‘Play-based’ Regulation Shows Promise, Poor Delivery, in Alberta Test
A large-scale test of “play-based” oil and gas regulation by Alberta’s former Conservative government showed promise, but was plagued by insufficient information and poorly developed administrative tools, the Alberta Energy Regulator has found in an evaluation.
As reported in the Mondaq legal news digest (registration required), the “play-based” approval system was launched on a trial basis in September 2014. For the next 10½ months, companies producing hydrocarbons from the province’s central Duvernay formation could “submit one regulatory application for all of their proposed activities within a region, instead of submitting numerous individual applications for each well, pipeline, facility, road, and water diversion.”
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Of roughly 55 companies operating in the region, Alan Harvey writes, six submitted applications for the trial “mega approvals,” each of which combined as many as 50 individual permits issued under Alberta’s Oil and Gas Conservation Act, Pipeline Act, Public Lands Act, Environmental Protection and Enhancement Act and Water Act, for which they would otherwise have had to file separate requests.
In theory, the play-based approach “allows for a more holistic assessment of risks, and a reduction of cumulative effects,” Harvey wrote. “Companies can also benefit from having improved longer-term regulatory certainty.”
According to the AER’s evaluation, First Nations, operating companies, and other stakeholders found promise in the approach, but faulted its implementation. Not enough information about it was passed on to stakeholders, especially Indigenous communities, and online user tools were never fully completed. The AER concluded “that cumulative effects were reduced but not minimized, and more work is needed to address cumulative effects comprehensively.”