As of August 1, 2017, the Ministry of the Economy has implemented Directive PNG017: Measurement Requirements for Oil and Gas Operations Version 2.1 in Saskatchewan. Directive PNG017 consolidates, clarifies and updates the Regulatory requirements with respect to measurement points used for accounting and reporting purposes, as well as those measurement points required for upstream petroleum facilities and some downstream pipeline operations under existing regulations.
Intent of this Directive
This Directive specifies:
- what and how volumes must be measured;
- what, where, and how volumes may be estimated;
- if accounting procedures must be performed on the determined volumes and what they are;
- what data must be kept for audit purposes; and
- what resultant volumes must be reported to the Regulator.
The licensee must comply with all requirements set out in this Directive.
In this Directive, the term “must” indicates a requirement that must be followed. In some situations, a requirement may be subject to exemptions if specific conditions are met.
The term “should” indicates a recommendation that will not be subject to enforcement. However, the Regulator may direct the licensee in writing to implement changes to improve measurement accuracy, and this direction will become a condition of operation for that facility or facilities.
‘Measurement’ as used in this document means measurement, accounting and reporting. While measurement is the determination of a volume, accounting and reporting are integral components of measurement in that after a fluid volume is measured, mathematical procedures (accounting) may have to be employed to arrive at the desired volume to be reported.
Directive PNG017 includes measurement and reporting requirements that are applicable to oil and gas operations located in Alberta and in Saskatchewan, with the intention that it will ultimately form the basis of a comprehensive and harmonized regulatory document for both jurisdictions. As a result, the term Regulator is referenced throughout the document, which refers to the Saskatchewan Ministry of the Economy (ECON) in Saskatchewan and the Alberta Energy Regulator (AER) in Alberta. The majority of the measurement and reporting requirements in Directive PNG017 are identical in both jurisdictions.
In situations where requirements differ between the two jurisdictions, the requirement that is applicable in each jurisdiction is listed separately in a box. Wells and facilities operated in Saskatchewan must comply with the requirement specified in the SK box. The Alberta information is provided for informational purposes only and subject to change without notice.
The Directive does not include instructions on how the volumes must be reported to the Regulator which are included in other Regulator documents, such as Saskatchewan’s Directive R01 - Volumetric, Valuation and Infrastructure Reporting - Petrinex, but it does include some information on requirements regarding facility subtype, status, and code in accordance with those documents.
If requirements in previously issued Regulator documents (interim directives, informational letters, guides, etc.) conflict with the requirements in this Directive, the requirements in this Directive replace the prior requirements. Over time, it is intended that all relevant superseded requirements will be rescinded.
This Directive replaces and supersedes a number of Saskatchewan Regulatory documents, as identified in Appendix 1. This Directive currently has Regulatory authority in Saskatchewan effective April 1, 2016. Regulatory enforcement of the new requirements, including audits and inspections, that are intended to ensure compliance with the new oil and gas measurement requirements and will be applied in accordance with the implementation schedule outlined below. Enforcement actions will be applied according to Section 13.6 of Directive PNG076: Enhanced Production Audit Program. As a result of the implementation of Directive PNG017, the Ministry of the Economy will be rescinding all Measurement Exemptions approved in Saskatchewan before April 1, 2016.
Industry must make continuous progress with respect to compliance for measurement and reporting by April 1, 2020, and the Ministry of the Economy may require operators to demonstrate their progress throughout the implementation schedule. Operators must meet the following implementation schedule:
- Requirements must be 25 per cent implemented by April 1, 2017
- Requirements must be 50 per cent implemented by April 1, 2018
- Requirements must be 75 per cent implemented by April 1, 2019
- Requirements must be 100 per cent implemented by April 1, 2020
Any facilities licensed after April 1, 2016, must be designed and operated in full compliance with Directive PNG017. For facilities licensed prior to April 1, 2016, operators are expected to comply with the 4-year implementation schedule.
Directive PNG017 Rollout Memo
Please refer to the Directive PNG017 Rollout Memo for more details about this initiative.
For more information
Please refer to the FAQs about Directive PNG017 for frequently asked questions regarding Directive PNG017.
Compliance Reporting Tool for Directive PNG017
The Ministry of Economy expects industry to make continuous progress towards being 100% compliant by April 1, 2020, and will require operators to demonstrate their progress during this period. When requested by the ministry, operators are required to provide the ministry a document that demonstrates their level of compliance. The Compliance Reporting Tool for Directive PNG017 could be one way to provide an approximate compliance percentage for Directive PNG017. Please refer to the Compliance Reporting Tool for Directive PNG017.
This document can also be used by operators to track their approximate compliance percentage for Directive PNG017 throughout the four-year implementation period. If there are any suggested changes to this document, please email Directive17.email@example.com.
Exemption from Base Measurement Requirements
Any approved measurement exemptions granted by the ministry before April 1, 2016, has been rescinded. Operators are responsible for applying for new measurement exemptions if they cannot meet the base requirements outlined in Directive PNG017. The criteria set out in Section 5 of Directive PNG017, provides instructions on measurement exemptions (also known as site-specific deviations from base requirements). All applications for measurement exemptions will be done through IRIS. Operators requesting a measurement exemption must complete a Measurement Exemption Application form and attach it along with other supporting documentation and submit the information on IRIS under the Applications – Measurement Exemptions section. Find more information as well as the Measurement Exemption Application.
Guideline PNG042: Measurement, Accounting, and Reporting Plan (MARP) Requirements for Thermal Heavy Oil Recovery Project
MARP application must be submitted with Enhanced Oil Recovery application as an attachment through the Ministry of the Economy’s Integrated Resource Information System (IRIS) generic application process. Apply for Enhanced Oil Recovery Projects.