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Request for Regulatory Appeal by Suncor Energy Inc. Pure Environmental Waste Ltd. (AER Request for Regulatory Appeal No.: 1919369)

Link to decision summarized

Request for Regulatory Appeal – Request Granted

In this decision, the AER considered Suncor Energy Inc. (“Suncor”)’s request, pursuant to section 38 of the Responsible Energy Development Act (“REDA”), for a regulatory appeal of the AER’s decision (the “Decision”) to issue to Pure Environmental Waste Ltd. (“Pure”) AER Approval No. WM 211 (the “AER Approval Decision”). In the AER Approval Decision, the AER granted Pure’s application for its proposed Hangingstone oilfield waste management facility (the “Waste Management Facility”).

In this decision, the AER granted Suncor’s request for a regulatory appeal, finding that Suncor was eligible to request a regulatory appeal and that Suncor’s request was properly before the AER.

Legislative Scheme

The applicable provision of REDA, section 38, states:

38(1) An eligible person may request a regulatory appeal of an appealable decision by filing a request for regulatory appeal with the Regulator in accordance with the rules. [Underlining added.]

Section 38(1) of REDA sets out a three-part test for standing for a regulatory appeal. The components of the test are:

(a) The requester must be an “eligible person”;

(b) The decision from which an appeal is sought must be an “appealable decision”; and

(c) The request must have been made in accordance with the requirements of the Alberta Energy Regulator Rules of Practice (the “Rules”).

Further, where a requester meets the tests set out in section 38(1) of REDA, the AER has the discretion pursuant to section 39(4) of REDA to dismiss a request for regulatory appeal if the AER considers that for any reason the request is not be properly before it, including where it concludes the request is without merit.

Application of the Test

In this matter there was no dispute that the AER Approval Decision was an appealable decision. It was made pursuant to the Oil and Gas Conservation Act (“OGCA”), an energy enactment, without a hearing and therefore was an appealable decision as defined under section 36(a)(iv) of REDA.

The issue was whether Suncor met the definition of an “eligible person.” As the decision appealed from was made under an energy enactment, eligible person in this instance was defined, as per section 36(b)(ii) of REDA, to be:

A person who is directly and adversely affected by a decision [made under an energy resource enactment]…

Eligible Person

The AER Approval Decision granted Pure the approvals necessary to construct and operate the Waste Management Facility. The Waste Management Facility would be a new stand-alone cavern oilfield waste processing and disposal facility. Waste products received at the Waste Management Facility would be pumped into two underground salt caverns and displaced brine from the caverns would be re-injected into disposal wells.

The basis for Suncor’s claim that it was directly and adversely affected by the AER Approval Decision was that, as the oil sands lease holder in the area, Suncor’s ability to recover bitumen would be directly impacted by the AER Approval Decision.

The AER Approval Decision allowed Pure to construct the Waste Management Facility on a 10.46 acre surface disposition directly above oil sand rights held by Suncor. Suncor’s planned operations in the area involved the development of Suncor’s in situ operations, which were part of Suncor’s Meadow Creek project involving steam assisted gravity drainage (“SAGD”) operations.

The AER found that Suncor met the onus that it may be adversely and directly affected by the AER Approval Decision. The AER noted that SAGD development involved horizontal wells, the impact of which extended beyond the wells. The AER found that steam from the wells’ steam chambers exited and expanded into the geological formation being accessed. The steam allowed the bitumen with the force of gravity to then flow into the lower production wells draining the bitumen.

Without Merit

Section 38(4) of REDA states in part:

The Regulator may dismiss all or part of a request for regulatory appeal

(a) if the Regulator considers the request to be frivolous, vexatious or without merit,

The AER rejected Pure’s submission that Suncor’s request for regulatory appeal should be dismissed because it lacked merit. Rather, the AER found that, in addition to other matters, the issues related to resource sterilization and conservation made the appeal meritorious.

Accordingly, the AER granted Suncor’s request for a regulatory appeal.

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