THE NEGOTIATOR. Resources Plays and Multiple Operating Agreements CAPL Property Transfer Procedure. A Tale of Two Conferences

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1 THE NEGOTIATOR The Magazine of the Canadian Association of Petroleum Landmen November 2017 Resources Plays and Multiple Operating Agreements All For One and One For All 2017 CAPL Property Transfer Procedure New PTP: Further Improvements A Tale of Two Conferences Looking Back at 2017 Looking Forward to 2018

2 lawyers Your energy partner Building on over 20 years of recognized oil and gas leadership and valued relationships with CAPL, McMillan continues to be your trusted and experienced energy counsel. For more information on the services McMillan s Energy Group can provide, please visit our website or contact a primary member of our energy team. Michael Thackray, QC e: michael.thackray@mcmillan.ca t: Adam Maerov e: adam.maerov@mcmillan.ca t: Andrew Stead e: andrew.stead@mcmillan.ca t: Greg McIlwain e: greg.mcilwain@mcmillan.ca t: McMillan LLP Vancouver Calgary Toronto Ottawa Montréal Hong Kong mcmillan.ca

3 THE NEGOTIATOR The Magazine of the Canadian Association of Petroleum Landmen Senior Editorial Board Director of Communications Marah Graham [ph] Advertising Editors Darcy Cosgrove [ph] Hallie MacCuaig [ph] Coordinating Editor Kristin Rennie [ph] Feature Content Editors Amy Kalmbach [ph] Regular Content Editor Martin Leung [ph] Social Content Editor Jason Peacock [ph] THE NEGOTIATOR GROWING POSSIBILITIES REGINA 2018 CAPL Conference Editorial Committee Christine Balash [ph] Design and Production Rachel Hershfield, Folio Creations Printing CBN Commercial Solutions Submissions For information regarding submission of articles, please contact a member of our Senior Editorial Board. By providing submissions to the Canadian Association of Petroleum Landmen for publication in The Negotiator you are granting permission for the content to be posted or re-posted on the CAPL website and CAPL s affiliated social media. For further information regarding the submission of articles, please contact a member of the Senior Editorial Board. Disclaimer All articles printed under an author s, association s or corporation s name represent the views of the author; publication or posting neither implies approval of the opinions expressed, nor accuracy of the facts stated. Advertising For information, please contact Darcy Cosgrove ( ) or Hallie MacCuaig ( ). No endorsement or sponsorship by the Canadian Association of Petroleum Landmen is suggested or implied. The contents of this publication may not be reproduced outside of the Canadian Association of Petroleum Landmen regulated content, either in part or in full, without the consent of the Senior Editorial Board CAPL Board of Directors President Larry Buzan, P.Land Vice-President Noel Millions, PSL Director, Business Development Alberta Tim Galbreath Director, Business Development Saskatchewan & Alberta Oilsands Michelle Creguer Director, Communications Marah Graham Director, Education Robyn Baron, P.Land, PSL Director, Field Acquisition & Management Rob Pettifer, P.Land, PSL Director, Finance Kristin Rennie Director, Member Services Rob Pitchford, PSL Director, Professionalism/Business Development (BC) Glenn Miller, PSL Director, Public Relations Gary Richardson, PSL Secretary/Director, Technology Shaun Williams Director, Social Janice Redmond Past President Larry Buzan Readers may obtain any Director s contact information from the CAPL office. Suite 1600, Avenue S.W. Calgary, Alberta T2P 3R7 [ph] [fax] Kaitlin Polowski Denise Grieve Karin Steers reception@landman.ca dgrieve@landman.ca ksteers@landman.ca Features November Resources Plays and Multiple Operating Agreements Michael A. Thackray, Q.C CAPL Property Transfer Procedure Jim MacLean In Every Issue 12 Board Briefs 14 Get Smart 23 The Negotiator s Message From the Board: Social 24 Roster Updates 25 In Memoriam 27 The Social Calendar 28 CAPL Calendar of Events 28 November General Meeting 28 CAPL Christmas Networking Event Also in this issue 19 CAPL 2017 Conference CAPL Conference Cover Photo: 2017 Conference Committee Front row left to right: Ebony Heffernan, Donna Brown. Kayley Stokes, Gloria Boogmans, Mandy Cookson Back row: Larry Buzan, Joe Iaquinta, Richard Fulton, Gord Howe and Pat Burgess

4 Resources Plays and Multiple Operating Agreements All For One and One For All 2 Spyglass Resources Corp. v. Bonavista Energy Corporation 2017 ABQB 504 AS NOTED BY C.M. JONES J. IN THE SECOND PARAGRAPH OF HIS LENGTHY DECISION IN THIS CASE, the facts of this matter are convoluted. My job for these pages is to make them not so. To that end, at the constant and clear risk of over-simplifying, the streamlined facts are as follows. Operator (Bonavista) incurs abandonment costs at the direction of the AER. Joint-Operator (Spyglass, in receivership) does not pay its proportionate share of these costs on the basis that (for the most part), Joint-Operator did not approve the same. Operator sets-off revenues (actually non-cash gas-over-bitumen royalty credits, the GOB Credits ) otherwise owing to the Joint- Operator as against the abandonment costs owing by the Joint-Operator. Joint-Operator (actually its receiver) cries fowl. CAPL Operating Procedures (1981 and 1990) and a CO&O Agreement govern, the CO&O Agreement importantly providing: WRITTEN BY MICHAEL A. THACKRAY, Q.C. MCMILLAN AND ASSOCIATES

5 At the weigh-in, it was determined that the Operator largely ignored the Joint-Operator s requests for a meeting to discuss the abandonment program and that the Joint Operator in fact never did approve the abandonment program. 602 Operator s Lien costs in the first place. At the weigh-in, it was determined that the Operator largely ignored the Joint-Operator s requests for a [ ] meeting to discuss the abandonment program and that the Joint Operator in fact never did approve the abandonment program. If an Owner fails to pay or advance any of the costs or However, this notwithstanding and although his reasons are a bit expenses incurred for the Joint Account which are to be skinny on this (sorry, sometimes I can t help myself) and might paid or advanced by it within the time period prescribed in the future be restricted in application to these very particular by the Accounting Procedure, Operator may, without facts, C.M. Jones J. determined that the Operator did not require limiting the Operator s other rights as contained in this approval from the Joint-Operator to incur expenses for the joint Agreement or otherwise held at law or in equity: account relating to the regulatory obligation to abandon the subject assets and that while the Operator s... lack of respon- [ ] siveness is unfortunate, I find that it does not make what was otherwise a proper expense for the Joint Account [the Operator s] Set-off against the amount unpaid by such defaulting sole responsibility. Third round TKO, now on to the main event Owner, any sums due or accruing to such Owner from being whether the Operator was entitled to net the abandon- Operator pursuant to this Agreement. ment costs against the GOB Credits. (emphasis C.M. Jones J. s) Forced against the ropes early in the first round, the Joint- Operator acknowledged that the Operator could set-off the The above versus what is provided in Clause 505(b)(iii) of the GOB Credits against unpaid amounts due or accruing to the CAPL 1990 Operating Procedure (there is no express set-off provi- Operator from the Joint-Operator under the CAPL Operating sion in the 1981 CAPL Operating Procedure) being: Procedures. However, fighting off the ropes, the Joint-Operator maintained that the CAPL Operating Procedures did not 505 (b) If a Joint-Operator fails to pay or advance any authorize the Operator to withhold the GOB Credits to offset of the costs or expenses incurred for the joint account disputed charges the Operator claimed owing to it under the which are to be paid or advanced by it within the time CO&O Agreement and that the Operator had to maintain all of period prescribed by the Accounting Procedure or Clause the assets for the joint account in accordance with the distinct 502 or 503, as the case may be, the Operator may, without terms of [the two JOA s and the CO&O]. The Joint-Operator limiting the Operator s other rights as contained in this then maintained that Clause 602 of the CO&O Agreement Operating Procedure or otherwise held at law or in equity: (set out above) required the Operator to determine what, if any, amounts accruing to the Joint-Operator under the CO&O [ ] Agreement could be set-off against the abandonment costs and then factor that amount into the overall netting of the joint (iii) set-off against the amount unpaid by such defaulting account. This would apparently have had the effect of reducing Joint-Operator, any sums due or accruing to such Joint- the set-off amount. The Operator countered that Clause 505(b) Operator from the Operator pursuant to this Operating (iii) of the CAPL Operating Procedure (also set out above) clearly Procedure or any other agreement between the Operator and such Joint-Operator, whether executed before or after the effective date of the Agreement (my emphasis) Before getting to the main event, on the undercard was the issue of whether the Joint-Operator was liable for the abandonment permits the Operator to set off any sums due or accruing due pursuant to any agreement between it and the Joint-Operator. In short, the broad set-off rights granted by the Operating Procedure are not prejudiced by the more limited set-off rights in the CO&O Agreement. The referee stepped in between the parties and bravely determined: 3

