Principal Issues: (a) Which Classes in Schedule II of the Regulations pipelines should be included into? (b) Which Classes in Schedule II of the Regulations pipeline appendage equipment should be included into?
Position: (a) Pipelines could be included in Class 1, 2, 8, 10 or 41 in Schedule II of the Regulations, depending on the facts of the circumstance. (b) Pipeline appendage equipment could be included in Class 1, 2, 8, 10 or 41 in Schedule II of the Regulations, depending on the facts of the circumstance. In case of linefill, it would be excluded from property in any Class of Schedule II of the Regulations.
Reasons:
(a) The reference to pipelines in the Act may refer to the pipelines of general use (e.g., see paragraph (l) in Class 1 of Schedule II under the Regulations) and the reference to gas or oil pipelines may includes flow lines, gathering lines, main or trunk lines, and transmission lines. Therefore, a pipeline could be included as asset of Class 1, 2, 8, 10 or 41, depending on the facts of the circumstance. If a pipeline is considered as "gas or oil well equipment", it would be included in Class 10(j) or Class 41(b), as the case may be. If a pipeline is considered as primarily used in "Canadian field processing" (i.e., assuming it would otherwise be included in Class 8), it would be included in Class 41(c) or (d). A pipeline which is not considered as "gas or oil well equipment" nor primarily used in "Canadian field processing", would be included in Class 1(l) or Class 2(b), as the case may be, provided the main source of supply for the pipeline would not be exhausted within 15 years. Otherwise, such pipeline would be included in Class 8(i).