Transcript BC Petroleum and Natural Gas Regulations

BC Petroleum and Natural Gas
Regulations Seminar
Presentation to CAPL
October 22, 2013
Geoff Turner
Terry Branscombe
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 1.
A
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L
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PART 1 – MINISTRY UPDATES
Ministry Structure / Organization Update
Acquiring Petroleum and Natural Gas (PNG) Tenure in BC
Resource Development Updates
Tenure Management Updates
Royalty Program Update
Policy and Regulatory Updates
Jobs and the Economy
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 2.
A
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PART 2 – TENURE MANAGEMENT
Resources for administrators
General framework for tenure
Land systems
Spacing
Rentals
Geological zones in BC
Tenures
Permits (Features)
Drilling Licences (Features, Extensions, Earnings, Groupings)
Leases (Features, Continuation Options, Land Plats)
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 3.
A
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O
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T
L
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PART 3 – GENERAL ADMINISTRATION
e-Payments
Training Resources
Payment Types and when to use them
Tenure Cancellation
Letters of Authority
Instruments Affecting Title
Transfers (assignments)
Encumbrances
Pooling Agreements
Name Changes/Amalgamation
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 4.
KEY CONTACTS
Garth Thoroughgood, Executive Director, Tenure and Geoscience Branch
250-952-6382
POSTINGS, PETROLEUM TITLES ONLINE, WEBMASTER, MAPPING
Elle Bardol, Manager, Crown Sale and GIS Services
250-952-0344
PRE-TENURE REFERRALS, TENURE CAVEATS
Matt Austin, Director, Resource Development
250-787-3426
GEOLOGY, ZONE DESIGNATION
Dave Richardson, Manager, Geology
250-952-0359
LEGISLATION AND POLICY DEVELOPMENT
Geoff Turner, Director, Policy & Planning
250-952-0709
DRILLING LICENCES, WORK PROGRAMS, PERMITS
Terry Branscombe, Senior Tenure Management Advisor
250-952-0340
DRILLING LICENCES, LEASE CONTINUATIONS
Cindy Kocol, Tenure Management Advisor
250-952-0342
DRILLING LICENCES, TRANSFERS, ENCUMBRANCES, LEASE CONTINUATIONS,
CANCELLATIONS
Christine McCarthy, Tenure Management Advisor
250-952-0341
E-PAYMENTS, BCeID, PRE-AUTHORIZED DEBITS
Carolyn Desjardins, Manager, Revenue Collection, Reconciliation and Reporting
250-356-1059
GENERAL INQUIRIES
www.empr.gov.bc.ca/Titles/OGTitles
British Columbia
Ministry of Natural Gas Development
October 22, 2013
250-952-0333
[email protected]
Page 5.
MINISTRY STRUCTURE
Deputy Minister
Ministry of
Natural Gas Development
Assistant Deputy Minister
Upstream Development Division
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Assistant Deputy Minister
Oil and Strategic Initiatives
Division
Assistant Deputy Minister
Liquefied Natural Gas Initiatives
Page 6.
UPSTREAM DEVELOPMENT
DIVISION
Assistant Deputy
Minister
Upstream
Development Division
Tenure and
Geoscience Branch
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Policy and Royalty
Branch
Page 7.
O
S
C
I
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N
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E
B
R
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N
CBritish
Columbia
Ministry of Natural Gas Development
HOctober 22, 2013
Matt Austin
Director
Resource
Development
Elle Bardol
Manager
Crown Sale &
GIS Services
Debbie Fischer
Director
Tenure &
Revenue
Management
Garth Thoroughgood
Executive Director
Tenure and
Geoscience Branch
Terry
Branscombe
Senior Tenure
Management
Advisor
Geoff Turner
Director
Policy &
Planning
Dave
Richardson
Manager
Geology
Fil Ferri
Director
Petroleum
Geology
Page 8.
ACQUIRING
PNG TENURE IN BC
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 9.
T
E
N
U
Tenure does provide:
R exclusive rights to the subsurface resource
E right to apply to the OGC for activities approval
Tenure does not provide:
the authority to conduct any activities on lands (e.g.,
drilling)
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 10.
T
I
O
N
P
R
O
C
E
S
S
British Columbia
Ministry of Natural Gas Development
October 22, 2013
12 sales per year
106 day process
Page 11.
ADDITIONAL INFORMATION
SOURCES
Posting Requests
http://www.empr.gov.bc.ca/Titles/OGTitles/SalesNotices
/Pages/Instructions.aspx
Submitting a Bid
Link to Bidding and Disposition Guide
Disposition Dates for 2014-2015
http://www.empr.gov.bc.ca/Titles/OGTitles/InfoLetters/Is
sueDate/Pages/OGD-13-03.aspx
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 12.
RESOURCE DEVELOPMENT
UPDATES
First Nations Engagement
Community Engagement
Caribou
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 13.
FIRST NATIONS ENGAGEMENT
Role of the Crown
The Crown has a fiduciary duty to consult First
Nations about decisions which may impact their
rights and, where possible, accommodate their
interests.
Role of the proponent
Build and maintain good relationships with First
Nations in the areas you operate.
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 14.
FIRST NATIONS ENGAGEMENT
Monthly Referral Process
Initial Impact Assessments
Responsive to First Nation comments
Deferred Parcels
Meet to resolve area-specific issues – FSJ staff
Example: Old Man Lily Parcels
Shapefile and PDF map of currently deferred parcels:
www.empr.gov.bc.ca/Titles/OGTitles/SalesNotices/Pages/defa
ult.aspx
Strategic First Nations Negotiations
Consultation Agreements
Strategic Engagement Agreements
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 15.
FIRST NATIONS ENGAGEMENT
Emerging Issues
Opportunities to build landscape level
impacts/Cumulative Effects into decisions
Outcome of the Dene Tha’ Judicial Review
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 16.
Y
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G
A
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M
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T
Referral packages and discussions on deferred parcels
with local government
Landowner Notification Program
Farmers’ Advocacy Office renewed
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 17.
R
I
B
O
U
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 18.
