province of Alberta. Every time we build a power line or a dam, and every time we or a municipality widen a road, some landowner is forced to give up the owner­ ship and use of his land for the public good. When they are driving down the road, maybe some people should ask themselves a simple question: when was the last time I gave up anything for the public good in Alberta?

Maybe it would change their attitudes a little on what the farmers are giving up. The legislation we now have says, in very simple lan­ guage, that when a farmer gives up his land — or is forced to give up his land, would be a better wording — for the common good, he will be no better off and no worse off than he was to start with. To our modern farmer this is really an unacceptable situation, because they are businessmen. Farming is no longer a way of life. It's a very competitive business, and they feel their land is there to make a profit.

If they are forced to give up this land for any reason, the profit they would have made on that land should become part of the compensation for the taking of that land. In effect they are saying that even if the Alberta government, the oil companies, or anybody, takes the land, the no-better-or-worse formula we have used for years in determining the compensation landowners re­ ceive is no longer acceptable.

They are saying that when a small piece of land is taken for road widening, a pipeline, or for any other reason, this small portion of land cannot be replaced to their land holdings and, for many years down the road, is a loss in their income that they should be compensated for. They're also saying that when they are compensated for a 10- or 20-acre parcel, it is impossi­ ble for a rural person to roll that over into another 20-acre parcel; they are forced to pay capital gains, and this capital gain should also be considered a loss the farmers should be compensated for.

On the other hand, industry is saying quite simply that if it has to pay more for the acquisition of land rights, it is going to increase the price of utilities and gas and oil to the consumer. I agree with that statement; I believe it's true. But the farmer who loses his land does not really believe that it's up to him to suffer a loss for the benefit of all Albertans. He is saying that if it benefits all Alberta, then all Albertans should equally share in the cost.

In a nutshell, I guess this is really the situation our legislative committee found itself in in the rural areas when we got between the rural landowners and the indus­ try. Both sides came up with some very convincing and excellent arguments. We had a difficult time coming up with something that would be fair to the oil companies and the industry and, at the same time, compensate farmers for the losses they incur when, under the forced- entry clause of our legislation, the general public takes land from the landowners for the public good.

One of the more controversial recommendations of the surface rights select committee was the forced-entry pay­ ment of so much per acre. The forced-entry payment recommendation was made for the precise reason I just mentioned: to compensate farmers or landowers for the force-take aspect of the legislation, which is now in effect and which gives the right to certain utilities and compa­ nies, municipalities, and government to force a landowner to sell his land, against his will, at a price set by a government body.

This report simply recommends that the farmer be compensated for that right of entry in that forced-entry clause. Annual rentals on pipelines and power lines caused a great deal of debate within the committee itself and was not among the recommendations made by the committee. This recommendation was made to the committee by almost 100 per cent of the landowners who put in submis­ sions to us. We made no recommendation. We left that up to negotiations between the industry and the surface rights groups.

From talking to the president of the Alber­ ta Surface Rights Federation, I understand that Nova has agreed to pay annual rentals on their pipelines. So I think this is something that can be settled between the industry and the surface rights groups. The president advised me on the phone last week that the surface rights groups were very concerned that annual rentals was not one of our recommendations and that they might be prepared to go so far as to boycott any more agreements until such time as industry is prepared to look at annual rentals on pipelines and power line rights of way.

This would have a tremendous effect on an already overloaded Surface Rights Board, and I think that if this were to happen, it would be detrimental to the industry and the people of Alberta. So I hope that indus­ try will begin to listen to landowners and to some of the surface rights groups, so that some meaningful negotia­ tions like those that took place between Nova and the federation, can take place. As a group, we made no recommendations for or against annual rentals. Our re­ port is quiet on that. Whether they should be paid is up to the agreements worked out between the industry and the people.

I would like to speak very briefly on one other recommendation in the report, that all agreements, even those signed before 1972, have a five-year renewal clause. This was debated at length, and the feeling of the committee was that the industry had had ample time to renegotiate that clause, and to bring them all up to a five-year review. In all fairness, 90 per cent or so of the industry has done this. But in their submissions to us, both industry and farm groups have said that a renewal clause should be in effect for all agreements, not just those from 1972.

