Good Production Practice

 

Good Production Practice

Pools with good production practice (GPP) status can be produced unrestricted by rate limitations or gas-oil ratio (GOR) penalties. In the development of such resources, operators are expected to produce the wells in accordance with good engineering practices to optimize oil recovery. Enhanced oil recovery scheme areas are automatically granted GPP. Once granted, the AER may rescind GPP approval if new information or technology shows that production under GPP may affect conservation or the rights of other mineral rights owners in the pool.

A Directive 065: Resources Applications for Oil and Gas Reservoirs application must be submitted in accordance with section 10.060 of the Oil and Gas Conservation Rules for the approval to exploit a hydrocarbon resource under GPP. Producing intervals in the hydrocarbon pool must already have been on stream, with a clear idea developed of the production performance capability before this application is submitted.

The following outlines the critical information that the AER requires and that the applicant must follow to get GPP approval for a hydrocarbon pool. It contains links to relevant application submission procedures and guidance documents.

Application Submission

A GPP application must be submitted using the Digital Data Submission (DDS) system, which is available through “Systems & Tools” on the AER website, www.aer.ca.

Applications are registered using Integrated Application Registry (IAR), and all material related to an application is stored within this system.

All submissions made in relation to any application are held non-confidential by the AER and are accessible, upon request, by other interested parties.

Approval Process for a GPP Application

All applications are published on the Public Notice of Application (PNoA) page on the AER website (www.aer.ca) to encourage public participation in the approval process.
Applications are initially reviewed for administrative completeness upon receipt at the AER. The application may be closed if significantly deficient of Directive 065 requirements. If the application is declared administratively complete, a technical review will be conducted to ensure that the application includes the following (supplemental information may be requested during the review period):

  • Statements of concern (SOCs) filed by parties that may be directly and adversely affected by GPP for which approval is sought. These are evaluated for relevance to the application. If relevant, an SOC may necessitate a public hearing to address the stated concerns prior to the disposition of the application. The relevance of the SOC is decided by the AER director of subsurface authorizations.
  • Notifications in accordance with Directive 065 guidelines
  • Application referral to AER Authorizations Subsurface (Geology), if required for answers to specific questions on the expansion potential of the pool and the existence of an associated gas accumulation
  • The applicant’s reservoir fluid volumetric estimates and the AER database estimates
  • A reservoir pressure history and the effect of reservoir energy depletion on the production performance
  • Evaluation of enhanced oil recovery potential, such as waterflooding and gas flooding
  • The list of active producers in the pool and their completion details

Other application process and approval considerations:

  • A technical memorandum, with disposition recommendations, and draft approval letter are prepared and presented for supervisory review.
  • The reservoir engineering manager or the manager’s delegates make the final decision on the merits of any application and sign off on the approval. The application is finalized in accordance with the decision of the panel, when a public hearing is required.
  • An application approval can be appealed after disposition if an SOC is received from eligible parties. Eligibility for an SOC is based on the Responsible Energy Development Act. The filing requirements and process for a request for regulatory appeal, including form, content, and time limits, are set out in sections 30 through 33 of the Alberta Energy Regulator Rules of Practice.

Application Timelines

The processing time for this application is 65 business days and the AER aims to meet this target 95 per cent of the time. This timeline is made up as follows:

Task Business Days
Administrative Completeness 5
Assignment 5
Referral 20
Supplemental Information 10
Technical Review 15
Decision 10
TOTAL 65