BOREAL CARIBOU RRAs
In June 2010, 500,000 hectares of
boreal caribou habitat were set
aside as “resource review areas”
(RRAs) where no PNG tenure
requests would be accepted for a
minimum of five years
For more information, see
Information Letter TACRD-10-10
http://www.empr.gov.bc.ca/Titles/OGT
itles/InfoLetters/IssueDate/Pages/TA
CRD-10-10.aspx
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 19.
BOREAL CARIBOU – UPDATES
Radio collaring underway funded in part by industry
New ungulate winter ranges and wildlife habitat areas
designated in May 2013 (Chinchaga herd)
Establishment of operating practices to be applied to oil
and gas activities within designated caribou habitat
management polygons
Consultation completed with First Nations and
stakeholders on the “Implementation Plan for the Ongoing
Management of Boreal Caribou”
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 20.
PEACE NORTHERN CARIBOU
Provincial implementation plan has been completed for
Peace Northern Caribou
Established RRAs for high elevation winter ranges for
Peace Northern Caribou Herds
Planning requirements have been established for activities
taking place in high elevation winter ranges
Work underway to establish operating practices for low
elevation habitat for the Peace Northern Caribou
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 21.
TENURE MANAGEMENT UPDATES
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 22.
eBUSINESS
Integrated Petroleum System (iPS)
iPS will transition 3 legacy applications to current
technology
Petroleum Titles System (PTS)
Petroleum Accounts Receivable System (PARS)
Sales Parcel System (SPS)
Launch has been postponed to make minor changes
and fixes
eBidding will be offered once industry consultation has
taken place (expected in the new calendar year)
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 23.
ROYALTY PROGRAMS
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 24.
TARGETED ROYALTY PROGRAMS
Challenge
Solution
Western Canada sedimentary basin deepens
towards the West
Deep Royalty Credit Program
New, conventional wells with lower
productivity
Marginal Royalty Program
Tight gas development
Ultra-marginal (tight gas) Royalty Program
Coalbed gas potential development
challenges
Coalbed Methane Royalty Program
“White spaces” and areas with limited
infrastructure (roads/pipes) available
Infrastructure Royalty Credit Program
Huge potential in new, remote, high-risk
unconventional resources
Net Profit Royalty Program
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 25.
TARGETED ROYALTY PROGRAMS
These programs can be combined in many cases, thus
providing enough margin to move certain projects to
economic territory
Example - a well that:
 is a road project (an infrastructure credit),
 is deep, and
 is marginal
can receive all the associated benefits for those programs
More information:
www.empr.gov.bc.ca/OG/oilandgas/royalties/Pages/default.aspx
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 26.
ROYALTY PROGRAMS UPDATE
Changes Announced as Part of Budget 2013
Deep Well Credit – minimum 3% royalty payable
Summer Drilling Credit Program cancelled
More information:
www.sbr.gov.bc.ca/business/Natural_Resources/Oil_and_gas_r
oyalties/bulletins.htm
2013 Infrastructure Royalty Credit Program
$115.8 million in royalty credits supporting 12 new
infrastructure projects in northeast BC, which will help
the advancement of an LNG industry
The 2013 credits are expected to generate about $445
million in revenues for the province and over $320
million in new capital spending by industry
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 27.
POLICY & REGULATORY UPDATES
BC Tenure Working Group
Review of the PNG Act & Regulations
New Policy Guides
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 28.
W
O
R
K
I
N
G
G
R
O
U
P
The BC Tenure Working Group continues to meet
regularly to discuss:
Improved communication
Legislation and Regulations
Opportunities to work more efficiently and effectively
Educational opportunities
eBusiness
Recent meetings included discussions about:
Posting and bidding processes
Foundational concepts for tenure reform
Tenure terms and continuation
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 29.
REVIEW OF THE PNG ACT &
REGULATIONS
Comments received in response to the Discussion Paper
on the tenure provisions helped inform analysis and
recommendations
Proposed changes are intended to modernize the Act,
streamline tenure administration and improve management
of unconventional resource development within the tenure
system
In March 2012 the Ministry issued a report on progress for
tenure holders regarding potential changes
Consultations with industry, First Nations and other
government agencies continued in 2012
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 30.
REVIEW OF THE PNG ACT &
REGULATIONS
Feedback on the proposed changes from the Tenure
Reform Task Group informed further analysis and
consultation with the BC Tenure Working Group
In addition to reviewing the tenure provisions, the Ministry
is working on a framework for the management of carbon
capture and storage
The Ministry is awaiting a decision on if and when changes
will be made
Ongoing consultation and analysis regarding some details
that would be introduced through the regulations
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 31.
NEW POLICY GUIDES
Policy guides will replace info letters as the main source of
detailed information on BC tenure policy and legislation
Guides are updated each time there is a change
eliminating the need to refer to multiple info letters
Guides available online:
www.empr.gov.bc.ca/Titles/OGTitles/OtherPublications
Info letters will still be used for announcements
Subscribers will receive notifications when a guide is
issued or updated (to subscribe, send a request to
[email protected])
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 32.
NEW POLICY GUIDES
Recently issued guides:
Guidelines for Registering a Transfer of Subsurface
Interest in Title
Guide to BC Petroleum and Natural Gas Act Lease
Continuations
Upcoming guides include:
Guide to Bidding and Disposition of Crown Petroleum
and Natural Gas Rights
Guide to the Petroleum and Natural Gas Drilling
Licence Regulation
Natural Gas and Oil Tenure Rents, Fees and
Penalties
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 33.
JOBS & THE ECONOMY
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 34.
CROWN SALES
2013 (to Sept)
2012 (Calendar)
2011 (Calendar)
184
145
217
171
326
274
105,290
83,846
169,533
136,521
243,730
191,534
$157,897,419.95
$1,883.18
$ 139,262,098.12
$ 1,020.08
$ 222,682,988.67
$ 1,162.63
# parcels offered
# parcels disposed
# hectares offered
# hectares disposed
Total tender bonus
Average price/hectare
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 35.
NATURAL GAS STRATEGY
Ensure an effective royalty regime
Ensure Infrastructure is available to encourage investment
Amend the Petroleum and Natural Gas Act and regulations
New Jobs for BC
Engaging with First Nations and Communities
Ensuring environmental responsible development
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 36.
