The Alberta government and its energy regulator are rolling out a one-stop software tool for oil and gas development applications that should streamline the review process, saving considerable time and money.

The Integrated Decision Approach (IDA) has been in pilot project stage since 2016 with a number of producers and will be fully rolled out by 2021. The Alberta Energy Regulator (AER) said the approach has already saved industry more than $140 million, with another $600 million of annual savings expected over the next three years.

“One of the AER’s objectives is to find efficiencies by eliminating duplication and simplifying the regulatory approvals process. The Integrated Decision Approach has improved regulatory efficiency and provides us with a path forward for further savings in the future,” said president and CEO Jim Ellis at a press conference.

Many of the changes were based on adapting to modern industry practices, such as longer horizontal drilling and drilling multiple wells from one location.

Ellis said that integrating the AER’s system into a single application, review and decision is a major step for the regulator and industry. IDA uses “complex rules” to automate low-risk applications and sends more complex and high-risk applications to technical experts for review.

“One-stop reduces timelines on applications, moving decisions from days to hours, and allowing staff to focus their attention to where it truly matters,” he said.

For example, land reclamation applications are now processed and approved 75% faster or more than under the old system—from 365 days to 90 days for high-risk certificates and from 180 days to 31 days for low-risk. The regulatory review of one of the pilot projects, Suncor Energy’s Meadow Creek East oil sands project, was reduced from five years to 15 months. A Canadian Natural Resources Ltd. smaller heavy oil development proposal saved almost $1 million and four months of review time under IDA.

“Less time is spent on administration and more time making sure that the rules are followed. This makes us a more proactive and responsive regulator,” Ellis said.

The Canadian Association of Petroleum Producers (CAPP) has been beating the drum for several years about longer than necessary review times and regulatory compliance costs that are higher than other oil and gas producing jurisdictions.

“While the U.S. is reducing the cost of environmental regulations and streamlining, Canada is moving in the opposite direction. There are between 40 and 50 policy and regulatory initiatives underway with the potential to adversely impact the upstream oil and gas industry,” CAPP complained in a 2017 report on competitiveness.

Industry seems to be onboard with the AER reforms.

“CAPP believes the program has significant potential to move the needle on approval timelines in Alberta. This streamlined regulatory process shows great promise for eliminating redundancies and providing certainty while also growing jobs and protecting our environment,” Terry Abel, executive VP Canada operations and climate, said in a statement.

Another objective of the AER reform was make the process more transparent, simpler and fair for those affected by oil and gas development. Energy Minister Marg McCuaig-Boyd claims that concerns from landowners, municipalities and Indigenous communities can be addressed with less expense and less time wasted. Citizens can access information, such as interactive maps and status report, on developments within their communities and across the province.

“They wanted an opportunity to have their voices heard,” McCuaig-Boyd said.

Industry has become quite concerned over the past several years that the Canadian government intends to layer on new climate and emissions reduction policies on top of provincial efforts. Ellis expects federal officials will recognize the value of conducting integrated planning and decision-making, which should lead to greater coordination between the two levels of government.

“We work quite closely with those regulators. They’re not going to have to run a lot of pilots, take a lot of risk, because we’ve done it all,” Ellis said.

He adds that the integrating the AER system into a single review and decision puts the provincial regulator at the forefront among global energy producing countries. “This IDA one-stop is truly jurisdiction-leading. This is trail blazing,” he said.

The AER plans to use the new system to handle not only project approvals, but operations issues as well. All reclamation certificate applications are already processed by IDA and all other regulatory functions will be gradually added over the next few years, according to Ellis.

McCuaig-Boyd said government has heard industry concerns about competitiveness loud and clear, and is committed to fixing problems within its jurisdiction.

“Top of mind for everyone was the need to maintain our competitiveness with a simple and straightforward process for reviewing energy projects,” she said. “Competitiveness was the focus right from the get-go. Another step in fighting for jobs and improving the investment environment in our energy sector is our work with the energy regulator and the integrated decision approach.”

Onshore