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BC Petroleum and Natural Gas Regulations Seminar Presentation to CAPL October 22, 2013 PowerPoint Presentation
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BC Petroleum and Natural Gas Regulations Seminar Presentation to CAPL October 22, 2013

BC Petroleum and Natural Gas Regulations Seminar Presentation to CAPL October 22, 2013

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BC Petroleum and Natural Gas Regulations Seminar Presentation to CAPL October 22, 2013

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  1. BC Petroleum and Natural Gas Regulations SeminarPresentation to CAPLOctober 22, 2013 Geoff Turner Terry Branscombe Page 1.

  2. SEMINAR OUTLINE PART 1 – MINISTRY UPDATES • Ministry Structure / Organization Update • Acquiring Petroleum and Natural Gas (PNG) Tenure in BC • Resource Development Updates • Tenure Management Updates • Royalty Program Update • Policy and Regulatory Updates • Jobs and the Economy Page 2.

  3. SEMINAR OUTLINE PART 2 – TENURE MANAGEMENT • Resources for administrators • General framework for tenure • Land systems • Spacing • Rentals • Geological zones in BC • Tenures • Permits (Features) • Drilling Licences (Features, Extensions, Earnings, Groupings) • Leases (Features, Continuation Options, Land Plats)

  4. SEMINAR OUTLINE PART 3 – GENERAL ADMINISTRATION • e-Payments • Training Resources • Payment Types and when to use them • Tenure Cancellation • Letters of Authority • Instruments Affecting Title • Transfers (assignments) • Encumbrances • Pooling Agreements • Name Changes/Amalgamation

  5. KEY CONTACTS Garth Thoroughgood, Executive Director, Tenure and Geoscience Branch250-952-6382 POSTINGS, PETROLEUM TITLES ONLINE, WEBMASTER, MAPPING Elle Bardol, Manager, Crown Sale and GIS Services 250-952-0344 PRE-TENURE REFERRALS, TENURE CAVEATS Matt Austin, Director, Resource Development 250-787-3426 GEOLOGY, ZONE DESIGNATION Dave Richardson, Manager, Geology 250-952-0359 LEGISLATION AND POLICY DEVELOPMENT Geoff Turner, Director, Policy & Planning 250-952-0709 DRILLING LICENCES, WORK PROGRAMS, PERMITS Terry Branscombe, Senior Tenure Management Advisor 250-952-0340 DRILLING LICENCES, LEASE CONTINUATIONS Cindy Kocol, Tenure Management Advisor250-952-0342 DRILLING LICENCES, TRANSFERS, ENCUMBRANCES, LEASE CONTINUATIONS, CANCELLATIONS Christine McCarthy, Tenure Management Advisor250-952-0341 E-PAYMENTS, BCeID, PRE-AUTHORIZED DEBITS Carolyn Desjardins, Manager, Revenue Collection, Reconciliation and Reporting250-356-1059 GENERAL INQUIRIES 250-952-0333

  6. Deputy Minister Ministry of Natural Gas Development Assistant Deputy Minister Upstream Development Division Assistant Deputy Minister Liquefied Natural Gas Initiatives MINISTRY STRUCTURE Assistant Deputy Minister Oil and Strategic Initiatives Division

  7. UPSTREAM DEVELOPMENT DIVISION • Assistant Deputy Minister • Upstream Development Division Policy and Royalty Branch Tenure and Geoscience Branch

  8. TENURE AND GEOSCIENCE BRANCH Garth Thoroughgood Executive Director Tenure and Geoscience Branch Dave Richardson Manager Geology Fil Ferri Director Petroleum Geology Debbie Fischer Director Tenure & Revenue Management Terry Branscombe Senior Tenure Management Advisor Geoff Turner Director Policy & Planning Elle Bardol Manager Crown Sale & GIS Services Matt Austin Director Resource Development


  10. PNG TENURE • Tenure doesprovide: • exclusive rights to the subsurface resource • right to apply to the OGC for activities approval • Tenure does notprovide: • the authority to conduct any activities on lands (e.g., drilling)

  11. DISPOSITION PROCESS 12 sales per year 106 day process

  12. ADDITIONAL INFORMATION SOURCES • Posting Requests • Submitting a Bid Link to Bidding and Disposition Guide • Disposition Dates for 2014-2015

  13. RESOURCE DEVELOPMENT UPDATES • First Nations Engagement • Community Engagement • Caribou

  14. FIRST NATIONS ENGAGEMENT • Role of the Crown • The Crown has a fiduciary duty to consult First Nations about decisions which may impact their rights and, where possible, accommodate their interests. • Role of the proponent • Build and maintain good relationships with First Nations in the areas you operate.