LIQUEFIED NATURAL GAS
(LNG)
In September 2011, the Premier confirmed Provincial
commitment to the development of LNG export capacity
in BC
The announcement included commitments in four
areas:
Greater emphasis on the permitting and decision making
processes
Skills training and development
Investment and attraction
International marketing
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 37.
LNG UPDATE
The Premier made two trade missions to Asia to
promote trade and cultivate business relationships
BC hosted Canada’s first international LNG conference
in February 2013
The NEB has issued export licences to three LNG
proponents and additional applications are before the
NEB for review
Several proponents have come forward with proposals
for LNG facilities and transportation systems
Most recently, in response to the Province’s request for
expressions of interest, four proponents submitted
proposals for an LNG plant and marine export terminal
at Grassy Point near Prince Rupert
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 38.
O
R
T
U
N
I
T
I
E
S
Continue to develop and implement strategies to make
PNG tenure available
Continue to create and implement progressive and
innovative strategies and approaches for effective
policy, legislation and regulations that support a
modernized tenure issuance and management system
Continue to provide an attractive investment
environment through royalty and infrastructure
programs
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 39.
QUESTIONS?
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 40.
PART 2
Tenure
Management
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 41.
a
n
a
g
e
m
e
n
t
Resource List
Tenure and Geoscience Branch homepage
•
•
•
•
Legislation
Information Letters
Other Publications (Guides and reference material)
Links to:
– Petroleum Titles Online (PTO)
» Submit posting requestes for Crown disposition
» Online title searches
– e-Payments
DataBC/GeoBC
•
http://www.data.gov.bc.ca/dbc/geographic/view_and_analyze/imapbc
• Map Viewer (iMap 2.0)
–
–
Complete data warehouse of provincial GIS data
Tenure in context of other geographic and land use information
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 42.
Start Here
http://www.empr.gov.bc.ca/Titles/OGTitles
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 43.
t
l
e
S
e
a
r
c
h
e
s
Getting there:
Navigate to PTO main page from the Branch homepage, or dial
in: https://www.ptonline.gov.bc.ca
On PTO main page, click “PTS Web” in left sidebar
Support: [email protected]
Content:
Up-to-the minute title status and descriptions for active title
Primary Term (years), Area (hectares), Key Dates: Issuance,
Effective, Expiry
Tracts – Lands and Rights held
Groupings (Drilling Licences)
Ownership profile
Rental & Continuation History
Transfers and Encumbrances
Special Projects (OGC), Wells (UWIs), Unit Agreements
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 44.
Online Tools and Support
Petroleum Titles Online (PTO)
http://www.ptonline.gov.bc.ca
File posting requests
Support: [email protected]
e-Payments
https://epayments.gov.bc.ca
Support: [email protected]
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 45.
d
R
e
g
u
l
a
t
i
o
n
s
Petroleum and Natural Gas Act
Grid Regulation
Drilling Licence Regulation
Fee, Rental and Work Requirement Regulation
Storage Reservoir Regulation
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 46.
Geography and Geology
Dominion Land Survey
(DLS)
Petroleum Grid (NTS)
Spacing Areas
Well Locations
Stratigraphy & Zones
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 47.
D
L
S
PNG Grid Regulation Schedule 1
Limited to Peace River Block
TWPs 76 - 88
RGEs 13 – 26 W6M
Section size is as surveyed, not
standard like Alberta
Refer to downloadable map entitled
“Peace River Block Gas Spacing
Units and Hectarage Map”
• Location: PNG Titles Branch > Other
Publications
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 48.
Petroleum Grid (NTS)
PNG Grid Regulation Schedule 3
Applies everywhere the DLS does not
Based on longitude and latitude, but
customized for oil and gas management
Sub-divisions achieve oil and gas spacing areas
similar in size to DLS
Unit areas defined in downloadable lookup tables
• Location: PNG Titles Branch > Other
Publications
Geothermal and coal tenures are also
managed with Petroleum Grid system
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 49.
m
G
r
i
d
(
N
T
S
)
8° long.
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Well location example:
4° lat.
d-010-A/094-H-16
Title description example:
094-H-16 Blk A Unit 10
Page 50.
Petroleum Grid (NTS)
Well location example:
d-010-A/094-H-16
Title description example:
094-H-16 Blk A Unit 10
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 51.
Normal Spacing – NTS
1
10
1
10
1
10
1
10
1
10
91
100
91
100
91
100
91
100
91
100
1
10
91
100
D
C
B
A
X
1
10
1
10
1
10
1
10
91
100
91
100
91
100
91
100
K
L
X
J
1
10
1
10
1
10
1
10
1
10
91
100
91
100
91
100
91
100
91
100
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 52.
N
o
r
m
a
l
S
p
a
c
i
n
OGAA: Drilling and Production Regulation
OTN’s are an OGC approval
PNG Act – section 65.1
Generally larger than normal spacing areas
Some are already declared
Peace River Block – Petroleum Grid
BC – YT, NWT, AB boundaries
BC – USA
Protected Areas
1 OTN gas spacing = 1 gas spacing for
calculating earnings from Drilling Licences
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 53.
OTN – Peace River Block
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 54.
OTN – Alberta boundary
41
50
31
40
21
30
11
20
1
10
1
91
100
91
81
90
71
80
61
70
51
60
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 55.
OTN – NWT / Yukon boundaries
YT / NWT
91
X
X
X
J
100
91
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
1
X
X
X
G
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
10
X
91
X
I
Portions above
60° North
100
1
100
X
X
X
X
X
X
X
X
X
X
X
X
X
10
X
91
H
L
100
E
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 56.
e
(
h
e
c
t
a
r
e
s
)
All tenure rentals are based on area, measured in whole
hectares
Petroleum Grid (NTS) Unit
“NTS Unit Areas” (Excel workbook; download)
For NWT/YT and other boundary areas, call us
Peace River Block (DLS)
“Gas Spacing and Hectarage Map for the PRB” (PDF; download)
• Includes size of fractional spacing's on NTS/DLS boundary
• Depicts lands in other-than-normal spacing areas
Regardless of source, calculate area the same
Sum individual source values
Keep intermediate fractions
Round sum for entire title to nearest whole hectare
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 57.
