Alberta Environment and Parks (AEP) is considering a pilot project in Alberta’s Duvernay shale basin in response to increased public concerns about cumulative effects, water conservation and groundwater protection associated with hydraulic fracturing. The Duvernay regulatory pilot project is expected to look at alternatives to fresh water sources of water, water transportation and storage, and waste water treatment and injection.

The Duvernay shale play in the Fox Creek area of northwestern Alberta is an oil and liquids-rich gas formation which has only recently experienced development. Significant future development is forecast for the play.

With respect to water use in the Duvernay, including water used in hydraulic fracturing, AEP is looking at the application of its water management hierarchy of reuse, reduce, recycle and release. A future policy to achieve these elements will likely emphasize collaboration among oil and gas companies and other industries in the area such as forestry and encourage technology and innovation through the use of regulatory incentives and disincentives. It is expected that thresholds will be set for water use on a cumulative basis. The pilot will also determine what is working when it comes to water and hydraulic fracturing and what is not. The pilot is also expected to inform regulators for regional planning purposes. A further objective of the pilot will be to provide clarity on regulatory requirements so that the oil and gas industry can make long-term investment decisions for water sourcing, handling and disposal.

Some industry players are suggesting that centralized water management is required for full development of the Duvernay and that “water midstreamers” will emerge whereby third party firms will for a fee transport produced water, treat it and then supply it back to the industry for reuse in hydraulic fracturing operations.