PURPOSE: The purpose of this request is to solicit comments from interested parties to help inform changes to provincial regulations to achieve further reductions in methane emissions from the oil and gas sector. The BC Energy Regulator (BCER), is seeking input that will inform regulatory development. To guide this process, several questions are included in the below Appendix. We also welcome perspectives and comments on other related issues for which there is not a question.

BACKGROUND: Methane is a powerful greenhouse gas and methane emissions reductions are a key component of efforts to reduce greenhouse gas emissions.

In December 2018, the BCER approved amendments to the Drilling and Production Regulation (the regulations) to reduce methane emissions from the oil and gas sector. These regulations became effective on Jan. 1, 2020 and were designed to achieve:

• the Provincial target to reduce methane emissions from the oil and gas sector by 45 per cent, relative to 2014 levels, by 2025, and
• equivalency with the federal regulations to reduce methane emissions from the upstream oil and gas sector.

The current regulations address methane emissions from storage tanks, pneumatic devices, equipment leaks, compressor seals, glycol dehydrators and surface casing vent flows.

The provincial CleanBC Roadmap to 2030 contains the following targets for the oil and gas sector:

• 75 per cent reduction of methane emissions by 2030, relative to 2014 levels, and
• near elimination of methane emissions by 2035.

In November 2022, the Government of Canada proposed a regulatory framework to also achieve at least a 75 per cent reduction of oil and gas methane emissions by 2030, but relative to 2012.

Regulatory Objectives: The goals of the current regulatory review are to identify changes required to achieve the provincial target for a 75 per cent reduction in methane emissions from the oil and gas sector by 2030, make progress towards near elimination of methane emission by 2035 and achieve equivalent reductions to the proposed federal regulations, as applied to the oil and gas sector in B.C.

This review focuses on the reductions that can be achieved by regulation under the Oil and Gas Activities Act and does not address reductions that may be achieved through other acts, policies or programs. As draft federal regulations have not been published, the regulatory development process will initially focus on achieving provincial goals and will consider federal regulations once they are published in the Canada Gazette, Part I.

Any new or revised provisions will build on the existing legislative and regulatory framework under the Oil and Gas Activities Act for reducing methane emissions including:

• Drilling and Production Regulation,
• Oil and Gas Processing Facility Regulation,
• Pipeline Regulation,
• Liquified Natural Gas Regulation,
• Investigations Regulation, and
• Applicable guidance documents (such as the Flaring and Venting Guideline and the Fugitive Emissions Guideline).

The BCER’s objective for this review is to deliver a regulation that ensures activities are undertaken in a manner that protects public safety, safeguards the environment, supports meaningful reconciliation and advances the public interest and contributes to B.C.’s economy.

Engagement: The BCER is implementing broad engagement to seek input for the development of regulations to reduce methane emissions. The engagement period was for one month--from Feb. 14 - March 14, 2023. At the close of the engagement period, an internal review with an analysis of comments received to date, was completed and the workplan for future targeted engagement updated. Further opportunities for engagement will be available in 2023, as the draft regulatory policy is developed.

Phase 1 Engagement Feedback Received

The British Columbia Energy Regulator (BCER) conducted early engagement with stakeholders and Indigenous Nations to gather feedback and obtain technical input into amending regulations to achieve the 75 per cent reduction of methane emissions by 2030, relative to 2014 levels.

The BCER received 17 submissions in response to Phase One of our engagement from Indigenous Nations, regulated companies, environmental organizations, industry associations and other interested parties.

The common themes we heard include:

• New vs existing facilities: For new facilities, set more stringent standards for new equipment as compared to existing operations. For existing facilities, provide flexibility for permit holders to assess and identify the best opportunities for methane abatement.
• Source-by-source approach and intermittent activities: There is general support for setting more stringent emission limits, continuing to promote operational work practices that enable efficient leak detection and repair while ensuring regulation of methane emission limits is informed by continued research; and recognizes effects or similar regulations in neighbouring jurisdictions.
• Alignment: To achieve a coordinated and effective framework for reducing methane emissions. Governments at varying levels within Canada must work to ensure intersecting policy and programs are working in synergy.
• Regulatory options: Enable considerations for safety, operational, technical, economic, and other practical constraints when setting emission limits, and conservation or destruction options for methane emissions.

This document highlights the technical and broader policy feedback received during early engagement.

Phase 2 Future Engagement (2023)

The BCER continues to review all input as we prepare for the next phase of our engagement. Please continue to monitor this webpage for details on when and how to participate in Phase Two.

Questions or Comments

Your input is very important to us, and we welcome your continued participation. Parties wishing to respond to questions posed are invited to provide written comments from Feb. 14 - March 14, 2023 to the email address below.

Email: Regulatory Affairs at RegulatoryAffairs@bc-er.ca

Appendix 1

Preparing Your Input:

Appendix 1 sets out the topics and questions seeking your input. Please provide feedback where you would like to contribute. When addressing the questions, it is helpful if you can provide tangible examples, or comments that provide practical explanation of the issue.

1. Sources: The BCER anticipates amended methane regulations may address the following sources:

1. Pneumatic devices (including instrumentation, valves and pumps).
2. Uncontrolled storage tanks.
3. Compressor seals.
4. Compressor engine exhaust.
5. Glycol dehydrators.
6. Pipeline blowdowns.
7. Surface casing vent flows.
8. Equipment leaks (fugitive emissions including controlled storage tanks).
9. Unlit flares.
10. Well liquids unloading.
11. Performance thresholds for methane conservation and destruction equipment.

For each source, please provide feedback on additional measures that should be considered to reduce methane emissions. Rationale should include technical feasibility / availability and cost-effectiveness of technology, to eliminate or control emissions.

2. Existing facilities: Existing facilities will require retrofits as we move towards near elimination of methane emissions. Please provide feedback on timing and approaches to reduce emissions from existing facilities.

3. Survey methodologies: Please comment on opportunities for alternatives to optical gas imaging camera surveys for fugitive emissions surveys, including opportunities for continuous monitoring systems, to address specific sources such as controlled storage tanks or entire sites.

4. Decision tree approaches: How could a decision tree approach be developed to guide methane emissions mitigation? A decision tree process could include factors such as safety, technical feasibility, net emissions reductions, and economics based on methane price. Please provide feedback on appropriate considerations and thresholds. An example of a decision tree approach is set out in Section 1 of the Flaring and Venting Reduction Guideline.

5. Performance-based regulation: Are there any opportunities for performance-based regulation of methane emissions? Please identify opportunities that could consider emissions from specific sources or total emissions at the permit holder level.

6. Additional Feedback: Please provide any additional feedback not addressed in the questions above that will inform the development of regulations.