Regulators in Alberta said the province would remove most subsurface well density controls for coalbed methane (CBM) and shale gas, one of several changes announced Thursday for well spacing for conventional and unconventional oil and gas wells.
Alberta's Energy Resources Conservation Board (ERCB) said the changes were being enacted to allow oil and gas companies to optimize resource recovery. "It's really about managing the resource more efficiently," ERCB spokesman Bob Curran told the Vancouver Sun. "We know from a geological standpoint, certain formations are developed more effectively when there are multiple drainage points."
The ERCB said subsurface well density controls would be removed across the province and "in certain gas zones in the southeastern Alberta," but it did not specify precisely where. It is believed the changes will affect the Duvernay Shale play. The board also decided to:
Oil and gas industry officials supported the changes. "Certainly it's a good streamlining initiative from the ERCB, which shows that they are being responsive to the changing nature of our business in this province," Travis Davis, spokesman for the Canadian Association of Petroleum Producers, told the Sun. "At the end of the day, it maximizes our ability to extract the maximum amount of resources more efficiently."
The Duvernay has been a popular play among producers and financial analysts, especially since Shell Canada Ltd. acquired Duvernay Oil Corp. for C$5.9 billion in July 2008 (see Daily GPI, July 15, 2008). On Aug. 15 Macquarie Capital Markets Canada Ltd. issued a 48-page report on the play, calling it "one of the most promising oil/gas resource plays in Canada."