Energy, Mines, and Resources

Oil and Gas Activities

Companies proposing to conduct a new oil and gas project in the Yukon are typically required to:

  • Obtain a licence pursuant to the Oil and Gas Act  1.3 MB.
  • Obtain a Land Use Permit pursuant to the Territorial (Yukon) Lands Act  118 KB, Territorial Land Use Regulations.
  • Obtain a Water Licence, if required, under the Waters Act  250 KB.
    Subject the project proposal to an environmental assessment pursuant to the Yukon Environmental and Socio-Economic Assessment Act.
  • Negotiate a benefits agreement pursuant to the Oil and Gas Act  1.3 MB. Yukon regulatory authorities simultaneously conduct operation reviews under their respective legislation, and conduct a joint, coordinated environmental assessment which includes consultation with affected Yukon First Nations.

Operators are encouraged to carry out activity using best management practices and innovative technologies appropriate to Yukon's unique operating environment.

Licences

Under the Yukon Oil and Gas Act  1.3 MB, a licence is required to carry out all oil and gas activity in the territory. Oil and gas activity includes:

  • Exploration, such as seismic or geological mapping.
  • Drilling of oil and gas wells.
  • Construction and operation of:
    • A pipeline wholly contained in Yukon
    • A gas processing plant
    • An oil and gas facility

 

Geoscience Exploration Licences

Licensee

Licence #

Year

Description

Status

Chevron Canada 1004 1999 Heli 2D seismic Completed
Explor Data 1005 1999 Heli 2D seismic Completed
Anderson 1025 1999 Aeromagnetic survey Completed
Northern Cross 1026 1999 Geological mapping Completed
Cdn Forest Oil 1066 1999 Heli 2D seismic Not initiated
Wascana 1069 2000 Heli 2D seismic Not initiated
Chevron Canada 1070 2000 Heli 2D seismic Completed
Devon 1071 2000 Geological mapping Completed
Wascana 1074 2000 Geological mapping Completed
Explor Data 1100 2001 Heli 2D seismic Not initiated
Devon 1102 2001 Heli 2D seismic Completed
Cdn Forest Oil 1103 2001 Geological mapping Completed
Devon 1104 2002 2D seismic Not initiate
ConocoPhilips 1105 2002 Geological mapping Completed
Devon 1106 2002 Geological mapping Completed
Northern Cross 1107 2002 Geochemical survey Not initiated
Devon 1110 2003 Heli 2D seismic Completed
Encana Corp 1111 2003 Gravity survey Completed
Devon 1112 2003 Geological mapping Completed
Devon 1113 2003 Gravity survey Completed
Northern Cross 1114 2003 2D seismic Not initiated
ConocoPhillips 1116 2004 Geological mapping Completed
Devon 1118 2004 Geochemical survey Completed
Devon 1122 2005 Geological mapping Completed
Explor Data 1125 2006 Heli 2D seismic  In progress

A Geoscience Exploration Licence is required for any oil and gas exploration activity. This includes investigations of the subsurface of the earth using direct or indirect methods. A direct method would be to conduct geological mapping over an area of interest. An indirect method would be to complete a seismic survey. A Geoscience Exploration Licence may be obtained in Yukon without holding an oil and gas disposition.

 

Well Licenses

A Well Licence is required to drill an oil or gas well. A company must hold a disposition which grants subsurface oil and gas rights before it can obtain this licence.

 

Pipeline Licenses

A Pipeline Licence is required for the construction and operation of a pipeline that is wholly contained in Yukon. A transboundary pipeline falls under the jurisdiction of the federal government.

 

Gas Processing Plant Licenses

A Gas Processing Plant Licence is required for any activity related to the construction and operation of a plant that extracts hydrogen sulphide, helium, natural gas liquids and other substances from raw natural gas.

 

Field Facility Licenses

A Field Facility Licence is required for activity related to the construction and operation of an oil and gas facility such as a battery, an oil treater, a pumping station, a waste disposal facility, or a compressor station.

 

More Information on Licenses

The licence applicant's proposed project undergoes an operations review to ensure that it will be conducted safely and to accepted industry standards. The project is examined to ensure that the proposed operations comply with the Yukon Oil and Gas Act  1.3 MB and the appropriate regulations. Adherence to other territorial legislation and standards from the Department of Environment, the Department of Community Services, the Yukon Worker’s Compensation Health and Safety Board, the Heritage Branch of the Department of Tourism & Culture, and acts and regulations from the federal Department of Indian Affairs and Northern Development is also verified.

The operations review is complete when all the required information has been received and examined and the program operations are deemed to be acceptable or unacceptable. Conditions to the licence regarding operations may be stipulated or the licence may be denied.

Since 1998, 25 geoscience exploration licences have been issued by the Yukon Oil and Gas Management Branch. Eleven 2D seismic surveys have been completed. See Geoscience Exploration Licences Table.

A total of 73 wells have been drilled in Yukon. More than 20 wells had hydrocarbon shows. The Kotaneelee field located in Liard Plateau in the southeast produced approximately 5.4 Bcf of natural gas in 2006, and is connected to the Duke Energy Gas Transmission Pointed Mountain Pipeline that carries the gas south to Fort Nelson, B.C. for processing. Limited crude oil test production has occurred at Eagle Plain.

