Bill 82 — First Session, 16Th L€Gislature, 17 Elizabeth Ii the Legislative Assemblr-Uf-A~'Fs~ Bill 82 An Act To Amend the Oil and Gas Conservation Act (Legislature 16, Session 1)

L16 S1 4533

Alberta — Bills

1968 Bill 82 First Session, 16th L€gislature, 17 Elizabeth II THE LEGISLATIVE ASSEMBLr-uF-A~'fS~ BILL 82

An Act to amend The Oil and Gas Conservation Act THE PREMIER First Reading ............................................................. . Second Reading. . ......................................................... . Third Reading ........................................................... . Printed by L. S. Wall, Queen's Printer, Edmonton

BILL 82 1968

An Act to amend The Oil and Gas Conservation Act (Assented to , 1968) HER MAJESTY, by and with the advice and consent of the Legislative Assembly of the Province of Alberta, enacts as follows: 1. The Oil and Gas Conservation Act is hereby amended.

Section 2 is amended (

a) by renumbering the

section as subsection (1), (

b) as to the renumbered subsection (1) (

i) by relettering clauses (b2) and (b3) as clauses (b3) and (b4) and by adding before relettered clause (b3) the following clause: (b2) "crude bitumen" means a naturally occur ing viscous mixture, mainly of hydrocar bons heavier than pentane, that may con tain sulphur compounds, and that in its naturally occurring viscous state is not recoverable at a commercial rate through a well; (ii) by adding after clause (k1) the following clause: (k2) "oil sands" means sands and other rock materials which contain crude bitumen and includes all other mineral substances in association therewith; (iii) as to clause (n), (

A) in subclause (i), by striking out the words "oil or gas" wherever they occur and by substituting the words "oil, gas or synthetic crude oil", (

B) in subclause (ii), by striking out the words "gas or water" and by substituting the words "gas, synthetic crude oil or water", (iv) by adding after clause (

r) the following clause: (r1) "synthetic crude oil" means a mixture, mainly of pentanes and hea vier hydro-

Explanatory Notes I. This Bill amends

chapter '63 of the Statutes of Alberta, 1957. 2. The

definitions of "crude bitumen" and "synthetic crude oil" are new. The definition of "oil sands" replaces the definition presently in

section 49a, which reads as follows: 49a. In this Part "oil sands" means th3 sands that lie between the Paieozoic sediments and the Joli Fou formation or the correlative or equivalent of such sands and contain a highly viscous crude hydro carbon material not recoverable in its natural state through a well by ordinary production methods. The definition in clause (

n) of "pipe line" is amended to include a pipe line transporting synthetic crude oil. The definition of "well" in clause (

v) is amended to include one used in the production of crude bitumen.

carbons, that may contain sulphur com pounds, that is derived from crude bitu men and that is liquid at the conditions under which its volume is measured or estimated, and includes all other hydro carbon mixtures so derived; (

v) as to clause (v), subclause (

i) by striking out the words "oil or gas" wherever they occur and by substituting the words "oil, gas or crude bitun1en", (

c) by adding the following subsection:

(2) Where dispute arises as to whether a mixture mainly of hydrocarbons is crude bitumen, the dis pute shall be referred to the Board and its decision thereon is final.

Section 25, clause (

b) is amended by striking out the word "~,.finister" and by substituting the word "Board".

Section 26, subsection (9) is amended by striking out the words "he may prescribe." and by substituting the words "it may prescribe.".

Section 35, subsection (1) is amended by adding after clause (

b) the following clause: (b 1) designate an oil sands deposit by describing the surface area vertically above the oil sands deposit and by naming the geological formation, member or zone in which the oil sands deposit occurs and by such other method of identification as the Board in any case deems suitable, o.

Section 36 is amended by adding after subsection (2) the following subsection:

(3) Notwithstanding subsection (1), where two or more pools in a field or area are subj ect to an integrated scheme approved under clause (

a) or (a1) of

section 38 after a public hearing, and where the Board is satisfied 2 (

a) that the scheme would result in significant con servation advantages in the field or area and makes a variation by the Board under this subsection desirable, (

b) with an undertaking by the operator to proceed with the integrated scheme, or an alternate approved by the Board which will result in equiva lent or greater recoveries, until the recoverable re serves of all of the pools under the scheme are pro duced, and (

c) that the reserves which will actually be recovered from each of the pools to be produced under the integrated scheme may be estImated with a reli ability comparable to that in the case of single pools not produced under such integrated scheme,

3. This amendment is in ,consequence of an amendment to the Act in 1967. 4. This 'amendment is in consequence of ,an .amendment to the Act in 19·67.

Section 35 is amended to permit the .oil and Gas Conservation Board to designate an oil sands deposit. The new clause (bl) is in terms similar to .clause (

b) which permits the Board to designate a pool. G.

