The Petroleum Registry of Alberta The Petroleum Registry of Alberta Energizing the flow of information Registry Information Session September 22, 2005

The Petroleum Registry of Alberta Agenda 1.Registry Update: –Natural Gas Royalty Regime Annual Allowable Costs Project Update –Registry Website Project –Importance of Correct Contact Information 2.DOE Update: –Provisional Assessments –DOE Oil Business Unit (Oil/APMC) Report Enhancements 3.EUB Update: –Reporting Error Rates –EUB Compliance Assurance - Enforcement Directive Industry Registry Team Update : –Industry Registry Planning 2005/06 –Training and Support 5.Questions and Answers.

The Petroleum Registry of Alberta 1. Registry Update Natural Gas Royalty Regime Annual Allowable Costs Project Update. Registry Website Project. Importance of Correct Contact Information.

The Petroleum Registry of Alberta Natural Gas Royalty Regime Annual Allowable Costs Project Update Project remains on schedule. AC1 process now in Acceptance Testing with implementation date set for October 11, Industry members encouraged to assist in this testing process. AC2-5 design sessions and development continues. AC2-5 implementation – February, 2006.

The Petroleum Registry of Alberta Registry Website Project Conversion to editing tool: Red Dot. –Improved administration of website –Ease of use Take this time to revamp website to better reflect customer needs. Improved “look and feel”. Important content moved closer to user. Other content areas edited or removed. Implementation: Mid to late October 2005.

The Petroleum Registry of Alberta Importance of Correct Contact Information 1.Non-operators require contact information to question facility operators regarding data submitted. 2.When there is a problem with batch files and report requests the Registry staff is required to contact the submitter. 3.The Registry system creates notifications based on the contact information.

The contact information is accessed via a Query screen and clicking the Contacts button.

This opens a new window that displays the name, phone # & address of the person who made the submission.

The Petroleum Registry of Alberta How to update the Contact information Contact information is updated by your BA USA (User Security Administrator). See Registry Training Module 2.4 Manage User ID and Access. (Available to BA USA’s only).

Log in under the USA ID and Select Manage User ID and Access.

Enter User ID or use the Select button to lookup a user. Then Click Go

This opens the personal information for the user. Once updated Click Submit.

The Petroleum Registry of Alberta 2. DOE Update DOE Provisional Assessments. DOE Oil Business Unit (Oil/APMC) Report Enhancements. - Update on Reports now available in the Registry - Potential uses for New or Updated Oil Report(s)

Provisional Assessments Billing PeriodOriginal PA Remaining PA from Original PA Charge October 2002$254,500, Average$31,000, Average$6,900,000 January/05$2,573,355$32,478 February/05$2,672,278$76,037 March/05$17,320,857$99,200 April/05$3,199,742$86,825 May/05$4,029,261$481,292 June/05$3,461,753

Location & Report Name Date Available in RegistryCSVPDFTXT Ministry Invoices & Statements Crude Oil Crown Royalty StatementsJune 29, 2005NEW Royalty Confirmation ReportJuly 22, 2005NEW Statements of Royalty Adjustments and Transportation AllowancesJuly 25, 2005NEW Certification StatementsAugust 2, 2005NEW APMC/Operator/DOE Reconciliation ReportAugust 3, 2005NEW ORBIS Wells in Programs ReportTBA Royalty Program Letters (Approvals/Terminations)TBA Bulletin Board – Documents – Ministry of Energy Third Tier Pool ListingJuly 18, 2005NEW Updated Oil/APMC Reports Available

The Petroleum Registry of Alberta Potential Uses for New or Updated Oil Reports The Third Tier Pool Listing: The listing is updated weekly. It is considered public information thus it is on the website not in your BA’s Ministry Invoices & Statements section of the Registry. Helps Industry determine if an oil well will qualify for 3 rd tier royalty rates. If your well is producing from a pool on this listing it should qualify for the reduced 3 rd tier royalty rate.

The Petroleum Registry of Alberta Potential Uses for New or Updated Oil Reports Certification Statements: Letters informing Operators/Licensees regarding the Vintage (new, old, 3 rd tier) for royalty calculations. It is considered confidential information thus it is in your BA’s Ministry Invoices & Statements section of the Registry. These were previously mailed and the expectation is that this method of communicating will get the information to the production accountant faster.