6 [79] While I agree that clause 602(b)(iii) of the CO&O purports to limit set-off to amounts due to a defaulting owner from the Operator pursuant to that Agreement, I do not view that clause as prohibiting Bonavista from netting receipts and disbursements arising in connection with the Joint Operations. [80] I believe it would be inimical to the interests of parties whose activities are governed by a number of agreements, but for whom a single joint account is maintained, to deny the Operator the ability to net amounts coming into the joint account under some of those agreements against amounts payable from the joint account under other agreements. In my view, such netting should be permissible when various revenues and expenses, accounted for through the use of the joint account, reflect integrated operations. [81] In this case, some aspects of the Joint Operations are governed by the JOAs and others by the CO&O, but the Joint Operations are directed at a common undertaking. While the unique terms of the various Agreements must be respected, I consider it appropriate to interpret the Agreements in the aggregate as permitting netting the GOB credits against the Abandonment Costs. Such an interpretation, in my view, gives business efficacy to the Agreements. The Court then went on to discuss whether or not the Operator was entitled to legal set-off and equitable set-off (i.e., as distinct from the contractual set-off discussed above) specific to the GOB Credits. C.M. Jones J. determined that the GOB Credits were to be treated in a manner similar to other forms of revenue and therefore subject to rights of set-off. Further, as the equities favoured the Operator, this was also not a bar to recovery via set-off. So there we have it. In our already, ordinarily complicated contractual world of resource play exploration and development, caution must be taken when considering single agreement pieces of the puzzle in isolation. This decision serves as a good reminder that in many circumstances, joint account economics and operations will require that we consider and interpret each of the governing agreements with reference to each of the others. Some day our industry might get simpler, but I doubt it m 4

7 2017 CAPL Property Transfer Procedure The Due Diligence Process THE THIRD DRAFT OF THE 2017 CAPL PROPERTY TRANSFER PROCEDURE ( PTP ) WAS MADE AVAILABLE TO INDUSTRY IN JULY THROUGH A WEB ENABLED DISTRIBUTION. The package on together with our responses to each individual comment; (v) a redline of the third draft relative to the January, 2017 draft; (vi) Word versions of the election sheets and the case studies included as Addendums to the PTP to facilitate early use the CAPL web page includes: (i) an overview of the PTP for anyone that wishes to use the draft of the project scope and the major changes in a new transaction; and (vii) a redline of the WRITTEN BY JIM MACLEAN relative to the 2000 PTP; (ii) a detailed 36 page matrix that outlines all material changes relative to the 2000 PTP and their rationale; (iii) a clean copy of the text and annotations; (iv) a 20 page coded comment matrix that presents the detailed verbatim comments we received from a modest number of commenting parties, third draft relative to the 2000 PTP. While we do not expect that the redline to the 2000 PTP will be reviewed in any detail, we believe that even a cursory glance at that redline will demonstrate convincingly the thought and effort that has been invested in the 2017 document over the last 18 months by our 15 member committee. 5

8 The October article was about the experiences of some of the users who have used drafts of the 2017 PTP for new transactions. It ended with a suggestion that readers take the 2017 PTP Challenge by comparing how one of their recent low to modest value, relatively straightforward transactions could be documented using the 2017 PTP as a foundation. This month s article is about the due diligence process, and relates primarily to Article 8.00 of the PTP. Vendors, Please, Please, Pretty Please Understand Your Assets! A Vendor should consider conducting a due diligence review of a property to be divested prior to the sale process whenever feasible. This review would include a review of all material aspects of the property, including land records, J.V. records, Surface records, HSE records, marketing arrangements, production accounting and a review with the applicable field personnel of the operational aspects of the applicable assets. There are several reasons why the Vendor should conduct this type of review for the typical low to modest value property for which the PTP is most likely to be used. A Vendor that prepares well for a sale has a very good basis on which to determine the value of its property and to present the property optimally to a potential Purchaser in order to help the Purchaser see that value when preparing its offer. This type of review also enables the Vendor to describe the property in the manner contemplated in the PTP with respect to such matters as land agreements, applicable ROFRs, J.V. type agreements, marketing arrangements, a list of Wells, the exclusion of certain surface rights, the identification of Facilities and Tangibles, any potential issues in the transfer of regulatory licences and other approvals, any outstanding production accounting issues and any required qualifications to the representations and warranties in Article This information would, in turn, also be used to simplify preparation of the Specific Conveyances for Closing. This review also has the major benefit of mitigating the potential for either Party to be surprised during the Purchaser s due diligence process. Not doing this work in advance leaves the Vendor vulnerable to price erosion or possibly even loss of the deal in an extreme case if the Purchaser s due diligence process were to identify material problems with the property. A prior review, for example, would allow the Vendor to attempt to address title deficiencies it believes are material early in the transaction cycle, and would mitigate the potential for issues prior to Closing. Put simply, a Vendor is trying to sell a product in a competitive marketplace. Its ability to optimize sale outcomes and its brand as a Vendor more generally will be influenced by the quality and integrity of the information it uses to present its properties to potential Purchasers. Due Diligence Without A Due Diligence Provision? The starting point in a review of the 2017 PTP due diligence provisions is to note the major change whereby the Article 8.00 Purchaser s review process is structured as an optional Article. This does not reflect a perspective that a Purchaser should not conduct its normal due diligence review or that it is precluded from conducting such a review. Instead, it reflects the view of an increasing number of Parties that they are unwilling to sign an Agreement until the Purchaser s due diligence review is complete and the Vendor understands the concerns, if any, being raised by the Purchaser about the Assets. Proponents of this approach believe that it provides each Party with greater control over any negotiations required to resolve any negative matters encountered in the due diligence review, and ultimately increases deal certainty if the Parties are able to resolve those matters. This approach allows each Party to know if there are material problems before execution, rather than finding themselves in a potential lingering dispute after the Agreement is executed. This binary close/don t close approach may be particularly attractive for the more straightforward Street, Edmonton, Alberta T5V 1M5

9 Assets for which the PTP would typically be used, and it also offers a significant potential simplification if the Assets comprise only undeveloped lands. Even if Article 8.00 is not selected to apply, the introduction of Article 8.00 creates protections for each Party with respect to whatever due diligence process was conducted before execution of the Agreement. The duties in Clause 8.01 apply to the Vendor with respect to the access it provided for the Purchaser s due diligence review prior to execution of the Agreement (something that should be reinforced in a letter of intent), and the indemnification obligations in the last paragraph of that Clause apply to the Purchaser for its due diligence review. (See also the Vendor s representation about the provision of documents in Paragraph 6.02(p).) Similarly, Subclause 8.02D applies to any such due diligence review to ensure that the Purchaser is in the same position after Closing as it would have been if it had acquired the Assets in an Agreement in which Article 8.00 was selected to apply. Due Diligence Other Than Title Review Clause 8.01 of the PTP imposes a duty on the Vendor to provide the Purchaser s nominees with reasonable access to records and a reasonable opportunity for a field inspection of the Assets, and this is reinforced in optional rep 6.02(p). However, the PTP is otherwise silent about due diligence concerns that do not pertain to the Vendor s title (e.g., environmental condition, confirmation of production data, confirmation or condition of Tangibles). Because of the wide variance in expectations on those issues and the likelihood that transaction specific provisions would need to be negotiated, we chose not to address those issues in the PTP. Instead, we noted in the annotations that Parties should address their expectations about any issues of this type in their Head Agreement, and noted that they would probably often choose to do so through the inclusion of additional conditions to Closing under Clause Examples of conditions to Closing that Purchasers might attempt to negotiate relate to such matters as: (a) specified approvals under the Regulations; (b) an environmental review; (c) a production audit to confirm that production and accounting data provided to it were accurate and to confirm current production rates; (d) a physical inspection of the Assets to ensure that they are in good working condition; and (e) a review of J.V. processing arrangements, marketing arrangements, etc. There are two important considerations for a Vendor to keep in mind when reviewing the potential inclusion of these types of additional conditions. The first is to ensure that any conditions like items (b)-(e) above are presented in the context of a discretion that must be THE NAME IN SURFACE LAND ACQUISITIONS LAND ACQUISITIONS FIRST NATIONS CONSULTATION PROJECT MANAGEMENT AER CROWN APPLICATIONS ANNUAL COMPENSATION REVIEWS DAMAGE SETTLEMENTS PUBLIC CONSULTATIONS & NOTIFICATIONS SHERWOOD PARK Info@hurland.ca 7

