Canada Oil and Gas Operations Act

Marginal note:Waste prohibited

• 18 (1) Subject to section 63, any person who commits waste is guilty of an offence under this Act, but a prosecution may be instituted for such an offence only with the consent of the Commission of the Canadian Energy Regulator.

• Marginal note:Definition of “waste”

  (2) In this Act, waste, in addition to its ordinary meaning, means waste as understood in the oil and gas industry and in particular, but without limiting the generality of the foregoing, includes

  • (a) the inefficient or excessive use or dissipation of reservoir energy;

  • (b) the locating, spacing or drilling of a well within a field or pool or within part of a field or pool or the operating of any well that, having regard to sound engineering and economic principles, results or tends to result in a reduction in the quantity of oil or gas ultimately recoverable from a pool;

  • (c) the drilling, equipping, completing, operating or producing of any well in a manner that causes or is likely to cause the unnecessary or excessive loss or destruction of oil or gas after removal from the reservoir;

  • (d) the inefficient storage of oil or gas above ground or underground;

  • (e) the production of oil or gas in excess of available storage, transportation or marketing facilities;

  • (f) the escape or flaring of gas that could be economically recovered and processed or economically injected into an underground reservoir; or

  • (g) the failure to use suitable artificial, secondary or supplementary recovery methods in a pool when it appears that those methods would result in increasing the quantity of oil or gas, or both, ultimately recoverable under sound engineering and economic principles.