Farmers' Advocate Office: Compensation

 
 
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 The FAO does not provide advice on compensation amounts for energy or utility developments. This page is designed to provide information on how Alberta's legislation approaches surface lease compensation, as well as current trending issues and advisories related to surface lease compensation.
  • Compensation Elements
    Compensation is determined under section 25 of the Surface Rights Act. This article provides more information on what factors are considering in the determination of compensation.

  • Option to Purchase Agreements
    A company may attempt to secure land in advance for energy and utility developments through an option to purchase. Landowners should be aware that this type of agreement commits them to the company at a fixed price, but does not obligate to company to purchase the land at the end of the term.

  • Promises to "Top Off" Compensation for Pipelines, Utilities, and Transmission Lines
    To avoid delays in securing an agreement, a company may commit to coming back to "top off" compensation if another landowner along a pipeline, utility, or transmission route negotiates at a higher rate. Landowners should be aware that each contract is valid from the day it is signed, so a company is not legally obligated to come back and "top off" compensation.

  • What To Do When A Company Fails to Make Annual Rental Payments
    A landowner who has not received their annual rental payment for their surface lease may submit a section 36 Recovery of Rentals application to the Surface Rights Board (SRB).
  • Advisory 2016-1: Rental Reductions
    Some landowners have reported being told that their annual rental payment would be unilaterally reduced before the anniversary date. A landowner's annual rental is based on their Loss of Use and Adverse Effect, so a landowner is under no obligation to accept a reduced rental if their impacts have not changed. The Surface Rights Act provides a process for rental renegotiations in good faith (honest, two-way conversation) on the five year anniversary. A recent decision from the Surface Rights Board (SRB) echoed this sentiment: Panel Decision Echoes FAO Advisory on Rental Reductions

  • Advisory 2016-2: Selling Surface Leases
    The FAO cautions landowners about the practice of selling surface leases to private companies. Selling surface rights is being marketed as a means of reducing a landowner's risk for unpaid rentals, but this approach may be misleading since recourse for unpaid rentals is available through the SRB.

Contact Us
Farmers' Advocate Office (FAO)
#305, 7000 - 113 Street
Edmonton, AB T6H 5T6
Telephone: 310-FARM (3276)
Fax: 780-427-3913
farmers.advocate@gov.ab.ca
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For more information about the content of this document, contact Jeana Schuurman.
This information published to the web on September 15, 2017.