Section 36' is the authority for the proration by the Board of oil to market demand. The new subsection will authorize a varia tion to enable a producer to produce pools sequentially where they are subject to a common enhanced recovery scheme in such a manner that he could maximize recovery without losing proration benefits. 2

it may vary the manner in which the provincial allowable for crude oil, condensate and pentanes plus is allocated among pools and may fix, for the pools subject to the scheme, a single, aggregate anlount of crude oil or con densate th?t may be produced from such pools or any of them regardless of whether all of the pools will be pro ducin'g pools during the proration period for which the allocation is made.

Section 41 is amended (

a) as to subsection (1) by striking out the words ", gas and water" and by substituting the words ", gas, oil sands, crude bitumen or products derived therefrom, and water", (

b) as to subsection (2) by striking out the words ", gas or water" and by substituting the words ", gas, oil sands, crude bitumen or products derived therefrom, or water".

Section 42 is amended (

a) as to subsection (1) by striking out the words "oil or gas or both n and by substituting the words "oil, gas or synthetic crude oil or any two or all of them", (

b) as to su1::sections (2) and (3) by striking out the words "oil or gas" wherever they occur and by sub stituting the words "oil, gas or synthetic crude oil" . 9. Sections 49a and 49b are struck out and the follow ing ssction is substituted: 49a.

(1) No scheme or operation for the recovery of oil sands, crude bitumen or products derived therefrom shall be proc2Eded with unless the Board, upon application and by order, has approved it.

(2) Upon receipt of an application pursuant to sub SEction (1), together with any information prescribed or required by the Board, the Board shall hold a hearing of the applic:1tion and m:.-..y, if so authorized by the Lieutenant Governor in Council, approve the scheme or operation pro posed in the application.

(3) Notwithstanding subsection (2), where the scheme or operation is for experimental purposes and involves no commercial production of oil sands, crude bitumen or pro ducts derived therefrom, the Board, in its discretion, may proceed without a hearing and without the authorization by the Lieutenant Governor in Council.

(4) An approval granted under this

section shall be subject to the terms and conditions therein prescribed and w~thout rEstricti~g the .genera~ity of the foregoing, may stIpulate the perIOd durIng whIch the approval will be in 3

Section 41 authorizes the Board to prescribe methods and standards used in measurement of oil and g.as. It is amended so that the Board will have similar powers with respect to the pro ducts of oil sands.

Section 42 authorizes the Board, with the approval of the Lieutenant Governor in Council, to declare an oil or gas pipe line proprietor to be a common carrier. The amendment would auth orize similar action in the case of the proprietor of a synthetic crude oil pipe line. 9. The present se-ction 49a defines "oil sands" and is being replaced by clause (k2) of

section 2: see Clause 2 of this Bill. The present

section 49b is replaced by new

section 49a. It presently reads as follows: 4gb.

(1) No scheme or operation for the recovery of oil or a crude hydrocarbon product from oil sands shall be proceeded with unless the Board. upon application and by order, has approved the scheme or operation for such recovery.

(2) Upon receipt of an application pursuant to subsection (1), to gpthcr with any information prescribed or required by the Board. the B0ard shall hold a hearing of the application and may, if so author ized by the Lieutenant Governor in Council, approve the scheme or operation proposed in the applicatlOn.

(3) Notwithstanding subsection (2), where the schem~ or operation is for experimental purposes and involves no commercial production from oil sands, the Board, in its discretion, may proceed without a hearing.

(4) The approval granted under this

section shall be subject to the terms and conditions therein prescribed and, without restricting the generality of the forf going, may stipulate the period during which the approval will be in force and the maximum volume or rate of pro duction of oil or -crude hydrocarbon product. 3

force and the maximum volume or rate of production of oil sands, crude bitumen or products derived therefrom.

Section 49d is amended (

a) as to clause (

a) by striking out the words "or oil or crude hydrocarbon products from oil sands" and by substituting the words "or crude bitumen or products derived from oil sands or crude bitu men", (

b) as to clause (

b) by striking out the words "any crude hydrocarbon product obtained therefrom," and by substituting the words "crude bitumen or products derived from oil sands or crude bitumen,".

Section 4ge is amended (

a) as to subsection (1) by striking out the words "oil or crude hydrocarbon products obtainable from oil sands." and by substituting the words "crude bitumen or synthetic crude oil.", (

b) as to subsection (2) by striking out the words "oil or crude hydrocarbon products obtainable from oil sands" and by substituting the words "crude bitu men or synthetic crude oil that may be recovered". 12.

(1) Section 50, subsection (1) is amended (

a) by striking out the words "oil or gas" wherever they occur and by substituting the words "oil, gas or crude bitumen", (

b) as to clause (

d) by striking out the words "oil and gas" and by substituting the words "oil, gas and crude bitumen".

(2) This

section is applicable to the 1969 and subse quent taxation years. 4 1.3.

