News Release October 24, 2000

FOR IMMEDIATE RELEASE

EUB ANNOUNCES SIGNIFICANT CHANGES TO ENERGY DEVELOPMENT APPLICATION GUIDE

Calgary, Alberta (October 24, 2000) In response to stakeholder feedback and a commitment by the Alberta Energy and Utilities Board (EUB) to improve stakeholder confidence, the EUB announces the first of a number of significant changes to the way the Alberta petroleum industry will plan, prepare for and submit energy development applications.

These significant changes are outlined in a new Interim Directive (ID 2000-8) and a revamped Guide, (G-56, Energy Development Application Guide) which become effective today.

Among the major changes:

• Certain higher risk sour gas (Category E) energy development applications submitted to the EUB will now be required to follow the "non-routine" path. This "non-routine" designation means that all applications for new or modified sour gas plants, or critical sour gas wells will be required to include expanded detail and be subject to an "up-front" review of an applicant's approach to the proposed development. This up-front review will determine, among other things, if the applicant's approach to items such as public consultation or setting sour gas release rates used in calculating emergency planning zones has been satisfactory.
• The EUB requires that applicants provide full disclosure and consultation between a company (the applicant) and parties whose rights may be directly and adversely affected by an energy application. These disclosure and consultation requirements have been clarified and expanded. A company must give potentially affected parties the opportunity to have their issues dealt with by the applicant before an application is filed with the EUB. Guide 56 further clarifies this expectation and expands upon the information that a company must provide to landowners and residents. The EUB is now mandating that the information package delivered by the applicant to members of the public must contain specific EUB information that explains a landowner's rights and the options open to affected parties if their concerns are not resolved. This information also provides EUB telephone numbers and contacts for the public to call for assistance.
• Guide 56 also encourages the use of Appropriate Dispute Resolution (ADR) options where applicable.

These and other changes (see Backgrounder attached) now being made to Guide 56 reflect the first step in a staged review of, and improvement to the EUB's facility application process to balance stakeholder needs. A number of initiatives and committee reviews are underway or planned which may further change EUB energy development policy. An example of such an initiative is the Provincial Advisory Committee on Public Safety and Sour Gas (http://www.publicsafetyandsourgas.org/). The next revision to Guide 56 is expected in mid 2001.

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This news release, ID 2000-8 and Guide 56 are available on the EUB Web site at http://www.ercb.ca

For more information, please contact:
Greg Gilbertson
Senior Advisor, Communications
(403) 297-3648, or
fax: (403) 297-3757
greg.gilbertson@gov.ab.ca

NR-2000-43

MEDIA BACKGROUNDER

October 24, 2000
Revised Guide 56: Energy Development Application Guide

WHAT IS GUIDE 56?

Guide 56 is the application process document that the Alberta Energy and Utilities Board (EUB) uses to effectively and efficiently handle more than 20,000 petroleum energy development applications annually. Guide 56 also provides an audit process designed to improve industry compliance with EUB regulations.

Guide 56 consists of two volumes:

• Volume One contains a number of different application forms, and instructions on completing these applications for specific petroleum developments such as wells, pipelines, or production facilities (i.e. compressor stations, or gas processing plants).
• Volume Two is an appendix document and contains pertinent EUB policy and technical guidelines, regulations and legislation excerpts.

Through the use of this standard guide, the EUB ensures that its application process meets and balances the needs of all stakeholders the public and the industry alike.

PUBLIC CONSULTATION

A basic requirement of the EUB's application process is that significant and meaningful public consultation must take place between the applicant (the petroleum company) and residents/landowners or other affected parties who may be directly and perhaps adversely impacted by the applicant's energy development project.

As part of the EUB's application requirements, the company must provide any potentially affected residents/landowners with a detailed information package.

The petroleum company is required to provide enough information about its proposed project that directly affected residents/landowners and other stakeholders understand:

• the facts of the proposal,
• and the possible impacts.

The company must also provide an opportunity for directly affected residents/landowners to have their questions answered in order that they may participate meaningfully in the decision-making process. This opportunity to participate in the application process is important.

The EUB encourages directly affected residents and landowners to study the information contained in the company package and to meet with company representatives to discuss the proposed development, including any measures that could be put in place to reduce potential impacts, and any alternatives that may exist. If residents/landowners or other stakeholders have questions or concerns either before or following their discussions with the company, they may call the EUB for assistance.

The information package distributed by a company is now required to contain information prescribed by the EUB, such as a description of landowner's rights. This includes what the options are if there is disagreement with, or concerns expressed about the petroleum development that is being proposed. It also includes telephone numbers for both the EUB's Calgary headquarters and the eight EUB Field Centres that are located throughout the province.

If there are matters that cannot be resolved in discussion with the company, the EUB can also provide residents/landowners or other stakeholders with more information on its adjudicative process, or alternative resolution processes, including information on the EUB's Appropriate Dispute Resolution (ADR) initiative.

OTHER SIGNIFICANT CHANGES

Well Designation Change - A former well category that combined sweet gas wells with those containing minute release rates of sour gas (gas containing hydrogen sulphide H2S), has now been separated into two distinct categories:

• a "B-14" category well which is for sweet gas only (zero sour gas), and a
• "B-28" category well, which may have a hydrogen sulphide (H2S) sour gas release rate of less than 0.01 cubic metres per second.

This change will assist public confidence in industry/public consultation, and reduce confusion over EUB well classifications.

Well Designation Change Another additional well category ("E-62") has been added for what are termed "proximity critical wells." These are sour gas wells that have a certain potential sour gas release rate, coupled with proximity to an urban centre. This will allow for easier identification and definition of this type of well, and has been done in order to improve public safety as Alberta's population increases in conjunction with expanded petroleum development.

Other significant amendments to Guide 56 reflect the desire by all stakeholders to reduce flaring in Alberta. Flaring issues that arise within Guide 56, are coordinated with the EUB's Guide 60 Upstream Petroleum Industry Flaring Guide.

Further amendments also relate to the newly announced Expanded Orphan - Liability Management Program which sees the petroleum industry voluntarily protect Albertans from the liability costs associated with environmental clean-up of "orphaned" wells or petroleum facilities (those wells or facilities which are left with no financially capable ownership known as "orphans").

Finally, Guide 56 has been amended to better identify pipelines requiring corrosion prevention programs, and to select these for EUB surveillance follow-up.*