  15. FIRST NATIONS ENGAGEMENT • Monthly Referral Process • Initial Impact Assessments • Responsive to First Nation comments • Deferred Parcels • Meet to resolve area-specific issues – FSJ staff • Example: Old Man Lily Parcels • Shapefile and PDF map of currently deferred parcels: • Strategic First Nations Negotiations • Consultation Agreements • Strategic Engagement Agreements

  16. FIRST NATIONS ENGAGEMENT • Emerging Issues • Opportunities to build landscape level impacts/Cumulative Effects into decisions • Outcome of the Dene Tha’ Judicial Review

  17. COMMUNITY ENGAGEMENT • Referral packages and discussions on deferred parcels with local government • Landowner Notification Program • Farmers’ Advocacy Office renewed


  19. BOREAL CARIBOU RRAs • In June 2010, 500,000 hectares of boreal caribou habitat were set aside as “resource review areas” (RRAs) where no PNG tenure requests would be accepted for a minimum of five years • For more information, see Information Letter TACRD-10-10

  20. BOREAL CARIBOU – UPDATES • Radio collaring underway funded in part by industry • New ungulate winter ranges and wildlife habitat areas designated in May 2013 (Chinchaga herd) • Establishment of operating practices to be applied to oil and gas activities within designated caribou habitat management polygons • Consultation completed with First Nations and stakeholders on the “Implementation Plan for the Ongoing Management of Boreal Caribou”

  21. PEACE NORTHERN CARIBOU • Provincial implementation plan has been completed for Peace Northern Caribou • Established RRAs for high elevation winter ranges for Peace Northern Caribou Herds • Planning requirements have been established for activities taking place in high elevation winter ranges • Work underway to establish operating practices for low elevation habitat for the Peace Northern Caribou


  23. eBUSINESS Integrated Petroleum System (iPS) • iPS will transition 3 legacy applications to current technology • Petroleum Titles System (PTS) • Petroleum Accounts Receivable System (PARS) • Sales Parcel System (SPS) • Launch has been postponed to make minor changes and fixes • eBidding will be offered once industry consultation has taken place (expected in the new calendar year)



  26. TARGETED ROYALTY PROGRAMS • These programs can be combined in many cases, thus providing enough margin to move certain projects to economic territory • Example - a well that: • is a road project (an infrastructure credit), • is deep, and • is marginal can receive all the associated benefits for those programs • More information: •

  27. ROYALTY PROGRAMS Update • Changes Announced as Part of Budget 2013 • Deep Well Credit – minimum 3% royalty payable • Summer Drilling Credit Program cancelled • More information: • 2013 Infrastructure Royalty Credit Program • $115.8 million in royalty credits supporting 12 new infrastructure projects in northeast BC, which will help the advancement of an LNG industry • The 2013 credits are expected to generate about $445 million in revenues for the province and over $320 million in new capital spending by industry

  28. POLICY & REGULATORY UPDATES • BC Tenure Working Group • Review of the PNG Act & Regulations • New Policy Guides

  29. BC TENURE WORKING GROUP • The BC Tenure Working Group continues to meet regularly to discuss: • Improved communication • Legislation and Regulations • Opportunities to work more efficiently and effectively • Educational opportunities • eBusiness • Recent meetings included discussions about: • Posting and bidding processes • Foundational concepts for tenure reform • Tenure terms and continuation

  30. REVIEW OF THE PNG ACT & REGULATIONS • Comments received in response to the Discussion Paper on the tenure provisions helped inform analysis and recommendations • Proposed changes are intended to modernize the Act, streamline tenure administration and improve management of unconventional resource development within the tenure system • In March 2012 the Ministry issued a report on progress for tenure holders regarding potential changes • Consultations with industry, First Nations and other government agencies continued in 2012

  31. REVIEW OF THE PNG ACT & REGULATIONS • Feedback on the proposed changes from the Tenure Reform Task Group informed further analysis and consultation with the BC Tenure Working Group • In addition to reviewing the tenure provisions, the Ministry is working on a framework for the management of carbon capture and storage • The Ministry is awaiting a decision on if and when changes will be made • Ongoing consultation and analysis regarding some details that would be introduced through the regulations