Tenure Size – NTS
Exercise; find the combined
area of NTS Units 42-47 of
Block E in 094-H-06
Map
94 EFGH
Group
5 to 8
Block
EFGH
Unit
41-50
Total
6 X 69.8 or 418.8
Rental Size: 419 ha.
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 58.
e
S
i
zExercise; find the total
area of the two gas
espacing areas outlined at
right
–
OTN: 19.0 + 21.4 + 39.7 +
D38.0 + 66.0 + 66.0 = 250.1
ha.
LSec 8-88-25: infer 263.9
S
Total
250.1 + 263.9 = 514.0
Rental Size: 514 ha.
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 59.
n
d
L
o
c
a
t
i
o
n
s
Well Authorization (WA)
Simple 5-digit number assigned to each OGC well permit
Please use wherever possible in correspondence
Unique Well Identifier (UWI)
16-digit code issued at spud
Examples
• DLS: 102041308617W603
• NTS: 200D024H094H1604
Digit 1: DLS (1) or NTS (2)
Digit 2: Always zero
Digit 3: Sequence of the well at that bottom-hole location
•
Value of 1 never used
Digits 4-14: Approved (then actual) bottom-hole location
Digits 15-16: drilling or completion event sequence
•
First CE gets same code as its DE
Well Name
Operator(s), HZ, and surface location
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 60.
Zone Designation System
Zones are packages of one or more formations
(marked in white on diagram)
Defined by specific intervals on specific logs of
a reference well
Zone boundaries carefully selected to avoid
disputes; primarily widespread markers in nonproductive strata
5-digit code
Digits 1-3: Zone series
Digits 4-5: Geographic ID
Code value increases as age decreases
Available for download as a PDF wall chart
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 61.
STRATIGRAPHIC CHART
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 62.
Zone Designation System
The Stratigraphic Chart illustrates standard geological
formation names used in British Columbia
Overlaid on the Stratigraphic Chart are major horizontal
intervals, lying between white lines, each containing from one
to several major geological formations. These horizontal
bands represent slices of rock that are used in the standard
Zone Designation System. Some intermediate or alternate
bands are left out for readability
Standard reference descriptions of geological intervals (“Zone
Designations”) with well-chosen type wells are used to ensure
consistency in the administration of rights
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 63.
Zone Designation System
In a petroleum and natural gas Lease, when hydrocarbons are
found in any part of a standard Zone Designation layer, then
the entire layer is eligible for lease continuation
The boundaries between layers are chosen at points where
geological correlations are clear. Conflicts between
companies over geological correlations, rights held, and
vertical pooling are eliminated
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 64.
QUESTIONS?
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 65.
BC’s Oil and Gas Tenures
Permits
Drilling Licences
Leases
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 66.
u
r
e
W
e
M
a
n
a
g
e
Underground Storage Lease
PNG Act sections 126 – 132
Special Agreement
PNG Act section 72
Requires Order-in-Council (cabinet)
Geothermal Resources Act
Permits
Leases
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 67.
Permits
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 68.
Permits - Main Features
A right to explore for oil and gas
Available only by Crown sale
Postings up to one NTS block accepted, with cause
One year primary term
Term renewal requires annual exploration spending
Actual exploration spending or cash-in-lieu payment
Rates defined in Fee, Rental and Work Req. Reg.
Renewal options and work requirements vary by class
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 69.
Drilling Licences
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 70.
n
F
e
a
t
u
r
e
s
A right to explore for oil and gas by drilling wells
Not a right to take production (for sale); testing OK
Acquired only from Crown Sale
Postings: 1 – 36 gas spacing areas
Term is 3, 4, or 5 years; “Prescribed Area” (Schedule 2
of the DL Regs)
Term may be extended, at least once, more depending
on circumstances
Splits not allowed; but partial surrenders OK
Convertible to Lease by drilling or grouping
May convert some GSAs to Lease for production and
defer any unused entitlement to later in DL term
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 71.
DL - Term Extensions
Section 3(5) - “Standard Extension”
One year period
Available once - only at end of primary term
Pre-requisite for some other extension types
$500 fee; double rent ($7/ha)
Written application not required
•
Apply from e-Payments Statement; do not use Submission
•
Available only up to expiry date (NO GRACE PERIOD)
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 72.
DL - Term Extensions
Section 3(5.1) - “Special Extension”
Available after term expiry or another extension
Renewable for one year or less, by application
Approval is discretionary
•
Decisions will be based on policies in Information Letter TACRD-11-02
Requires:
•
Application submitted to the Director before expiry
•
WA application filed with OGC at least 30 days before expiry
•
Start of drilling is delayed by one of:
–
Environmental or socio-economic study
–
Public hearing
–
Planning or consultation process
Application
•
Standard DL rental ($3.50/ha) by ePayments Submission (not Statement)
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 73.
E
x
t
e
n
s
i
o
n
s
Section 3(5.3) - “Coal Bed Gas Extension”
Applies only to land and rights within a coalbed gas project
approved by the OGC under s.75 of OGAA
Available only after standard extension
May be used up to 5 times
Requires:
•
Application submitted to the Director before expiry
•
Lands and zones remain subject to OGC special project
Application
•
Standard DL rental ($3.50/ha) by ePayments Submission (not Statement)
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 74.
E
x
t
e
n
s
i
o
n
s
Sections 3(7) – “Drilling past expiry”
Available only after the “standard” extension
Term extended to the rig release date (for drilling operations)
Requires:
•
Drilling has reached 150m (from surface) at midnight on expiry date
•
Drilling is being conducted “diligently”
–
Drilling interruptions may be allowed depending on circumstances
Section 3(10): Other DLs expiring after standard extension
may be extended to the same rig release date by grouping
with the DL extended under 3(7).
Section 3(9): No other well may be started during extension,
except in the event of mechanical failures in the first well.
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 75.
r
o
u
p
i
n
g
Section 4.1
One DL must have, in the Director’s opinion, an earning well not
previously used as an earning well for grouping or selection
Any number of qualified DLs may now be grouped
To qualify, a DL must lie within 4 km. of the DL to which the
grouping well is associated.
