Offsets Frequently Asked Questions


Alberta Energy’s Electronic Transfer System (ETS), offers an Offset Notice Response Online Learning course.
What is an Offset?
What options are available for satisfying the offset notice?
I did not respond to an offset notice or I was not able to place our well on production by expiry. Have I lost the rights under notice? How can I get them back?
The offset notice expires on a Sunday. Will you accept a response on the following Monday?
If the freehold well is suspended, does the Crown close the offset compensation file?
I don't feel the offset zone is productive and want a review of the serving of the notice. What data do I need to send in with my request?


Under what grounds can I ask for an extension to act on an offset notice?

Multiple Offsets

I received two gas offset notices, one for each quarter section lease that I hold within the spacing unit. If I choose to pay offset compensation, do I pay on 100% of the section or 50%?
I was served more than one offset notice on more than one zone on the same lands. How many wells do I have to produce to satisfy the offsets?

Offset Compensation

I am electing to pay offset compensation. How is it calculated and how does billing work?
Is the calculation of offset compensation based on the production of all the freehold wells in a section or just on the freehold well that created the offset drilling obligation?
If two freehold wells each create an offset drilling obligation on the same Crown lands, do you calculate the liability on the highest producing freehold well only?
If offsets are served on all eight locations adjoining the freehold spacing unit, does offset compensation apply on all eight sections individually?
If I elect to pay offset compensation, then put a well on production before the offset compensation commencement date, will I be liable to pay offset compensation?
If I put a well on production in the month in which the liability to pay offset compensation commences, when does the liability end?

Well on Production

If I spud a well on the 5th of the month, and the offset notice expires on the 20th of the month, what happens if I can't put the well on production by that date?
What happens if I have drilled a well and it is not productive from the offset zone? Is this enough evidence to get the offset notice withdrawn?
I received an offset notice and I already have a well drilled on the Crown spacing unit. If I put it on production from the offset zone, will that satisfy the offset obligation?
I was served an offset notice for oil and I plan on putting a well on production from the offset zone but not in the spacing unit that you served. It would be in an adjoining spacing unit in the same section. Will this well satisfy the offset?
What information does the Crown need in order to know the offset has been satisfied?
I have a well or a previously producing well from the offset zone on my lease. Why did Alberta Energy serve an offset notice?
When will offset compensation end in the event that I have put a well on production? Will I be reimbursed?

Surrender Offset

I am surrendering the lands under offset notice but there is a suspended well on those rights. Do I have to do anything with this well?
Is there any specific time when I may apply to have offset compensation terminated if I have concluded there are no hydrocarbons from the offset zone?
I would like to surrender the rights under notice but have a productive shallower well. Can I keep all rights to the base of this shallower productive zone?
I want to surrender the rights under notice. There is a unit agreement in a shallower zone. Can I keep all the rights to the base of the unitized zone?
If I choose to surrender the lands under notice, will I be able to keep the offset zone since I have a gas capped well?
Why can't I just surrender the offset zone? Why do I have to surrender all the rights to the base of the offset zone?
If I was served an oil offset and I want to surrender to the base of the offset zone, can I surrender only the oil?
If I elect to pay offset compensation as I think I am going to drill a well in the next few years, can I elect to surrender at a later date if our plans change?