Industry FAQ

Below are some commonly asked questions about the oil and gas industry in Canada. To reveal the answers, you must click each question individually. If you have a question that has not been addressed below, please feel free to contact us.

What is the outlook for the Western Canadian oil and gas industry and how does it contribute to North America's energy security and economic prosperity?

The Canadian Energy Research Institute

The Canadian Energy Research Institute (“CERI”) produces a large quantily of research that can be accessed without cost.

What can you tell me about pipelines used to transport liquids, crude oil and natural gas?

The Canadian Energy Pipeline Association (“CEPA”) www.cepa.ca represents Canada’s major pipeline owners and operators.

 At their website you will find interactive maps of liquids and natural gas pipelines owned and operated by their member companies.

At CEPA’s About Pipelines page you will find useful information about the economic benefits of pipelines, how they are constructed and maintained and operated to the highest standards of safety. 

The CEPA Integrity First® Program is a management system approach that enables CEPA members to strengthen the pipeline industry’s performance, communication and engagement by jointly developing and individually applying common practices and messages.

Pipeline Regulators in Canada

Major national and trans-border pipelines are regulation by Canada’s National Energy Board.  Within the Western provinces, local pipelines and gathering systems are regulated by provincial authorities such as the Alberta Energy Regulator

What can you tell me about "hydraulic fracturing"?

Hydraulic fracturing is a method that has been employed for over sixty years in North America to improve the recovery of oil and natural gas from reservoir rock. Over one million oil or gas wells have been hydraulically fractured or "fracked" in North America using this method of well completion since first invented. Today the vast majority of oil and gas wells in Canada are completed with hydraulic fracturing and the activity, like all oil and gas drilling operations, is subject to a variety of government regulations.

Oil and gas wells are drilled into rock and then the well bore is sealed off from the surrounding rock by steel casing cemented in place. A well is designed and constructed so that the flow of produced liquids (oil, natural gas, water, etc.) will only enter the well bore from targeted producing formations. The targeted producing zones can be fractured by pumping special fluids at high pressure to convey a "proppant" which is usually quartz sand particles. The material pumped into the rock formations is approximately 99.5% water and sand, and the remainder is chemical additives. These sand particles are pushed out into fractures in the rock that are created by the high pressure fluid volumes being pumped down the well bore from the surface. When the pressure pumping fracturing treatment is completed the sand particles remain behind to prop open the fractures thus creating additional small cracks in the rock for oil and gas to flow to the well bore. The chemical additives in the fracturing fluids are designed to keep the sand particles in suspension and act as a lubricant for improved fluid dispersal into the formation.

The Canadian Society for Unconventional Resources has produced a booklet called "Understanding Hydraulic Fracturing", that provides a good introduction to the subject. The Canadian Association of Petroleum Producers has also published a voluntary set of Guiding Principles for Hydraulic Fracturing. The Alberta Energy Regulator (AER) provides regulatory oversight pursuant to it's Directive 083 Hydraulic Fracturing – Subsurface Integrity.  The AER has also created a "spotlight" in their website called "What is Hydraulic Fracturing?". 

The United States Environmental Protection Agency released in 2015 the results of its multi-year study of potential impacts to drinking water resources from hydraulic fracturing.  It concluded that: "The assessment, done at the request of Congress, shows that while hydraulic fracturing activities in the U.S. are carried out in a way that have not led to widespread, systemic impacts on drinking water resources, there are potential vulnerabilities in the water lifecycle that could impact drinking water. The assessment follows the water used for hydraulic fracturing from water acquisition, chemical mixing at the well pad site, well injection of fracking fluids, the collection of hydraulic fracturing wastewater (including flowback and produced water), and wastewater treatment and disposal." The EPA also stated that it's "review of data sources available to the agency found specific instances where well integrity and waste water management related to hydraulic fracturing activities impacted drinking water resources, but they were small compared to the large number of hydraulically fractured wells across the country."

Can hydraulic fracturing cause "earthquakes"?

Comprehensive data on all types of seismic events in Canada can be found at Natural Resources Canada, and  the United States Geological Survey has additional information as well.