• Verify using GIS measurement tools: DataBC, PTO Viewer, or
contact us for written confirmation.
Application:
Submitted to Director before earliest expiry date of the DLs to be
grouped.
Written authority of one titleholder of each DL to be grouped when
the applicant is neither the Payor nor a titleholder of all DLs in the
proposed group.
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 76.
QUESTIONS?
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 78.
Lease Earnings
Awarded in terms of gas spacing areas (GSA)
and “zones”
GSAs awarded depends on:
Prescribed Area 1, 2, or 3
• When DL spans two or more Areas, earnings are based on the
Area with the greatest earnings
• Information Letter TITLES-05-03
Combined lengths of drilling events
• Less any length drilled through rights held by lease that are
not necessary for the purpose of evaluating the DL
Licensee must designate one of the GSAs the
earning well evaluates
A GSA may only be designated once during the life
of the DL.
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 79.
Lease Earnings
Zones awarded are to the base of the deepest
zone "evaluated”
If the well penetrates 2 or more DLs
Licensee must nominate one to be the ‘drilled’ DL
Earnings and grouping rights attach to ‘drilled’ DL
only
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 80.
DL Term – Prescribed Areas
Measured Wellbore
Length (meters)
Download from link in “Info Letters”
Info Letter TITLES-05-03
Link: “NEBC DL Boundary .pdf Map”
British Columbia
Ministry of Natural Gas Development
October 22, 2013
less than
1001
1 001 to 1 300
1 301 to 1 500
1 501 to 1 800
1 801 to 2 100
2 101 to 2 400
2 401 to 2 600
2 601 to 2 800
2 801 to 3 000
3 001 to 3 200
3 201 to 3 400
3 401 to 3 600
3 601 to 3 800
3 801 to 4 000
4 001 to 4 200
4 201 to 4 400
4 401 to 4 800
4 801 to 5 200
Over 5 200
Column 2
3 years
Primary Term
Column 3
4 years
Column 4
5 years
2
2
3
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
18
18
3
5
6
7
8
9
10
12
13
14
15
16
18
20
22
24
25
25
4
6
8
9
10
11
12
14
16
18
20
22
24
26
28
30
31
32
Page 81.
Earning Wells
Definition:
3.1(1) A licensee may apply to the director to have a well designated as an earning
well for a gas spacing area if another well has not been designated as an
earning well for that gas spacing area.
3.1(2) On application under subsection (1), the director may designate a well as an
earning well for a gas spacing area if the well
a)
b)
is drilled in a spacing area all or part of which is in a location described in a drilling
licence that is either in effect on the date of designation or ceased to be in effect not
more than 60 days before the date of the designation, or is a well re-drilled in a spacing
area formerly described in a permit, drilling licence or lease no longer in effect.
Has generated well reports and well data, as defined in section 14 of the Oil and Gas
Activities Act General Regulation, B.C. Reg. 274/2010, that, in the opinion of the
director, sufficiently evaluate a zone in the gas spacing area.
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 82.
Earning Wells
A "redrilled" well refers to a “re-entered” well, so the
work carried out may consist of one or more of:
deepening the existing well to evaluate one or more underlying
zones
completing a previously uncompleted interval in the well
re-completing one or more intervals in the well in a manner that
provides significant new information about the formation
The total wellbore length for re-entered wells is
measured from surface to the base of the new bottomhole location or from surface to the base of the deepest
new completion interval, whichever is applicable
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 83.
Earning Well Scenario A
Drilling order does
not matter
1st
1 2nd
2
Each well
evaluates the
same zones
One well not an
earning well;
choice is
applicant’s
Zone A
Applicant
designates
GSA1/ZoneA
Zone B
GSA 1
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 84.
Earning Well Scenario B
Drilling order does
not matter
1st
1 2nd
2
Each well drills a
distinct ‘formation’,
but in same zone
Upper leg
Lower leg
Zone A
Applicant
designates which
well is the earning
well
Applicant
designates
GSA1/ZoneA
Zone B
GSA 1
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 85.
Earning Well Scenario C
1st
1 2nd
2
Drilling order does
not matter; both
wells qualify as
earning wells
Well #1
designates
GSA/ZoneB
Zone A
Well #2
designates
GSA/ZoneA
Zone B
GSA 1
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 86.
Earning Well Scenario D
1t
1
2
2nd
Drilling order does
not matter; both
wells qualify as
earning wells
Well #1
designates
GSA1/ZoneA
Zone A
Well #2
designates
GSA2/ZoneA
Zone B
GSA 1
British Columbia
Ministry of Natural Gas Development
October 22, 2013
GSA 2
Page 87.
W
e
l
l
–
O
f
f
D
L
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Drilling Licence
Lease
Page 88.
Earning Wells – “Evaluation”
A selected Lease may include rights down to the base
of the deepest geological zone “evaluated” by the
earning well
This standard is applied in a broad, exploratory sense
The well must at least drill into and find significant or
substantial new geological information about a zone.
Typically, the information could establish that the well
encountered a:
wet reservoir; or
tight reservoir; or,
hydrocarbon-bearing reservoir
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 89.
Earning Wells – “Evaluation”
Alternately, evaluation may also mean determining
The definitive absence of a reservoir; or,
The geological character of a zone in a new area
The existing state of exploration of a zone in a particular
geographic area is an important factor, for example:
If drilling takes place in a remote or wildcat exploratory
area, or if little is known about the zone of interest, then
smaller amounts of new information will be considered
significant in the evaluation of the zone
Similarly, a zone known to have a great degree of local
geological variability will require only a small amount of
new significant drilling information in order to be
considered evaluated
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 90.
Lease Selection Applications
First, e-Payments Submission; then
Application Letter
Create a Conversion type of Submission
If a grouping is needed, add each DL to be grouped
to the Sub
For each DL, create a row for each new Lease to be
issued from that DL, with its expected area, in
hectares
Application Letter must include:
The e-Payments Submission number in subject line
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 91.