The landowners have said that five years is too long; that it should be a three-year review, similar to Saskatchewan's. The committee's report on this issue recommended that all leases be upgraded and renego­ tiated every five years. On pages 27 and 28 of the report, the committee made several recommendations in the area of major electrical

April 26, 1982 ALBERTA HANSARD 795 transmission lines. But one of the more controversial ones is: That legislation provide the right to landowners to seek annual compensation for all major transmission [line] surface structures erected by utility companies, regardless of their date of placement. This of course is of concern to the utility companies, because they are saying it's going to increase the price of power to Albertans. On the other hand, farmers are saying exactly what I said in my opening remarks. They do not believe it's up to them to subsidize the rate of power for all Albertans.

Not only are they saying that, but they are also saying that annual compensation should be paid, not only on the structures, but on the entire right of way the companies have leased. As a farmer, I would much rather have a pipeline across my land than a power line. Even though the pipeline places a lot of restrictions on your land, at least you can farm over it, and there's no weed problem. If it's reclaimed right, it has not too detrimental an effect on your farming operation. But a power line is a different matter, because there is a continual weed problem.

If you grow anything under the power line, the power compa­ nies have the right, at any time, to come in and drive through your crop. If they damage that crop, it's up to you to prove and collect the damages. So farmers and rural people are saying they would like to have complete annual rental on the right of way the utility company leases from the landowner, and has access to. However, the committee again remained quiet on this aspect of annual rental on the complete right of way. We made no recommendation on that.

The only recommen­ dation made was annual rental on all above-ground struc­ tures on major power lines. We did not make any recommendations whether the farmer should receive any rentals on rights of way and power line leases. We again left that to the negotiations between the surface rights groups and farmers, and the company. Mr. Speaker, I would like to conclude by mentioning one other area of real concern to landowners.

When we went around Alberta, we had many, many briefs on reclamation, not only of oil sites and pipelines; people are also concerned about allowing good farmland in Alberta to be used for surface mining. They're concerned that the land would not be reclaimed to its original state. I believe they're also concerned that the importance of good farm­ land in Alberta does not have as high a priority with our government as maybe it should have. That was brought up to us several times, and that our land surface reclama­ tion people were not really doing the job they should in rural Alberta.

They should be out there to ensure that land, when disturbed by the gas and oil or mining indus­ tries, is put back in as good condition and productive value, or even better, than it was before. We looked at the reclamation Act as it is now in effect in Alberta, and came to the conclusion that the Act itself was workable, but maybe the land conservation council should become a little more aggressive and vigilant to ensure the conservation of good topsoil and the preserva­ tion of prime agricultural land.

We also recommend: That the Energy Resources Conservation Board should include as part of its licensing requirement, strict reclamation . . . guidelines to be known as the 'Soil Protection Order' as determined by the Land Conservation and Reclamation Council in consulta­ tion with Alberta Agriculture . . . We also made a recommendation that the Land Con­ servation and Reclamation Council address itself to up­ grading the qualifications of some of their reclamation officers, and that the local reclamation officers become part of local agricultural development committees.

On pages 25 and 26 of the report, we made several other recommendations in regard to surface mining reclama­ tion. At the present time an MD such as Edmonton, wanting to produce power, takes land for a mine under the Expropriation Act. But a private company like Tran- sAlta or some other power company, goes to the Surface Rights Act. So you could end up with people in rural areas losing their land to surface mining and wondering why there could be such a discrepancy in some of the payments, because two different bodies bring in the compensation for it, and they work under two different Acts.

There could be two entirely different sets of rules. So we looked at whether we should put it all under the Expropriation Act, the Surface Rights Act, or bring in a new Act especially for surface mining. We also recommended that when a landowner had to give up rights to his land for surface mining, and it took a part or all of his farm, the landowner be adequately compensated to re-establish a home or farm on land of equal value. By land of equal value, I don't mean telling him, when he was was 10 miles from the city of Edmonton, to go 100 miles, or to go down to Drum- heller. I think it's got to be fair.

