With the recent 2017-18 Budget announcement, programs and services affected will be updated shortly. Posted March 22, 2017

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Apply for a Well Spacing Modification

How to apply to modify the drainage unit/area or setback distance of oil or gas wells in Saskatchewan.

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1. Guidance

A drainage unit is the subsurface area allocated to a well completion for drilling and producing in order to maximize oil or gas recovery from a defined or miscellaneous pool. The Government of Saskatchewan’s drainage unit/area and setback requirements ensure long-term, equitable, and orderly development of resources while preventing reservoir damage.

In accordance with Section 27 of The Oil and Gas Conservation Actan application for oil/gas well spacing modifications must be submitted and approved by the Minister of the Economy before licensing a well completion that won't meet the well spacing minimum requirements. Typically, this occurs if a second well is proposed within a drainage unit or if a well is being proposed will not meet the regulated setbacks. 

 An application for well spacing modification can be made:

  • for a single well completion;
  • on a large scale, multiple well completions or lands;
  • for a pilot application or an application to test a spacing modification;
  • to enlarge a drainage unit’s size; or
  • reduce the regulated setback distances.  
Well spacing modifications approved by the Ministry of the Economy are available on the Minister’s Order Bulletin Board.  All archived Minister’s Orders since 2005 can be found here.
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2. Eligibility

To apply for a well spacing modification authorization: 
  • Have an Integrated Resource Information System (IRIS) account and the appropriate permissions assigned by your IRIS Security Administrator to submit a well spacing modification application.
  • The applicant must be an operator in the proposed area they are requesting the spacing change. 
  • Applications must be made before licensing or completing a well otherwise the operator may violate the regulated drainage unit/area or setback. 
  • In accordance with Section 8(1) and 32 (1) (3) of The Oil and Gas Conservation Act, an operator can apply to modify well spacing for one or more of the following reasons. Well spacing applications that do not meet at least one of these criteria will be rejected. 
    • Recovery improvement.
    • Additional or fewer wells are necessary to provide the capability to drain a pool at a reasonable rate without adversely affecting the recovery from the pool.
    • The spacing is already sustainably established in the pool and the proposed spacing modifications are equal to or more restrictive than the established pool spacing.
  • All applications must include technical engineering arguments and analysis, as well as associated production, geological and other relevant engineering supporting data. 
  • All applications must meet all The Oil and Gas Conservation Regulations, 2012, criteria for drainage units and clearly support the entirety of the area.
  • The applicant must complete the Public Notice process or gain consent(s) from stakeholders prior to making a submission. For more information see Public Notice Process for Oil and Gas Activities.

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3. How To Apply

To apply for a well spacing modification

  1. Determine the current spacing of the proposed project area and verify that the proposed spacing or setbacks will require a modification from those already assigned by the province. 
  2. Determine if a reduced interwell setback is required, in the case of horizontal wells.
    • Request to test reduced interwell setback if the proposed well drains less than the normal 50m or 75m radius. 
      • Approval is considered if the proposed well is drilled adjacent to an existing well or wells with stabilized production (typically six months or more). 
      • A reduced interwell setback can also be applied for in situations such as:
        • layer segregation within a single formation; or
        • setbacks in a pool or area where reduced interwell setbacks are routinely approved (when offset production exceeds 1m3/day) but is not designated in the proposed area.
    • All wells must have common ownership or consents.  
  3. Download and fill out the Spacing Modification Form.
    • Include the following items in a single document/attachment: 
      • Proposed well(s) type (oil or gas).
      • Primary and secondary pools of interest (pool name (if applicable)).
      • A map of the area showing all existing wells for the proposed pool and their present status (producing, abandoned, etc.). The map should include the number and location of the wells to be drilled within the upcoming year. 
      • A map of the proposed and adjacent area showing mineral/working interest ownership.  The map should indicate the mineral ownership (i.e. Open Crown, Crown (with the crown lease indicated) or Freehold (with the Freehold owner indicated) and highlight any well open (active or suspended) to the proposed reduced spacing area. 
        • In the discussion of the application, describe how you've obtained the right to operate within the area of question (i.e. farm-in, have leased the minerals, have partnered with the company that holds the Mineral Rights, a third-party purchased the minerals on behalf of the applicant, etc.).
      • Provide a detailed explanation of how the current spacing does not allow for sufficient recovery within the initial development, including a geological discussion of the area. 
      • Detailed reservoir characteristics, including rock and fluid data and probable drive type. 
      • A description of the reservoir parameters, including the Original Oil in Place (OOIP) or Original Gas in Place (OGIP) calculation. 
      • Indicate the percentage of reserves that could be recovered under the current spacing and the predicted incremental recovery due to the spacing modification.
      • Pool performance history:
        • The results of comparable programs within the same reservoir or one with similar properties.
        • A company may reference pilot infills within the same pool or area and use the production data. 
      • Isopach mapping, including net pay and structure maps.
  4. The applicant can also include:
    • Static bottom-hole pressure survey data, including pressure build-op test data and illustrative curves (initial and current pressures).
    • Interference test data, including flowing bottom-hole pressures and pressure charts, showing that no interference will occur in varying directions. 
    • Geological cross-sections.
    • These items are not required for the application submission but may be requested by the Ministry for review.
  5. Include the Recompletion/Reclassification (part of a reservoir) Application Form with all necessary attachments (as one document) if a well is to recompleted, reclassified or reconfigured as a result of the spacing modification. For more information, see Guideline PNG024: Reclassification and Recompletion.
  6. Complete the Public Notice Process when the proposed project is located within any diversely owned and operated lands before submitting a spacing modification application. 
  7. Log in to IRIS and complete the appropriate application process for authorization and attach the required documents:
    • Mandatory technical information and attachments outlined above must be submitted as a single document.
    • If Public Notice or consent letters are required, submit them as a separate document.

To apply for a reduced spacing as part of another application type

Log in to IRIS and complete the appropriate application process for authorization (EOR, waterflood, commingling) and attach the required documents.
  • If a proposed project area is associated with a waterflood or Enhanced Oil Recovery project that requires reduced spacing or modification, then include the change in spacing with the proposed project application. 
  • If applying to commingle, and are proposing to add a pool where a well completion may cause spacing requirements to not be met, include information related to spacing modification as part of the Commingling Application. 
    • Reclassification or recompletion applications, if required, must also be attached with the EOR, waterflood or commingling application. 
  • Applications must include all the mandatory technical information and attachments outlined above as a single document.

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4. Apply

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5. Further Information

Documents related to third-party engineering reports and seismic data can be attached as confidential. The applicant must provide enough information to justify the data being deemed confidential. These items are kept confidential and are only viewable to the Business Associate and the Ministry.

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