Bulletin 2013-06

Bulletin 2013-06: Invitation for Feedback on Proposed Changes to Administration of Off-Target Oil and Gas Wells

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Invitation for Feedback on Proposed Changes to Administration of Off-Target Oil and Gas Wells

Feb 11, 2013

The Energy Resources Conservation Board (ERCB) invites stakeholder feedback on proposed changes to the administration of off-target oil and gas wells. The current provisions, the proposed changes, and comments on the proposed changes are summarized in the attached table. The proposed changes would have the following benefits:

  1. There would be clarity in the details of how off-target wells are handled, with the documentation for the administration combined into one document: Directive 065: Resources Applications for Oil and Gas Reservoirs. Some appropriate information would also be included for convenience in Directive 007-1: Allowables Handbook – Guidelines for the Calculation of Monthly Production Allowables in Alberta.
  2. The rules on off-target well administration would be applied consistently with regular ERCB surveillance, resulting in a more predictable and level playing field for industry.
  3. There would be less administrative burden on industry as the ERCB would be conducting regular surveillance and assessing penalties on off-target wells.
  4. The rules for off-target well administration would be consistent for off-target wells in both drilling spacing units and in holdings. The current requirement that an off-target well in a holding be shut in would be eliminated and replaced by an off-target penalty provision.
  5. The penalty provision for off-target wells in holdings would eliminate the current problems that occur now when industry applications for special well spacing are denied because approval of an application would place a well off target in the holding.
  6. For off-target gas wells, industry would no longer be required to conduct a bottomhole static gradient test on an annual basis as is presently the case.
  7. The rules for applying the first-well-in-a-pool policy and in calculating penalized allowable production would be simpler and more consistent for gas wells and oil wells and expanded to include both drilling spacing units and holdings. The penalized allowable production should be consistently meaningful as it would be reviewed more often.

To provide the ERCB with feedback on the proposals, complete the comment form available on webpage for this bulletin (www.ercb.ca). Feedback or questions should be sent by e-mail to off-targetwells@ercb.ca. Feedback will be accepted until March 29, 2013. All feedback received will be reviewed for the purpose of revising the proposal. All of the comments provided through this consultation will form part of the public record and, at the discretion of the ERCB, any comment received may also be attributed to the specific individuals providing it.

Personal information provided with the comments will be collected, used, and disclosed in accordance with the Freedom of Information and Protection of Privacy Act. The ERCB may use the personal contact information provided for follow-up communication related to your feedback.

The ERCB requests that the responses be formatted as shown on the feedback form to include the issue for which feedback is to be provided, possible solutions or recommendations, and the rationale to support the solution or recommendation.

<original signed by>

Stephen Smith
Executive Manager
Applications Branch

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