On October 28, 2009, the Alberta Court of Appeal released a decision that resoundingly rejected the Energy Resources Conservation Board's (“ERCB”) decision to deny standing to several landowners that had sought to participate in the application process for two sour gas wells.
These landowners reside in the “Protective Action Zone” (“PAZ”) of the proposed wells. The PAZ is a newly created concept that incorporates wind modeling and weather patterns to establish an area beyond the traditional Emergency Planning Zone (“EPZ”) in which exposure to H2S may still be harmful. This decision is the first to contemplate the significance of the PAZ and the obligations of the ERCB and Applicant to the residents that reside within it.
Previously, landowners within the EPZ, defined by the ERCB as “a geographical area surrounding a well, pipeline, or facility containing hazardous product that requires specific emergency response planning”, received consultation from the Applicant, enjoyed the automatic right to participate in the ERCB process and were the subject of extensive emergency response planning, including possible evacuation.
Whereas the EPZ is a circular area surrounding the well or other sour gas facility, with the radius being determined based on H2S concentration and other factors, the PAZ was introduced in July, 2008 to account for the possible impact wind conditions could have on the dispersion of H2S in the event of a release. The ERCB defines the PAZ as an “area downwind of a hazardous release where outdoor pollutant concentrations may result in life-threatening or serious and possibly irreversible health effects on the public”. The PAZ modeling results in a conical zone extending from the well in the direction of the prevailing winds. It was intended to give direction to emergency responders in the event of a release so that response could be prioritized to those most likely affected. Although it will depend on the facts of each case, the PAZ is larger than the EPZ, sometimes significantly so. In this case, the EPZ was 2.11 km while the PAZ was 9.25 km.
The Court ruled that although in the event of a release the PAZ would extend only in one direction (the direction of the prevailing winds at that time), all landowners within 9.25 km of the well site could be affected by a release as it is impossible to predict weather patterns. Accordingly, the rights of landowners within the PAZ are directly and adversely affected by the drilling of the sour gas well and they are therefore entitled to consultation and participation to the same extent that was previously reserved for landowners within the EPZ. In the present case, this increases the size of consultation and participation area from approximately 14 square kilometers in the EPZ to 269 square kilometers in the PAZ. These numbers suggest that the Court's interpretation of the PAZ is beyond what the ERCB had intended when it introduced this concept in July, 2008.
This decision dramatically increases the size of the footprint in which an applicant for a sour gas well must consult with the landowners and by extension the number of persons who can claim to be potentially affected by a sour well application and thus participate in the ERCB's process, including triggering a public hearing.
For advice on this or any other energy, environmental or regulatory law topic please contact Ron Kruhlak in Edmonton, Gavin Fitch in Calgary, or any member of our Energy, Environmental and Regulatory Practice Group. |
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