Various types of resource extraction activity, such as mining, geothermal energy extraction and hydraulic fracturing of oil and gas wells can cause seismic events.  Hydraulic fracturing in these events are best characterized as "micro-seismic" since the events are generally contained in a targeted rock formation deep underground and are rarely felt at the surface.  

The BC Oil & Gas Commission produced a detailed report on this subject in 2012 that found micro-seismic activity is a routine occurrence associated with hydraulic fracturing but that "none of the events caused any injury, property damage or posed any risk to public safety or the environment."  Similar conclusions were found in reports conducted in the United Kingdom by the Royal Society and Royal Academy of Engineering and in the US by The National Academies of Sciences, Engineering, and Medicine.

The State of Oklahoma, a major oil and gas producing state, has reported higher incidences in recent years of seismic activity which has been linked to injection of waste water from oil & gas completions into deep disposal wells.  The Oklahoma Geological Survey (a state government agency) has more information.

What is the industry's impact on the environment, and what is being done to reduce this impact?

No form of energy production is without some impact on the environment, whether the energy produced is nuclear, hydro, wind or oil and gas. The goal for oil and gas producers is to minimize and mitigate, wherever possible, their impact on air, water and land. 

EPAC supports applied research targeted at finding solutions that reduce the impact oil and gas production has on the environment.

EPAC is a founder of organizations such as the industry funded Petroleum Technology Alliance Canada (PTAC) and the British Columbia Oil and Gas Research and Innovation Society (BCOGRIS).

Surface disturbance

In the last few years, the industry has taken a number of important steps to minimize and reduce the surface "footprint" from oil and gas development. For example, new regulations and guidelines require smaller cut lines in forests for seismic data acquisition. Integrated land management procedures are being adopted to avoid multiple road and pipeline corridors, where one will do. And horizontal drilling allows many wells to be drilled from a single surface site, thus, reducing the need for multiple surface drilling locations. Many areas in the northern parts of Western Canada are accessible by permit only during the winter months when the ground surface is frozen, to mitigate impact to wetland areas. And in oilsands areas, the insitu method of recovery will not have the surface impact that the mining operations have today.

The development of oil and gas resources is tightly regulated over the full life cycle of the wells and related production and transportation facilities. When an oil or gas well reaches the end of its economic life, the well is capped underground and plugged with cement. Then, the disturbed surface site must undergo reclamation and remediation work to restore the site as near as possible to its prior use. When the landowner and the government are satisfied with the result, a reclamation certification is issued.

In Alberta, industry funds 100% of the "Orphan Well Fund" managed by the Orphan Well Association to ensure that the public does not have to foot the bill for this type of clean-up work if an individual oil and gas company becomes insolvent. Similar programs operate in British Columbia and Saskatchewan as well.

Impact on the air

Canada is the source of about 2 percent of the world's greenhouse gas emissions. Not surprisingly - as in a large, cold climate country - Canadian's are among the world's largest percapita consumers of energy for power, heat and transportation. About 80 percent of greenhouse gas emissions from using oil and gas are actually emitted by the consumers of the energy. For example, it comes out the tailpipe of your car. The production of oil and gas itself consumes energy too. The industry is constantly working to reduce the energy consumed, and reduce emissions to the atmosphere.

Alberta is a leader among jurisdictions in North America in the regulation of greenhouse gas emissions and imposes targets and penalties on large emitters of greenhouse gases. These large emitters are mostly large coal-fired power plants, oilsands facilities and petrochemical plants. You can learn more about this program through Alberta Environment and Parks.

Greenhouse gas emissions include those from flaring and venting of solution gas. Flaring is the burning of natural gas that cannot be conserved, and venting is the release of natural gas into the atmosphere. Solution gas is natural gas produced in association with crude oil and bitumen production.

In Alberta, solution gas flaring by our industry has been reduced by 80 percent since 1996, and solution gas venting has been reduced by 53 percent since 2000 (source: Alberta Energy Regulator). In British Columbia, the government and industry plan to eliminate all routine flaring at wells by 2016. The BC Oil & Gas Commission has a target of 97 percent conservation of solution gas in 2011 and 98 percent by 2016. For the past few years, oil and gas producers in BC have consistently achieved a target of 96 percent conservation of solution gas. The Province of Saskatchewan also has introduced regulations to further improve conservation of solution gas consistent with the other Western provinces.

