EUB STAFF COMMITTEE SEEKS STAKEHOLDER INPUT ON PROPOSED CHANGES TO THE EUB'S SUBSURFACE WELL-SPACING APPLICATIONS PROCESS

Calgary, AB (March 10, 2005) - The Alberta Energy and Utilities Board (EUB) today issued Bulletin 2005-08, which sets forth a process to gather stakeholder input on an EUB staff proposal to improve the EUB's subsurface well-spacing regulations and application process. Stakeholders will have the opportunity to provide input to staff until April 22, 2005. Staff will consider all input; make any necessary changes, then submit the updated proposal and input to the EUB's nine-member Board for consideration.

Staff identified four main areas where changes to the subsurface well-spacing application process could occur: notification; higher baseline well densities in certain areas of Alberta; the introduction of three risk-based application processing models, and automation of the applications process.

One of the goals of the proposal is to more clearly delineate the difference between subsurface, or reservoir management applications, and surface, or facility applications, as the two are distinctly reviewed and processed by the EUB. By eliminating the requirement to provide notification to surface rights owners on subsurface applications, surface rights owners should be better able to more effectively engage EUB processes when they have concerns with oil and gas industry development.

Approval of a well-spacing application does not predispose the EUB to grant approval for associated surface developments, nor does it alter the process industry must use when applying for facilities.

Also proposed is an increase in baseline subsurface well-spacing densities in Alberta east of the fifth Meridian and south of Township 53 in the Mannville and shallower formations. This is consistent with development trends and down-spacing that has already been approved for formations in this region.

Well spacing is a reservoir-management process that defines the number of subsurface drainage locations necessary to maximize oil or gas recovery from a pool or formation. The well density is determined from engineering analysis of reservoir rock characteristics, fluid properties and production behavior.

The EUB ensures that the discovery, development, and delivery of Alberta's resources take place in a manner that is fair, responsible, and in the public interest.

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This news release and Bulletin 2005-08 are available on the EUB Web site at http://www.ercb.ca.

For more information, please contact:

Bob Curran
EUB Communications
Phone: (403) 613-5554
E-mail: bob.curran@gov.ab.ca

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