Initial Term Licences Frequently Asked Questions

The following frequently asked question topics are covered in this section:

  • Submitting an application
  • Submitting Data
  • Licence Validation (Business Rules)
    • Minimum Meterage
    • Multi-legged wells
    • Earned Sections

Submitting an Application

Who can apply to validate a licence?
Do I have to include all the land in the agreement tab?
Do I have to apply for validation?
Can I submit an Application for Validation as soon as I have a validating well for the licence?
Am I required to submit an Application for Validation for each licence being validated even though all the licences have the same expiry date?
Can I request an advanced ruling on an Application for Validation?
What happens if I do not apply for validation prior to expiry of the licence?
What happens to my Expiry Date while drilling over expiry?
If I am drilling over expiry, when am I required to submit my validation application?
When drilling over expiry, when does my geological data need to be submitted?
Can I amend a drilling over expiry application after expiry?
I have a licence with one tract containing PNG rights from the surface to basement and another tract containing PNG rights below the base of the Mannville zone. If I drill a well into the Viking zone, will the well validate both tracts?
Can I receive my final validation letter before the offer notice period expires?
Can any well be used as a multi leg well?
Can I apply using multiple wells?
Can I submit a late application?

Submitting Data

Alberta Energy and Alberta Energy Regulator (AER) are both part of the Energy Ministry. Why am I required to submit confidential data to Alberta Energy when it’s been submitted to the AER?
Will my technical data be returned once my application is reviewed?
Can anyone else access my data?
Is my data kept confidential even if someone requests it under The Freedom of Information and Protection of Privacy Act (FOIP)?
I am sending data, how will you know which application the data applies to? Should I attach my ETS application to my data package?
What data does Alberta Energy require for submitting a Validation Application?

Licence Validation (Business Rules)

Does a well have to be drilled to validate a licence?
If a well is drilled on an initial term licence and is subsequently abandoned, can it be used as a validating well?
Can a water source well be used as a validating well?
Can a validating well evaluate multiple licences?
Will an earning well always be a validating well?
How do I know if my well is a validating or earning well?
Am I required to select the section of the licence where the validating well was drilled when I apply for validation?
Can a well be drilled off location and not within the spacing unit of a licence, be used as a validating well?
Where can I find the definition of minimum depth?
Can the ownership of a licence in its initial term be transferred?
What will happen to the rights not evaluated in a licence?
Can we continue work on our initial term licence after expiry?

Minimum Meterage

Is there a minimum meterage difference for the Plains, Foothills or Northern areas?
Do the 75 meters have to be logged?
Does minimum meterage apply to both vertical and horizontal drilling?
I am drilling a horizontal well through multiple licences. Do I have to drill minimum meterage through each licence?
I am drilling a new well but I have not drill minimum meterage into my licence? Will the well be a validating well and if so, what will be used to calculate sections earned?
What if I am drilling a horizontal well and a portion of the well bore cuts through a corner of a section contained in an initial term licence by less than 75 meters?
I am drilling a new horizontal well through one initial term licence but I didn’t drill minimum meterage into a section within another initial term licence. What meterage will be used to calculate sections earned?
I re-entered a well and the new drilling is less than minimum meterage. Can this well be considered a validating well?
What if I am unable to drill minimum meterage as it may result in damage to the formation or if I am unable to test within the formation?
I am drilling a horizontal well that begins in a lease, drills through an initial term licence and terminates within another lease. What portion of the well bore will be used to calculate sections earned?
I am drilling a well on an expiring licence and I would like to use the well to validate a recently acquired licence. When must the well begin drilling or be rig released, for it to be considered a validating well for the new licence?

Multi-legged wells

What is used to calculate sections earned when a multi-legged well is drilled?
For a multi-legged well if I chose the shallowest leg of a multi-legged well to determine sections earned, does this also become the point where the licence is severed?

Earned Sections

What are Earned Sections?
Do unused earned sections remain in the “bank” indefinitely?
If I have three licences, each with a different expiry, how does the well drilled on the first licence allow me to use sections earned for the two remaining initial term licences? Assume the well is not drilling over expiry of any of the licences.
Can I access earning information from ETS?
Is there a way to search ETS using a validating well to see all the licences that used sections earned from that validating well?
Will the validation letter received from Alberta Energy provide the number of sections initially earned and number of sections remaining in the bank?
What criteria is applied when determining if a licence is eligible to be validated using unused earned sections?
If more than one validating well is drilled on my agreement, can I use the lengths of all of the well bores to determine sections earned?
How does the distance criteria of not more than one intervening section from the licence boundary apply to horizontal wells?
Are the number of sections of land earned determined using Schedule 2 of the Petroleum and Natural Gas Tenure Regulation?
How are sections calculated for a validating well?
I hold several PNG initial term licences with intersecting regional boundaries, some in the foothills region and some in the northern region. Which PNG initial term license should I drill on that will provide me with the maximum earned sections?