The Petroleum Registry of Alberta Potential Uses for New or Updated Oil Reports APMC/Operator/DOE Reconciliation Report: Identifies the variances between the DOE oil royalty calculated volumes and the volumes delivered to the APMC. The new CSV format allows for sorting and filtering of the data which allows production accountants to better analyze and focus on the largest problems first.

Potential Uses for New or Updated Oil Reports Use the dropdown to select the report format you wish and then Click download

Potential Uses for New or Updated Oil Reports Clicking Open will load the file onto an Excel spreadsheet.

Potential Uses for New or Updated Oil Reports Above is the original sort by Delivering Facility. Below the data is sorted by the Difference. On the Excel menu bar select Data – Sort and choose the appropriate column to sort by

On the Excel menu bar select Data – Filter – Auto Filter. This adds filters to each column which you can then use to limit the data that is displayed. Below the filter was used to select a single delivering facility. Potential Uses for New or Updated Oil Reports

The Petroleum Registry of Alberta 3. EUB Update Reporting Error Rates. EUB Compliance Assurance - Enforcement Directive 019.

Reporting Error Rates # Operators Invoiced # Chargeable Errors $ invoiced$46,100$45,200$24,800$47,300 # Appeals22178 # Granted21158 Net $$31,600$29,400$22,700

Reporting Error Rates Missing Well Metering diff Imbalance Missing Facility 'P' Pending Other77121 Total

The Petroleum Registry of Alberta Compliance Assurance Initiative (CAI)

The Petroleum Registry of Alberta Background 1997: Information, Collection and Dissemination Enforcement Policy (Ladder) for Production, Injection and Disposition. 1999: (IL) 99-4 EUB Enforcement process, Generic Enforcement Ladder and Field Surveillance Enforcement Ladder. Stakeholder feedback indicated further improvements to the EUB’s enforcement approach was required.

The Petroleum Registry of Alberta Background 2004 – Board Direction: Risk based, Common & Consistent Process Simplify, Remove Automatic Escalation. 2005: Draft Directive issued for stakeholder review and feedback Directive 019 EUB Compliance Assurance - Enforcement issued – available on EUB web site.

The Petroleum Registry of Alberta Objectives Develop simplified and proactive approach to Compliance Assurance: Increase focus on: Information, Education, Prevention. Deliver new Enforcement Directive and Risk Based process. Maintain and/or improve overall industry compliance rates.

The Petroleum Registry of Alberta Objectives Handle non-compliance events consistently and fairly. Measure and report compliance performance of Industry. Support EUB strategic direction and compliance goals.

The Petroleum Registry of Alberta Risk Assessment Each requirement will have an associated Low or High Risk rating based on: Health and safety, Environment impact, Conservation, and Stakeholder confidence in the regulatory process. All requirements (business rules) for Monthly Volumetric Reporting fall into the stakeholder confidence in regulatory process and therefore have been assessed a Low Risk rating.

The Petroleum Registry of Alberta Timelines Effective January 1, 2006 Directive 019: EUB Compliance Assurance – Enforcement replaces all current EUB Enforcement Ladders. Bulletin identifies all EUB documents and their respective sections that are superseded by Directive 019. Compliance not achieved by December 31, 2005 will continue under Directive 019.

Monthly Volumetric Reporting Current Escalation ProcessRevised Monthly Volumetric Reporting for Low Risk Non-compliance LevelApproximate Time to the Next Level EUB Action Approximate Time to the Next Notice EUB Action Level 130 daysInvoice = 30 days1 st Notice of Low Risk Non-compliance Invoice Warning Level 30 daysPA Manager Letter = 30 days2 nd Notice of Low Risk Non-compliance PA Manager Letter Low Risk Enforcement Level 230 daysVP Letter = 30 daysVP Letter

Monthly Volumetric Reporting Current Escalation ProcessRevised Monthly Volumetric Reporting for Low Risk Non-compliance LevelApproximate Time to the Next Level EUB Action Approximate Time to the Next Low Risk Enforcement EUB Action Level 315 daysEUB Follow-up Data discrepancies and missing data not corrected EUB connect with company Notify EUB’s Corporate Compliance Group = No automatic escalationEUB Follow-up EUB connect with company either by phone call or a face-to-face meeting to discuss the situation. As necessary may lead to: EUB Senior Staff and Corporate Compliance Group to take action to implement appropriate enforcement consequences. Level 4 Enforcement Consequences

The Petroleum Registry of Alberta Monthly Volumetric Reporting Process consistent with previous discussions with the Industry Benefits Committee (IBC). More detailed information being presented to the IBC on September 27, More information specific to Monthly Volumetric Reporting process will be available mid October.

