Our estimated processing time for this application is 120 business days. See our timeline spreadsheet for updates.
Purpose of the Application
We have authority under Oil and Gas Conservation Act (OGCA) to
- ensure that oil and gas resources are conserved;
- give each owner the opportunity to secure its share of the production of oil or gas from any pool; and
- provide for economic, orderly, and efficient development in the public interest.
Under section 36 of the OGCA, we can limit the amount of gas that a company can produce, or we can distribute the amount of gas that is produced from a pool or part of a pool. Historically, this legislation has been used to authorize the distribution of gas production among wells in a nonassociated gas pool (as mentioned in Directive 065: Resources Applications for Oil and Gas Reservoirs).
As an example, multiple companies may own several gas wells that are on production in a pool. One owner may believe its reserves are being inequitably drained; its well has been placed on production at rates that do not allow the well to capture the owner’s share of the pool reserves. The well’s rate might be restricted by pipeline or processing capacity or by a gas sales contract.
When the rate limitation is due to pipeline or processing capacity, the owner may
- have capacity in its own facilities; and
- believe that building or obtaining more capacity would not represent economic, orderly, and efficient development.
When the rate limitation is due to a gas sales contract, the owner may have been unable to adjust the contract or produce gas in excess of the contract to allow for an equitable rate of production.
Our approval of a rateable take order is significant because it has the potential to override contractual agreements put into place through normal business practices. For this reason, we require each applicant to demonstrate the following:
- The applicant is deprived of the opportunity to secure its share of production from the pool.
- Drainage has occurred and continues to occur, or is expected to occur with a very high degree of certainty. The drainage must also be a result of the applicant not having an opportunity to produce its share of production.
- The restriction in rate must not be due to limitation in well capability.
Submit an Application
Companies must submit rateable take applications through our Digital Data Submission (DDS) system. We will register each application and assign it a reference number.
By submitting an application, the company accepts that its information is no longer confidential.
- We share all applications on our Public Notice of Application page to encourage public participation in the approval process.
- Anyone who believes that they may be directly and adversely affected by an application can file a statement of concern (SOC). If we receive an SOC, it may take us longer to process the application.
- We will assign the application to a subject matter expert for initial review. If information is missing (i.e., the application is not complete, or Directive 065 requirements are missing), we will close the application. Otherwise, we will proceed with a full technical review.
- We look at whether the applied-for well or facility site falls within an area covered by the Lower Athabasca Regional Plan or the South Saskatchewan Regional Plan. If so, our review will be more stringent.
- We may request additional information (through a supplemental information request) to complete our technical review.
- We will decide to approve, close, or deny the application. If we close it, the applicant may reapply without prejudice. If we deny it, the applicant can file an appeal through our appeal process.
- We will provide the applicant with a link to the letter with our decision, which is accessible through the Integrated Application Registry. We will also share our decision on our Publication of Decision page.