|
4. Oil and Gas ActivitiesCompanies proposing to conduct a new oil and gas project in the Yukon are typically required to:
Operators are encouraged to carry out activity using best management practices and innovative technologies appropriate to the Yukons unique operating environment. A. Licences Under the Yukon Oil and Gas Act, a licence is required to carry out all oil and gas activity in the territory. Oil and gas activity includes:
Geoscience Exploration Licences
A Geoscience Exploration Licence is required for any oil and gas exploration activity. This includes investigations of the subsurface of the earth using direct or indirect methods. A direct method would be to conduct geological mapping over an area of interest. An indirect method would be to complete a seismic survey. A Geoscience Exploration Licence may be obtained in Yukon without holding an oil and gas disposition. A Well Licence is required to drill an oil or gas well. A company must hold a disposition which grants subsurface oil and gas rights before it can obtain this licence. A Pipeline Licence is required for the construction and operation of a pipeline that is wholly contained in Yukon Territory. (A transboundary pipeline falls under the jurisdiction of the federal government.) A Gas Processing Plant Licence is required for any activity related to the construction and operation of a plant that extracts hydrogen sulphide, helium, natural gas liquids and other substances from raw natural gas. A Field Facility Licence is required for activity related to the construction and operation of an oil and gas facility such as a battery, an oil treater, a pumping station, a waste disposal facility or a compressor station. The licence applicant's proposed project undergoes an operations review to ensure that it will be conducted safely and to accepted industry standards. The project is examined to ensure that the proposed operations comply with the Oil and Gas Act and the appropriate regulations. Adherence to other territorial legislation and standards from the Department of Environment, the Department of Community Services, the Yukon Worker’s Compensation Health and Safety Board, the Heritage Branch of the Department of Tourism & Culture and federal acts and regulations from the federal Department of Indian Affairs and Northern Development is also verified. The operations review is complete when all the required information has been received and examined and the program operations are deemed to be acceptable or unacceptable. Conditions to the licence regarding operations may be stipulated or the licence may be denied. Since 1998, 23 geoscience exploration licences have been issued by the Yukon Oil and Gas Management Branch. Ten 2D seismic surveys have been completed. See Geoscience Exploration Licences Table. A total of 73 wells have been drilled in Yukon (see Oil and Gas Resource Potential Table). More than 20 wells had hydrocarbon shows. The Kotaneelee field located in Liard Plateau in the southeast produced approximately 6 Bcf of natural gas in 2004, and is connected to the Duke Energy Gas Transmission Pointed Mountain Pipeline that carries the gas south to Fort Nelson, B.C. for processing. Limited crude oil test production has occurred at Eagle Plain.
B. Land Use Permits Land use permits are required for most activities on Yukon land. The Territorial Land Use Regulations specify project requirements for permits and would apply to such oil and gas projects as clearing seismic lines, constructing an access route, or clearing a well site. Land use permits are typically issued for a period of two years with an option for a one-year extension. A permit does not provide the holder exclusive rights, interest, or tenure to the land. Permits typically include terms and conditions to ensure that work is conducted in an environmentally safe and responsible manner.
C. Water Licences A water licence under the Waters Act and Waters Regulation may be required for certain oil and gas activities depending on the water usage and the need to discharge into a water body:
D. Environmental Assessments All projects and activities will be subject to an environmental assessment (EA) before a licence is issued. Currently the assessment is done pursuant to Yukon legislation (Yukon Environmental Assessment Act or EAA) which mirrors the Canada Environmental Assessment Act (CEAA). An applicant is requested to provide information on the project and the surrounding environment, the potential environmental effects and directly-related socio-economic effects of the project and the mitigation to eliminate or reduce these effects. The branch seeks input from advisory committees and/or the public in conducting the environmental assessment. The branch then determines whether the project may proceed, whether mitigation measures are required, or whether further assessment is required. Many oil and gas projects require federal and other territorial permits. The branch works with other agencies to coordinate the application submission requirements, the EA process and the development of compatible licence terms and conditions. Coordinating with other agencies streamlines the EA and licensing process and eliminates the potential for agencies to issue conflicting EA decisions or licence terms and conditions. In the future, assessments will be done under the Yukon Environmental and Socio-Economic Assessment Act (YESAA). YESAA was given royal assent on May 8, 2003 and legally came into effect November 2004. Assessments under this new legislation, however, will not be conducted until the accompanying regulations are passed, which is targeted for the fall of 2005. This Act replaces existing EA processes and will apply throughout the Yukon and to projects under the authority of federal, territorial and First Nation governments. YESAA will change the way assessments are done in the Yukon. For example, a YESAA board and (regional) designated offices have been established to conduct environmental and socio-economic assessments. The Yukon government will no longer be conducting EAs but will still retain decision-body responsibilities as defined in the legislation.
E. Benefits Agreements A benefits agreement is required for all projects with estimated expenditures of more than $1 million in the Yukon. A benefits agreement identifies employment and training opportunities for Yukon residents including Yukon First Nations and residents of communities affected by oil and gas activity. It also identifies opportunities for Yukon businesses to supply goods and services to the licensee and the licensee’s contractors. The benefits are to be commensurate with the nature, scale, duration and cost of the project, and shall not place an excessive burden on the licensee. The agreement is negotiated by the licensee, the Yukon government and the Yukon First Nation(s) on which traditional territory the oil and gas activity will be conducted.
Contact Information For more information, or to submit comments and suggestions on this section, contact: F. Best Management Practices The Oil and Gas Management Branch is developing a Best Management Practices (BMP) guide for present oil and gas exploration and development activities in Yukon. The guide will focus on best industry practice in areas of geographical, biological and cultural sensitivities unique to Yukon. In response to interest expressed during previous disposition processes in the North Yukon, the first draft of the guide will look at broad integrated resource management objectives for wetlands, caribou habitat and key wilderness tourism areas. The intent of the guide is to provide operators, managers, planners and field staff with recommended processes and practices for meeting a series of operating practice objectives. The practices that will be presented are designed to reduce the impacts of oil and gas exploration and development activity on the ecological landscape, providing common sense and cost effective suggestions within targeted social and economic constraints. While the guide has some limitations, it marks a significant step toward responsible stewardship of all the resources within the identified oil and gas regions. As scientific understanding and social values change over time, the scientific and value-based choices presented in the guide will be revisited. The BMP guide is also intended to:
Contact Information For more information, or to submit comments and suggestions on this section, contact: Kirstie Simpson – Sustainable Development Coordinator
Back to Table of Contents, back to previous section (Oil and Gas Rights) or on to next section (Fiscal Regime).
|
Last Updated 16-01-2006