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September 2015. Our industry has endured one of the most challenging summers in recent years – both in terms of commodity pricing and in terms of the regulatory landscape we find ourselves in. There have been significant changes in our pipeline operational space with updates to Z662, recently released audit results from the NEB and an increased focus in Alberta by the AER; largely driven by several recent incidents and findings. Operators will see a sustained focus on their pipeline operations, maintenance and integrity plans by regulators across Canada for the foreseeable future. The expectation by the public, stakeholders and the regulators of operators to demonstrate that our operations are being conducted in compliant manner; including the ability to provide supporting documentation that demonstrates due diligence is only increasing. Regardless of the financial landscape we are all operating in today, our ability to understand and maintain compliance across all aspects of the regulatory landscape are critical and do not lessen with low commodity prices.

It’s no longer business-as-usual in BC’s resource industry. First Nations have a stronger voice than ever when dealing with projects proposed on their territory and as result, the rules of engagement are undergoing a fundamental change. Recognizing that engagement with First Nations must be done better, but also differently, is good news for everyone. Resource companies are transforming their relationships with First Nations communities, embarking on long-term, comprehensive partnerships that, ultimately, create mutual benefit for all. Here’s why:

Historically, procedures for engagement with groups such as First Nations communities and local communities affected by resource development were driven by the highly prescriptive regulatory process. Engagement was primarily informational and included activities such as engagement meetings and documentation of consultation processes.

Our clients, energy companies and First Nations alike, tell us that the prescriptive regulatory approach has not produced satisfying long-term results for any parties. Companies are realizing that to improve outcomes, they must gain a deeper understanding of Aboriginal values and communities, and proactively engage with First Nations collaboratively across project lifecycles.

Our First Nations clients have told us they recognize the need to take a more comprehensive approach. They’re looking at responsible energy development as a way to ensure the long-term sustainability of their communities and the environment and drive economic independence. For many communities there is a heightened focus on community benefits, greater decision-making power, and partnerships.

Today’s leading companies take a strategic approach, one which contributes to the long-term well-being of communities impacted by development. This approach involves working with leaders to identify areas were the greatest benefits to be had, investing in them, establishing specific goals, and measuring progress through performance metrics. Partnerships announced by Steelhead LNG Corp. and the Huu-ay-aht First Nations (HFN) and Malahat First Nations to develop land for LNG facilities in both communities and share long-term benefits exemplifies this new approach to engagement. Larger, more complex LNG projects in development have also involved the negotiation of forward-looking agreements with multiple First Nations. Before long, these best practices may well become standard procedure.

Companies adopting this new approach must look at including more extensive capacity-building benefits into community agreements, ones which include but are not limited to: meaningful, long-term local employment and procurement opportunities; support for local education and training initiatives; equity participation; and long-term impact measurement.

One new strategy, developed by Deloitte and First Nations communities, is the re-establishment of traditional forms of decision-making through community trust structures. These trusts put control of resource development wealth into the hands of communities instead of banks, as has traditionally been the case. Investment decisions are made by trustees chosen from within communities as opposed to corporate trustees with no stake in the development of the community.

These new approaches represent a major shift in how the energy industry will do business in the future, how professionals will provide support and how First Nations will approach to resource development going forward. Well-planned engagement strategies will embrace core business processes and enable higher returns on investment and establish as sense of long-term certainty for communities and companies alike. Approaches to First Nations engagement will include forward-thinking strategies which understand communities’ priorities, build consensus and capacity and performance measures and investment assessments that track actual outcomes against goals. An engagement-minded dealmaker will look for a mutually winning scenarios and assess and communicate performance in a timely manner, facilitating good conditions for business outcomes.

While the “new rules of engagement” may appear to require a significant amount of effort, the benefits they produce, particularly in a competitive environment, are worth it. In the end, authentic engagement between all members in a resource project provides, secure, significant and long-term economic benefits for all parties – and that’s good news for everyone.

CFOs and their teams have difficult jobs that get all the more challenging during volatile times. Deloitte surveyed CFOs from many large Canadian upstream oil and gas companies and learned that, during volatile times, a CFO juggles 4 roles – catalysts, strategists, stewards and operators. For Finance to step up to be a strategic advisor to the board in such situations, CFOs and their teams will need to rethink and retool the organization to think differently about people, process, data and technological capabilities.

To learn more about what the survey revealed, visit
https://www2.deloitte.com/ca/en/pages/energy-and-resources/articles/enhancing-the-cfo.html

Cyber attacks have now become a major risk for organizations of all sizes, across all sectors. Many, however, lack the internal tools, team knowledge and skills required to effectively protect themselves and respond to cyber threats. This can not only lead to financial loss and legal issues; it can also put your hard-earned reputation at unnecessary risk.

The energy and resources sector faces specific challenges dealing with fraudulent connections to service systems, attacks on the SCADA systems that monitor and control industrial processes, and attacks on employees, “the human operating system,” in the form of targeted malware and spear phishing emails and URLs.

The Canadian Cyber Intelligence Centre (CIC) is designed to provide clients with a range of customized, integrated cybersecurity services that deliver 24/7 monitoring and advanced threat detection for critical IT systems and data. The CIC provides clients with leading cybersecurity solutions to help them stay ahead of cyber threats and risks. With the CIC, clients can choose either a complete managed security solution or select services to augment existing capabilities to ensure that their organization remains secure, vigilant and resilient against cyber-crime.

To learn more about Deloitte’s Western Canada Cyber Intelligence Centre and our cyber risk capabilities, visit www.deloitte.ca/cyber or contact Justin Fong, Partner, Enterprise Risk Services

Companies on average leak 3-5% in costs in vendor management. Learn how you can recover this spend from our cost reduction video series.

On June 15, 2015 the Canadian Standards Association (CSA) released a new edition of CSA Z662 oil and gas pipeline systems. Under section 1 of the pipeline regulation and section 1 of the drilling and production regulation, this new edition of the standard is immediately incorporated into the pipeline regulation and the drilling and production regulation. As there are significant changes and additions to the standards, the commission requires all companies to review the latest version of CSA Z662-15 and take the necessary steps to ensure compliance.

For further information, please refer to CSA Z662-15 Oil and Gas Pipeline Systems. This information can be found through the CSA website.

WorkSafeBC has created a downloadable guide to assist you in filling out the four-part employer incident investigations report in conjunction with the requirements of the Workers Compensation Act, Part 3 Division 10, and the interim policies D10-175-1 and D10-176-1.

You can get more resources on this topic online.

The Workplace Hazardous Materials Information System (WHMIS) 2015 requirements are laid out in the amended Hazardous Product Act (HPA) and the new Hazardous Products Regulations (HPR). Please refer to the link WHMIS 2015 - Orientation to see where specific topics are referenced. This section provides information on some of the key regulatory changes to WHMIS 1988 as a result of the coming-into-force of the modifications to the HPA and the coming-into-force of the new HPR. Additional technical guidance is expected to be added throughout 2015.

You can get more information on this here.