Conservation Easements in Alberta

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What is the Legal Nature of a Conservation Easement?

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A conservation easement is legally considered an interest in land for the qualified organization (grantee). Like other forms of covenants, a conservation easement is not treated as an encumbrance on land. Encumbrances are “charges” or claims related to land such as a mortgage or lien whereas a conservation easement represents property related rights.

Conservation easements typically exist in perpetuity (with no end date), but can also be created for a set term. While a conservation easement effectively transfers certain property use rights and opportunities from the landowner to the qualified organization through the limitations imposed in the agreement, the qualified organization cannot exercise them if they do not support the conservation purposes of the agreement. For example, if the landowner is restricted, for conservation reasons, from building houses on the property affected by the conservation easement that does not mean the qualified organization acquires a right to build houses on that property.

Conservation easement agreements set out a list of binding restrictions on specified land uses. These are the “rights” that have been granted by the landowner to the qualified organization. However, those transferred rights do not override the applicable regulatory authority. For example, if a conservation easement says the landowner may build only one house on the property, and only in a specific surveyed location, that does not create a “right” to build a house. The landowner would still need to obtain all the required development and building permits, any of which may be denied by the municipality. Similarly, conservation easement restrictions that “allow” certain land uses do not override local zoning requirements and related permitted and discretionary uses.

Because a conservation easement constitutes an interest in land for the qualified organization, that property interest enables legal recognition of the organization’s participation in regulatory decisions relating to land. For example, this means that both the landowner and qualified organization will have recognizable rights related to the conservation land, which may include the ability to participate in hearings before decision-making bodies such as the Alberta Energy Regulator, Alberta Utilities Commission and Environmental Appeals Board.

However, granting a conservation easement on land does not exempt the land from energy development or expropriation. If the landowner granting the conservation easement owns the associated sub-surface mineral rights (a rare circumstance), they can prevent energy development by declining to sell or develop those mineral rights. Otherwise, oil and gas companies continue to enjoy the right to access minerals they have purchased and can obtain a right-of-entry order from the Surface Rights Board to access the land and develop those rights. A qualified organization may have the ability to participate in (and oppose) oil and gas development or expropriation decisions before administrative bodies. Depending on the terms of the conservation easement agreement, the qualified organization may also be entitled to compensation where activities adversely impact the conservation easement area. It is also important to note that the existence and purpose of a conservation easement held by a qualified organization can affect the practices and even the willingness of hydrocarbon explorers and developers to proceed on the land in question.

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