The Environmental Protection Security Fund operates under the authority of Section 32(1) of the Environmental Protection and Enhancement Act (the Act). Regulatory processes are detailed in the Conservation and Reclamation Regulation and the Waste Control Regulation. For oil sands mines, further direction regarding submission of reclamation security estimates is provided through approvals issued to operators under the Act.
The purpose of the fund is to hold security deposits to assure satisfactory land reclamation will be carried out pursuant to approvals under the Act. When conditions of the approval are met and a reclamation certificate is issued, the funds are returned to the depositor. Partial refunds or credits are given when part of the reclamation work is completed. If the conditions of the approval are not complied with and the operator is unwilling or unable (e.g., in a bankruptcy) to complete the necessary reclamation, the funds will be used for this purpose.
Security is collected for certain specified activities, including Coal and Oil Sands Mining Operations, Landfills, Hazardous Waste and Recyclable projects, Quarry Activities, Waste Management Facilities, and Sand and Gravel operations. Pursuant to the regulations, the depositor provides the Director with an estimate of the actual cost of reclamation.
For oil sands mining operations, security estimates are updated annually based on the total projected disturbance and reclamation activities to the end of the upcoming year. The estimates are based on third-party costs to reclaim that projected disturbance. The Director reviews the estimate and either accepts it or requests further information. Once the estimate is finalized, the depositor provides the required amount of security, typically as a Letter of Credit, guaranteed by the depositor’s bank. The industrial plant sites associated with the mines are not included in this calculation, as per the Act. There is some grandfathering under the previous Land Surface Conservation and Reclamation Act, whereby Syncrude Mildred Lake and Suncor’s Lease 86/17 remain secured at $100,000 plus three cents per barrel of production.