Lease Selection Applications
Application Letter (continued)
Include a table with rows for each earning well, containing:
•
OGC Well Permit (WA)
•
Rig release date (from drilling operations)
•
Estimated total length of all eligible wellbore segments
–
Do not include lengths drilled after leaving the Drilling Licence rights
•
Expected number of GSAs earned
•
Name of the deepest formation “evaluated” by the well
•
Designated GSA – location and zone
Desired configuration of Leases
•
Use legal descriptions that match formats used in the Drilling Licence
•
Use separate tracts for lands of different rights
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 92.
Lease Configuration
Basic restrictions on selected Leases:
Must include all spacing areas to be placed on production
Each Lease must be located entirely within one DL
Must not result in new split gas spacing areas, unless you
have an oil well and want to split the gas spacing area
Options for selected Leases:
So long as leases share a common issuance date, and are
selected simultaneously, earnings from two or more WAs
may be combined, regardless of zones earned, or the
originating DL
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 93.
QUESTIONS?
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 94.
Leases
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 95.
e
a
s
e
s
A right to explore for and produce oil and gas
Available from
Crown Sale
Converting Permits and Drilling Licences
Split from another Lease (transfer)
May be continued beyond initial primary term
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 96.
e
s
–
T
e
r
m
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Inside Area 1: 5 years
Outside Area 1: 10 years
A Lease overlapping both
areas has a 5-year term
Posting requests and
Lease selections
intersecting the boundary
should be done carefully:
Term is the shorter of 5
or 10 years if Lease
straddles boundary
Page 97.
Leases – Continuations
Several forms
Section 62
Section 61
Section 61.1
Section 58
One year, in all cases
Guides available online (“Other Publications” page)
“Guide to BC Petroleum and Natural Gas Act Lease
Continuations”
"Recommended Technical Package Contents for Section
58 Applications"
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 98.
s. 62 Continuation
Continuation by Penalty Payment
Year 1
$15.00 / Ha
Years 2 or 3
$25.00 / Ha
Available three times for any 10-year Lease
No rights reversion
Need not be used in consecutive years
Application made through ePayments
Use the statement when no other continuation types are
anticipated for the Lease, or
Use submission and written application when other continuation
types (splits) are anticipated or desired for the Lease
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 99.
s. 61 Continuation
Continuation by Drilling Commitment made Before Expiry
Drill one or more wells on Lease during continuation year,
evaluating at least one zone held by that Lease
Application Must be in Writing and Must be made Prior to Expiry
Available for any Lease that is expiring
No rights reversion
May be used more than once, but spacing area(s) of
successful commitment wells will be split out under s.58
Applies only to Lease(s) being drilled
Director may cancel Lease for non-performance
Applications made through e-Payments
The Act requires sending written application
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 100.
s. 61.1 Continuation
Continuation for Disposal Well and Planning Purposes
Continues spacing areas for existing disposal operations and
spacing areas the Director believes will be required for
effective future disposal, for example Coalbed Methane
projects that advance across the land
Water, CO2, frac fluids, waste fluids
Shallow and deep rights revert
Spacing areas included in projects approved under s.75 of the
Oil and Gas Activities Act are not eligible
Written application with supporting technical material to
accompany e-Payments for first approval
Once approved, application is by annual rental until further
notice by Director
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 101.
s. 58 Continuation
Four types of continuation:
58(3)(a): Eligible Spacing Areas
58(3)(b): Unit and Royalty Agreements
58(3)(c): Work Programs
58(3)(d): Establishment of a Well
All s.58 continuations subject to rights
reversion: deep rights or zone specific (s.59)
Leases approved under two or more s.58 subsections will be split accordingly
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 102.
s. 58 Continuation
Section 58(3)(b) - “unit or royalty agreements”
Portions of Lease subject to Unit or Royalty Agreements
Once approved, continuation is by rental payment until further
notice; subject to annual review under the Act
Section 58(3)(c) - “work programs”
Must be designed to delimit a pool or field of oil or natural gas
May include multiple Leases
Not intended for multi-year exploration programs, depends on
circumstances (e.g., access, scope)
Section 58(3)(d) – “drilling incomplete”
The drilling or work on the establishment of a well is incomplete
on the expiry date
The Director is satisfied that the drilling or work will continue
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 103.
s. 58(3)(a) - Eligibility
s. 58(3)(a) – An Eligible Spacing Area is a spacing area
that:
Contains a “petroleum well” or “gas well”
Is subject to an approved issued under s.75 of the Oil and
Gas Activities Act by the Oil and Gas Commisssion
The Director believes is at least 50% covered by a
designated land plat
The Director believes contains a pool that may be
adequately drained by a well in an adjacent spacing area
Once approved, continuation is made by annual rental
payment until further notice; subject to annual review
under the Act
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 104.
s. 58(3)(a) – Land Plats
Depicts where the Director of Petroleum Lands
recognizes that a pool of natural gas or petroleum has
been delimited through the exploration and
development work of industry
Illustrates, in map view, the gas or oil Spacing Areas
delimited in a pool, and names the geological formation
in which the pool is recognized
Referred to by combining the Tenure Area (oil or gas
field name), Geological Formation, Sequence Letter,
and Fluid Type (oil or gas), for example:
TA49004980DG (Inga Doig Phosphate ‘D’ Gas)
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 105.
A
T
S
E
x
a
m
p
l
e
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 106.
s. 58(3)(a) – Land Plats
Lease continuation application process is simplified for Crown
and industry
Expertise of geological staff can be focused on Spacing Areas not
yet recognized
Freely available
Data download; or,
View online (iMap tool at DataBC website)
Pools are delimited by Control Points of hard and soft data:
Wells posting hard results at specific locations
2D Seismic line locations; 3D seismic survey grids
Known geological formation characteristics
Mid to long term production and pressure histories
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 107.
s. 58(3)(a) – Land Plats
Sources of Evidence Delimiting Land Plats:
Industry applications for continuation interpreting the results of
drilling, seismic and well evaluation work
Ministry evaluations of drilling, log, sample, drillstem test,
completion and production results, posted at the specific well
locations, combined with geophysical evidence extending pools
beyond well control
Analogous wells, old and new, with similar properties
Evaluations and approvals received from the OGC
Thousands of geophysical and geological interpretations on file
from all Crown title holders, representing decades of information
and analysis
All Analysed Spacing Area by Spacing Area
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 108.
s. 58(3)(a) – Land Plats
Clients that only submit a land plat and no technical package
with their 58(3)(a) original application, or a contingent section
58(3)(c) application, will be notified of the land plat reduction
by telephone and e-mail and given one opportunity to make
their case (58A or 58C) within 10 working days of that contact,
regardless of how much time has elapsed after expiry.
