Written by Chloe Marie – Research Fellow
The Global Shale Law Compendium series addresses legal developments and
other issues related to the governance of shale oil and gas activities in
various countries and regions of the world. In this article, we will highlight
governance actions taken by the Provinces of Newfoundland and Labrador, Ontario,
and Prince Edward Island to develop policies specific to shale gas development.
In our previous post, we addressed shale gas development in the Provinces of New Brunswick,
Québec, and Nova Scotia. Another article will address shale gas development in
western Canadian provinces.
Newfoundland and Labrador
The province of Newfoundland and
Labrador holds abundant onshore and offshore oil and natural gas resources.
According to the Canadian Association of Petroleum Producers (CAPP), “three
billion barrels of oil and 11 trillion cubic feet of natural gas have been
discovered in Newfoundland and Labrador to date.” Around September 2012, Shoal
Point Energy declared it might have found significant shale oil prospects in
the West Coast Newfoundland region, within the Green Point Shale formation,
requiring the use of hydraulic fracturing. The company’s CEO George Langdon
further stated that “just the sheer number of what
could be in place there makes it, to me, one of the significant resources in
North America, right up there with the big ones.”
In November 2013, however, the
provincial Department of Natural Resources (DNR) announced that approvals for
exploration or production activities relating to hydraulic fracturing would not
be granted pending a jurisdictional review, a geological review, and an
opportunity for public engagement.
In the meantime, the provincial
government of Newfoundland and Labrador commissioned two experts to prepare a
jurisdictional review of current legislation and regulatory initiatives
relating to hydrocarbon as well as hydraulic fracturing best practices. The
purpose of this review was to help prepare and develop a practical guidance
tool for the government throughout all stages of hydraulic fracturing
operations. A series of three reports were released entitled Newfoundland &
Labrador Basis for Development of Guidance Related to Hydraulic Fracturing Part 1, Part 2 and Part 3.
On October 10, 2014, the provincial
DNR announced that it had appointed an
independent panel of five experts in order to carry out a review of the
socio-economic and environmental implications of hydraulic fracturing in
Western Newfoundland. The question addressed by this review was whether or not
hydraulic fracturing should be allowed in Western Newfoundland. On May 31,
2016, the Newfoundland and Labrador Hydraulic Fracturing Review Panel released its Final Report on the implications of hydraulic
fracturing operations in the province. The Independent Panel “unanimously
recommend[ed] that a number of gaps and deficiencies must be addressed before
the necessary conditions could exist that would allow hydraulic fracturing, as
an all-inclusive industrial process, to proceed reasonably and responsibly in
Western Newfoundland.” The Panel also added that, “at this point, the ‘pause’
in accepting applications involving hydraulic fracturing in Western
Newfoundland should remain in effect while the fundamental gaps and
deficiencies are addressed.”
Interestingly, the Independent Panel
stated in the final report that they believe that “the Green Point shale
resource, and other oil and gas resources that may be present in Western
Newfoundland, represent unconventional opportunities and challenges for
industrial development and economic growth in the region.”
Ontario
Ontario is a central-eastern
province of Canada, located along the Great Lakes bordering the United States.
Shale gas development in Ontario has not yet happened despite the fact that
southern Ontario may possess significant shale gas resources, according to the
Ontario Geological Survey (OGS).
OGS established its first drilling
program in 2010, which was intended to determine the potential for shale gas
resources. This drilling program revealed that the Kettle Point Formation as
well as the Rouge River Member of the Blue Mountain Formation and the
Collingwood Member of the Cobourg Formation might have “the best potential for
shale gas productive units,” in a 2012 Summary of Field
Work and Other Activities.
As part of its second drilling
program, OGS drilled exploratory wells in St. Joseph, Little Current, Wiarton,
Bruce, Clatham, Port Stanley, Halton, Mount Forest, Imperial Lincoln, Pickering
and Russell. These exploratory activities, however, encountered opposition from
the public due to concerns that such development of shale gas resource could
impair the quality and ecological integrity of the Great Lakes.
Interestingly, in March 2015, the
provincial government rejected a bill intended to prohibit the development of
shale gas resources in Ontario using hydraulic fracturing. The Minister of
Natural Resources Bill Mauro explained that the government is currently
reviewing its plans for the development of potential shale gas projects in the
province.
Prince Edward Island
Prince Edward Island is a maritime
Canadian province located in the Gulf of St. Lawrence, on the eastern side of
the country. Exploration for hydrocarbon resources in the province of Prince
Edward Island is still at a relatively early stage. According to the government
of Prince Edward Island, the potential of the island for hydrocarbon
development has not yet been fully assessed and only twenty exploratory wells and
one re-entry well have been drilled on and around the island.
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