No New Wells Approved Last Month In B.C.; Province And BRFN Continue To Work On Interim Decision-Making Plan

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No new wells were approved in British Columbia in August, as the province continues to work with the Blueberry River First Nations (BRFN) on a way to improve and modernize provincial processes that recognize and respect their treaty rights.

Earlier this summer, the B.C. Supreme Court found the provincial government breached the Treaty 8 agreement signed with the Blueberry River First Nations because it allowed development such as forestry and natural gas extraction without the community’s approval.

It found the province failed its treaty promise to maintain the nation’s rights to hunt, fish and trap without interference.

Blueberry River elected Chief Marvin Yahey says Treaty 8 First Nations are not opposing resource development on their lands, but want to ensure industry progresses in a responsible way to the benefit of all parties.

“Our treaty always contemplated balance,” he told a news conference in early July outside the B.C. Supreme Court. “We support the use of resources on the land in a responsible way that ensures they can continue. We are not against industry. If this is done right, then there is plenty of work for everyone.”

In a recent statement to the DOB, a spokesperson for the BC Oil and Gas Commission (OGC) said the province, as a starting point, is working with Blueberry River on an interim decision-making approach while they negotiate a longer-term approach.

“Until the Province and Blueberry River come to agreement on the interim approach, we expect decisions could take longer than usual as applications must be considered in light of the court’s finding of infringement of treaty rights,” the OGC spokesperson said.

“We recognize this process will take time while we work to create a more balanced path forward in the territory, one that provides stable economic activity and employment along with environmental sustainability and protection of Treaty 8 rights.”

This summer, the B.C. Ministry of Energy, Mines and Low Carbon Innovation cancelled the province’s July and August petroleum and natural gas tenure dispositions in consideration of the B.C. Supreme Court decision

In Q2 conference calls, several companies active in northeast B.C. mentioned the Blueberry River case, including Tourmaline Oil Corp., AltaGas Ltd. and ARC Resources Ltd., among others, noting they have good working relationships with the BRFN (see here and here).

Last August, 83 new wells were approved in B.C. and Tourmaline was the top licensee with 36 wells licensed.

Top licencees

Cenovus Energy Inc. was the top licensee of new wells in August 2021 (including experimental and oilsands evaluation holes), with 53 new permits. The Top 5 licensee list for the month was rounded out by Canadian Natural Resources Limited (26), Teine Energy Ltd. (19), Spur Petroleum Ltd. (18) and Tundra Oil & Gas Ltd. (also 18).

Over the first eight months of the year, there’s a tie in licensing between Cenovus and Tourmaline. Each operator has licensed 157 wells. CNRL has permitted 144 wells, followed by Crescent Point Energy Corp. (143) and Teine (126).

August licence stats

Overall, operators across the country licensed 373 wells last month compared to 256 wells authorized in August 2020 — an increase of 46 per cent.

Alberta licensed 223 wells in August, up 105 per cent from 109 permits in the year-prior period, while Saskatchewan authorized 132 permits during the month compared to 51 wells licensed in August 2020 (up 159 per cent).

Manitoba’s permit count increased to 18 from 12 a year ago.

Year-to-date licence counts

Over the first eight months of the year, a total of 3,104 wells across Canada have been permitted, up 40 per cent from last year’s tally of 2,225.

To the end of August, Alberta has licensed 1,820 new wells compared to 1,056 wells a year ago.

Saskatchewan has permitted 846 wells in the first eight months of the year compared to 726 a year ago, while B.C. has approved 321 wells to the end of August compared to 384 in the first eight months of 2020.

Over the first eight months of the year, Manitoba has licensed 110 new wells compared to 46 a year ago.

Operators across Western Canada licensed 249 oil and bitumen wells last month, up from 139 in August 2020. Over the first eight months of the year, 1,997 oil and bitumen wells have been permitted compared to 1,240 a year ago (an increase of 61 per cent).

In August, 70 gas wells were permitted in Alberta, B.C. and Saskatchewan compared to 93 last year. In the first eight months of 2021, operators in these three provinces have licensed 812 gas wells versus 739 gas permits in the comparable period last year (an increase of 10 per cent).

To the end of August, operators have licensed 2,751 horizontal wells, or about 89 per cent of the total wells authorized across Canada (excluding experimental wells), and up from 1,896 horizontal wells in January-August 2020 (87 per cent of total wells).

Producers licensed no oilsands evaluation holes in August, the same as last year. Operators have licensed only six oilsands evaluation holes in the January-to-August period versus 37 in the first eight months of 2020.

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