Private Natural Gas Well…

Private Natural Gas Well Association SUBMISSION (2023 10 15) to MNRF Environmental Registry Posting (ERO) # 019-7507 seeking proposed changes to the OGSRA.

The Private Natural Gas Well Association (PNGWA) is pleased to make the following submission in reply to the Ministry of Natural Resources and Forestry (MNRF) posting of September 1st, 2023, on the Ontario Environmental Register (ERO) # 019-7507 – where it is proposing significant changes to the Oil Gas and Salt Resources Act and its Regulation 245/97 (OGSRA & Reg).

The Private Natural Gas Well Association has a long history of working with the MNR since 2007 and later, the MNRF. The PNGWA’s efforts have been to assist private gas well operators who have found themselves to be non-compliant with the OGSRA & Reg from when it was introduced in 1997. The PNGWA has also worked along with the Ontario Federation of Agriculture (OFA), The Christian Farmers Federation of Agriculture (CFFA) and the Haldimand Federation of Agriculture IHFA) dealing with private gas well matters.

The PNGWA views the Proposal as detailed on the ERO website to be a very complex undertaking, and generally extending far beyond the interests of the average private gas well operator, except for the proposal to remove the exceptions for security provisions.

The PNGWA is of the view that private gas wells are located on land owned by the operator. This is clearly a distinction that sets a private well apart from all that is contemplated for the commercial type of operations for the referenced activities in the ERO proposal, such as carbon dioxide and other types of sequestering storage, where the land is leased from a land owner, and the where such operators can vanish whether it by insolvency or be stranded by the complexities with changes of entity ownership, leaving an abandoned operation that needs some form of remediation. The MNR and later MNRF has a long history of being faced with commercial petroleum well operators who fail and become insolvent causing wells to be abandoned.

The following are extracts from Ontario Regulation 245/97 and the Private Gas Well Policy that will hopefully illustrate how private gas wells (among other entities) have always been excluded from the need to post any form of security.

O. Reg. 245/97: EXPLORATION, DRILLING AND PRODUCTION
under Oil, Gas and Salt Resources Act, R.S.O. 1990, c. P.12
“Private well” means,
(a) an unplugged well drilled for the purpose of oil or gas exploration or production on land of which the operator owns both the surface and mineral rights, and
(b) if oil or gas is produced from the well, the oil or gas,
(i) is for the operator’s private use,
(ii) is not used in relation to a business or commercial enterprise, and
(iii) is not sold by the operator.
Security
16. (1) Subject to section 16.1, every operator of a well shall establish securit
(3) Subject to subsection (4), well security required for each operator is,
(a) $0 for each licensed oil well that is registered as part of an oil field having historical oil field status.
(b) $0 for each private well.
(c) $0 for each licensed hydrocarbon storage cavern well located on land as long as the operator owns both the surface rights and the mineral rights.
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Private Gas Well Policy (Sept 2012)
https://www.ontario.ca/page/policy-for-licensing-private-gas-wells#sect…
8.0 Administration
Application Fee: There is no licence application fee for a private gas well licensed under this Policy Directive.
Annual Fees: There are no annual licence fees.
Security deposit: No security deposit is required.
Annual reports: No annual reports are required.

The PNGWA realizes and understands there is a significant problem in Ontario and many other jurisdictions (Alberta, New Brunswick, and many American states) with abandoned and leaking wells. The PNGWA has worked since 2007 to help private well operators become licenced in order so they could get their wells serviced and maintained without fear of MNRF enforcement actions resulting from activities with unlicensed wells. The PNGWA understands there are some 600 or so private wells in Ontario and they are not the problem the Government of Ontario needs to address and as such should not be encumbered by the proposed provisions for security.

The Province of Ontario has a long history of attempting to identify what gas wells are causing problems. However, the record keeping for gas wells is known to be problematic. For example, during 1936 and 1937 field seasons, J.F. Cayley from Canada Department of Mines and Resources, Mines and Geology Branch studied the geology in Southern Ontario from the Latitude of 44’00” North southward to the north shore of Lake Erie bounded by 77’00” to 80’00 West longitude and published his observations in Geological Survey Memoir 224. He notes in this memoir his observations of Natural Gas in the studied area (pages 114 - 284) that he found wells for which there were no records (drilling began in 1866) and records for which there are no located wells. It was offered that perhaps wells had their casings pulled (common practice during World War to reuse casings on new wells) and no identifiable markers left to mark the wells. Any attempts to resolve such problems is far beyond licenced private gas well operators.
The PNGWA understands the magnitude of the problem that the Province of Ontario is trying to quantify with the abandoned and leaking wells, but it fails to understand how eliminating the security exemption for private gas wells (albeit incrementally) will help to resolve the associated problems in any manner.
Private gas wells are considered a valued asset by their operators for the production of a clean source of energy that offsets the needs for other fuels such as propane, heating oil, fire wood and very expensive electricity. The supply of propane and heating oil, while considerably less clean than natural gas, also have a significant carbon footprint when delivery modes (usually tank trucks) are considered. Operators who have lost their supply of energy from gas wells have been known to resort to cutting wood for residential and shop heating needs. The use of wood for heating also has a negative effect where it causes a premium to be added to homeowner insurance policies. Private gas wells also provide a form of economic support for agriculture particular in the lower yielding hard clay soils in some parts of Southern Ontario.

Private gas well operators also take pride in maintaining their well (s) and subscribe to good conservation practices.

The PNGWA is somewhat mystified that MNRF is proposing a change that is restrictive for private gas wells when the government of Ontario provided significant subsidies to private gas well operators to drill new wells for some time during the period when the Petroleum Resources Act was in effect, cica 1962 to 1997. It is further mystified when one examines the Minister of Energy’s ERO proposal for consultation on the future of natural gas expansion and home heating affordability # 019-7506 and its predecessor #017-4060. The thrust of ERO #019-7506 is directed to making natural gas available to more Ontarians to lower home heating costs.

The PNGWA considers this ERO proposal (# 019-7507) to have significant potential for the alternate uses of gas wells, however as it is related to private gas wells security, the proposal is restrictive and injurious to private well operators and respectively suggests that it be removed from the proposal.

Submitted on behalf of the Private Natural Gas Well Association

pngwa@outlook.com