If he has land within a radius of 20 miles of Edmonton, he should be paid enough compensation so that he can re-establish himself in that community. Another recommendation is that the landowner should be in a position to initiate the procedures of the sale of his or her land, when he thinks it was desirable to buy. People were pretty determined on this recommendation. If a landowner's farm is expropriated for surface mining, he then has no idea when it's going to be required by the mining company, and when he's going to lose his farm. It could be five years, 10 years, or six months.

He doesn't know from one day to the next when the company will decide to buy his land. It is therefore desirable for him to be able to say: I have found a farm I would like to have in this area and, seeing my farm is in the land that's going to be mined, I would like you to buy it now; I will move out, give you the land, and buy my farm. If the mining company didn't need that land, it would be in a position to rent it to somebody for the ensuing years, and the landowner would be entitled to go out and buy a farm of equal value that he agreed on, with no rush.

One recommendation was that the land­ owner should be in a position to initiate the sale at such time as he desired to buy a new farm. Another recommendation was that when we reclaim surface mining, it be reclaimed at a productive level as good, if not better, than before mining took place. I had the privilege of going into the States with the committee, and looking at some large mining areas where they're moving 150 feet of topsoil to get down to the coal. They're putting that land back in better shape than it was before, as far as productivity is concerned.

If they can do this to produce power in the United States, I can't see why we can't do it in Canada, and produce power at a profit. I can't see why our reclamation standards can't be just as high as they are in a similar area in the United States. In closing, Mr. Speaker, I would just like to say that I believe it is important that to help clear up the backlog of the Surface Rights Board, Alberta begin to implement some of the recommendations in this report. I personally would like to see some further negotiations between in­

796 ALBERTA HANSARD April 26, 1982 dustry and farm groups in major areas of concern that are still there. I don't believe they're going to go away. I mentioned some of them: annual rental on pipelines, power lines, and other areas might have to be renego­ tiated. But I believe the government has to take some steps in the immediate future to implement the recom­ mendations we have made. I hope all members of the Legislative [Assembly] will support this report. Thank you very much. MRS. CRIPPS: Mr.

Speaker, as the MLA for the con­ stituency of Drayton Valley, I'm acutely aware of the vital role of both agriculture and oil in the economy of this province. I was pleased to be a member of the select committee on surface rights, which had the stewardship of trying to come up with a reasonable solution to that problem. Mineral rights are generally held by the province. When they are sold, the buyer of course is guaranteed the right to develop them; that is, the right of entry. Over the years, the problem has arisen because mineral rights and surface rights are held by two different owners.

The development of these two resources is often incompatible and, in fact most of the time, causes serious conflict between the two owners. The assumption is that the mineral holder will negotiate an agreement with the sur­ face owner regarding the area needed for mineral development. Mr. Speaker, the difference in interests between these two groups has caused antagonism, distrust, and outright conflict. I sincerely believe that some of that conflict has resulted from misunderstanding and lack of communica­ tion, and partly because of insensitive legislation.

I won't try to recap all the changes that have taken place since 1972; I'll just say that I really believe there were some very unjust abuses of the right-of-entry privileges in the early years of the oil industry. These issues have resulted in some animosity still being felt in rural areas of Alberta where the oil industry was prominent in the early '50s. As I said, I was pleased to be a member of the select committee on surface rights, which was to take an in- depth look at these long-standing problems.

From my point of view, and from the point of view of representing the constituency of Drayton Valley, the select committee report must — and I repeat that, Mr. Speaker — must be fair to both agriculture and the oil industry. I want to re-emphasize that point. The report had to be balanced, it had to be fair, and it has to be reasonably acceptable to both industries. I have been questioned by one industry or the other: why wasn't this in the report? I usually answer: because we felt it just would not be acceptable to either the agricultural industry or the oil industry.

If it's totally unacceptable and not fair, I don't believe you can put it in a report meant to resolve conflicts, rather than create more. I believe this is the key to assuring reasona­ ble, amicable agreements between two diverse, dynamic industries: oil and agriculture. I'll try briefly to outline my major concerns. I'm cer­ tainly not going to go into all of them, because there are many speakers and I know the points will be well covered elsewhere. The first major concern I had when elected, and have carried to the point of bringing in a motion, was the location of well sites.

