Area Based Closure: A Regulators Perspective David Hardie, Director - - PowerPoint PPT Presentation

area based closure a regulator s perspective
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Area Based Closure: A Regulators Perspective David Hardie, Director - - PowerPoint PPT Presentation

Area Based Closure: A Regulators Perspective David Hardie, Director Liability Strategy May 7, 2018 Area Based Closure (ABC) Principles Flexible Transparent Achievable Data and information driven decisions Scalable for all sizes


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Area Based Closure: A Regulator’s Perspective

David Hardie, Director Liability Strategy May 7, 2018

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Area Based Closure (ABC)

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Principles

Flexible Achievable Scalable for all sizes Results focused regulations Transparent Data and information driven decisions Stakeholder collaboration Continuous improvement

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Expected Outcomes

Reverse liability growth Shortened closure timeline of oil and gas sites Greater understanding and transparency of liabilities Broad industry collaboration Efficient closure operations Effective regulatory framework

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Area Based Closure Objective

To enable industry-wide area based closure (ABC) of inactive oil and gas infrastructure and sites in a way that mitigates liability exposure to Albertans through timely and efficient movement of inventory to closure, while enhancing the province’s reputation as a place to invest for sustainable energy development.

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Task Teams

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The task of driving success for area based closure in Alberta has been categorized into four tasks:

  • 1. Develop a Communication Strategy
  • 2. Develop a Closure Funding Framework and

Performance Measures

  • 3. Identify ABC Field Selection Methodology
  • 4. Develop Operator Non-Performance Options
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Task Team 1

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Develop a Communication Strategy Determine the information/data to be shared with stakeholders Foster collaboration between producers and service companies Share best practices and lessons learned Launch and roll-out

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Task Team 2

Develop a Closure Funding Framework and Performance Measures

Develop Common Liability Assessment Model (CLAM) Use CLAM to calculate historical closure costs and set minimum closure spending requirement Update CLAM annually with industry-reported, actual closure costs Monitor success of ABC using performance metrics

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Task Team 3

Identify ABC Field Selection Methodology Develop area based closure definition Analyze economic, risk, and infrastructure considerations Evaluate 2016-2017 large scale ABC pilots

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Task Team 4

Develop Operator Non-Performance Options

  • Provide options for behavior modification

– Information transparency – Industry association declared support for program – AER corporate health scorecard impacts of non-performance – Limitations on new activity authorizations – Security deposits for liability

  • Challenge: ABC is not a prescribed regulatory

requirement

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Next Steps for ABC

Conclude task teams Prioritize and execute on recommendations from task teams Host joint information sessions Solidify joint steering committee to oversee performance regarding principles, outcomes, and

  • bjectives

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Questions?