Oil and Gas Securities Regulation and Reporting: National Instrument 51-101
Authors: Elliot D.C. 
Published: March 2010

Abstract
The prime assets of an oil and gas company are its reserves and resources; they are the most important information about a company, and are the basis on which capital is raised to carry out its activities. A reporting issuer is a company that sells securities on the open market, but not necessarily on an exchange. Canadian National Instrument 51–101 (NI 51–101) governs the disclosure that is required of a reporting issuer. It has been in force since September 2003 and mandates the disclosure of Proved and Probable reserves and allows the disclosure of other categories of resources by reporting issuers.
This paper provides a background to the securities regulation and regulatory reporting regime of NI 51–101, including recent amendments. It is not a substitute for the expert advice that should be sought by anyone attempting to fulfill securities regulatory requirements. Some trends and issues on oil and gas reserves and resource estimation and disclosure in Canada and the international arena are also discussed.

Introduction
The ability to raise money in the public market, to start or continue the activities of a company, carries with it a responsibility to report on these activities to investors. Reporting or "disclosure" requirements are prescribed by securities regulators and apply to all such companies. Because of the importance to the Canadian economy of the extractive industries, oil and gas and mining companies are required to provide additional information beyond that generally required. For the oil and gas industry, new securities legislation, National Instrument 51–101, Standards of Disclosure of Oil and Gas Activities (NI 51–101), was implemented in 2003, replacing the previous legislation, National Policy 2B. Some recent amendments, mainly a reduction in reporting requirements, came into force in December 2007. The Alberta Securities Commission has been administering NI 51–101 since its inception. NI 51–101 reporting is only one of the many reporting requirements that a company is required to fulfill.
A brief overview of securities regulation is given here to provide a context for NI 51–101 reporting within the general framework of securities regulation. This is not a substitute for the expert advice that should be sought by anyone attempting to fulfill securities regulatory requirements.

The Canadian Oil and Gas Securities Market
The Canadian oil and gas securities market is one of the largest of its kind in the world, and about 50% of the world's public oil and gas companies are listed on TSX/TSXV.
The number of listed oil and gas companies on the TSX website as of December 31, 2007 was:Canadian TSX/TSXV 424US (NYSE, AMEX, NasDaq) 183LSE-AIM 140A number of reporting issuers trade on other venues than the TSX/TSXV, and an estimated 538 reporting issuers are currently expected to make NI 51–101 annual filings in 2008.

Securities Regulation
Purpose
Securities regulators are responsible for the administration of securities laws in Canada, which includes:
Developing, implementing and maintaining securities laws and policies.Regulating primary and secondary market trading through the closed system.Enforcement of securities laws.Educating and communicating with stakeholders and the public.