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 109.
s. 58(3)(a) – Reversion
Leases are now subject to one of two types of rights
reversion: zone-specific or deep rights reversion. In
either case, the existing Zone Designation System will
be used to administer them
What is Zone-Specific Retention (ZSR)?
A ZSR-subject Lease is a PNG Lease that is a member of a chain
of title originating with the purchase of a PNG title through a
Crown sale held on or after March 29, 2007
ZSR is designed to return to the Province, at the end of the
primary term of a subject Lease, all the zones that do not contain
identified oil or natural gas deposits
All other zones will revert to the Crown unless they can be continued
under other applicable sections of the Act, including sections 58(3)(c)
and (d) and sections 61 and 62. These sections allow continuation
based on drilling, completions, work programs, delimiting pools, and
the simple payment of a penalty
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 110.
s. 58(3)(a) – Reversion
Benefits of Zone-Specific Retention
Increased investment opportunities for industry
Earlier discovery and development of new oil and gas
pools, leading to earlier revenues for both industry and the
Province
If well, geophysical, geological or engineering data shows
that a pool of oil or gas exists in a zone in any spacing
area, then it qualifies for continuation. This consideration is
independent of the status of a well
The zone may be behind pipe, and in some cases the well
may be abandoned, but well information proves a pool
exists.
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 111.
s. 58(3)(a) – Zone Reversion
Standards for Zone-Specific Retention
Well information, combined with existing geological
knowledge, are usually sufficient to determine whether a
zone contains hydrocarbons
Modern well evaluation technologies, properly applied, are
capable, in the vast majority of cases, of demonstrating
the presence of hydrocarbons
Any remaining doubts should be resolved by completing
the zone
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 112.
iMapBC 2.0
Land Plats Demo
British Columbia
Ministry of Natural Gas Development
October 22, 2013
s. 58(3)(c)
General Features
May include multiple Leases, even multiple target zones,
and with different but relatively close expiry dates
Proposed work must, in the opinion of the division head,
be designed to delimit one or more pools
Approved non-optional work must be fully completed
during the term of the continuation.
Contingent work must be started during the term of the
continuation, e.g., contingent wells must be spudded
Majority of programs are one year only; exceptions may be
considered due to very limited access or an unusually
complex work program
Non-performance jeopardizes future work programs
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 114.
s. 58(3)(c)
Application must include a cover letter on company
letterhead, and include:
A firm work commitment, e.g. “XYZ Corp. commits to carry out
the following program of work: . . .”
A clear description of where the work will take place in relation to
the Leases included in the application
The locations and formation names of the pools that will be
delimited by the work program
Technical package contents
Must demonstrate the current state of geologic knowledge of the
pools to be delimited, and how the work is likely to further delimit
those pools
May include any technical material, such as public and proprietary
well data, geological x-sections, isopachs, interpreted seismic,
remote sensing results, and field studies
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 115.
s. 58(3)(c)
Where approved programs include seismic
components (new or re-evaluated), an
acceptable report of the geophysical results is
required at the end of the continuation year
Refer to downloadable document entitled
“Requirements for Affidavits and Reports”
Location: “Other Publications” page
Reports held confidential for 10 years, then
deposited with thousands of similar studies
A cumulative index is published annually and
available online from the same page
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 116.
s. 58(3)(d)
Designed to allow leaseholders to finish drilling or
“establishing” a well that is clearly in progress
More scrutiny will be applied if the well has not been
spudded by expiry
If the well drilled into or will drill into multiple Leases, all
Leases may be approved
All rights below the base of the deepest objective zone
corresponding with the OGC well permit’s (WA)
deepest “objective” formation are not included
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 117.
PART 3
General
Administration
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 118.
ePayments
Support: [email protected]
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 119.
ePayments – Overview
Accepts rents, fees, and penalty payments
Requires self-managed BCeID, electronic passport to
BC Gov
Mandatory
Client must initiate payment; not an auto debit system
Key components to remember: Payors, Statements,
Submissions, Receipts, Refunds, Surrenders
Issues refunds electronically, also mandatory
e-Payments will not accept payments related to:
Split Transfers of PNG Leases
PNG Permits
Section 72 Agreements
Underground Storage or Geothermal tenure
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 120.
ePayments – User Roles
BCeID Profile Manager
Appointments Company Administrator for each
application accessed with BCeID
Company Administrator (e-Payments)
Assigns roles to other users; can perform function of
any role
Users may be assigned multiple roles
Land Adminstrator
Creates and ‘opens’ submissions
Payment Administrator
Initiates payments from Statements or Open
Submissions
Viewer
Read-only access
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 121.
Continuing your Tenure
Statements
Submissions
• When written applications are not
required
• Use one of the “Statements” screens
• Primary Term
• Continuation/Extension
• Leases
• Section 62, or
• Section 58(3)(a), 58(3)(b), or 61.1
when this would repeat the previous
continuation
• Drilling Licences
• Section 3(5)
• When written applications are
required or to reduce title area by
partial surrender
• Use “Manage Expiring Titles” screen
• Leases
• 58(3)(a),(b) – first time
• 58(3)(c),(d) – each time
• 61 – each time
• 61.1 – first time
• Drilling Licences
• Conversions to Lease
• 3(5.1) – each time
• 3(5.3) – each time
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 122.
Submission payments
Distinct from payments made from a Statement
Used when written applications are required
Certain DL extension and Lease continuation types
All DL groupings and lease conversions
When requested by the Crown
An electronic “bucket” to hold a group of tenures related by
their inclusion in a common application for extension,
continuation, or conversion
Designed to facilitate application tracking by industry and
reduce need to contact Branch staff for updates
e-Payments generates a Submission ID number; please
reference it in all application correspondence
Tracking with Milestones and Communication Log
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 123.