10 is it feasible to be able to provide proof of payment of a freehold rental from 1962 if there is no proof of payment on file, nothing on file to indicate any concern by the lessor at the time and ongoing communications with the lessor that are fully consistent with a mutual belief that the freehold lease remains in good standing? exercised reasonably. The inclusion of a condition to Closing manner. This definition reflects the practical consideration that linked to the subjective discretion of the Vendor or its business many of the deficiencies that are presented as title defects by or legal advisors, for example, potentially turns the transaction Purchasers are immaterial, and only operate to frustrate the into an option to purchase. This should be of particular concern ability of both Parties to complete the transaction by the contem- during a period of volatile commodity prices. plated Closing Date. The second is that it will often be desirable to use a date The definition has been included to: (a) introduce an element significantly earlier than the Closing Time as the trigger date of objectivity into the process; (b) focus the attention of the Parties for any such conditions. Otherwise, the Vendor could discover on items that matter; and (c) ensure that the title review process that the Purchaser will be exercising its right to terminate the does not turn the transaction into an option to purchase, under transaction two days before Closing. Addressing those types which a Purchaser can, in effect, terminate the transaction at will of conditions early in the process also allows the Vendor to if, for example, it does not receive a title opinion satisfactory to consider an alternate Purchaser much earlier than would other- it from its solicitors. wise be the case. This is particularly important if a property is being sold through a competitive bidding mechanism or close to year end. (See also Subclause 10.05C, which operates to The 2017 definition has been updated to include two Alternates waive any such condition in the absence of notification by the Alternate 1 is similar to the 2000 definition. It is a much less applicable Party by the specified date that the condition has not prescriptive definition than Alternate 2. Alternate 1 should be been satisfied.) used if Alternate 1 of Subclause 8.02B is selected, although it could still be used if Alternate 2 of Subclause 8.02B were selected. A sample of this type of condition follows: Alternate 2 is a more elaborate definition, and is designed Review: The Purchaser will have completed a primarily for use with Alternate 2 of Subclause 8.02B. It iden- review of prior to, through tifies items that are Title Defects. However, it also specifies a which the Purchaser is satisfied, acting reasonably, with number of items that are not to be regarded as Title Defects, and. this type of definition sometimes includes items that are very Vendor friendly. As noted in the annotations on the definition of Environmental Some Vendors require this type of definition for at least their Liabilities and on Paragraph 8.01(b), Purchasers will some- larger value Transactions because of negative experiences in times structure a condition about the status of Environmental which Purchasers have attempted to use the title review process Liabilities that is also linked to an environmen- to attempt to negotiate a reduction of the Purchase Price for tal defects provision analogous to the Title Defects purported defects that are, in practice, remote risks that the procedure in Alternate 8.02B(2). This would allow modifica- Vendor would often be unable to address. Should a Vendor be tions to the Purchase Price and a potential termination right at expected to prove payment of an Alberta Crown rental in 1974, certain value thresholds. This structure would more typically for example, when it is clear that the Lease has not reverted to be used for larger value transactions, though, so has not been the Crown? Similarly, is it feasible to be able to provide proof of 8 included in the PTP. Title Defects The foundation of the Article 8.00 title review process is the definition of Title Defects. In essence, it is an attempt to link the title review process to deficiencies in title that would be regarded as material to purchasers assessing the Assets in an objective payment of a freehold rental from 1962 if there is no proof of payment on file, nothing on file to indicate any concern by the lessor at the time and ongoing communications with the lessor that are fully consistent with a mutual belief that the freehold lease remains in good standing? As noted in more detail in the annotations, this Alternate was designed to offer a reasonably balanced handling of the concept

11 between Vendors and Purchasers, recognizing that some Vendors will attempt to broaden this Alternate if it is selected and that some Purchasers will be trying to narrow it. Clause 8.02 Title Review Process The title review process can be one of the most frustrating aspects of a transaction, notwithstanding that the bells and whistles of industry agreements are ultimately used relatively infrequently to exclude Assets from Closing. No matter which form of agreement the Parties choose to use for a transaction, the annotations on Clause 8.02 offer insights about the title review process that can be helpful to both Vendors and Purchasers for their transaction. Subclause 8.02A: The Purchaser is to notify the Vendor of Title Defects at least seven business days prior to the Scheduled Closing Date or another agreed upon date (as compared to a negotiated period in the 2000 PTP), although it is often advantageous if items are disclosed to the Vendor as discovered. The Vendor is to respond not later than three business days prior to that date. These are arbitrary periods, premised on the assumption that the title review will be a relatively straightforward process, and they can be modified easily for any particular transaction. If the Land Schedule is complex, this may not be feasible. The notice period will sometimes have to be modified (or Closing delayed) to provide the Purchaser with an additional opportunity to complete its review. If Closing is to be delayed while the Title Defects are being remedied, the Parties should address their expectations at the time about the handling of any interest that would otherwise accrue during that period under Clause It is critical for Purchasers to retain the responsibility for management of the title review process, so that the transaction is conducted efficiently. If the property is complex, it may be beneficial for the applicable Land personnel responsible for Closing to meet early to discuss the process to move towards Closing and the respective expectations for managing the title review process. The title opinion of the Purchaser s solicitors will often list many title deficiencies. Many, though, will not fall within the definition of Title Defects. A Vendor generally wishes to cooperate with both the Purchaser and its solicitors in the due diligence review, but cannot be expected to devote significant effort to the review of immaterial title deficiencies. To minimize this possibility, the Purchaser is to provide notice of the Title Defects, the Affected Assets, a list of missing documents and the Purchaser s requirements for rectification. Winter Drilling Season Has Arrived! As you ramp up your plans, it's more important than ever to use the right Land Company. We have the industry's strongest team of experienced PMs, Administrators, Land Agents, Crown Land Experts and First Nations Consultation Agents based in a network of full-service offices. Our local knowledge and proximity to your projects will provide you with the best service at lower costs. CALL US AT FOR YOUR NEXT PROJECT. SCOTTLAND.CA CALGARY EDMONTON GRANDE PRAIRIE FORT ST. JOHN LLOYDMINSTER REGINA 9

12 There is a risk that a Purchaser might terminate a Transaction under this Alternate if there are Title Defects for which the value of the Affected Assets is not material to the entire Transaction. This could place a Vendor at significant risk during a period of volatile prices. This encourages a Purchaser to screen its solicitors title opin- with Alternate 2 of the definition of Title Defects. Closing will proceed if the value of the outstanding Title Defects is below a threshold of 10% of the Base Purchase Price. The sample election sheet included as Addendum I reminds users that the typical 10% threshold might not provide a suitable result for a minor value transaction if they chose to select Alternate 8.02B(2). If the value of uncured Title Defects is above the 10% threshold, the Purchaser has four options: (a) to provide the Vendor with additional time to remedy the Title Defects by delaying Closing to an agreed date; (b) to waive the uncured Title Defects and to proceed with Closing; (c) to proceed with Closing for the Assets not affected by the Title Defects, with the consideration being reduced accordingly, insofar as that value is greater than the 10% threshold; or (d) to terminate the Agreement if at least 25% of the consideration is applicable to the Assets affected by the uncured Title Defects. However, the Vendor may also terminate the Agreement if the Purchaser is proposing to exclude Assets with a value of at least 25% of the Purchase Price under Paragraph B(c). (The Parties also always have a fifth option in practice, to substitute other mutually agreed upon assets of the Vendor.) Some Vendors prefer a variation to Paragraph (c), so that the Purchaser acquires the Affected Assets with a reduction in the Base Purchase Price. This is designed so that a Vendor is not required to retain Assets that would be difficult to dispose separately. There is an associated risk, though, that this could potentially encourage a Purchaser to identify Title Defects in order to attempt to acquire all of the Assets at a lower Base Purchase Price. The 10% threshold in Paragraph (c) of this Alternate is, in effect, a deductible. In the absence of the deductible aspect, Purchasers would be encouraged to raise additional concerns to try to satisfy the 10% threshold and obtain a full recovery, an approach that the PTP does not reinforce. The thresholds in Paragraphs (c) and (d) of this Alternate were modified from a blank to be negotiated for each Transaction in the 2000 PTP to 25% as of the 2017 PTP. This was done to reflect the most typical negotiated outcome and to reduce the number of elections associated with use of the PTP. The Parties always remain free to negotiate a different handling in any particular transaction, and the bolded paragraph in the sample Schedule ion, by focusing the Vendor s efforts on those Title Defects that matter to the Purchaser. It must determine which deficiencies are Title Defects and the actions that will be required to rectify them. Subject to the exceptions in Subclause 8.02D, the provision is also structured to prevent the Purchaser from surprising the Vendor with additional Title Defects after the prescribed notification deadline. Subclause 8.02B: This Subclause addresses the impact of Title Defects on Closing, and can only apply if the Purchaser has served a notice under Subclause 8.02A. (There are only rights under this Subclause if a notice of Title Defects was served by the required time.) It includes two Alternates. Alternate 1 of the definition of Title Defects should be used if Alternate 8.02B(1) is selected. Alternate 8.02B(1) provides the Purchaser with three options. It can: (a) provide the Vendor with additional time to remedy the Title Defects by delaying the Closing Time to such date as the Parties may agree; (b) waive the uncured Title Defects and proceed with Closing; or (c) terminate the transaction. That being said, the construction of this Alternate is ultimately binary. Unless otherwise agreed by the Parties, the ultimate choice of the Purchaser is to proceed to Closing or to terminate the transaction. The major advantages of this approach are its relative simplicity and the prohibition of cherry picking, such that it can be particularly attractive for minor value transactions. In addition to avoiding the potential for cherry picking, this mechanism also avoids the valuation problems inherent with the potential exclusion of portions of the Assets. It also assumes, though, that the Vendor would be able to find an alternative Purchaser easily, something which may not be true. There is a risk that a Purchaser might terminate a Transaction under this Alternate if there are Title Defects for which the value of the Affected Assets is not material to the entire Transaction. This could place a Vendor at significant risk during a period of volatile prices. Parties will sometimes modify this Alternate to include a requirement of a minimum value threshold before the Purchaser can exercise this termination right. Alternate 8.02B(2) includes greater flexibility in the handling of the Title Defects, and it would typically be used in conjunction 10