Section 96 is amended (

a) as to subsection (1) (

i) by striking out the words "crude oil or raw gas," and by substituting the words "crude oil, raw gas or crude bitumen,", (ii) as to clause (

a) by adding after the words "raw gas," the words "crude bitumen", (

b) as to subsection (3) (

i) by striking out the words "crude oil or raw gas," and by substituting the words "crude oil, raw gas or crude bitumen,", (ii) as to cIa use (

a) by adding after the words "raw gas" the words ", crude bitumen", (iii) as to clause (d), subclause (

i) by striking out the words "or condensate" and by substituting the words ''', condensate or crude bitumen" ,

Section 49d, clauses (

a) and (

b) presently read: 49d. The Lieutenant Governor in Council, upon the recommendation of the Board, may make general regulations or special orders, (

a) governing operations to reCOVEr oil sands or oil or crude hydro carbon products from oil sands and the abandonment of such operations, (

b) to exclude from the application of any provisions of this Act any oil sands or any crude hydrocarbon product ,obtained there from, and I I.

Section 4ge now reads: 49.e

(1) Section 36 shall not be construed to apply in respect of oil or crude hydrocarbon products obtainable from oil sands.

(2) With the approval of the Lieutenant Governor in Council, the Board may by general ,or special order restrict the total amount of oil or crude hydrocarbon products obtainable from oil sands in the Province. 12.

Part VII of the Act authorizes the assessment of oil and gas properties to def,ray part of the expenses of the Board. The defin ition of oil and gas properties in

section 50 is amended to include property relating to crude bitumen.

Section 96 requires the owner 'Of an 'Oil or gas well to record and report production. The amendment would make the

section applicable to the 'Owner of a well productive of crude bitumen. 4

(

c) as to subsection (5) by striking out the words "or condensate" and by substituting the words ", con densate or crude bitumen". 1~. The following

section is added after

section 97: 97a.

(1) The operator of a scheme for the recovery by surface excavation or mining methods of oil sands, crude bitumen or products derived therefrom shall keep at his field office or other place of business within Alberta and within reasonable distance of his operations a daily record of the operations in a form satisfactory to the Board, and the original recording of measurements used in determin ing the particulars for the record, which record shall show (

a) the oil sands excavated or mined, (

b) full particulars of the disposition of all products from the operation, and (

c) if a product is sold, the name of the purchaser and the amount realized from the sale.

(2) The operator of a scheme for the recovery by sur face excavation or mining methods of oil sands, crude bitu men or products derived therefrom shall, not later than the 15th day of the month, file with the Board, on forms furnished or approved by the Board, a full report of (

a) the oil sands excavated or mined, and the crude bitumen recovered from such oil sands, during the preceding month, and the disposition thereof, and (

b) unless otherwise directed by the Board, the amount realized from the sale during the preceding month, and the name of the purchaser of oil sands, crude bitumen or products derived therefrom.

Section 98 is amended (

a) by striking out the words "oil or gas" and by sub stituting the words "oil, gas or synthetic crude oil" , (

b) by striking out the words "oil and gas" wherever they occur in clauses (

a) and (

b) and by substi tuting the words "oil, gas and synthetic crude oil". l r6.

Section 99 is amended (

a) by striking out the words "oil and gas" wherever t~ey occur and by. substituting the words "oil, gas, 011 sands, crude bItumen and synthetic crude oil", (

b) as to clause (

e) by striking out the words "oil or gas." and by ~ubstituting the words "oil, gas, oil sands, crude bItumen or synthetic crude oil.".

Section 100 is amended (

a) b~ st~iking out the :;~rds "oil or gas" and by sub stItutIng the words 011, gas, oil sands, crude bitu men or synthetic crude oil", 5

14. The new sectian 97a will require the aperatar af an ail sands scheme invalving mining methads to' recard and repO'rt prO' ductian similarly to' a well operatar. 15. Sectian 98 deals with recards and reparts by a purchaser or transparter af ail or gas. The 'amendment makes the sectian applicable to' the purchaser ar transparter af synthetic -crude oil. 16. Sectian 99 deals with recards to' be kept by a refiner O'r gas plant aperatar. The amendment wauld caver ail sands praducts which he may process. 17. Sectian 100 deals with the reparts to' be made by a plant O'peratO'r prO'cessing O'il O'r gas.

The amendment makes the sectiO'n applicable to' the aperatar af a plant pracessing ail sands and their prO'ducts. 5

(

b) by striking out the words "oil and gas" and by substituting the words "oil, gas, oil sands, crude bitumen and synthetic crude oil", (

c) by adding after the word "condensate," wherever it occurs in clauses (

a) and (

b) the words "oil sands, crude bitumen, synthetic crude oil,".

Section 122, subsection (1), clause (

b) is amended by striking out the words "oil or gas is refined" wherever they occur and by substituting the words "oil, gas, oil sands or crude bitumen is refined, produced". 19. This Act comes into force on the day upon which it is assented to. 6

Section 122 ,authorizes the Board and authorized employees to enter upon and inspect well and plant sites. The amendment would extend the authority to cover wells, workings and plants handling oil sands or their products. 6 Title: 1968 (16th, 1st) Bill 82,

An Act to amend The Oil and Gas Conservation Act

Document details

Collection	Alberta — Bills
Citation	L16 S1 4533
Type	bill
Volume / chapter	L16 S1 4533
Language	en
Format	json
Source	PROVINCIAL
Identifier	7efda66e2e118d1b4734b66ce609f58083653639

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