On November 13, 2013, two environmental organizations filed a
petition that challenges the lawfulness of the BC Oil and Gas
Commission's (OGC) practice in granting approvals for the
short-term use of water in hydraulic fracturing and other oil and
gas operations, and seeks to quash certain specific approvals.
Section 8 of the B.C. Water Act gives the OGC the power
to grant approvals for short-term water usage. An approval may be
granted for the diversion or use of water if that diversion or use
"is required for a term not exceeding 24 months." The
procedure for obtaining an approval is less onerous than that for
obtaining a license.
It is alleged that the OGC has a practice of granting approvals
"that combine to exceed one term or the statutory time
limit." The petitioners argue this is unlawful because a water
license is required if the use or diversion of water is required
"for more than one term" or "for more than 24
The OGC's Short-Term Use of Water Application Manual
states that while most approvals do not exceed 12 months, those
approvals granted for up to 24 months are generally for
"seismic activity, winter road construction, water source
dugouts, or the initial exploration phase of a hydraulic fracturing
project." The manual also provides that an approval cannot be
extended, and that a new application must be made if the holder of
the approval wishes to use the same water source beyond the initial
The specific approvals challenged in the petition permit water
withdrawals from "water source dugouts", a source that
the OGC began regulating in March 2011 when it issued Directive 2011-02. The directive defines both a
"water source dugout" and a "borrow pit". A
borrow pit is an excavation resulting from the extraction of
material (borrow) for fill, the construction of roads and well
pads, and other oil and gas related activities. A water source
dugout is a borrow pit in which water has naturally accumulated
(through snowmelt, rainfall or groundwater inflow).
The directive requires approvals for the use, on Crown land and
for oil and gas purposes, of water from borrow pits and water
source dugouts. It also creates an obligation to obtain an approval
before withdrawing any naturally accumulated water from a
"water storage site". Companies holding approvals are
required to submit data quarterly regarding their monthly
withdrawals. Under the directive, unless a company has tenure on
the land on which a borrow pit or water source dugout is located,
section 8 approvals can be granted to multiple companies. While
water may be withdrawn by any company holding an approval, the
directive states that "there is no guarantee or precedence to
If the petition is successful, companies that require water
beyond the initial term of an approval including water from a water
source dugout may now have to apply for a water license, a more
onerous process, instead of merely applying for a further short
term approval. This will likely add to the regulatory burden
on oil and gas companies.
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