  32. NEW POLICY GUIDES • Policy guides will replace info letters as the main source of detailed information on BC tenure policy and legislation • Guides are updated each time there is a change eliminating the need to refer to multiple info letters • Guides available online: • Info letters will still be used for announcements • Subscribers will receive notifications when a guide is issued or updated (to subscribe, send a request to

  33. NEW POLICY GUIDES • Recently issued guides: • Guidelines for Registering a Transfer of Subsurface Interest in Title • Guide to BC Petroleum and Natural Gas Act Lease Continuations • Upcoming guides include: • Guide to Bidding and Disposition of Crown Petroleum and Natural Gas Rights • Guide to the Petroleum and Natural Gas Drilling Licence Regulation • Natural Gas and Oil Tenure Rents, Fees and Penalties



  36. NATURAL GAS STRATEGY • Ensure an effective royalty regime • Ensure Infrastructure is available to encourage investment • Amend the Petroleum and Natural Gas Act and regulations • New Jobs for BC • Engaging with First Nations and Communities • Ensuring environmental responsible development

  37. LIQUEFIED NATURAL GAS (LNG) • In September 2011, the Premier confirmed Provincial commitment to the development of LNG export capacity in BC • The announcement included commitments in four areas: • Greater emphasis on the permitting and decision making processes • Skills training and development • Investment and attraction • International marketing

  38. LNG UPDATE • The Premier made two trade missions to Asia to promote trade and cultivate business relationships • BC hosted Canada’s first international LNG conference in February 2013 • The NEB has issued export licences to three LNG proponents and additional applications are before the NEB for review • Several proponents have come forward with proposals for LNG facilities and transportation systems • Most recently, in response to the Province’s request for expressions of interest, four proponents submitted proposals for an LNG plant and marine export terminal at Grassy Point near Prince Rupert

  39. PNG OPPORTUNITIES • Continue to develop and implement strategies to make PNG tenure available • Continue to create and implement progressive and innovative strategies and approaches for effective policy, legislation and regulations that support a modernized tenure issuance and management system • Continue to provide an attractive investment environment through royalty and infrastructure programs


  41. PART 2 Tenure Management

  42. Tenure Management • Resource List • Tenure and Geoscience Branch homepage • Legislation • Information Letters • Other Publications (Guides and reference material) • Links to: • Petroleum Titles Online (PTO) • Submit posting requestes for Crown disposition • Online title searches • e-Payments • DataBC/GeoBC • • Map Viewer (iMap 2.0) • Complete data warehouse of provincial GIS data • Tenure in context of other geographic and land use information

  43. Start Here

  44. Online Title Searches • Getting there: • Navigate to PTO main page from the Branch homepage, or dial in: • On PTO main page, click “PTS Web” in left sidebar • Support: • Content: • Up-to-the minute title status and descriptions for active title • Primary Term (years), Area (hectares), Key Dates: Issuance, Effective, Expiry • Tracts – Lands and Rights held • Groupings (Drilling Licences) • Ownership profile • Rental & Continuation History • Transfers and Encumbrances • Special Projects (OGC), Wells (UWIs), Unit Agreements

  45. Online Tools and Support • Petroleum Titles Online (PTO) • • File posting requests • Support: • e-Payments • • Support:

  46. Key Acts and Regulations • Petroleum and Natural Gas Act • Grid Regulation • Drilling Licence Regulation • Fee, Rental and Work Requirement Regulation • Storage Reservoir Regulation

  47. Geography and Geology • Dominion Land Survey (DLS) • Petroleum Grid (NTS) • Spacing Areas • Well Locations • Stratigraphy & Zones

  48. DLS • PNG Grid Regulation Schedule 1 • Limited to Peace River Block • TWPs 76 - 88 • RGEs 13 – 26 W6M • Section size is as surveyed, not standard like Alberta • Refer to downloadable map entitled “Peace River Block Gas Spacing Units and Hectarage Map” • Location: PNG Titles Branch > Other Publications

  49. Petroleum Grid (NTS) • PNG Grid Regulation Schedule 3 • Applies everywhere the DLS does not • Based on longitude and latitude, but customized for oil and gas management • Sub-divisions achieve oil and gas spacing areas similar in size to DLS • Unit areas defined in downloadable lookup tables • Location: PNG Titles Branch > Other Publications • Geothermal and coal tenures are also managed with Petroleum Grid system

  50. Petroleum Grid (NTS) 8° long. Well location example: d-010-A/094-H-16 4° lat. Title description example: 094-H-16 Blk A Unit 10