The Petroleum Registry of Alberta 4. Industry Registry Team Update Industry Registry Planning for 2005/06. –Consultation Process –Industry Benefits Committee/ Industry Registry Team Priorities Training and Support.

The Petroleum Registry of Alberta Industry Registry Planning for 2005/06 -Consultation Process Industry-Registry governance document describes consultation process to identify/ gain approval for: –IBC/ IRT Focus Items –IRT Staffing and Funding Approach. This document is available on request.

The Petroleum Registry of Alberta Industry Registry Planning for 2005/06 -Consultation Process 1.IBC generates Focus Item list. 2.IBC reps “rate” (on scale of 0-5) the value of each item to their companies. 3.IBC reviews ratings and averages, and approves “consensus comments” and recommendations. 4.CAPP Accounting Committee/ Industry Consultation Group review ratings and recommendations. 5.Above recommendations are presented to the CAPP Fiscal Executive Policy Group and SEPAC Finance Committee for review and endorsement. 6.Funding recommendations must be approved by CAPP Board of Governors and SEPAC Board of Directors.

The Petroleum Registry of Alberta Industry Registry Planning for 2005/06 -Consultation Process CAPP/SEPAC endorsement of enhancement priorities is approval to pursue the initiative within the Industry and Registry protocol processes: –Business cases/ further consultation and approvals are required to proceed. A number of initiatives require funding from DOE or EUB, and must align with their priorities as well. Priorities identified have strong Industry support on average. Individual company perspectives differ. Items listed in the following slides were endorsed by CAPP Fiscal EPG for further work by the IRT/ IBC.

Industry’s Registry Priorities for 2005/06 InitiativeIndustry Rating Value / Support Base IRT (Testing, Training, Industry Support, Change Management, Promote Initiatives of benefit to Industry, smaller enhancement projects) V. High / Strong GCA (currently in development) V. High / Strong BCV. High / Strong Sask. (Likely contingent on BC) High / Strong Pipeline SplitsHigh / Strong Current Month Oil Crown EstimatorHigh / Moderate Large-small co split Forecast Oil Crown Estimator Industry not in agreement that current forecasts are inaccurate/problematic. Med / Moderate Proposed only if alternative is penalties

Industry’s Registry Priorities for 2006 InitiativeIndustry Rating Value / Support EUB Audit MatrixHigh / Strong RMF2 (Royalty Reassignment)High / Strong Production EntitiesHigh / Strong Condensate StatementsLower / Strong Greenhouse Gas Reporting (Research common approach) Med. / Mixed Daytime running of all reports High / Strong EUB Dir.13 reportV. High / Strong

The Petroleum Registry of Alberta Thank-you The IRT appreciates the support consistently demonstrated by the IBC, Industry Consultation Group, CAPP and SEPAC. Our role is to support Industry in maximizing value captured from the Registry. Let us know how we can help.

The Petroleum Registry of Alberta Training and Support –The IRT continues to be available to help you in working most efficiently with the Registry. –We will come to your “shop” and target a session to meet your needs. Contact any of the IRT staff to arrange.

The Petroleum Registry of Alberta Registry Training System The Registry Steering Committee have endorsed a recommendation made by the Training Coordinator and the Industry Registry Manager to discontinue the Registry Training System “Free Starter” Package, and provide the “Comprehensive” package to all users at no cost, effective immediately. This change will be rolled out in the next couple of months, with communication to each user explaining their new access. New users requesting training system access will be provided the “Comprehensive” Package. The Registry website under Training will be updated to reflect this. Reminder: If anyone requires a reset of their training profile password – contact the Service Desk at

The Petroleum Registry of Alberta Questions