Québec’s Public Hearing on Natural Gas and New Oil Regime
At the request of the Québec Government, the Bureau d’audiences publiques sur l’environnement (Québec’s environmental review agency), will be holding public hearing on a new natural gas and oil regulatory regime for Québec. It is expected that the BAPE’s report will be available by February 2011.
Québec’s natural gas and oil natural resources are currently subject to the mining regulatory regime under the Québec Mining Act. The current regulatory framework provides that natural gas and oil resources are owned by Québec and natural gas and oil producers are required to pay royalties within a 10 to 12.5 per cent range, depending on the size of production. In addition to specific regulatory requirements under the Québec Mining Act, natural gas and oil producers must also comply with other regulatory Québec requirements, including permitting and environmental regulations.
The BAPE’s public hearing will focus its work essentially on the review of the environmental and health safety issues of hydraulic fracturing (or "fracking"). Hydraulic fracturing consists in a drilling method used to extract national natural gas or oil by creating fractures that extend from a well into rock formations. The drilling process involves injecting a high pressure mixture of water, sand and chemicals into the well to extract natural gas and oil. The fractures allow the natural gas or oil to travel more easily from the rock pores, where the natural gas or oil is trapped, to the production well. Hydraulic fracturing may also be used to reinstate productivity in an older well. Hydraulic fracturing drilling technique has been used since the 1940s.
While tracking is exceedingly prevalent in the United States, in August 2010 the New York Senate instated a 12-month moratorium on the practice of hydraulic fracturing pending completion of a U.S. Environmental Protection Agency study, including new permitting guidelines. The EPA plans to complete its draft study by October 2010 and initial results are expected by late 2012. The moratorium was passed by a strong majority in a vote of 48 to 9. The New York senate’s action is the first from a U.S. state legislature on the issue.