It just seems incredible to me that you have a well site — which has to have an access road, a power line leading to it, and pipelines leading from it — located in the middle of someone's quarter section. It was a subject of emotion on October 28, 1980. I was really pleased that the ERCB made a ruling which moved the oil site location to the northeast corner but, more important, noted that the location should be flexi­ ble. I think it's extremely important that we have to be flexible in the location of these wells.

The other problem I've come across many times in my constituency, with regard to oil well location in the middle of a quarter, is the lease roads. There are hun­ dreds of miles of lease roads in my constituency, which are about 600 feet off the road allowance. There were no roads in the area at the time, so they took the line of least resistance, which was from well to well. All those roads are now causing major problems, because the area has become settled. They run across the centre of a quarter, cause a lot of problems and, in my estimation, are another example of lack of foresight.

I hope the Minister of Energy and Natural Resources, the Associate Minister of Public Lands and Wildlife, and the Minister of Transportation will take a look at ensur­ ing that future roads built to oil well locations are built on road allowances. With the movement of the site to the northeast corner, I think this will probably be far easier to do. The government may in fact have to give some assistance to compensate for extra costs of building the roads on road allowances, but I'm sure those costs would be reimbursed many times over if the area were settled in the future.

The second area, compensation, of course was a key issue throughout the province. Since other members to a degree have covered the initial compensation of the lease site, I won't go into that, except to say that those compensation payments are not freely negotiated. Any indication that they are, is totally wrong. Everyone who negotiates a well site or, for that matter, a pipeline right of way, knows they have no alternative. The oil company or the mineral holder, whatever they may be, has a right of entry.

I guess that's caused a lot of conflict throughout rural Alberta, because everyone knows they are not nego­ tiating freely. They have a club over their head, which is the right of entry. The one change that I think is particularly important is

Section 36(2) of the 1972 Surface Rights Act: This

section applies only to compensation orders made after January 1, 1972. Mr. Speaker, in my constituency, many wells were drilled prior to 1972. If the oil company or, for that matter, the farmer cannot come to an agreement on annual rentals of any well locations drilled prior to '72, they have no recourse. I believe this is a key recommendation in our report: they have to be able to take all renegotiations of lease rentals to the Surface Rights Board. In fact, I believe this is one of the key recommendations which will be of assistance not only to farmers but to oil companies.

The other area of compensation I had a major concern about is tying it to the land. Newer fields probably don't have that kind of problem. But in older fields where land may have changed hands, a major problem shows up. If we don't do something about it now, I think it will be a major headache in the years to come. The yearly rental is paid for loss of use, inconvenience, and damage. An absentee non-landowner certainly does not have any in­ convenience, loss of use, or damage. For that reason, I believe the annual compensation should stay with the land.

I believe this will benefit not only the landowner but, again, especially the oil company, and I highly endorse that recommendation in the report. In our hearings it became apparent that reclamation was one of the major concerns. Since the Member for Drumheller adequately outlined the recommendations we

April 26, 1982 ALBERTA HANSARD 797 made on reclamation, I certainly don't intend to go through all of them, except to say that we talked about the temporary reclamation certificate. I believe it is im­ portant that that should be implemented. I also want to mention the area of reclamation and conservation of water wells. The onus should be on the mineral companies to prove that they don't adversely affect water wells. I believe the Department of the Envi­ ronment should do some major studies on water forma­ tions in this province. I really don't believe we know what's happening to ground and surface water.

Certainly the owner of a good water well shouldn't have to prove that someone else damaged his well. If there's been recent activity in the area, they should have to prove they didn't damage the well. I think we have to give special consideration in the area of reclamation, recognizing that gray-wooded soil and shallow soil conditions are unique, and that they're far harder to reclaim than the heavy black soil areas of the province. In the special areas, we noted it takes years and years to reclaim some of that good grassland.

There can't be blanket, overall reclamation regulations for this prov­ ince, unless it is that the land must be as good or better than it was prior to drilling, open-pit mining, or whatever it may be. After visiting some open-pit mines, I came away firmly convinced that good reclamation is possible, and that the onus needs to be on the government to ensure that companies know what is expected of them, that legislation is in place, and that good practices are adhered to. I think the Land Agents Licensing Act is a move in a positive direction.