Managing Rental Deadlines
Rental “Default Notices” were eliminated
July 1, 2010
Manage expiries from the All Titles screen
e-Payments sends a monthly e-mail
reminder to view your statements
Overdue titles are shown in purple and
fall off ePayments 61 days past expiry
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 124.
Late Penalties
Late penalties are automatically calculated
once the anniversary date has passed
Leases
Day 1-30 - 1.5 %
Day 31-60 – 3.0 %
Drilling Licence
Day 1-60 $500.00
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 125.
Cancellations
Request from All Titles screen in ePayments
Ministry will cancel 60 days after anniversary date
and send confirmation
Check title to be cancelled
While the title remains visible, the cancellation
request can be reversed with the Cancel Request
function button
Please use signed letters for tenure types not
managed through e-Payments (may require
letter of authorization from a titleholder)
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 126.
Letters of Authority
Letter of Authorization’s are needed when you
are neither an owner or payor
Required for Titles not covered by e-Payments
For e-Payments, the registered Owner’s intent
is implied by authorizing the Designated Payor
to make decisions on the title
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 127.
Training Information
Online Help
Follow link in Resources slide
Getting Started
Self-Tutoring
FAQs
Quick Reference Tool
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 128.
Other Instruments
Affecting Title
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 129.
Power-of-Attorney
No fees required
Cover letter is required
Power of Attorney documents should have original
signatures or be a Certified True Copy
The document must clearly state the types of document
that the person/position is authorized to sign on behalf
of the company
A registration number will be assigned to the company
upon the initial registration, this number will be used for
all future registrations
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 130.
Partnerships
Permitted to hold title in BC
Partnership needs to provide documentation showing
the partnership structure
Documentation must be signed by all parties of the
partnership
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 131.
Title Transfers
New Guide available from “Other Publications” page
Guidelines for Registering a Transfer of Subsurface
Interest in Title (see Information Letter OGD-13-01)
No fees required
Cover letter must accompany documents
Transfers are considered effective from the date
received, not the execution date
Stale-dated transfers are acceptable
Changes are recorded against title specified in the
document
Only transfers of undivided interest are permissible
Signatures in counterpart are acceptable
Any color ink acceptable for signatures
British Columbia
Ministry of Natural Gas Development
Electronic Signatures and signature stamps
October 22, 2013
acceptable
are not
Page 132.
Title Transfers
Transfer documents must:
Be originals
List all title numbers to be transferred
Be executed by all transferors and all transferees
• Subsequent edits must be initialled by all parties
A properly “executed” document is:
Dated, and
Signed by a signing officer of the firm or by a person with a Power
of Attorney registered with Titles, Aboriginal and Corporate
Relations Division, and
Witnessed or affixed with a corporate seal
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 133.
Title Transfers
Schedules are permitted and should include only the
title number and the company reference number
Transfer documents must specify interest as a
percentage of the undivided interest
8 decimal places (max)
Interests displayed as percentages of percentages are
not acceptable:
Interest amounts are not required on transfer of all a
companies interest in a title
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 134.
Title Transfers
Sample forms available from the Division website, no
prescribed form necessary
Information Letter EMD-008
Must not contain implied or explicit encumbrances, eg:
“subject to” clause
Do not send title documents with your transfer request
Use full legal name of companies
If legal descriptions must be included for corporate
reasons, they:
Must be identical to registered legal description
Must include complete tract rights
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 135.
Split Transfers
A procedure to divide one lease into two or
more leases
Leases only
$500.00 fee for each new lease to be issued
Leases may be divided by:
Surface hectares
Stratigraphic
A combination of both
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 136.
Split Transfers
All criteria applicable to simple transfers are applicable
to split transfers, plus:
“in and to a portion of….” must be used on the transfer
documents”
Legal descriptions of the transferred portion, including
the rights held by that portion, must be specified
Must not divide gas spacing areas containing gas wells
May divide gas spacing areas if:
Contains an oil well; or
Spacing area already split
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 137.
Pooling Agreements
Purpose – joint development of a spacing area
Recorded as an ‘encumbrance’ in the titles
registry (will appear online in title searches)
Letter contents:
Name all title holders
Title numbers
Well authorization No.
UWI of well
Date of Pooling Agreement
Signature of all title holders
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 138.
Encumbrances
Information Letter EMD02-01
A claim or lien placed on a title by a third-party
NOT a legal registry; information purposes only
Encumbrances do not restrict the application of any
provision of the Petroleum and Natural Gas Act
Examples of types of documents:
Bank Act assignment
Deed of Trust
Debenture
Mortgage
Builder’s Lien
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 139.
Recording Encumbrances
Single one-time fee:
$50.00 per title per encumbrance
Includes any partial or full discharge fees
Requests must include:
Letter of instruction and fee
• State the type of encumbrance
• State the full legal names of the companies involved
Encumbrance document
• Original or certified true copy
• Document must be dated and signed by a signing officer of
the company holding the encumbrance
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 140.
Discharging Encumbrances
Requests must:
Be dated and signed by a signing officer of the company holding
the encumbrance
Include original encumbrance registration numbers
State the type of encumbrance
State full legal names of the companies named in the
encumbrance
Include the date of the original encumbrance registration
Include the date of the encumbrance
Indicate if the discharge is full or partial
List only active title numbers to be discharged
Original signatures or certified true copy
Each encumbrance must be discharged with a separate
document
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 141.
Copies of Encumbrances
Requests for copies of encumbrances can be sent by
fax
Fax: (250) 952-0331
Fees – minimum charge of $10.00, or .75 cents per
page whichever is greater, an invoice will be sent with
the documents
We will copy only the first 6 pages of the document plus
the signature page; additional pages may be accessed
and copied on-site by an authorized agent.
Return by fax or email up to 50 pages, by collect courier
or mail – include your courier name and account
number with your request
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 142.
Name Changes & Amalgamations
Requests must include:
May be sent by mail, fax or email
Copy of certificate and articles of amendment
Photocopies acceptable
Changes are only recorded against “active”
title
All federal and provincial certificates are
accepted where:
Jurisdiction and registration numbers are included
Full legal names of the parties are used
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 143.
THANK YOU
British Columbia
Ministry of Natural Gas Development
October 22, 2013
Page 144.