Change in Ownership Application




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Change in Ownership Application

Pursuant to Section 74(1)(a) through (c) and Section 21

of the National Energy Board Act (Act)

Please note that non-compliance with s. 74(1) is designated as a violation set out in Schedule 1 of the Administrative Monetary Penalties Regulations. Failure to apply for change in ownership could result in a monetary penalty or other enforcement.  Furthermore, the purchaser or leaser may also be liable for a violation of s. 30 of the Act should they operate a pipeline without a certificate or s. 58 order in force.



When to Use This Form
Use this form if:

  • you plan to sell, transfer, lease or purchase a National Energy Board (NEB or the Board)-regulated pipeline, in whole or in part;

  • you plan to purchase a pipeline or facility to transfer into NEB jurisdiction; or

  • a company with a NEB-regulated pipeline plans to amalgamate with any other company.

The Board wishes to remind companies that, in accordance with s. 74 of the Act, a company shall not, without leave of the Board, sell, transfer, lease, or purchase any pipeline, or enter into an agreement for amalgamation with any other company.


In order to comply with s. 74 requirements, these activities require approval from the Board prior to the transaction taking place. As the Board cannot retroactively grant leave under s. 74, any application made after the transaction has already taken place would be a contravention of the provisions in section 74 of the Act.

How To Use This Form
Replace pages 1 and 2 with a cover letter signed by the Applicant(s). ◄

Replace blue text in the following table with your information. ◄


Electronically file the application (i.e., this completed form and all supporting documents) following the directions on the NEB’s website. See Filing With the National Energy Board.
Underlined text in this document is a hyperlink. Hold down the “Ctrl” key and click on the underlined word(s) to connect to the Board’s website.
The use of this form is voluntary, however all the information contained in the form must be accurately included in an application filed with the NEB. Failure to include in the application all of the information required by the Filing Manual may result in delays.

Ensure A Complete Application

Read the Instructions: For information, refer to the Board’s Filing Manual online, particularly Chapter 3, Common Information Requirements, and Guide R, Transfer of Ownership, Lease or Amalgamation. Fill in all sections of the form as completely as possible. If you believe something is not applicable you must clearly justify why this is so.


Meet with NEB Staff, if required: Companies and their representatives may meet with Board staff before filing an application. Board staff can answer your questions about the Board and its application process. To arrange a pre-application meeting, please contact the Applications Business Unit by calling the Board toll free at 1-800-899-1265.
Provide Feedback: We welcome your feedback on this form. Your suggestions will help us make this form clearer and easier to use. Please provide feedback by calling the Board toll free at 1-800-899-1265.
February 2015 version

The Application

1

Date:

Indicate the date the application is filed with the National Energy Board (Board or NEB).

2

Applicant:

The Board strongly encourages the purchaser and the seller to apply jointly, if both parties are NEB-regulated companies. Provide the full legal names of the Applicant(s) -- the purchaser and the seller -- including addresses, telephone numbers, fax numbers and the name(s) of authorized representatives.

3

Authorized Company:

Provide the full legal name of the company the Board authorized to, construct, and/or operate the pipeline.

4

Board Order(s):

Provide copies of the Board Orders which authorized the construction and operation of the facilities, as well as any related orders (e.g., Amending Orders.) The Applications Business Unit at the Board may help you identify the appropriate orders prior to filing the application.

If the pipeline is not currently regulated by the Board but is coming under Board jurisdiction, provide copies of the equivalent documentation issued by the present regulator or, if applicable, its predecessor.



5

Acquiring Company:

Provide the full legal name of the company or companies proposed to own and operate the pipeline. If the owner is different from the operator, include the name of the operator and describe the relationship between the owner and the operator.

6

Accountable Officer:

The acquiring company must appoint an accountable officer who has the authority over the company’s human and financial resources required to establish, implement and maintain its management system and protection programs, and to ensure the company meets its obligations for safety, security and protection of the environment (National Energy Board Onshore Pipeline Regulations (OPR) subsection 6.2). Provide the name of the accountable officer.

7

Corporate Status:

Describe the corporate structure. Attach documentation of the corporate status such as a copy of the Certificate of Incorporation as an Appendix. Verify whether the province of incorporation is different from where the company will be carrying on business for the pipeline.

8

Action Sought:

Indicate the relief the Applicant would like the Board to grant, which will include at least one of the following:

  • grant leave for a company to sell, transfer or lease to any person its pipeline, in whole or in part pursuant to paragraph 74(1)(a) of the Act, and/or

  • grant leave for a company to purchase or lease any pipeline from any person pursuant to paragraph 74(1)(b) of the Act, and/or

  • grant leave for a company to enter into an agreement for amalgamation with any other company pursuant to paragraph 74(1)(c) of the Act, and/or

  • vary the original order made by the Board to change the name on the order to reflect the new owner/operator of the pipeline after the transaction is complete pursuant to section 21 of the Act.

See Action Sought by Applicant for more information.

9

Reason for the application:

Describe the nature of the transaction. Include relevant contracts or other supporting documentation as appendices. Explain any changes in ownership, which occurred between the issuance of the Board or other regulator’s authorization and the date of this application. See Application or Project Purpose for more information.

