Applying for Period 3: Alberta Site Rehabilitation Program
The Alberta Government has released the details for Period 3 of the Alberta Site Rehabilitation Program. Applications are open until March 31, 2021. An additional $100 million in grant funding is available, limited to $139,000 per licensee.
Key Details for Period 3
The $1.0 billion in Federal funding allocated to the Alberta Site Rehabilitation Program (SRP) is distributed in increments of $100 million — each period with targeted priorities, application acceptance criteria, and timelines. Period 3 includes an additional $100 million in available grant funding.
Application period
Applications for period 3 are open from July 17, 2020 to March 31, 2021 or until funding is fully allocated, whichever comes first.
Funding allocation
For period 3, the $100 million in grant funding will be allocated as follows:
$139,000 in grant funding will allocated to each active site licensee in the province.
Projects are eligible for 100% grant funding, up to the limit of $139,000 for each licensee.
As with previous periods, the application review process uses department and industry data to assess contract costs and scope for reasonability.
Eligible sites
For period 3, the basic requirements for site eligibility are as follows:
Only sites from eligible licensees are eligible for funding. You can download the list of eligible licensees in (.xlsx format) from the Alberta Government website.
As with previous periods, site licensees cannot apply for funding. Oilfield service contractors must contract with licensees for closure work and apply for an SRP grant for the work.
For oil and gas sites to be eligible, they must be in Alberta and their closure operations must put Albertans to work.
Contractor Eligibility
For period 3, oilfield service (OFS) contractors and environmental contractors are eligible, provided they are contracted for eligible activities.
Upstream oil and gas infrastructure abandonment contractors
For period 3, OFS contractors are eligible for grant funding for the following activities:
Wellsite abandonments
Pipeline abandonment and segment removal
Facilities
Environmental contractors
For period 3, environmental contractors are eligible for grant funding for the following activities:
Phase 1 and 2 environmental site assessments
Remediation
Reclamation
Contract validity and criteria
Oilfield service contractors must have a valid contract with an Alberta oil and gas licensee. The following criteria are very important when structuring contracts with licensees.
The contract must be fully executed, with no ‘subject to’ clauses (with the exception of ‘subject to’ required abandonment and environmental).
Only the contractor who has signed the agreement with the licensee can apply.
The licensee is responsible for ensuring the contractor has the skills, expertise, capacity, and equipment to conduct the work to meet all provincial requirements.
Funding can only go to contractors; no funding can go to licensees.
Prime contractors
This is the first SRP period that makes mention of Prime contractors having the ability to apply and carry out work for licensees.
The contractor or prime contractor responsible for doing the contracted work must apply for the grant.
Prime contractors must show that their sub-contractors have been paid in full when submitting invoicing for interim and final grant payment.
Eligible Activities
Eligible and ineligible activities are similar to that of Period 1 and Period 2, with exclusions for specific types of work, work already completed, and work outside of Alberta.
Eligible activities
All of the following activities are eligible:
Closure work on inactive wells and pipelines
Phase 1 and phase 2 environmental site assessments
Remediations
Reclamations
Preparation of applications for remediation and reclamation certificates
Ineligible activities
The following activities are ineligible:
Suspension and discontinuation costs that are not part of abandonment and reclamation projects
Non-closure work on production site like spill remediation
Work on orphan wells
Closure work outside of Alberta
Work completed or in progress before the program came into effect on May 1, 2020
Eligible Costs
Eligible and ineligible costs are similar to that of Period 1 and Period 2, with exclusions for administrative, preparatory, and non-work related expenses.
Eligible costs
Eligible costs are as follows:
Materials and supplies
Wages
Equipment rentals
Laboratory analyses
Transportation of equipment and worker to and from sites
Ineligible costs
Ineligible costs are as follows:
Administration fees
Costs of work to prepare for contract bids, grant applications and project contracts
Non-work related expenses
Special Considerations for Period 3
Indigenous companies, contractors, and employees
Beginning with Period 3 and continuing in future periods, applicants can identify as an indigenous company or as a prime contractor that is hiring indigenous sub-contractors or employees.
Separate stages of site closure
Separate stages of closure work at the same site require separate applications. For this reason, oilfield service (OFS) contracts can have “subject-to” clauses referencing completion of required abandonment work or environmental work.
Single applications that include all closure work stages on one site will not be accepted.
Work activity scope and verification
Applications for the same work activity by different OFS companies will be accepted if the scope of work for each is clearly distinguishable.
A prime contractor may apply for all the closure work required for one work activity on a site, but must be able to show that sub-contractors have been paid in full when submitting invoices for grant payment.
Multiple sites, multi-well pads, and previously-funded sites
Multi-site, multi-well, and previously funded applications should take the following special considerations into account:
Multiple applications are allowed, up to the maximum approved allocation of $139,000 in grant funding per licensee.
Licensees must ensure that the total grant amount requested by their contractors will not exceed their allocation of $139,000.
Multiple sites that have the same License BA code and require the same work activity can be included on a single application.
Multi-well pads are eligible if all wells are abandoned and ready to move through remaining closure work.
Multi-well pads with operating well(s) are not eligible.
Identical work activities at the same site that have received grant funding in previous periods are not eligible for additional grants.
How to Apply for Period 3 Grants
Electronic Transfer accounts and credentials
To create a grant application in Period 3 you can use the same credentials as Period 1 or 2, or sign up for a new Electronic Transfer account.
Enter into a contract with the site licensee before applying
Applicants need to contact site licensees and enter into a contract for site closure work. With this contract, applicants can apply online.
More information
For more details about the overall Alberta Site Rehabilitation Program, requirements, timelines, and payments, refer to our comprehensive guide.
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Understanding the appropriate requirements and compiling the necessary documentation is essential, but it can quickly add overhead to any project.
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Sources
Site Rehabilitation Program | Application Information and Guidelines, viewed 21 July 2020,
https://www.alberta.ca/site-rehabilitation-program-apply-for-a-grant.aspx