Land Use Permits

Land use permits are required for most activities on Yukon lands. The Territorial Land Use Regulations specify project requirements for permits and would apply to such oil and gas projects as clearing seismic lines, constructing an access route, or clearing a well site. Land use permits are typically issued for a period of two years with an option for a one-year extension.

A permit does not provide the holder exclusive rights, interest, or tenure to the land. Permits typically include terms and conditions to ensure that work is conducted in an environmentally safe and responsible manner.

Water Licences

A water licence under the Waters Act  250 KB and Waters Regulation  186 KB may be required for certain oil and gas activities depending on the water usage and the need to discharge into a water body:

  • During exploration and ice road construction, the proponent may require a water licence if water use is more than 100 m3/day.
  • Stream crossings greater than five metres in width may require a water licence for culvert installation.
  • Camps with a capacity of greater than 50 people per day will require a water licence for waste disposal.
  • Drilling mud and cutting disposal sumps will not require a licence if the Alberta Energy Utility Board Guide 50 is followed.
  • During well drilling, produced water may be extracted from the formation and re-injected back to the formation or another formation that is not connected to surface or groundwater, without a licence.

Environmental Assessments

Most projects and activities will be subject to an environmental assessment (EA) before a licence is issued.

Assessments are done pursuant to the Yukon Environmental and Socio-Economic Assessment Act (YESAA). YESAA was given royal assent on May 8, 2003 and came into full force in Yukon on November 28, 2005. This Act replaced previous EA processes and applies throughout Yukon and to projects under the authority of federal, territorial and First Nations governments. A YESAA Board and regional designated offices have been established to conduct these environmental and socio-economic assessments.

An applicant is requested to provide information on the project and the surrounding environment, the potential environmental effects and directly related socio-economic effects of the project and the mitigation to eliminate or reduce these effects. The Board seeks input from governments, advisory committees and the public in conducting the environmental assessment. The Board then recommends whether the project should proceed, whether mitigation measures are required, or whether further assessment is required.

Oil and Gas Resources works with other agencies to coordinate the application submission requirements, the YESAA process, the regulatory review of the YESAA recommendations and the development of appropriate licence terms and conditions. Coordinating with other agencies streamlines the EA and licensing processes.

Benefits Agreements

A benefits agreement is required for all projects with estimated expenditures of more than $1 million over a 12-month period in Yukon. A benefits agreement identifies employment and training opportunities for Yukon residents including Yukon First Nations and residents of communities affected by oil and gas activity. It also identifies opportunities for Yukon businesses to supply goods and services to the licensee and the licensee’s contractors. The benefits are to be commensurate with the nature, scale, duration and cost of the project, and shall not place an excessive burden on the licensee. The agreement is negotiated by the licensee, the Yukon Government and the affected Yukon First Nation(s).

Contact:

Richard Corbet – Chief Operations Officer
Phone: 867.667.3565
E-mail: richard.corbet@gov.yk.ca

Best Management Practices

Oil and Gas Resources is developing a Best Management Practices (BMP) guide for oil and gas exploration and development activities in Yukon. The guide will focus on best industry practice in areas of geographical, biological and cultural sensitivities unique to Yukon.

In response to interest expressed during previous disposition processes in North Yukon, the first draft of the guide will look at broad integrated resource management objectives for wetlands, caribou habitat, heritage values and key wilderness tourism areas. The intent of the guide is to provide operators, managers, planners and field staff with recommended processes and practices for meeting a series of operating practice objectives.

To date Best Management Practices have been published for heritage values, wilderness tourism operations and seismic operations. In the fall of 2007 expect to see BMP guidelines provided for woodland and barrenland caribou, trapping, wetlands, permafrost, invasive plant species and linear features. These BMPs will help guide the oil and gas industry and others to plan activities around these values.

These practices are designed to reduce the impacts and footprint of oil and gas exploration and development activity on the ecological landscape, providing common sense and cost effective suggestions within targeted social and economic constraints.

While the guide has some limitations, it marks a significant step toward responsible stewardship of all the resources within the identified oil and gas regions. As scientific understanding and social values change over time, the scientific and value-based choices presented in the guide will be revisited.

The BMP guide is also intended to:

  • Help streamline regulatory and environmental assessment reviews by providing up-front assistance or “guidance” to industry and reduce time spent on permit by permit reviews.
  • Improve efficiency, consistency and defensibility of regulatory decisions based on current scientific understanding and public policy objectives.
  • Allow industry, governments and stakeholders to identify issues, and propose mitigative strategies in a value-free or pre-project setting.
  • Assist with long-term planning for research and development initiatives and cumulative effects modelling.
  • Focus information gathering and assessment on the issues of most concern from a scientific and public policy perspective.
  • Ensure the standards of care being applied are at a landscape level that can reflect regional ecological, cultural and economic values.

Contact:

Kirstie Simpson – Sustainable Development Coordinator
Phone: 867.393.7424
E-mail: kirstie.simpson@gov.yk.ca

Northern Investment Opportunity Table of Contents