13 of Elections and Modifications in Addendum I reminds users to review the default values included in the 2017 PTP. Paragraph (d) of this Alternate and Subclause 7.01E were updated significantly in the 2017 PTP. The 2000 PTP had been structured so that the threshold in Paragraph (d) was a negotiated threshold for the combination of Title Defects and ROFR exercises. As of the 2017 PTP, the two processes are independent. Subclause 8.02D: If a Purchaser Closes with respect to Assets, the Purchaser generally should not be able to assert after Closing that there are Title Defects. Subclause D addresses this. However, it is possible that Title Defects may subsequently be discovered after Closing in circumstances in which it would not be appropriate to preclude the Purchaser from a potential remedy. The primary examples of the latter would be Title Defects that were: (a) not apparent because of the Vendor s failure to provide access to the required files in violation of Paragraphs 6.02(p) and 8.01(a); (b) created as a result of the Vendor s breach of its maintenance of business obligations under Clause 5.03; and (c) subject to Clauses 6.05 and 13.01, in violation of the Vendor s representations and warranties under Article The qualifications to Clause 6.05 address both the time limitation and the ability of the Vendor to raise a no reliance defence if appropriate in the circumstances. Subclause 8.02E: There may not have been any prior agreement with respect to the portion of the Purchase Price that is attributable to the Assets affected by the Title Defects. This Subclause addresses the determination of the value if the Parties proceed with Closing for the Assets not affected by the Title Defects. In essence, the Purchaser would make a good faith estimate of that value, pending the resolution of the value of the Affected Assets by agreement of the Parties or under Article 9.00 (negotiation/arbitration). They would accelerate any such arbitration. Subclause 8.02F: The Vendor will often rectify uncured Title Defects for excluded Assets shortly following Closing. The Vendor may, at its option, require the Purchaser to complete the acquisition of those Assets on the same basis as in the Agreement, subject to any obligation to issue ROFR notices again. Including this as an option of the Vendor is a disincentive for Purchasers to exclude Assets, as there is no right to re-acquire the excluded Assets. Similarly, the Purchaser is under no obligation to acquire excluded Assets if the Vendor is unable to remedy the applicable Title Defects within 30 days after the initial Closing. That being said, there may be circumstances in which the Purchaser would still be interested in acquiring the applicable Assets if the applicable Title Defects were remedied at a later date. The Parties will enter into a separate Agreement for the acquisition of the applicable Assets in the form of the Agreement, except that Clause 2.06 interest would not accrue for the period prior to the Vendor s notice under this Subclause. As this is a separate Agreement, it would use the original Effective Date, but would have its own Closing Date. Subclause 8.02G: This Subclause protects the Vendor against the possibility that the Purchaser may attempt to terminate the Transaction under Paragraph (d) of Alternate 2 of Subclause 8.02B in circumstances in which the Vendor believes that the values attributed to the Title Defects have been inflated. This Subclause enables a Vendor to delay the Closing Time until two business days following a determination of the applicable value under Article At that point, the Purchaser may again make the election under Subclause 8.02B, subject to any obligation to issue ROFR notices again. The Vendor would also presumably be attempting to remedy outstanding Title Defects during that period as well. Would You Rather Have A Title Review Or A Root Canal? Let s be honest, the title review process can, well, be painful. It can be much less painful, though, if each Party prepares suitably for the process. The Vendor can make the process much less frustrating for its own personnel and the Purchaser by doing a reasonably detailed due diligence review early in the divestiture process, by identifying and beginning to address material title deficiencies and by presenting a high quality Land Schedule and list of wells, by presenting its file materials in a reasonably organized manner and by making its personnel available to answer questions of the Purchaser s representatives. The Purchaser can make the process much less frustrating for its own project personnel and the Vendor if the Purchaser s business representatives engage in the process sufficiently to ensure that the concerns being identified to the Vendor are truly material to it, rather than just the shopping list of material and immaterial deficiencies identified during its title review. The Purchaser should also ensure that its representatives commence the title review in a timely manner, conduct it diligently and identify major concerns to the Vendor at the earliest opportunity. The annotations on Article 8.00 offer a helpful reference for personnel involved in A&D transactions, even if the PTP is not being used for a particular transaction. Tick, Tock The July draft was the third draft issued for industry comment. In the absence of surprises, we will work collaboratively with commenting parties to complete the document late this year. m 11

14 Board Briefs The key discussion items at the CAPL Board of Directors Meeting held September 12, 2017 at the CAPL Office were as follows: Rob, Membership, advised that the Committee will be drafting a membership procedure to be brought forward at the October Board meeting. The Committee will also be reviewing the membership categories, membership fees and any new membership categories that may be required and presenting recommendations for possible fee increases. Rob also added the need to revisit the members who have not renewed their membership along with those whose payment has not been received yet. In Attendance Absent Guests R. Baron G. Miller N. Millions Denise Grieve L. Buzan R. Pitchford R. Pettifer Karin Steers M. Creguer J. Redmond G. Richardson T. Galbreath K. Rennie S. Williams M. Graham Janice, Social, advised that she is working on getting budgets from every committee. She added both the Golf Tournament and the Trap Shoot made money, but the exact amount is not available yet. Janice also mentioned that Ed Grandan was honoured at the 2017 Trap Shoot. Robyn, Education, provided the following update: Kristin, Finance, presented a Treasurer s Report as at September 12, 2017, showing CAPL investments totalling Robyn is currently working on a list of courses with $348, Canadian along with a cash balance of $376, instructor names, instructor fees, material ownership and Canadian for a total of $724, The CAPL Scholarship instructor contracts and is reviewing the courses held in Fund has a balance of $236, at the end of June 30, , 2015 and Kristin added that the cash balance is up $78,831 from Robyn is also reviewing instructor fees and will be looking to the previous report due to the Conference Registration and standardize the fees. Sponsorship payments received. Several expenses will be incurred shortly for the Conference that will reduce the cash Michelle, Business Development, advised that the Alberta balance in the next month. Government is currently looking at a year extension to the current Oilsands Regulations to December 31, Rob Pitchford, Membership, presented the Board with a The Government has held sessions on the Liability Management motion to endorse the recommendation of the Membership Review and the AER will be holding an information session on Committee to accept three candidates for Active Membership, September 22, 2017 on Integration Approach. four candidates for Associate Membership, two candidates for Student Membership and one candidate for Interim Tim, Business Development, Alberta, advised that he is looking Membership in the Canadian Association of Petroleum to focus on three key items. A meeting will be set up with Cody Landmen, which were approved. Battershill, Janice Redmond, Nikki Sitch, Glenn Miller, Larry Buzan and himself to discuss ideas. 12 SINCE 1965 Surface / Mineral Acquisition & Administration Accredited Appraisers & Expert Witnesses for Regulatory Proceedings Certifi ed Arbitrators / Mediators Valuation Impact Studies Real Estate Services P E. mlsmail@mcnallyland.com #215, a St. SW Calgary, AB

