Well spacing defines the number of subsurface drainage locations necessary to maximize hydrocarbon recovery from a pool or formation. Spacing regulations promote conservation through efficient and orderly development of reservoirs, and protect equity among mineral rights owners.
As prescribed in part 4 of the Oil and Gas Conservation Rules (OGCR), standard drilling spacing units (DSUs) are one section of land for a gas well and a quarter section for an oil well. Baseline well densities for standard DSUs are prescribed in section 4.021 of the OGCR and vary depending on the substance, production source, formation, and area of the province from which oil or gas is being produced. Under section 79(4) of the Oil and Gas Conservation Act (OGCA), the AER will consider an application for special well spacing that would allow for an increase in well density from the baseline.
Under section 4.040(3) of the OGCR, special well spacing applications must demonstrate that
Approval of special well spacing does not authorize the drilling of any wells nor the construction of any related facilities. Additional approvals from the AER or other government agency are also required in order to drill wells for the production of oil or gas. ]
Holdings and units must be composed of whole and contiguous DSUs, and the ownership must be considered common at both the lessor and lessee levels in accordance with section 1.020(2)(4) of the OGCR and unit 7 of Directive 065. A block of land containing multiple, contiguous DSUs of common ownership may be developed without a special well spacing approval, limited only by the standard target area on the external boundaries of that block of land, as long as the baseline well density per DSU is not exceeded for that area or strata.
The following outlines the process to follow to get approval for quick spacing applications. It includes links to application submission procedures and guidance documents.
The applicant will submit its quick spacing application through electronic applications submission (EAS). Applications are registered using the Integrated Application Registry (IAR), and all material related to an application is stored in this system.
After the application is received, it will be reviewed for completeness under Directive 065 requirements and as further clarified in the explanatory notes in appendix I of Directive 065. If the application is determined to be incomplete, the application will be closed with an explanation. If the application is determined to be complete, a technical review will be conducted as follows:
The processing time for this application is 20 calendar days.