Overview

For nearly 70 years, Shell operated the Foothills assets in Alberta, which included high quality operating gas wells, pipelines and gas processing plants with long-term development potential. These assets were a cornerstone of Shell’s upstream business in Canada for decades but were no longer a strategic fit when Shell’s global investment focus shifted in 2019.

The Foothills Assets, however, are an excellent fit for Pieridae, an experienced Canadian operator. As part of the transaction, Shell transferred to Pieridae more than 200 employees in upstream and midstream capacities who supported the Foothills Assets, and Pieridae is well positioned to take these assets on to the next phase of their development.

These assets consist of long-life fields, low decline production, with high liquids and sulphur yields and align well with Pieridae’s existing central Alberta properties, providing further consolidation of the productive Alberta and British Columbia conventional foothills natural gas pools which form the core of their portfolio. More information on Pieridae can be found in their Corporate Presentation or on their website at www.pieridaeenergy.com.

Through its acquisition of the Foothills Assets, Pieridae has assumed responsibility for the long-term liability associated with the abandonment, remediation and reclamation of these assets. The assets have been well maintained and end-of-life wells have been systematically remediated and reclaimed through-out the life of the assets. Through the commercial terms of the sale, Shell has contractually retained liability for the ongoing management and remediation of specific environmental impacts in, around and under the Waterton and Jumping Pound gas plants resulting from the operation of these two gas plants until regulatory closure is achieved.

Shell appreciates the complexity associated with the regulatory aspects of this transaction. Taking into account the feedback from the May 2020 decision (see application history), Shell will soon file a transfer application with the Alberta Energy Regulator (AER) that seeks to transfer all of the licences and approvals for the Foothills Assets to Pieridae.  This will include regulatory responsibility as licensee and responsible party for 282 well licences, 70 facility licences (including the three gas plants), 81 pipeline licences, as well as other supporting approvals/licences.

As part of this application, Shell and Pieridae will provide more detailed information about the commercial arrangements of the sale, to build understanding and clearly articulate Shell’s ongoing contractual responsibility for the specific environmental liabilities related to the operation of the Waterton and Jumping Pound gas plants.

Anyone who is interested in receiving more information about the application can submit a request to FoothillsQandA@shell.com and will be added to the Public Notice of Application at the time of submission.

Additional information about how to raise a concern can be found on the AER’s website.

Application History

In November and December of 2019, Shell and Pieridae jointly submitted applications to the AER requesting that the AER transfer all of the licences and approvals for the Foothills Assets to Pieridae with the exception of the licences applicable to the Waterton and Jumping Pound gas plants. For these gas plants, Shell and Pieridae requested the AER divide the existing operating and environmental approvals (Split Approval Applications) for Shell to retain both the regulatory and contractual liability for the management and remediation of specific environmental impacts at these gas plants. The intent of the Split Approval Applications was to provide assurance to both the regulator and the public that Shell would continue to be directly responsible and accountable to the AER under an existing active regulatory approval for ongoing groundwater monitoring and regulatory reporting regarding the specific environmental impacts.

In addition to the Split Approval Applications, Shell and Pieridae submitted applications to transfer all of the licences, approvals and other authorizations for the infrastructure, facilities, wells and pipelines associated with these two gas plants as well as the Caroline gas plant and its associated infrastructure, facilities, wells and pipelines in its entirety from Shell to Pieridae (Field Applications).

On May 13, 2020, AER denied Shell’s Split Approval Applications, noting that the proposed approach would create uncertainty of the administration and enforcement on the approvals. The AER also noted that as the parties had requested that all applications be considered and decided together; the licence transfer applications for the Field Applications were also therefore denied.

Contacts

Location Contact Number Hours Reason
Caroline Complex Admin Office 1-800-565-0165 or (403) 722-7000

Monday to Friday

8:00am - 4:30pm MST

General inquiries
Caroline Community Liaison 1-403-722-7049 Monday to Friday 8:00am - 5:00pm MST Community concerns

Sundre Petroleum Operators Group

Caroline Complex Control Room

1-800-567-0818

(403) 722-2100

24 hours a day/ 7 days a week Report an odour or emergency
Jumping Pound Complex Admin Office (403) 932-8200

Monday to Friday

6:00am - 6:00pm MST

General inquiries
Jumping Pound Complex Control Room (403) 932-2441 24 hours a day/ 7 days a week Report an odour or emergency
Waterton Complex Admin Office 403-627-7200

Monday to Friday

8:00am - 4:30pm MST

General inquiries
Waterton Complex Control Room 403-627-4200 24 hours a day/ 7 days a week Report an odour or emergency
Shell Helpline 1-800-661-1600

Monday to Friday

8:00am - 6:00pm MST

Other inquiries

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