BILL 9

An Act to Amend the Oil and Natural Gas Act

Her Majesty, by and with the advice and consent of the Legislative Assembly of New Brunswick, enacts as follows:

1 Section 1 of the Oil and Natural Gas Act, chapter O-2.1 of the Acts of New Brunswick, 1976, is amended

(a)  by repealing the definition “allowable”;

(b)  by repealing the definition “battery”;

(c)  by repealing the definition “paying quantity”;

(d)  in the definition “natural gas” by striking out “and includes hydrogen sulphide”.

2 Paragraph 16.3(c) of the Act is amended by striking out “drilling program” and substituting “drilling program, which includes the completion program”.

3 Section 16.4 of the Act is amended

(a)  by repealing subsection (1) and substituting the following:

16.4( 1) A well licensee shall, in the following circumstances, apply to the Minister for an amendment to the well licence:

(a)  the name of the well licensee will change;

(b)  the name of the well will change; or

(c)  the well licensee’s drilling program will change.

16.4( 1.1) A well licensee may apply to the Minister for an amendment to any term or condition imposed on the well licence.

(b)  by repealing subsection (2) and substituting the following:

16.4( 2) An application under subsection (1) or (1.1) shall be on a form provided by the Minister and shall be accompanied by any information prescribed by regulation.

4 Section 20 of the Act is amended

(a)  by repealing subsection (1.01);

(b)  by repealing subsection (1.02);

(c)  by repealing subsection (1.1);

(d)  by adding before subsection (2) the following:

20( 1.2) At any time during the term of an on-shore licence to search, a licensee may apply, on a form provided by the Minister, for an extension of the term of the licence to search.

20( 1.3) The licensee shall set out in the application the reasons for the extension.

20( 1.4) If the Minister is satisfied that the circumstances justify the extension, the Minister may extend the on-shore licence to search for the period of time the Minister considers necessary.

5 The heading “CONTINUANCE AND EXTENSION OF LEASE” preceding section 30.1 of the Act is amended by striking out “CONTINUANCE AND”.

6 Section 30.1 of the Act is repealed and the following is substituted:

Extension of lease

30.1( 1) At any time during the term of a lease, a lessee may apply, on a form provided by the Minister, for an extension of the term of the lease.

30.1( 2) The lessee shall set out in the application the reasons for the extension.

30.1( 3) If the Minister is satisfied that the circumstances justify the extension, the Minister may extend the lease for the period of time the Minister considers necessary.

7 Section 30.2 of the Act is repealed.

8 Section 59 of the Act is amended

(a)  in subsection (1)

( i) in paragraph (n) by striking out “deepened, recompleted” and substituting “deepened, completed, recompleted”;

( ii) in paragraph (o) by striking out “during drilling” and substituting “during a drilling or completion”;

( iii) in paragraph (p) by striking out “drilling, development” and substituting “drilling, completion, development”;

( iv) by adding after paragraph (q) the following:

(q.1)  respecting the manner of drilling and completing a well which produces, or may produce, oil, natural gas or condensate;

( v) in paragraph (s) by striking out “anchorage and cementation thereof” and substituting “anchorage, cementation and barrier protection of the well casing”;

( vi) in paragraph (u) by striking out “analysis, survey” and substituting “analysis, assessment, survey”;

( vii) by repealing paragraph (v) and substituting the following:

(v)  respecting the measures to be taken before the commencement of drilling and completion and during drilling, completion and production to conserve any oil, natural gas or water;

( viii) in paragraph (w) by striking out “during drilling” and substituting “during drilling and completion”;

( ix) in paragraph (aa) by striking out “drilling” and substituting “drilling and completion”;

( x) in paragraph (ii) by striking out “development and drilling” and substituting “development, drilling and completion”;

( xi) in paragraph (jj.1) by striking out “well licence” and substituting “well licence or for an amendment to a well licence”;

( xii) by adding after paragraph (oo) the following:

(oo.1)  prohibiting the hydraulic fracturing of a well;

(oo.2)  prohibiting the use of certain fluids for hydraulic fracturing;

(oo.3)  prohibiting specific volumes of fluids to be used at each fracture stage;

(oo.4)  prohibiting hydraulic fracturing at specified depths;

(oo.5)  prohibiting the use of certain chemicals, additives or proppants in the fluids used for hydraulic fracturing;

(oo.6)  regulating and restricting the hydraulic fracturing of a well, including, but not limited to:

( i) the use of certain fluids for hydraulic fracturing;

( ii) the volume of fluid to be used at each fracture stage;

( iii) the depth at which hydraulic fracturing is allowed;

( iv) the use of certain chemicals, additives or proppants in the fluids used for hydraulic fracturing; and

( v) regulating and restricting any combination of subparagraphs (i) to (iv);

(oo.7)  prescribing the maximum quantity or concentration of chemicals, additives or proppants allowed to appear in the fluids used for hydraulic fracturing;

(oo.8)  respecting the measures to be taken before the commencement of a hydraulic fracturing program, including, but not limited to:

( i) conducting an assessment of inter-wellbore communication;

( ii) conducting an assessment of the geological containment;

( iii) pressure testing;

( iv) reporting to the Minister the type of fluid to be used for hydraulic fracturing;

( v) reporting to the Minister the volume of fluid to be used for each fracture stage; and

( vi) completing and submitting a prehydraulic fracturing checklist, on a form provided by the Minister, to the Minister;

(oo.9)  respecting the measures to be taken and the methods of operation to be observed during a hydraulic fracturing program, including, but not limited to, monitoring, testing and recording surface injection pressure, fluid rate, slurry rate, annulus pressures and chemical, additives or proppant concentration;

(oo.10)  respecting the measures to be taken after the completion of a hydraulic fracturing program, including, but not limited to:

( i) reporting to the Minister the type of fluid used for hydraulic fracturing; and

( ii) reporting to the Minister the volume of fluid used for each fracture stage;

( xiii) by repealing paragraph (pp) and substituting the following:

(pp)  respecting the measures to be taken when hydrogen sulphide is encountered or anticipated to be encountered during drilling;

( xiv) by adding after paragraph (pp) the following:

(pp.1)  defining any word or expression used in but not defined in this Act;

(b)  by adding after subsection (1) the following:

59( 1.1) Regulations under paragraph (1)(f) may prescribe different rental amounts for different sections of a licence area or lease area, as the case may be.

(c)  in subsection (2) by striking out “paragraph (1)(i.1)” and substituting “subsection (1)”;

(d)  by repealing subsections (4) and (5).

9 This Act or any provision of it comes into force on a day or days to be fixed by proclamation.