Build­ing a Com­pet­i­tive En­ergy ,ndus­try in Al­berta AER Pres­i­dent and CEO -im El­lis

The McLeod River Post - - The Patch -

Build­ing a Com­pet­i­tive En­ergy ,ndus­try in Al­berta AER Pres­i­dent and CEO -im El­lis

,n a fast-chang­ing and chal­leng­ing world, how can an en­ergy reg­u­la­tor be­come more ef­fi­cient and cost-ef­fec­tive? And how can the Al­berta En­ergy Reg­u­la­tor AER help cre­ate a more com­pet­i­tive province by re­duc­ing the eco­nomic bur­den on in­dus­try while still pro­tect­ing the en­vi­ron­ment and im­prov­ing Al­ber­tans’ abil­ity to in­ter­act with the reg­u­la­tory sys­tem? We have been work­ing for some time on a sig­nif­i­cant mod­ern­iza­tion of the province’s en­ergy reg­u­la­tory sys­tem that would an­swer these Tues­tions. /et’s look at what we’ve ac­com­plished so far and what we’re work­ing on now.

Our jour­ney to cre­ate a stronger, more ef­fi­cient reg­u­la­tory sys­tem started the day the AER launched in . Since then, we have re­duced du­pli­ca­tion in our sys­tem, re­sult­ing in more than bil­lion in sav­ings to in­dus­try. That said, we know we need to do more and can do more.

Our reg­u­la­tory sys­tem was de­signed to gov­ern in a dif­fer­ent era; tech­nol­ogy has changed, as has the way en­ergy com­pa­nies op­er­ate. Al­ber­tans ex­pec­ta­tions have also changed. Through years of en­gage­ment with stake­hold­ers, we un­der­stand that there are lim­i­ta­tions and is­sues with our reg­u­la­tory sys­tem and how to fix them. We also know that we’re in a uniTue po­si­tion to drive change and in­flu­ence in­vest­ment in our province, some­thing that’s crit­i­cal to in­creas­ing Al­berta’s com­pet­i­tive­ness.

)or Al­berta to be com­pet­i­tive, we need to en­able fur­ther de­vel­op­ment by re­mov­ing un­nec­es­sary costs in our reg­u­la­tory sys­tem, while still main­tain­ing high stan­dards for en­vi­ron­men­tal pro­tec­tion and pub­lic safety. Achiev­ing this means de­vel­op­ing smarter reg­u­la­tions that • Are modern, ef­fi­cient, ef­fec­tive, and clear. • Make our pro­cesses more ef­fi­cient for in­dus­try, our stake­hold­ers and our staff. • .eep pace with an in­no­va­tive en­ergy in­dus­try. • Give op­er­a­tors greater flex­i­bil­ity in how they de­velop en­ergy re­sources while meet­ing all reg­u­la­tory reTuire­ments.

We’re un­der­tak­ing a num­ber of ini­tia­tives, to be im­ple­mented over the next to months, to sup­port this trans­for­ma­tion and to con­trib­ute to Al­berta’s com­pet­i­tive­ness. $ 6LPSOHU $SSURDFK Our new ,nte­grated De­ci­sion Ap­proach and the tech­nol­ogy we’ve built to sup­port it are stream­lin­ing the project ap­pli­ca­tion process. ,nstead of many sep­a­rate ap­pli­ca­tions for a project, com­pa­nies sub­mit a sin­gle ap­pli­ca­tion and re­ceive a sin­gle de­ci­sion. The pro­cess­ing of low-risk ap­pli­ca­tions is au­to­mated, while higher-risk and more com­plex ones are re­viewed by our tech­ni­cal ex­perts, thereby cut­ting wait times. This move to au­to­ma­tion will al­low our staff to fo­cus their at­ten­tion where it mat­ters most, where the risk is higher.

This new ap­proach is truly game chang­ing and some­thing that few reg­u­la­tors have at­tempted. The sup­port­ing tech­nol­ogy² called On­eStop²has been rec­og­nized in­ter­na­tion­ally with awards for in­no­va­tion and proven to save sig­nif­i­cant time and money. Per­haps most im­por­tant, it pro­vides in­dus­try with the cer­tainty it needs to make in­vest­ment de­ci­sions.

This ap­proach is good news not only for in­dus­try but also for Al­ber­tans, who will have ac­cess to in­for­ma­tion about an en­tire oil and gas de­vel­op­ment, rather than just in­di­vid­ual el­e­ments of a project as it pro­gresses. This will pro­vide Al­ber­tans with a deeper un­der­stand­ing about the en­ergy de­vel­op­ment ac­tiv­i­ties tak­ing place in their back­yards and give them con­fi­dence that the AER is pro­tect­ing what mat­ters to them.