That came out about the same time as our report, so we really don't know whether it will be effective. But, believe me, we certainly heard some horror stories about dealings with the farmer. I believe that's one of the reasons the committee recommended the informa­ tion package, so that everyone believes they're working from the same footing. Mr. Speaker, the last issue I want to raise is the trauma to a community or farmer faced with the loss of his home and livelihood by the development of an open-pit mine. Again, the Member for Drumheller raised it.

It's certainly important that we take a look at adequate compensation for the loss of a home or farm. This was a subject in an earlier debate, so I won't dwell on it, except to say that I think we must give careful consideration to the concept of a farm for a farm. If the farmer is forced to move, he must not only be adequately compensated for his incon­ venience but must be able to replace that land. [Mr. Appleby in the Chair] I hope that support of this resolution will result in legislation which will create an atmosphere of trust and mutual respect between the surface rights owner and the mineral rights owner.

I only hope that, as is happening now, they will continue to discuss and talk to the groups. There's been a lot of movement in the last months, especially since the surface rights committee finished its report. The surface rights groups have been meeting with the oil companies, and I think a lot of the problems we've had in the past can be resolved by communication. I appreciated working with the committee. We had eight weeks of travel, four days a week, three meetings a day. Sometimes I think that on some days it was an exercise in endurance.

I'd just like to state that I see here that the Member for Bonnyville is again going to have the last word. I can say that that was usual. I had to get that in there, Ernie. I hope members of the Legislative Assembly will sup­ port this resolution. As I said earlier, Mr. Speaker, and I want to re-emphasize: when we bring in legislation, I believe it has to be fair not only to the agricultural industry but to the oil industry, because both are key to this province. As my constituency well illustrates, they can work together, and I hope they will work together amicably in the future. Thank you. [Mr.

Speaker in the Chair] MR. NOTLEY: Mr. Speaker, in rising to speak on the resolution before the House, initially I'd like to offer the observation that, by and large, I think the report before us this afternoon is a good one. I intend to support the resolution. But I suppose the first observation that should be made is that we had the report made public last fall. One really has to ask one's self why we aren't examining legislation at this time.

I say to the members of the Legislature this afternoon that I would like to see a clear commitment on the part of the government — I didn't notice it when the Minister of Agriculture opened the debate — that legisla­ tion is going to be prepared for the fall sittings of the House, presuming of course that we have fall sittings of the House, before Albertans are allowed an opportunity to judge the performance of us all. But it would have been much better if, instead of dealing with a resolution now, we were in fact looking at legislative changes based on this report. Mr.

Speaker, I want to deal with some of the recom­ mendations. The suggestion that all decisions of the Board be in written form and . . . issued within 14 days of the compensation hearing is a good one. In addition, the whole question of opening up agreements concluded prior to 1972 is an important recommendation. I'd just like to say that, as members of the House are well aware, we've had continuing debate in this Assembly on agreements prior to 1972, particularly in the Redwater area. I recall the discussion that took place in 1972, when changes were made.

We changed the right-of-entry arbitration board to the Surface Rights Board and, I think, took some reasonable steps in modernizing our surface rights legislation in that particu­ lar year. But the question of what happened to those agreements prior to 1972 was still left hanging. This report deals with that issue and, I think, quite appropri­ ately so. Perhaps not as major a recommendation, but an im­ portant one, is that a library of surface rights agreements be kept by the board. If implemented, it would go a long way to help farmers achieve equitable future settlements. Mr.

Speaker, one additional recommendation that I think has considerable merit is with respect to the geophysical companies obtaining a 'Permit of Exploration' from the municipality re­ sponsible for the roadway in advance of [that] exploration. I think most rural MLAs would readily agree that while seismic exploration leads to oil development, which leads to revenue for the province, it also creates havoc with roads. The question of prior notification is going to be important.