15 Glenn, Business Development, British Columbia, presented information on the Trans Mountain Expansion Project which is moving forward even though an appeal has been granted. Glenn also provided a brief overview on BC Tenure and noted that the Pacific Northwest Project has been cancelled. Glenn, Professionalism, provided the following update: She also advised that she is working with Janice Redmond on the CAPL Marketing Committee. Larry gave the following update on the 2017 Conference: The attendance numbers are currently at 353 Delegates, 37 Guests and 15 Event Package attendees. The Professionalism Committee met on June 27 and again on August 29, Steve Oslanski and his sub-committee have updated the P.Land/PSL exams and Kaitlin Polowski will make the necessary changes to the exams. The technical writer has sent a portion of the section and will send the balance prior to September 26, Marah, Communications provided the following update: The committee is still seeking a new replacement publisher for The Negotiator. They are currently working with the BOE on an exchange of services for 3 months. Marah advised the Board that she is on the 2018 CAPL Conference as the Marketing Chairman. Larry, President, reminded the Board of the following: Directors were reminded to review the redline version of the Bylaws as a vote to amend the Bylaws will be held at the October 18, 2017 General Meeting. The next General Meeting is a breakfast meeting at the 2017 Conference on Tuesday, September 19, 2017 at Winsport. The AAPL President, David Miller and his wife Sheila Miller will be in attendance and the keynote speaker is Jeremy Gutsche. The next Board of Directors Meeting will be held on Tuesday, October 3, Meeting adjourned. m Shaun Williams Secretary/Director, Technology Land Acquisition I Environmental Services I Asset Management I Stakeholder Engagement Environmental liability weighing you down? LandSolutions team of environmental experts can offer practical solutions to help lighten the load. To learn more, contact LandSolutions today. Calgary I Bentley I Edmonton I Lloydminster I Grande Prairie I Fort St. John I Lampman I Toronto I Fredericton LandSolutions.ca

16 Get Smart The CAPL Education Committee is pleased to present the following courses: November 2017 Courses Groundwater: Issues & Impacts for Surface Landmen (PSL ) ** CANCELLED ** November 1, :30 a.m. to 12:00 p.m. This seminar is intended to help land personnel understand landowner concerns regarding groundwater related issues. The seminar will cover an introduction to groundwater topics, common landowner concerns and mitigative measures, case-studies and a description of pre and post well testing directives. Specific topics will include groundwater concerns relating to oil and gas operations, coal bed methane production, seismic surveys, drilling operations, mining, pipeline excavations and road-cut excavations. Preparing for a Surface Rights Board Hearing (PSL ) ** CANCELLED ** November 1, :30 a.m. to 4:30 p.m. This seminar is intended for individuals who require a better understanding of the Surface Rights Board hearing process from start to finish. This course will begin by covering the types of surface rights board hearings, including compensation, rent review, damage claims and back rent. The next section will focus on the structure of the hearing and deal with procedural elements, evidence taken under oath, direct and cross examination of witnesses and questions from the board. From there, the course will focus on evidentiary issues like the burden of proof and discuss privacy issues before closing by discussing the orders ultimately issued by the board. Directive 056: AER Energy Development Applications Public Consultation Requirements (PSL ) ** CANCELLED ** November 2, :30 a.m. to 4:30 p.m. This seminar is designed for land agents, land administrators, operations engineers as well as any other personnel who may be responsible for AER applications or regulatory compliance issues. The AER (the Board ) believes that appropriate notification and public consultation must be conducted well in advance of the submission of an application to the AER. It must be thorough enough to allow all parties who are affected to be sufficiently aware of not only the proposed project, but the Board process as well. The Board believes that the public must have sufficient information to participate meaningfully in the decision making process, to voice their concerns and have their concerns heard and properly addressed, and if possible, resolved. The proponent s information must be extensive, consistent, factual and must be disclosed in a timely manner, and if the proposal is part of a larger project, the proponent should be prepared to discuss the entire project and explain how its components compliment other energy development plans in the area. This seminar helps proponents understand the public consultation requirements, expectations of the AER and assists companies in completing the application or audit processes for regulatory compliance. Fundamentals of Mineral Land November 16, :30 a.m. to 12:00 p.m. This course is provided for professionals such as surface landmen, engineers, geologists and other professionals who either work with their mineral land department or manage their mineral land group as part of a larger team. Individuals new to the land industry would also benefit from this course; some knowledge of mineral land is beneficial but not required. The course is designed to provide course attendees, who may 14 Sayer Energy Advisors... The Leading Expert in Corporate Advisory Services Corporate Valuations Fairness Opinions Expert Witness Assignments Strategic Partnerships and Joint Ventures Shareholder Value Analysis Corporate Restructurings For information on our services visit our website: or contact Alan Tambosso at or atambosso@sayeradvisors.com

17 have limited or basic knowledge of oil and gas, with a basic ground-up overview of mineral land and the role of landmen in the exploration process. This course will also include an introduction to land tenure and agreements in Western Canada. Principles of Contract Drafting and Interpretation November 7, :00 p.m. to 4:30 p.m. Senior land personnel with a minimum 10 years experience drafting and interpreting contracts as a part of their daily job requirements. The principles of drafting and interpreting contracts that have evolved in case law over the years will be presented. In addition to reviewing case studies, the instructor will discuss the essential concepts in drafting and suggestions for improving essential parts of agreements CAPL Operating Procedure November 8, :30 a.m. to 4:30 p.m. This seminar is intended for anyone who is seeking to learn about the new 2015 Operating Procedure. All experience levels are welcome, but it should be noted that the course will not be focused on the basics of the Operating Procedure. This one-day course is an overview of the 2015 CAPL Operating Procedure focused specifically on the changes between the 2007 and the new document. It is meant to enable personnel to appreciate substantive differences between the 2007 and the 2015 documents. Geology ** CANCELLED ** November 8, :30 a.m. to 4:30 p.m. This seminar is designed for oil and gas personnel that require a general understanding of geological prospect evaluation. Landmen, technologists and other personnel involved in written or oral communication with the geological department will benefit from attending this seminar. This seminar will provide an overview of geology as it applies to petroleum exploration in Canada. Workshops and exercises are an integral part of the seminar. The instructor will review the geological exploration tools, models and concepts as they apply to oil and gas exploration in Canadian sedimentary basins. Topics to be discussed include: rocks and minerals, geological time scale, plate tectonics and reconstruction, development of hydrocarbon reservoirs and traps, the generation and entrapment of oil and gas and the historical geology of the Western Canadian sedimentary basin. The geological tools used in exploration and formation evaluation will be utilized throughout the seminar, including well cuttings, cores, wireline and geophysical well logs, drillstem tests, surface and subsurface maps and cross-sections. The integration of geological data with geophysical, land, engineering and other disciplines will also be discussed. Geophysics for Non-Geophysicists ** CANCELLED ** November 9, :30 a.m. to 4:30 p.m. This seminar is designed for non-scientists who wish to acquire a basic understanding of geophysics as it is relates to the oil & gas industry. Particular emphasis will be placed on trying to provide answers that land professionals may have regarding the interpretation, uses, limits, costs, and timing issues pertaining to seismic data in Western Canada. This seminar will introduce the field of geophysics as it pertains to hydrocarbon exploration in Western Canada. The instructor will focus on a number of personal cases to exemplify the use of seismic data. Simple in-class exercises will show some of the limitations of seismic data in a cost-effective exploration program. Ownership issues and legal obligations of acquiring seismic data in Canada will also be introduced. Sample show and tell scenarios employing geophysics will demonstrate how the information acquired in this course can benefit a non-geophysicist. 15

