License status

The license status of a well is a crucial indicator of its lifecycle stage in Alberta's energy sector. It provides a snapshot of the well's operational state, from initial approval to final decommissioning, crucial for stakeholders like regulatory bodies, environmental groups, and industry professionals. Understanding these statuses reveals a well's journey, from active resource contribution to restoration and closure.

Abandoned

An Abandoned status is assigned to a well that has been permanently taken out of service and has undergone a series of steps to ensure it poses no ongoing environmental or safety risks. The process includes sealing the well with cement and restoring the site. However, despite stringent AER regulations, not all wells are properly abandoned. Sometimes, due to oversight or financial insolvency of the responsible company, wells may become “orphaned”. These orphan wells require intervention by the Alberta Orphan Well Association to manage their proper closure and land reclamation. For example, a well on the edge of a farmer’s field, long out-of-sight, might be discovered to be inadequately sealed, prompting regulatory action to mitigate any potential environmental harm.

Amended

An Amended status indicates a change or modification to the original well license, typically to update operational details or to comply with new regulations. For instance, if a company realizes that drilling a well closer to a water body requires additional safety measures, they might amend their license to include those measures and receive approval from the AER to proceed.

Issued

The Issued status is granted to a well once the AER approves the license, permitting the licensee to begin drilling and production. Picture a new well that plans to extract oil from a field recently discovered beneath a prairie; once the company has met all the necessary regulatory requirements, it receives an Issued status and can start operations.

Re-Entered

A well with the Re-Entered status has been reactivated after being temporarily suspended. This could occur when technological advancements make it economically feasible to extract additional resources. An example would be an old well deemed unproductive in the past, but with the advent of newer extraction technologies, it is re-entered and tapped for resources once again.

RecCertified

RecCertified refers to a well that has been re-certified after a suspension or period of inactivity, ensuring it meets current safety and environmental standards. For example, a well might be re-certified following an upgrade to its infrastructure, such as replacing old pipes with new corrosion-resistant ones to ensure safe operation.

RecExempt

The RecExempt status applies to wells exempted from certain regulatory requirements, often due to posing low environmental risk or being involved in special projects. An example could be a well used solely for scientific research in a remote area, where the AER has granted an exemption from some standard regulations due to its minimal impact and specific use case.

Suspension

Lastly, a well marked as Suspension is not currently active, usually due to economic reasons or regulatory issues. It’s maintained in a safe state until either conditions change or it moves to abandonment. For instance, during periods of low oil prices, a company might suspend a well, maintaining it in a state that allows it to quickly resume production when the market recovers.

About abandoned wells

The issue of properly abandoning wells is a significant one. In Alberta, as in many jurisdictions, regulations stipulate strict procedures for well abandonment to ensure environmental and public safety. However, it is known that not all wells are always abandoned to the letter of these regulations. There are cases where wells are improperly abandoned, leading to so-called “orphan wells”. These are wells that no longer have a legally responsible party to manage their closure, often because the company that owned them went bankrupt or otherwise evaded their responsibilities.

The Alberta Orphan Well Association (OWA) is an organization set up to manage the abandonment and reclamation of orphan wells, but the number of these wells and the associated costs can pose challenges. The OWA, funded by levies on the industry and government loans, works to ensure that these sites are dealt with properly, but the process can be slow, and the backlog of wells requiring attention is a concern for regulators, environmentalists, and the public.

Conclusion

In Alberta’s energy landscape, each well license status, from Issued to Abandoned, marks a critical phase in a well’s life. These classifications guide decisions and strategies, reflecting the industry’s commitment to safety and environmental stewardship. Understanding these statuses is essential for navigating the complex lifecycle of wells and ensuring sustainable energy development.