Operations

10

Management Systems and Programs Under the OPR:


Sections 6.1 to 6.6 of the OPR detail the required elements of a company’s management system. Confirm the acquiring company’s management system will also coordinate the following five programs:

  • Emergency Management Program (OPR section 32)

  • Integrity Management Program (OPR section 40)

  • Safety Management Program (OPR section 47)

  • Security Management Program (OPR section 47.1)

  • Environmental Protection Program (OPR section 48)

Section 6.5 of the OPR lists a number of processes and requirements that must be a part of a company’s management system and each of the five programs. Consult the Filing Manual or Board staff.

11

Emergency Signage:

Explain when emergency signage will be updated.

12

Records

The company divesting of the facilities must provide a confirmation that a copy of the records set out in section 10.4 of CSA Z662-11 and section 56(e) to 56(g) of OPR have been provided to the new owner of the facilities. If the records set out in section 10.4 of CSA Z662-11 and section 56(e) to 56(g) of OPR, 1999 do not exist, the acquiring company must provide a plan detailing how it will acquire the information/records necessary to maintain and operate the facilities safely.

Notification and Consultation

13

Consultation Program:

Describe all third party persons or groups who were consulted, the nature of any concerns expressed, and the applicant’s response to the concerns as well as how ongoing concerns will be resolved. If consultation was not undertaken, provide justification of why it was not necessary to carry out a consultation program with respect to the proposed change in ownership. See Consultation for more information.

14

Landowner Notification:

Explain how landowners will be notified of the change in ownership.

15

Commercial Third Parties:

Confirm that all commercial third parties, including third party shippers, who could potentially be affected in any way by the outcome of the application, have been notified, including the method used to notify those parties and any concerns raised. Provide a justification in the event that notification of commercial third parties was considered unnecessary. See Notification of Commercial Third Parties for more information.




The Pipeline

16

Location:

For each pipeline provide the start and end points, the length by province, and the direction of flow.

17

Description:

Provide a complete description of each pipeline and related facilities and the products to be carried.

18

Upstream and Downstream Facilities:

Describe the upstream and downstream facilities, and identify any pipeline facility that could become stranded as a result of the transaction. Provide a map or maps of the pipeline and related facilities.

19

Specifications:

Provide the outside diameter and wall thickness of the pipeline.

20

Pipe Material:

Provide the pipe material, pipe material standard, pipe grade, the pipe manufacturing process and external coating type.

21

Maximum Operating Pressure:

Provide the maximum operating pressure of the pipeline.

22

Long term use:

Describe the intended long term use of the facilities. If the long term use is different from the present use of the pipeline, the acquiring company should provide a description of plans for the future use of the facility.

23

Operating Status:

Describe the status of the pipeline (i.e., whether the pipeline is presently in operation, deactivated or decommissioned.) If the operating status has changed or will change, additional information or applications may be necessary. Consult the Filing Manual or Board staff.

24

Conditions of Service:

If, after the change in ownership, there are any changes to the conditions of service offered by the pipeline, then explain any changes to the type of service, or terms and conditions of service; and describe the effect of these changes on the operation of the pipeline. If conditions of service have changed or will change, additional information or applications may be necessary. Consult the Filing Manual or Board staff.



Financial Matters

25

Tolls and Tariffs:

If a toll, tariff or negotiated settlement is presently in effect, describe any planned changes to the toll or tariff, other than the change in ownership. If no toll, tariff or negotiated settlement is presently in effect but third party shippers are anticipated to require service on the pipeline, file a proposed tariff.

26

Value:

Provide the original cost of the asset, accumulated depreciation, and the net book value.

27

Cost:

Provide the purchase price of the asset.

28

Financing:

Explain how the acquiring company will finance or pay for the pipeline and ongoing operations. For example, if the company has a credit rating with a major credit rating agency, provide it.

29

Abandonment Funding:

  • Provide the total Abandonment Cost Estimate of the facilities being sold or transferred.

  • Provide a draft copy of the purchaser’s letter of credit, surety bond, or trust agreement for abandonment funds.

  • Provide the dollar amount of abandonment funds that will be in the purchaser’s trust.

  • Describe how the purchaser intends to collect, or contribute, funds to the trust, as applicable.

  • Describe the intended actions, if any, of the seller for its existing letter of credit, surety bond or trust for abandonment funding.

For information regarding Abandonment Funding please see Reasons for Decision RH-2-2008, MH-001-2012, and MH-001-2013.

Jurisdiction

30

Changes to Jurisdiction:

Most often, the pipeline is currently regulated by the NEB and will continue to be regulated by the NEB. If this is not the case, please describe the circumstances surrounding the transfer and why jurisdiction for the pipeline will change.

For pipelines coming into NEB jurisdiction the acquiring company is required to submit the application. Apply concurrently under either section 58 or section 52 of the NEB Act (see Guide A of the Filing Manual) for authorization to operate the pipeline, as if the pipeline were a new facility. You must also apply concurrently under section 47 for leave to open (see Guide T of the Filing Manual or contact the Board).


If the change in ownership results in the seller having no remaining assets that are regulated by the NEB, please provide the Board with notification in this section.









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