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CRITICAL SUCCESS FACTORS IN FLARING & VENTING REDUCTION:

THE ALBERTA/CANADA EXPERIENCEGeorge Eynon PGeoBoard Member

2Key Elements

CONTEXT• Alberta’s history of industry

regulation• Recent history of flaring &

ventingDATA

• Measurement, collection, and public availability

STAKEHOLDER INVOLVEMENT• Governments, Industry,

and NGOs

ECONOMIC TEST• Price/Cost Sensitivity

3GGFR: the Canadian Context

Canada first to submit a Country Implementation Plan

Required co-operationamong provinces

Canadian Flaring and Venting Regulators Forum [CFVRF]created

ERCB-led process

4The Alberta Context

Provincial ownership of resources

Legislated oversight of industry

75-year experience in regulation

Arms’ length quasi-judicial tribunal

Technical expertise; 900 staff

5ERCB Mission

…to ensure that development of Alberta’s energy resources is orderly, efficient and effective

…and is conducted in a manner that is safe, fair, responsible, and in the public interest

6Beginnings…

1930s massive flaring at Turner Valley oil fields nr Calgary

1938 Alberta created regulator Gas Conservation Board

1949 ERCB authorized to regulate removal of gas from Alberta

1950s NGTL created to gather gas in Alberta & TCPL created to move gas across North America

Gas required for pipelinesso conservation required

7Separate Roles…

GOVERNMENTAlberta Dept of EnergyP&NG licenses & leasesRoyalties

REGULATOR ERCB at arms lengthDelegated regulation-making authorityData gathering & analysisReporting requirementsCompliance/enforcementCompliance infractions publically reported

8Data…

Alberta economy resource-basedoil & gas development facilitated by public availability of data/information to industry, government, and NGOs

ERCB role and reputation based on collection and analysisof information and dataIf it gets measured, it gets doneNo data, no analysis!Shows where to focus efforts

Public reportingpositive pressure on companies to do betterrecognition for those that do a good jobshows where to focus our efforts

9Definitional Problems…

Federal/Provincial terminologyneeds to be harmonized

Data/Reporting inconsistenciesNRCan/Environment Canadaworking with Provinces e.g., “fuel gas” definition and reporting requirements

10Verifiable Data…

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12N2 in vented gas?

13Gas Flared in Testing?

14Other Sources

Mineable oil sandsDifficult to estimate vented volumesWhat emissions factor should be to estimate volumes of gas emitted per cubic tonne of oil sands?

UpgradersNot previously reported in annual reports.Flare and vent data reported to ESRD not ERCBMay change with a single regulator

15Economic Test…

Gas Conservation OrdersInitial methodologyset level of conservationfield/product specificbased on economic conservation

Stakeholder involvementCASA – industry, government, publicnow incl. municipalities, communities, NGOs, etc

Economic testERCB sets economic parameters Ability to audit and reviewCompliance/enforcement

16Directive 060…

Economic testBased on gas conservation economics only

If…NPV of sales revenues less than…NPV of conservation costsand >($50,000) then conservation required

17Challenges…

Low gas prices affect economics…result in less conservation

Companies only required to consider the gas;gas/oil ratio needs to be used?

The NPV threshold needs revision?

Using gas as fuelat wells and batteriesalso needs to be encouraged

18Looking Ahead…

Canada’s GHG emissions policy to play a larger role

Harmonization of definitions across Canadian jurisdictions?

Revise economic test in Alberta if gas prices remain low?

Impacts of URRF?Alberta Unconventional Resources Regulatory Frameworkbased on play trends/project areas

Impact of “single regulator”and Land Use Frameworklegislation in Alberta?

Gas conservation orders again?

19Thank you!

Questions?

Georg Eynon PGeoBoard Member – ERCBgeorge.eynon@erccb.ca www.ercb.ca