Another related topic is sour gas (natural gas with elevated levels of highly toxic hydrogen sulphide). Sour gas development is tightly regulated to protect the public, and Canadian companies are world leaders in operating sour gas production facilities safely. You can learn more about sour gas regulation in Alberta through the Alberta Energy Regulator.

Impact on water

Water is a key factor in oil and gas production in Canada. First, a lot of underground water is often produced with oil and gas brought to the surface. It must be separated from the oil or gas and safely disposed of by re-injection into the earth. Second, water is used in drilling and well completions, hydraulic fracturing of rock formations, enhanced oil recovery, steam generation for insitu bitumen recovery and more. The water used by our industry for these purposes is usually sourced from surface water (rivers and lakes) or groundwater (produced from wells drilled underground). Much of the groundwater used is saline (salt) water, which is not suitable for human consumption.

The United States Environmental Protection Agency released in 2015 the results of its multi-year study of potential impacts to drinking water resources from hydraulic fracturing.  It concluded that: "The assessment, done at the request of Congress, shows that while hydraulic fracturing activities in the U.S. are carried out in a way that have not led to widespread, systemic impacts on drinking water resources, there are potential vulnerabilities in the water lifecycle that could impact drinking water. The assessment follows the water used for hydraulic fracturing from water acquisition, chemical mixing at the well pad site, well injection of fracking fluids, the collection of hydraulic fracturing wastewater (including flowback and produced water), and wastewater treatment and disposal." The EPA also stated that it's "review of data sources available to the agency found specific instances where well integrity and waste water management related to hydraulic fracturing activities impacted drinking water resources, but they were small compared to the large number of hydraulically fractured wells across the country."

 The industry is allocated relatively small amounts of surface water and fresh underground water for its activities. For example, in Southern Alberta, our industry is licensed to use only 0.3 percent of the total allocated water in the South Saskatchewan River Basin (which includes the Bow, Oldman and Red Deer as well as the South Saskatchewan River). Much larger users are the agriculture industry and urban areas. In Northern Alberta, the industry is allocated only 2.8 percent of the Athabasca River's average annual flow; but the actual water use by industry is lower still.

The industry is constantly developing new methods to reduce its use of fresh water in oil and gas production, and has to follow federal and provincial laws and regulations on its use of water. Find out more through the links below:

The Canadian Society for Unconventional Resources has produced a booklet called "Understanding Water and Unconventional Resources", that provides additional information.

Spill Protection

The industry also employs a unique "co-op" business model to ensure fast emergency response, in case there is ever a spill into rivers or lakes in Western Canada. Hundreds of companies have joined the Western Canada Spill Services organization, which strategically places equipment, boats, berms and other materials in key locations in British Columbia, Alberta and Saskatchewan. Volunteers trained in emergency response measures stand ready to respond quickly in case of a spill.

Impact on wildlife

In Alberta, the industry annually contributes significant funding, along with other stakeholders, to caribou and grizzly bear research. The goal of this research is to understand better the impact of human and industrial activity on populations, and seek ways to mitigate that impact. The information influences decisions taken by oil and gas companies such as relocating activity away from critical habitat.

 

How does the industry ensure the safety of its employees?

The oil and gas industry has dangers and hazards. While zero injuries is a goal all employers desire, it is clear that accidents can be reduced through better trained workers and supervisors. Our association is a member of Enform, the upstream industry safety organization. We are joined by associations from the drilling, seismic, service and supply and pipeline sectors, as well as the Canadian Association of Petroleum Producers (CAPP). Enform offers numerous training programs with a focus on safety. It issues regular safety alerts to industry and facilitates the development of industry recommended practices with a goal of providing a safer work environment.

 

Did you know that Canada’s oil and natural gas industry does more than just produce the energy that powers much of our electrical system, heats our homes and drives our transportation system?

Petroleum-based products are also used in countless ways to improve the quality of life of Canadians.  Our colleagues at the Petroleum Services Association of Canada have provided a series of 30 second videos that illustrate this. Click on the links below to learn more:


FAQ