Because if compensation is required, the mu­ nicipality is in a position to track somebody down, in fact to be able to find the offending company and recover

798 ALBERTA HANSARD April 26, 1982 damages, if damages exist. Those are some good recom­ mendations contained in the report. For that reason, basically, I support both recommendations. I think there are a couple of problem areas. Much discussion has centred around the force-take payment. While that's a good concept, I think it acknowledges that farmers are at a disadvantage with regard to right-of- entry orders, but . . . And the "but" is: it doesn't take into account the serious problem of

Section 23(2) of the current Act, which does not cover all the losses, tangible and intangible, suffered by the surface owner when a mineral operator exercises his right to develop. Therefore, Mr. Speaker, I suggest that this force-take payment should be applicable any time an energy operator requires agricultural land. Just recently we had the brief presented by the Elk Point Surface Rights Association. According to Elk Point, there is a strong argument that this provision should be made retroactive to January 1, 1980.

Not only would this be fair to the surface owners, who for a long time have been anticipating a better deal, but it would likely result in the dissipation of a number of cases now pending before the board. Mr. Speaker, one area where there's been at least some representation has been the question of composition, where three members from each municipality will be on board hearings in a particular area. There seems to be at least a certain amount of confusion over their function. Presumably their presence is going to expedite the hold­ ing of compensation hearings and local understanding of the issues.

But the suggestion has been brought to my attention, at least, that why not instead establish a mechanism whereby farmer representatives can partici­ pate directly in the board, both in permanent and part- time capacities. Moving on from that point to deal with the suggested realignment of the responsibilities of the board, especially vis-a-vis the ERCB, I think there is a commendable, if you like, designation of responsibility there. But there is still not adequate provision for direct surface owner par­ ticipation on either board. This is especially crucial with respect to the Surface Rights Board.

Basically the method of appointment remains the same, the Lieutenant Gover­ nor in Council, and there are some legitimate concerns about that. Another item raised in the Report of the Select Committee to Review Surface Rights is the suggestion that landmen be subject to some code of conduct. I would say that is generally well supported. It should be contain­ ed in legislation specific to the profession, and not left basically to the profession itself to undertake an exercise in self-policing. Mr.

Speaker, the other area I'd like to touch upon, and I think this is important, is what happens in the Lloydminster-Wainwright part of the province, where we have approximately 2.5 billion barrels of recoverable heavy oil. The suggestion has been made that we should take some real time and examine the question of direc­ tional drilling, so that we reduce as much as possible the negative effect of drilling on surface rights and land in that particular area. Even with drilling at the rate of 64 wells to the section, the recovery of oil in place in the Lindberg heavy oil field is only 7 to 8 per cent.

As can be well documented, this results in a great deal of unneces­ sary destruction of food-producing soil for little return. I don't think it's unreasonable to require that this destruction be minimized by the use of directional drill­ ing. I know that some spokesmen in the industry suggest that, as an alternative, this is prohibitively expensive. But it seems to me that we have to weigh the loss of agricul­ tural land and other excessive operating expenses for the farmer against the impact on the operator of the mineral lease.

With that in mind, it seems to me that where it is at all feasible, directional drilling should be emphasized. In general conclusion, Mr. Speaker, I think it's fair to say that the report addresses many concerns that have been brought to the attention of Albertans and especially members of the Legislature. It's not too often that I congratulate government members, but I think they un­ dertook their responsibilities in a very serious manner.

They travelled extensively throughout the province, large numbers of Albertans attended the public hearings, and we now have a report which, by and large, represents a job well done. But I think the major point I would close on is: where do we go from here? Because as long as they are simply in the form of a resolution to this Legislature, the best reports in the world simply express an intent. That's fine, but the situation is not going to be changed until we have amendments presented in legislative form. I know hon. members can say we need all kinds of time to review this and consider it.

But I suggest to members of this House that before we accept or justify that kind of delay, we might well look back at what happened in 1971 and 1972. This government was elected at the end of August 1971. The Legislature was called six months later, in March 1972, and one of the very first items on the agenda of the 1972 Legislative session was The Surface Rights Act, introduced by Mr. Zander, the former Member for Dray­ ton Valley, who had researched and done a great deal of work. I commend him for the work he undertook in major changes. Ten years ago, we had swift action. Mr.

Speaker, with that as a precedent, I say to hon. members of the House that we don't want to see this report simply l