18 Overcoming the Five Dysfunctions of a Team November 14, :30 a.m. to 4:30 p.m. This seminar is suitable for team leads or those looking to enhance their team leadership skills. This seminar is built on the assumption that great teams attract great team players, and that great team players on great teams achieve more collectively than they could on their own. Using Patrick Lencioni s book The Five Dysfunctions of a Team as a template, this day long seminar teaches participants how to strengthen their teams, improve their self-awareness and sharpen their leadership skills. The course also includes a number of practical exercises that can be used to overcome hurdles that stand in the way of building an effective team. Aboriginal Affairs November 15, :30 a.m. to 12:00 p.m. This session is especially useful for those interacting with Aboriginal governments, businesses and communities, and helps in building positive relationships to enhance effectiveness with Aboriginal people. For many Canadian businesses, there is a lack of understanding of issues facing Aboriginal communities or Aboriginal employees within their organization. Understanding where and how Aboriginal people live, and why there are ongoing issues that just don t seem to go away is a first step to building successful relationships. Understanding historical, social and cultural differences and areas of common ground can help companies build successful relationships necessary for meaningful and long-term relations with Aboriginal communities and Aboriginal employees. Aboriginal Awareness training provides a basis of understanding of those issues to enable employers to develop strategies to improve both internal and external relationships with Aboriginal peoples. Indian Oil & Gas Canada November 15, :00 p.m. to 4:30 p.m. This session is useful for surface and sub surface landmen and administrators interacting with aboriginal governments, businesses and communities on reserve and helps in building a greater understanding of Indian Oil and Gas Canada and its role in helping First Nations develop and manage oil and gas on reserve. The session provides an overview of IOGC, the Indian Oil and Gas Act and regulations, IOGC s role in assisting First Nation develop their oil and gas, the two key approaches to negotiations and a review of IOGC s current sub surface and surface disposition processes, applicable federal legislation and regulatory requirements. 16 Crown Land Services Delivered by Trusted and Fully Qualified Professionals, who are Members of the Association of Alberta Forest Management Professionals, including:. -Complete EAP Management -Survey Support and Coordination -Pre-site and Timber Volume Assessments -LAT Reports and Interpretation -Review of Master Schedule of Standards and Conditions -Application Supplements and Mitigation -First Nations Consultation and Site Inspections -Wildlife Sweeps Maps, Reports, Photographs -Compliance Recommendations -Wetland Assessment and Impact Form (WAIF) -Wetland Assessment and Impact Report (WAIR) -Alberta Wetland Rapid Evaluation Tool (ABWRET-D) SERVING ALBERTA & SASKATCHEWAN Head Office: Fort Saskatchewan AB Field Office: Macklin SK

19 ROFR Issues: An Interpretative Approach November 16, :30 a.m. to 4:30 p.m. Registrants should consider Introduction to Surface Rights or at least 5 years of field experience as a prerequisite for this course. This seminar is intended for more senior level landmen who are responsible for analyzing various situations in which ROFR issues may arise and recommending or implementing appropriate corporate responses thereto. This seminar will be presented in two parts. The morning will be devoted to a presentation of legal principles which may be relevant to ROFR situations and a suggested interpretative methodology for analyzing and responding to unusual ROFR scenarios. In the afternoon, a senior landman will join the lawyers in a round table discussion of ROFR issues and specific fact scenarios gathered by the presenters and submitted to the panel by the course participants. Prospective course participants are encouraged to submit their favourite challenging ROFR problem to the instructor prior to or at the seminar for consideration and discussion in the afternoon round table discussion. Advanced Surface Rights (PSL ) ** CANCELLED ** November 21, :30 a.m. to 4:30 p.m. This seminar is directed towards members of industry with five or more years experience and is intended to summarize and describe all facets of surface rights within the oil and gas business. Evaluation of Canadian Oil and Gas Properties for Landmen November 22 and 23, :30 a.m. to 4:30 p.m. This seminar is ideally suited for oil and gas professionals who may currently or in the future be involved in the evaluation of oil & gas development opportunities, reserves assessments and mergers & acquisitions or dispositions of assets. The course objective is to focus on understanding the process of evaluations and understanding the outputs so that land professionals understand what oil & gas evaluators do and what they report. Title Review & Due Diligence: A How To November 28, :30 a.m. to 4:30 p.m. This seminar is intended for landmen and other industry personnel who are responsible for coordinating the conduct of title review with outside counsel or those conducting due diligence reviews and rectifying title deficiencies when acquiring assets. This seminar will focus on the practical aspects of title and due diligence reviews when acquiring assets in Western Canada. Attendees will benefit from the suggestions presented to make the title review British Columbia St. Fort St. John BC V1J 3Y6 T: F: Alberta Box Ave. Fairview, AB T0H 1L0 T: F: Toll Free: Negotiator Feb 2016.indd 1 Visit us online at 2/12/2016 2:00:54 PM 17

20 process involving outside counsel more cost-effective and efficient, enabling you to interpret the title opinion and use it as a working document in your land administration system. In addition, guidelines and procedures will be presented to enable internal land personnel to conduct due diligence reviews in circumstances where the involvement of outside counsel may not be merited. Finally, the process of deficiency rectification will be discussed as well as alternatives for dealing with unresolved deficiencies within the context of the business deal and the sale agreement. Drilling and Production Operations November 29 and 30, :30 a.m. to 4:30 p.m. This seminar is designed for persons with little or no experience in drilling and production technology. The seminar will give a non-technical overview of oilfield operations in Western Canada. The major topics of drilling, well completion, and production operations will be covered. In the drilling section, the instructor will discuss drilling and other operations such as logging, drill stem testing, coring and cementing. The completion section will include a discussion of the service rig, perforating, stimulation and downhole equipment. Production operations will cover production facilities and equipment, methods of artificial lift and enhanced recovery techniques. December 2017 Courses Professional Ethics: Theory and Application December 5, :30 a.m. to 4:30 p.m. This seminar is suitable for all interested land personnel and is required for prospective CAPL members as well as CAPL s professional certification program. This seminar is intended to increase the understanding of ethics and the dimensions to ethical behavior by stimulating the ethical thought process, giving a basic introduction to the nuances of ethics, introducing several methods used in ethical decision making, and providing a forum for discussions with respect to land related ethical issues. Negotiation Skills for Surface Land Agents (PSL ) December 12, :30 a.m. to 4:30 p.m. This seminar is for surface landmen looking to improve negotiation skills to meet negotiation objectives. This seminar will examine the common struggle we often experience between meeting our substantive needs in the negotiation while maintaining or improving the working relationship. m Bring confidence and credibility to your financial reports with an independent Land evaluation. With over 10 million acres of mineral rights analyzed every year, Seaton-Jordan is the most recognized name in non-reserve Land evaluations. Let us help you do the heavy lifting. 18 Seaton - Jordan 395, 800-6TH Ave SW Calgary, AB T2P 3G3 Call today for a free consultation: inquiries@seaton-jordan.com seaton-jordan.com

21 CAPL 2017 Conference LOOKING BACK AT THIS YEAR S CAPL CONFERENCE IN CALGARY, I AM BOLSTERED BY THE FACT that we listened and were able to engage a large base of membership and the overall energy community in a Conference that delivered what members wanted. This year s focus on education and engagement with our land community meant that delegates had several choices in tailoring their program ranging from surface sessions to core lab information. Attendees could choose between bankruptcy reviews and start-ups discussions and many more. The 2017 Conference also established a new baseline, that CAPL can host an effective and engaging land Conference in its home city of Calgary. Calgary s Conference demonstrates that content, not location, should be the primary focus of this annual event. This gathering needs to provide members with a platform to learn and adapt to the ever changing business world. Our Conference should always aim to provide insight and connections for land professionals that will improve their contribution to the overall business environment. Stephen Harper speaks to the conference during Wednesday s lunch Welcoming Reception at the Bow 19

22 For those who attended this year s Conference, you can easily educational portion of the Conference important, so too are the attest to the fact that there were ample choices for learning and daily social aspects. Land professionals need a chance to share education. After each keynote breakfast on Tuesday and Wednesday, time with other professionals that work in their field. From surface delegates broke into three independent sessions that focused on to minerals and everything in between, these social connections various aspects of the land business. These educational sessions are one of the keys to successful land management. ranged from What will be Unconventional Next? to Indigenous The 2017 CAPL Conference team embraced the use of technol- Relations. Each of the breakout sessions were designed to provide ogy with the 2017 CAPL Conference phone app. The free phone app unique insights into the specific topics of interest. We as a Conference committee specifically focused on providing a variety of choices that would appeal to all aspects of the land business and we were rewarded with full attendance at each one. Feedback that the committee and I have received from those that attended the event has been more than generally positive. One of the main takeaways from the many conversations that I have had are around the effective use of Calgary based venues such as the Bow building and Conoco classrooms. Cenovus and Encana not only provided the classroom for the Monday educational sessions but they also hosted the welcoming reception. Using the space we have around our city proved to be a charming and effective solution. The Conference educational sessions provided for several choices on the day before and the day after 20 the Conference and key to the success was that all the educational classes were included in the registration price. The 2017 Calgary Conference struck a balance between providing a current market conditions updates and the educational needs of our members. This past year s Conference committee encourages future Conference teams to make note of the high demand for education and learning that delegates want out of this annual event. Not only is the Michael Tran, RBC Capital Markets

