Canada: New Brunswick Oil, Gas Blueprint to Be Released by Spring of 2013

The provincial government will develop an oil and gas blueprint to be released in the spring of 2013, Energy and Mines Minister of New Brunswick Craig Leonard announced.

The blueprint will look at the current and future framework required for the oil and gas industry in the province. It will also take into account the fact that natural gas currently provided to New Brunswick from offshore sources in Nova Scotia will eventually run dry, and it will consider what that could mean to the province’s security of supply, as well as to natural gas prices in the future.

“Natural gas extraction from shale formations has transformed the energy marketplace around the world,” said Leonard. “New Brunswick has the potential to take part in that transformation through its own natural gas reserves. We are investigating the opportunity but we will only permit the expansion of the natural gas industry in New Brunswick if we are convinced it can be done in an environmentally-responsible manner.”

Leonard noted that natural gas, while not a renewable fuel, could play a significant role in the future in helping to diversify the province’s energy needs. For example, using cleaner natural gas to fuel power plants currently running on oil which comes from markets overseas. This is an area that will be more closely examined in the blueprint.

“Natural gas will play a significant role in reducing greenhouse gas emissions today and into the foreseeable future as it displaces oil and coal as energy sources in our region and provides efficient back-up to renewable sources such as wind and solar power,” he said.

The blueprint will focus on five key objectives identified as priorities by the public during the past 18 months in various reports and discussion documents, public engagement and town hall meetings:

• environmental responsibility;
• effective regulation and enforcement;
• community engagement;
• stability of supply; and
• sustainable economic development.

Building on those five objectives, the action plan will address recommendations outlined in the reports authored by Louis LaPierre and Dr. Eilish Cleary including: standards for water usage and well construction; monitoring standards for natural gas development sites; and a human resource plan to assure proper inspection and environmental oversight on all projects, at all stages.

Further, the provincial government will examine the idea of establishing regulatory bodies such as an oil and gas commission and an oil and gas secretariat.

The provincial government will address the royalty regime and the regulatory model early in 2013 to provide clarity to the public and stakeholders before activities resume on an incremental approach in the spring.

The regulatory framework will consist of a combination of legislation, regulation and policy administered primarily by the Department of Energy and Mines and the Department of Environment and Local Government. This will follow the work undertaken during the past 18 months from which a series of recommendations were put forward for public feedback.

Existing legislation such as the Oil and Natural Gas Act and the Clean Environment Act have the necessary authorities and mechanisms to administer and enforce the bulk of these requirements. Adjustments to legislation will be made as necessary to ensure complete oversight of industry standards.

Any proposed operational or technical requirements which fall outside of the jurisdiction of these two departments will be managed through the department responsible for the area in question.

“We expect that the final technical review and establishment of the regulatory framework will be completed by the end of the year and that all activity taking place in 2013 will be required to adhere to the new rules,” Leonard said.

The provincial government will continue to identify and act upon any possibilities that arise for greater research and scientific work to be done in the province in relation to oil and natural gas activities.

“The Department of Energy and Mines will be initiating discussions with New Brunswick universities to determine the best manner in which we can move forward with the establishment of an energy institute – an independent body that would ensure credible research and monitoring in support of natural gas exploration and production, as recommended by Louis Lapierre,” said Leonard. “The government strongly believes that academia must play a key role in developing our own knowledge base for natural gas right here at home.”

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LNG World News Staff, November 30, 2012; Image: New Brunswick Canada