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Bulletin 2010-25
August 9, 2010
Province-Wide Framework for Commingling of Gas from Coals and Shales with Other Gas
The Energy Resources Conservation Board (ERCB/Board) announces changes to the province-wide commingling framework to allow gas produced from coals and shales to be commingled with other gas in the wellbore. These changes reflect an ongoing commitment to restructure and improve the ERCB's regulatory framework respecting unconventional gas development.
The commingling framework for gas from coals and shales is divided into two geographic areas:
- the area south of Township 31, east of the 5th Meridian, and
- the remainder of the province.
This bulletin announces the issuance of
All are effective immediately.
1. Commingling in the Area South of Township 31, East of the 5th Meridian
Southeastern Alberta Order No. MU No. 3847 allows for the commingling of gas production in the wellbore from the Milk River Formation, First White Speckled Shale, Colorado Shale, Medicine Hat Sand, Second White Specked Shale, and Fish Scale Zone in the area of the province south of Township 31, east of the 5th Meridian.
There are no conditions associated with the order, and no fluid, pressure, or deliverability testing requirements for wells with production commingled under the provisions of the order. A well under the order could commence commingled production without notification to offsetting mineral holders.
Order No. MU 3847 is hereby rescinded and replaced with Order No. MU 7490, which applies to gas production from all zones, including coals and shales, from the top of the Edmonton Group to the base of the Colorado Group. The new order, which adds additional strata from which production may be commingled, applies to the same area that was covered by Order No. MU 3847. As with Order No. MU 3847, there are no conditions, no notification requirements, and no requirements for pressure or deliverability testing associated with producing under Order No. MU 7490, with the exception of wells producing from coals and shales, which will continue to be subject to the control well requirements set out in Section 7.025 of the Oil and Gas Conservation Regulations ( OGCR ) and, for gas production from coals, Directive 062: Coalbed Methane Control Well Requirements and Related Matters.
Testing requirements for commingling under Order No. MU 7490 are clarified in the revised edition of Directive 040.
Wells producing under the provisions of Order No. MU 7490 are also subject to other directives that generally apply to all wells producing from the province. This includes Directive 027: Shallow Fracturing Operations – Restricted Operations and Directive 044: Requirements for the Surveillance, Sampling, and Analysis of Water Production in Oil and Gas Wells Completed Above the Base of Groundwater Protection.
The area and strata subject to Order No. MU 7490 overlap the area and strata covered by DE No. 1, as set out in Order No. DE 2006-1. The provisions of both orders allow for commingling of production in the wellbore. The ERCB is eliminating the area of overlap by amending the area subject to DE No.1, so that the southern boundary of DE No. 1 coincides with the northern boundary of the area subject to Order No. MU 7490. This amendment is to the benefit of well licensees, as commingling under Order No. MU 7490 is less restrictive than under the provisions of DE No. 1. Commingled production that commenced using the DE production code will now be administered under the MU requirements in the area involved.
The self-declared (SD) commingling process may continue to be used to commingle gas from the strata subject to Order No. MU 7490 with gas from strata above or below the strata subject to the order.
Order No. MU 7490, Order No. DE 2006-1A, and the revised edition of Directive 040 are now available on the ERCB Web Site www.ercb.ca.
2. Commingling of Gas from Coals and Shales in that Area of Alberta Outside the Area of Order No. MU 7490
There are currently three processes for the management of commingled production in the wellbore:
- DEs,
- SD commingling, and
- approval of an application in accordance with Directive 065 (resulting in a commingling order).
Outside of a DE and where commingling has not already been granted by a commingling order, a well licensee would consider using either the SD or application process for commingling production.
The OGCR and Directive 065 had specified that the SD process could not be used for commingling of production of coals and shales with other gas in the wellbore outside of a DE. This meant that for a large area of the province, commingling of production from coals and shales could occur only through approval of an application. This provision in the OGCR was included in the SD criteria as there was uncertainty surrounding how the development of these resources would unfold. With three years of experience since the SD process was put into place, the ERCB considers that any risks associated with commingling gas from coals and shales with other gas in the wellbore can be controlled by applying the SD decision tree criteria to such commingling.
The ERCB is therefore amending the SD process set out in the OGCR and Directive 065, effective as of the date of this bulletin, to allow for the commingling of gas from coals and shales with other gas in the wellbore under that process. Well licensees may therefore proceed immediately with commingling of gas from coals and shales with other gas using the SD process.
Current data requirements continue to apply to SD commingling as set out in Directive 040 until the ERCB directs otherwise. Additionally, wells producing from coal and shale under the SD process will continue to be subject to the control well requirements set out in Section 7.025 of the OGCR and, for gas production from coals, detailed in Directive 062.
The newly revised edition of Directive 065 is available on the ERCB Web site.
Stephen Smith
Executive Manager
Applications Branch
