Western Canada has had a thriving conventional energy industry for many decades. It encompasses the exploration, development, transformation and transportation of hydrocarbons to markets across North America.

In Quebec, until recently the oil and gas industry was limited to distribution and transportation activities. As an industry, it regulated the infrastructure needed to process hydrocarbons and the legislation had very little to do with the exploration and development of hydrocarbons.

However, with shale gas development, technological breakthroughs, and more favourable pricing conditions, Quebec has witnessed the birth of an unconventional oil and gas industry which now includes intense activity by exploration companies, developers and possibly, over the next few years, producers.

The Western Canadian regulatory framework will be reviewed and contrasted with the emerging Quebec regulatory framework to highlight the different challenges that may arise.

We will outline the legislative framework that governs the unconventional oil and gas industry in Quebec. Also, we will address the potential liability of officers and directors regarding the reclamation and abandonment of upstream facilities.

We will comment on Quebec laws regulating land use, planning and the environment which may pose specific challenges depending on whether or not local gas lines, or processing plants need to be built or implemented.

The oil and gas industry in Quebec is made subject to mining laws that are not entirely compatible with industry practices of traditional players.

The regulation of unconventional oil and gas is emerging throughout North America.

In the St-Lawrence valley in the past 5 years, there has been a thriving exploration push. This exploration could lead in the medium to longer term to the securing of defined reserves for consumption in the local market. There had been anecdotal evidence of this over the years; however, recently this possibility has become very real indeed.

Millions of dollars had been invested over the years by local entities such as Petrolia and Gastem Inc. These juniors have partnered with western Canadian or American players which have confirmed their participation and are motivated to further exploration and development of shale gas discoveries and unconventional oil plays.

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