Vice-President, Canadian Division, Regulatory and Government Relations, Encana Corporation
Good morning. I'm Richard Dunn, the vice-president of government relations for Encana.
Encana is a leading North American energy producer, with Canadian unconventional natural gas operations in northeast B.C. and Alberta.
At Encana we take our responsibility as a steward of the land very seriously. We believe conservation and development can proceed together, and certainly we believe it is not a matter of one or the other. It's about finding that balance.
In Alberta and British Columbia, strong regulations set out by our provincial regulators provide effective and efficient operating frameworks that enable both environmental protection and resource development.
Mandated by a culture of continuous improvement, we meet and in many cases exceed the regulations by working collaboratively with other operators, governments, first nations, and communities to minimize our environmental footprint.
Our development in the Horn River basin, located in the far reaches of northeast British Columbia, is illustrative of the success of this approach through the use of new technology and innovative methods, such as pad drilling, saline water sourcing, and participating in the development of boreal caribou management plans, all of which I'll touch upon in the next few minutes.
The Horn River basin is an important development for the Canadian natural gas industry. This shale gas play has been estimated by the National Energy Board to hold some 78 trillion cubic feet of marketable natural gas. In context, that's enough gas to meet the energy needs of the city of Calgary for some 500 years. So it's a huge amount.
The Horn River basin is in a very remote area. It's a long way from market and as it's at the very early stages of the play it has very little infrastructure, all of which requires us to innovate and look for solutions not only to reduce costs but at the same time minimize our environmental impact as we proceed with development.
A key feature of that innovation is pad drilling. Pad drilling operations in the Horn River involve drilling multiple horizontal wells from a single surface location. This technique enables us to disturb far less surface area while maximizing our resource extraction. One 250-by-250-metre-square multi-well pad produces some 15 square kilometres of resource, essentially replacing several hundred vertical wells and well sites, along with their associated roads and pipelines. The result is enhanced environmental performance through minimized land disturbance.
Working together, and with the support of government, producers in the area have created the Horn River Basin Producers Group. This initiative is comprised of 11 companies active in the basin and is dedicated to efficient development planning and also open communication with stakeholders. Regular dialogue with the Fort Nelson community and the Fort Nelson First Nation has enhanced communication, and in doing so allowed the shaping of the development in the area. Additionally, it has generated initiatives that maximize the benefit of natural gas development to local stakeholders, principally in the form of local employment and job skills creation opportunities.
The Horn River Basin Producers Group has developed an integrated approach to minimizing surface disturbance by using effective planning measures, such as the joint development of roads, pipelines, and processing facilities to reduce the collective environmental footprint. In the Horn River basin, as in other shale gas plays, the shale gas development is a water-intensive process, there's no doubt about it. In 2009 the Horn River Basin Producers Group worked with the B.C. government to examine non-potable water supply alternatives for our operations. This was accomplished through Geoscience B.C., a government-supported research organization that launched a number of projects to identify and map subsurface aquifers in the basin.
The Debolt source water plant, a joint project of Encana and our partner in the area, Apache, is an innovative result of this research. The Debolt plant has been in operation since June 2010 and supplies some 98% of the water needed for both companies' hydraulic fracturing operations in the Two Island Lake area. The plant produces water from the Debolt formation, a geologic formation some 800 metres deep. This is a non-potable aquifer, holding saline water that is unfit for human, agricultural, or animal consumption. The salinity of the water produced is so high it's effectively the same as seawater.
The availability of the Debolt water has allowed us to by and large eliminate the use of fresh water in our hydraulic fracturing operations in that Two Island Lake area. We're quite proud of that. This results in significant conservation of fresh water and preservation of the surrounding aquatic surface habitat.
Turning to an example of land use, the industry continues to take measures to protect sensitive species.
In 2010 the industry partners worked with the B.C. Oil and Gas Commission and the B.C. Ministry of Environment to develop the B.C. implementation plan for the management of boreal caribou. The detailed local knowledge and on-the-ground understanding of B.C.'s specific issues were essential to achieving the desired outcome. That outcome was the development of a flexible strategy that provides for caribou protection while enabling much-needed, responsible resource development.
In addition to promoting the use of pad drilling, as mentioned, the implementation plan manages access for development during the critical calving period. It also includes such items as meandering seismic lines, which Murray touched upon. Those meandering lines limit the line of sight between predators and prey and afford the caribou protection.
Furthermore, industry has committed to provide $2 million per year in annual funding for caribou research that guides, informs, and really underpins the implementation plan.
I've spoken to how conservation is applied while development is occurring. However, as mentioned, production occurs for a finite period of time. I would like to address some of the steps we've taken to reclaim areas no longer in production.
In 2011 Encana received reclamation approval certificates from the regulator for almost 360 acres of land that had been returned to the environment. That was our highest amount to date. Additionally, we have some 4,800 acres of land under active reclamation in Canada. We have worked with local stakeholders, first nations, and governments to ensure that the land is returned to its original state and in certain cases is enhanced. That is the case with the recent project we undertook as part of our ongoing support of the Foothills Research Institute. For example, in 2011 we took an abandoned well site from the 1990s and converted it into a wetland to provide habitat for a diverse range of species. Since the reclamation has occurred, we've seen grizzly bears, moose, and birds moving into the area.
In closing, I would like to reiterate that it is our opinion that conservation and environmentally responsible development can and should proceed together. Strong regulations ensure that environmental concerns are a priority and are sensibly balanced with development activities.
The examples I've provided from our operations in the Horn River basin of northeast B.C. highlight the importance of technology, effective planning, and collaboration among governments, communities, first nations, and industry partners in enabling the economic sustainability of our industry in an environmentally responsible manner.
Thank you very much.