But sim­pler reg­u­la­tory ap­proaches are not just for new en­ergy de­vel­op­ments. The AER rec­og­nizes that many ex­ist­ing reg­u­la­tions and pro­cesses fail to con­sider the ex­ten­sive work that was al­ready done when an ex­ist­ing in situ or con­ven­tional oil and gas project was orig­i­nally ap­plied for. Given this, the AER is ex­am­in­ing op­tions to more ef­fi­ciently re­view ex­pan­sions of ap­proved projects by us­ing a sim­pler reg­u­la­tory ap­proach to eval­u­ate the in-depth work from the orig­i­nal ap­pli­ca­tion. $ 0RUH 7UDQVSDUHQW 6\VWHP

We’re pro­vid­ing greater clar­ity, cer­tainty, and trans­parency around our pub­lic in­volve­ment pro­cesses by tak­ing ac­tions such as stan­dard­iz­ing our state­ment of con­cern process and set­ting re­view time­lines so Al­ber­tans and in­dus­try know what to ex­pect. A more trans­par­ent sys­tem also means align­ing our reTuire­ments for con­sult­ing with in­dige­nous peo­ple with those of the Abo­rig­i­nal Con­sul­ta­tion Of­fice; this elim­i­nates du­pli­ca­tion and en­sures a more stream­lined ap­proach. We also rec­og­nize the need to bet­ter in­volve in­dige­nous peo­ple in our de­ci­sions and are ex­plor­ing ways to do this in part­ner­ship with the Gov­ern­ment of Al­berta. $ 0RUH ,QQRYDWLYH ,QGXVWU\ We want to mod­ern­ize our reTuire­ments to align with mar­ket, tech­nol­ogy, and pol­icy changes, and to pro­vide com­pa­nies with greater flex­i­bil­ity in en­ergy de­vel­op­ment.

Many of our reTuire­ments for un­con­ven­tional re­source de­vel­op­ment, such as for hy­draulic frac­tur­ing and hor­i­zon­tal drilling, are out­dated and fail to re­flect chang­ing tech­nol­ogy. We are work­ing to up­date these reTuire­ments to ad­dress new tech­nolo­gies, main­tain our com­mit­ment to pub­lic safety and en­vi­ron­men­tal pro­tec­tion, and get the best pos­si­ble eco­nomic value for Al­berta’s re­sources.

Other changes will al­low com­pa­nies to sub­mit one ap­pli­ca­tion for an en­tire in situ project in­stead of for each in­di­vid­ual ac­tiv­ity. This en­ables com­pa­nies to bet­ter man­age the foot­print of their projects, which in turn will help min­i­mize the en­vi­ron­men­tal im­pact. $ 0RUH &ROODERUDWLYH $SSURDFK

While im­prov­ing ef­fi­ciency is im­por­tant, we must also en­sure that Al­ber­tans aren’t bur­dened by the costs of the li­a­bil­i­ties of in­ac­tive wells and fa­cil­i­ties. To­gether with in­dus­try, we’ve de­vel­oped an area-based clo­sure process that en­cour­ages com­pa­nies to co­op­er­ate with one an­other in clos­ing oil and gas in­fra­struc­ture. This will re­sult in time­lier de­com­mis­sion­ing and recla­ma­tion of en­ergy sites, mean­ing lower li­a­bil­i­ties and greater cost sav­ings. )or ex­am­ple, a re­cent pilot project re­sulted in an es­ti­mated cost sav­ings of to per cent per com­pany.

All of this adds up to a sig­nif­i­cant mod­ern­iza­tion of Al­berta’s en­ergy reg­u­la­tory sys­tem. ,t’s a com­plex un­der­tak­ing that will take time, but we’ve al­ready made great head­way and have pub­licly com­mit­ted to time­lines for de­liv­ery. This is not easy for the AER’s staff, but is cru­cial for clar­ity and cer­tainty go­ing for­ward. While the AER is fo­cused on these ini­tia­tives, we con­tinue to seek ad­di­tional ways to im­prove our sys­tem to sup­port an en­ergy in­dus­try that con­trib­uted bil­lion to Canada’s econ­omy in . We also con­tinue to lis­ten to the Gov­ern­ment of Al­berta, the en­ergy in­dus­try, and Al­ber­tans about where we need to fo­cus our ef­forts. We see our path for­ward and know it won’t al­ways be an easy one. Mod­ern­iz­ing our reg­u­la­tory sys­tem is crit­i­cal for at­tract­ing in­vest­ment and en­sur­ing Al­berta’s com­pet­i­tive­ness; it is com­plex and will take sig­nif­i­cant work car­ried out us­ing a phased ap­proach. But we must seize this huge op­por­tu­nity to make a dif­fer­ence and take risks if it means build­ing a stronger, more ef­fi­cient reg­u­la­tory sys­tem. But to be clear, we will never com­pro­mise en­vi­ron­men­tal pro­tec­tion and pub­lic safety.

“All of this adds up to a sig­nif­i­cant mod­ern­iza­tion of Al­berta’s en­ergy reg­u­la­tory sys­tem. ,t’s a com­plex un­der­tak­ing that will take time, but we’ve al­ready made great head­way and have pub­licly com­mit­ted to time­lines for de­liv­ery. This is not easy for the AER’s staff, but is cru­cial for clar­ity and cer­tainty go­ing for­ward.” We know we need to do more than state our in­ten­tions²we must act on them. This means con­tin­u­ing to make sure com­pa­nies fol­low the rules and be­ing more trans­par­ent by re­port­ing our progress and the en­ergy in­dus­try’s per­for­mance through our com­pli­ance dash­board, our in­dus­try per­for­mance re­ports, and our an­nual re­port.

Al­berta’s en­ergy re­sources con­trib­ute sig­nif­i­cantly to the eco­nomic health not just of the province but of the en­tire na­tion. We know that a more ef­fi­cient reg­u­la­tor helps de­liver eco­nomic ben­e­fits while en­sur­ing that de­vel­op­ment is safe, the en­vi­ron­ment is pro­tected, and the rules are en­forced. This is our com­mit­ment to Al­ber­tans.

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