23 Keynote speaker Jeremy Gutsche delivers a energetic address to delegates Delegates ask questions during the breakout sessions outlined all the details related to the Conference, including times, places, and people that each session included. It was personalized for each delegate, showing which sessions that they had selected to attend, and what time it started. Post Conference, delegates are able to review and download individual session materials for future reference from each of the sessions. Overall the phone app proved to be a useful tool in helping delegates manage their time. As the 2017 Conference teams established this year, hosting the CAPL Conference in the City of Calgary is cost effective, educational, engaging, accessible and affordable for virtually all our members. New this year was the use of a Day Pass which helped those who had pressing business issues downtown to choose two of the events best suited for them to attend during the Conference and we have positive comments on that as well. During tough economic times, CAPL does not need to compromise on the quality and content of our Conference. Finally I want to personally thank the Conference sponsors who continue to step up and support CAPL each and every year. Without their specific support for our event and our land community the Conference would not happen. Next year s Conference is in Regina, Saskatchewan from September 16-19, Please view the video on our CAPL website, and keep your eyes open for further details as they become available. We hope that everyone is able to make it to the capital of our friendliest energy neighbour in Regina and engage in a new round of learnings, engagement and opportunities. If you have any questions please call (403) or (rfulton@elcano.ca) me anytime. I hope to see you all this fall. m Richard Fulton Welcoming Reception at the Bow 21

24 2018 CAPL Conference 22 GROWING POSSIBILITIES REGINA 2018 CAPL Conference WELL NOW THAT THE DUST HAS SETTLED ON A VERY SUCCESSFUL 2017 CONFERENCE, IT S TIME TO PLAN FOR THE 2018 CONFERENCE IN REGINA, SASKATCHEWAN! The 2018 Conference is scheduled from Sunday September 16 to Thursday September 20, 2018, and will be held at the grand chateau-style Hotel Saskatchewan in the heart of downtown Regina. In keeping with the ever changing conditions of our industry and honouring one of the strengths of our host province, the theme for the conference is Growing Possibilities. As most of us know, both thriving markets and challenged times create possibilities. Saskatchewan has remained a thriving region of Canada through a time of turbulent commodities pricing and political change. It is a hub for oil and gas, agriculture, potash, mining and many other industries and institutions. Possibilities abound. Regina is a city ripe with opportunity and yet humble about its attributes. After all Regina markets itself as the greatest place you ve never seen. This is a unique opportunity to have the CAPL Conference in a city that is close in proximity to a lot of our members, while honouring a province that has served our business well. For some it will be a chance to explore parts unknown; others are returning to familiar territory. We intend to have unique educational activities and wonderful speakers in this impressive prairie setting. Whether your company operates in or around Saskatchewan or not, we promise a great conference in an exceptional location. Your 2018 conference chair is Wayne Ellis, Crescent Point Energy Corp. and he is joined by the following Conference Executive team: Activities: Marilyn Gosling, Ridgeback Resources Inc. Administration: Jeff Rideout, Millennium Land Ltd. Finance: Kelly Pypers, Birchill Canada Corp. Marketing: Marah Graham, Cona Resources Ltd. Program: Steve Brisebois, Whitecap Resources Inc. We look forward to seeing a large contingent of CAPL members in Regina next September. m Marah Graham 2018 CAPL Conference Committee, Marketing

25 The Negotiator s Message From the Board Alone we can do so little; together we can do so much - Helen Keller Social I HAVE BEEN HONOURED TO TAKE ON THE ROLE AS YOUR SOCIAL DIRECTOR FOR THE TERM. Having been an active member within CAPL for the past 5 years has given me plenty of insight to this portfolio and how it has evolved. The amount of hours that are dedicated to the various events hosted by CAPL cannot go unmentioned. Have you ever wondered which portfolio in CAPL might have the most volunteers? Without a doubt, it is the Social portfolio. The amount of volunteer hours that are involved with the planning and execution of our events is by far unmeasurable. The backbone to any organization is the people behind it and as the Social Director, I can say that we are very fortunate to have the many people that come together to put on our events. Thank you to all of you for your continued involvement in making our events a success. With the results of our last membership survey, we have been tasked with providing further networking opportunities for our membership. To answer the call, we will be creating additional events for all members to enjoy as well as including further events specific to the needs of our Landmen. Our goal is to bring value to networking by enhancing opportunities for what our membership has asked for. With that said, our board is open to feedback. If you are concerned about our events and/or want to see something different, do not hesitate to speak up and talk to one of us. We are here to represent you and it is our duty to ensure that your needs are being met. Social events are always updated on the CAPL website under Social Events. Being that we are in the age where social media is a large component of communication, we are continuously working with Shaun Williams and the Technology committee to ensure we are promoting our events to the membership and to other organizations that might want to join us. If you haven t already joined us online, you can find CAPL on Linkedin, Twitter and Facebook. This is where you will find pictures of the events and further details as to each event, which will lead you back to the CAPL website. This year we continued to have success with our annual events such as the Curling Bonspiel, the Squash Tournament, Triple Round-Up, Golf Tournament, and our Trap Shoot (which was celebrating their 40 th Anniversary). The Trap Shoot has always been an event that continues to be a success. The success of this event cannot go unnoticed without mentioning Ed Grandan. Ed was the face behind the Trap Shoot and we will definitely miss his continued efforts to ensuring the event was a success. Being that the industry is still dealing with some financial constraints, the Barnburner took a step back for the year to reassess and will be coming back to life in the spring of 2018 with a new approach, to be announced at a later date this year. Not only do we have amazing volunteers, but incredible and generous sponsors. Our events are supported by our many sponsors and I cannot thank them enough. Without their contributions to CAPL, many of our events would cease to exist. The Social, Communications and Technology portfolios have come together to work on a marketing plan for CAPL. We will be working with our sponsors this winter to ensure our sponsors needs are also met. We want to ensure all of our sponsors are given the same opportunities to promote themselves at our various social events and throughout CAPL as a whole. By streamlining our sponsorship opportunities, this will in turn make it easier for our volunteers who are tasked with looking for those sponsorship dollars for our various events. CAPL is your association. We need you to be active. Take the opportunities presented to you and make the most of them. I am excited about the upcoming year and I look forward to meeting those of you that I have yet to meet and I want to thank you for allowing me to represent you. m Janice Redmond Director, Social 23

26 Roster Updates New Members The following members were approved to student membership status by a Motion on September 12, 2017: Applicant Current Employer Sponsors Active Brodie Barkway Shell Energy Canada Paul Cooper Dan Cicero Mark MacKay Shaun Kozak Scott Land Tyler Cheetham & Lease Ltd Nathan Laviolette Greg Meidinger Regan Smiley Marquee Land Dan Legault Services Ltd. Tony Waddell Trevor White Associate Laura Reimer Caltex Resources Ltd. Sue Dsikun Dave Elmer Rob Pettifer, P.Land, PSL Ashlee Rowland Rife Resources Ltd. Brad Purdy Michelle Radomski Michael Stone Ryan Smith Scott Land Wade McLeod & Lease Ltd. Greg Meidinger Steve Oslanski, PSL Kirt van der Woude Challenger. Brad Rouse Geomatics Ltd Neil Taylor Jason Tweten, PSL Student Shameer Jina University of Calgary Bob Schulz Christiana Wahl Mount Royal University Andrea Gill On the Move David Barva Randy Bergmann, P.Land Donna Bowles, P.Land Neil Cusworth, P.Land Brenda Duce David Elmer Joe Ewaskiw Kathryn Gagne Bruce Gordon, P.Land Shane Holden Paramount Resources (TEC) Ltd. to Tidewater Midstream and Infrastructure Ltd. Second Wave Petroleum Inc. to Rayberg Holdings Topanga Resources Ltd. to Independent BLZ Energy Ltd. to Cusworth Oil & Gas Ltd. Pengrowth Energy Corporation to Duce Corporation SanLing Energy Ltd. to Pembina Pipeline Corporation Independent to Crescent Point Energy Corp. Repsol Oil & Gas Canada Inc. to Journey Energy Inc. Arnage Consultants Ltd. to Cona Resources Ltd. Grizzly Resources Ltd. to Sage Exploration Corp. Interim Brady Roy Rife Resources Ltd. m Calvin House Spry2 Energy Inc. to Independent 24 AT PRAIRIE LAND WE PLACE OUR CLIENTS FIRST. Aron Streifel Terry Jordan REGINA: TOLL-FREE: WE SPECIALIZE IN: Land Acquisitions Freehold Mineral Specialists Surface Acquisitions Pipeline Right-of-Way Rental Reviews Damage Settlements Crown Sale Attendance Title Registration Potash Projects Wind Generation Projects SASKATCHEWAN MANITOBA ALBERTA Suite 201, th Avenue, Regina, Saskatchewan, S4S 2N9 Fax: postoffice@prairie-land.com Website:

27 Sara Izzo Dylan Johnson Janice Lambert Michael Miles Lance Petersen Rajesh Pillai Greg Strachan, P.Land Brett Suchan Chris Trudel, PSL ConcoPhillips Canada to Cenovus Energy Inc. Independent to NAL Resources Limited Obsidian Energy Ltd. to Independent Sinopec Daylight Energy Ltd. to Insignia Energy Inc. Athabasca Oil Corporation to Alberta Ltd. Obsidian Energy Ltd. to Independent Nexen Energy ULC to Independent Encana Corporation to Raging River Exploration Inc. Integrated Environments (2006) Ltd. to KINDER MORGAN Canada Terminals m In Memoriam Raymond Maguire It is with deepest sadness that the CAPL announces the passing of Raymond (Ray) Maguire on July 9, 2017 at the age of 83 years. Ray became a member of the CAPL in 1968 and during his career was employed at Mobil Oil Canada and Anschutz (Canada) Exploration. At the time of his passing, he was President of Maguire Oil and Gas Exploration Ltd., a company he started in Ray received the P.Land (Professional Landman) designation on February 8, 1990, after successfully completing the Professionalism Grandfathering Assignment. He enriched the lives of those who knew him and will be truly missed by all of those that had the opportunity to know him. Timothy Ward Pinkerton It is with deepest sadness that the CAPL announces the passing of Timothy (Tim) Ward Pinkerton on August 9, 2017 at the age of 56. He is survived by his wife Leanne as well as many relatives. After a tenure in the oil and gas industry as a respected consultant specializing in corporate mergers and/or downsizing of companies, Tim left the corporate environment to enjoy his passion for scuba diving. He was an accredited professional It s like virtual reality for your survey 3D Laser Scanning produces fast and accurate results, saving you time and money when there isn t a lot of either. Contact us today to see how 3D Laser Scanning can work for your next project! Calgary Edmonton Grande Prairie Swift Current Fort Nelson Fort St. John canam.com 25

28 diver with numerous certifications in many different aspects of diving. May Tim s love for life spirit be within those who loved him. He will be truly missed by all of those that had the opportunity to know him. shooting skills. He was a member of Alberta Hunter Education and Instructors Association with a passion for teaching novice shooters proper techniques. He enriched the lives of those who knew him and the CAPL marks his passing with great sorrow. Edward Grandan It is with deepest sadness that the CAPL announces the passing of Edward (Ed Grandan) on September 22, 2017 at the age of 72. He is survived by his wife Donna, two sons Jeffrey and Paul, grandchildren Alexander and Sarah. He was Opa to special grandchildren Kieran and Rosie, brothers, an aunt, niece, nephews and cousins. He was predeceased by his grandmother, mother, father and uncle. Ed worked in various Calgary oil companies for 40 years as a Landman where he developed great friendships until his passing. Ed was employed as a landman for many years at Husky Oil Operations Ltd., Northstar Energy Corporation which became Devon Canada Corporation, as well as the Enerplus Group where he is remembered fondly for his hearty laugh, his desire for a win-win deal and his support of others in his land department. Ed enjoyed the outdoors, particularly hunting and fishing. He was an avid trap shooter and shot competitively for years. He was most recently honoured by the CAPL Trap Shoot Event with a trophy in his name that will awarded annually for trap David Barlass It is with profound sorrow that the CAPL announces the passing of David (Dave) Barlass on September 29, 2017 at the age of 65. He is survived by his beloved son Jack, Jack s mom Lesley and his best buddy Shredder. He was predeceased by his mother Celia, his father Jack and his brother Jackie. Dave was born in Calgary and attended Central Memorial High School and the University of Calgary. He was a senior landman at Dome Petroleum Limited and in those early days of working with BC as his area, Dave flew out to the Island many times forging new relationships with the BC government and OGC staff. He will always be remembered by the Dome landmen as a shrewd negotiator and avid story teller a prerequisite for a landman in that era. Dave will be remembered for his love of skiing, fly fishing, vintage cars and spending time at the family cabin in Windermere, BC. Dave enriched the lives of those who knew him and will be truly missed. m As a service provider, our product is our people. Keeping them safe is a serious matter. LAND IS OUR PASSION, SAFETY IS OUR CULTURE That s why a Certificate of Recognition (COR) is a significant achievement for Synergy Land, and a benefit to you, our clients. You can rest assured that we uphold strict safety standards to protect the people directly involved in your projects. Call us today at to learn more about the COR advantage. 26 synergyland.ca LAND (5263)

29 The Social Calendar EVENT DATE TIME LOCATION COST (INCLUDING GST) CONTACT NAME CONTACT PHONE CONTACT REGISTRATION DEADLINE CAPL November General Meeting 16-Nov-17 7:30 AM The Westin Calgary Members: $36.75 Student Members: $36.75 Non-Members: $63.00 Karin Steers Kaitlin Polowski (403) Nov-17 CAPL Christmas Networking Event 14-Dec-17 4:30 PM The Fairmont Palliser Members: $20.00 Student Members: $20.00 Non-Members: $40.00 Karin Steers Kaitlin Polowski (403) Dec-17 * Information and online registration: General Meetings: Social: A new partnership. + Midwest Surveys Inc. and Boundary Technical Group Inc. have merged operations to provide wide-ranging, customer-oriented survey solutions in Western Canada. Operating under Midwest Surveys, the new team will be called the Utility Services Group. The united entity will offer customers a wide array of utility surveying services including fibre cable and power line projects. For more about how Midwest Surveys can help with your next project, please visit: Offices: Calgary Edmonton Estevan Fort St. John Grande Prairie Lloydminster Maple Creek Medicine Hat Regina Resident Field Crews: Peace River Stettler Red Deer Brooks Lethbridge Kindersley 27

30 CAPL Calendar of Events November Meeting November 16, 2017 Guest Speaker: Rafi G. Tahmazian November 7 Tuesday Board Meeting 7 Tuesday Principles of Contract Drafting and Interpretation (afternoon) 8 Wednesday Alberta Crown Land Sale 8 Wednesday Manitoba Crown Land Sale 8 Wednesday 2015 CAPL Operating Procedure 11 Saturday Remembrance Day 14 Tuesday Overcoming the Five Dysfunctions of a Team 15 Wednesday Aboriginal Affairs (morning) 16 Thursday Fundamentals of Mineral Land (morning) 15 Wednesday Indian Oil & Gas Canada (afternoon) 15 Wednesday British Columbia Crown Land Sale 16 Thursday Breakfast Meeting 16 Thursday ROFR Issues: An Interpretative Approach 22/23 Wed/Thurs Evaluation of Canadian Oil and Gas Properties for Landmen (2 Days) 22 Wednesday Alberta Crown Land Sale 28 Tuesday Title Review & Due Diligence: A How To 29/30 Wed/Thurs Drilling and Production Operations (2 Days) m December 5 Tuesday Board Meeting 5 Tuesday Saskatchewan Crown Land Sale 5 Tuesday Professional Ethics: Theory and Application 6 Wednesday Alberta Crown Land Sale 12 Tuesday Negotiation Skills for Surface Land Agents (PSL ) 13 Wednesday British Columbia Crown Land Sale 14 Thursday Christmas Networking 24 Sunday Christmas Eve 25 Monday Christmas Day 26 Tuesday Boxing Day 31 Sunday New Year s Eve m Time: 7:30 a.m. Where: The Westin Calgary Avenue S.W. Cost: Members: $36.75 Student Members: $36.75 Guests: $63.00 To register, please go the event tab on the CAPL website. Deadline for registration is noon, Friday, November 10, m CAPL Christmas Networking Event December 14, 2017 Time: 4:30 p.m. Where: The Fairmont Palliser Avenue S.W. Cost: Members: $20.00 Student Members: $20.00 Guests: $40.00 To register, please go the event tab on the CAPL website. Deadline for registration is noon, Friday, December 8, m 28

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