New Brunswick’s Shale and Tight Resources

New Brunswick

• Geography
• Geology
• Exploration and Production
• Regulation
• Public Research

A product of the Energy and Mines Ministers’ Conference

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Geography

Shale and tight sand resources occur within the Caledonian Highlands of the Maritimes Basin in New Brunswick; particularly the 3,700-square-kilometre Moncton Subbasin. Crystalline volcanic and plutonic rocks that are between 560 to 540 million years old constitute prominent hills that have elevations up to 400 metres. Deeply embedded streams drain southward to Chignecto Bay and northward to the Petitcodiac River. Low-lying rounded hills form ridges on both the northwest and southeast boundary of the Central Plateau. Moderate to steeply dipping Early Carboniferous-aged rocks create these ridges.

McCully Field is located near Sussex, New Brunswick and houses the major tight sand zone. This area is relatively flat-lying due to the shallowly dipping Early Carboniferous aged rocks. On the west side of the Petitcodiac River and south of Moncton, New Brunswick, Stoney Creek Field hosts tight sand zones containing both oil and gas. Southeast of Stoney Creek Field, shales at Hillsborough host natural gas, while tight sands at Hopewell host oil.

Geology

The Maritimes Basin of Atlantic Canada began taking form 380 million years ago and formed during the Early to Middle Devonian Acadian Orogeny. In New Brunswick, the Maritimes basin is characterized by thick accumulations of predominantly sedimentary rocks deposited from rivers, streams, lakes and oceanic environments over a period of 90 million years. As the basin evolved throughout millions of years, these sedimentary rocks developed into the source rocks that host New Brunswick’s petroleum resources. Petroleum resources are concentrated within the Early Carboniferous Albert Formation of the Horton Group. The thick organic-bearing shales of the Albert Formation can be up to 350 metres thick and are believed to have potential for holding large volumes of natural gas. The Albert Formation typically contains three conformable members: Dawson Settlement, Frederick Brook and Hiram Brook. All three members contain kerogenous sandstone, mudstone and shale. The Hiram Brook Member typically is the main exploration and development target for conventional oil and gas, whereas the Frederick Brook Member hosts unconventional petroleum.

All known shale/tight resources are in the Moncton Sub-basin. McCully Field, near Sussex New Brunswick, is currently producing sweet natural gas. Corridor Resources Inc. currently holds the natural gas lease along with its partner, PCS New Brunswick Division. Most of the gas is from fracture-completed tight sand zones in the Hiram Brook. The McCully Field is estimated to contain an in-place shale gas resource of 67.3 trillion cubic feet. Corridor Resources Inc. has expanded its exploration to the Elgin area, just east of McCully Field. Kicking Horse Energy Inc. currently holds a lease for Stoney Creek Field in southeastern New Brunswick. This play is similar to McCully Field in that it is characterized by tight sand zones. The resource estimate at Stoney Creek is 30 million barrels of oil in-place. Other leases held by Kicking Horse Energy Inc. include Hillsborough and Hopewell, just southeast of Stoney Creek Field. At Hillsborough, there is an estimated 10.9 trillion cubic feet of natural gas resource in-place, occurring in Frederick Brook shales. Tight sands of the Hiram Brook are also being assessed at Hillsborough. To date, the Hopewell play is currently being compared to Stoney Creek, and there are plans for future exploration.

Exploration and Production

The Stoney Creek field, south of Moncton near Hillsborough, is a historic producing field that commenced in 1909, with reported production of over 800,000 barrels of oil and 28 billion cubic feet of natural gas.  Contact Exploration (Kicking Horse) recommenced commercial production of oil in 2007 and also has plans to exploit a vast shale gas target within the region. In 2000, Corridor Resources began to drill and evaluate the potential for natural gas production and to determine deep well injection disposal potential of brine production from the PCS mine in Penobsquis. It was determined that the targeted formation was unsuitable for brine disposal, but significant volumes of natural gas were encountered, in what is now known as the McCully field.  Since June 2007 natural gas has also been exported to the northeastern United States via the Maritimes and Northeast Pipeline. SWN Resources Canada acquired exploration licences in March 2010, covering 1.1 million hectares, and is still in the exploration stage.

Currently, eight companies hold 56 agreements to explore for oil and natural gas on more than 1.15 million hectares of land in the province.  SWN Resources Canada completed two geophysical surveys in 2013, additional to seismic surveys undertaken in 2010 and 2011.  In the summer of 2014, Corridor Resources completed a five well hydraulic fracturing operation, exploiting both tight gas sands and shale targets. Corridor is currently producing natural gas from 32 wells. Kicking Horse is currently producing oil from 16 wells. SWN has tentative plans to drill exploration wells throughout licenced holdings.

In December of 2014, the Government of New Brunswick introduced legislation to impose a moratorium on all types of hydraulic fracturing in the province until more research and information is made available and the risks to health, water and environment are fully understood.

Regulation

Exploration activities for oil and natural gas in the Province of New Brunswick are regulated by two main departments, the Department of Energy and Mines (DEM) and the Department of Environment and Local Government (DELG). 

Acts and regulations in New Brunswick do not distinguish a difference between exploration and production (development), as an operator has the capability to produce oil or natural gas while exploring the province’s resources.  There are no special regulations for tight gas or shale.

DEM regulates operational activities for the exploration of all oil and gas resources including seismic surveys, drilling, well completion, and hydraulic fracturing.  DELG regulates all exploration activities, except seismic operations, and ensures that the environment is protected with respect to those activities.  The following departments are also involved in making determinations about moving projects forward for approval: the Department of Public Safety (DPS), the Department of Transportation and Infrastructure (DTI), the Department of Tourism, Heritage, and Culture (THC), the Department of Natural Resources (DNR), and the Aboriginal Affairs Secretariat (AAS).

Applicable acts and regulations:

• Department of Energy and Mines
  • Oil and Natural Gas Act
    • Survey System
    • Geophysical Exploration
    • Licence to Search and Lease Regulation
    • Prohibition Against Hydraulic Fracturing Regulation
• Department of Environment and Local Government
  • Clean Air Act
  • Clean Water Act
  • Clean Environment Act

Current approvals require companies to disclose all hydraulic fracturing chemicals and fluids used to DEM and DELG, and this info is being posted to FracFocus.

Public Research

Energy and Mines Ministers’ Conference

Taking Action: Moving Forward Together on Energy Research Technology and Innovation

Responsible Shale Development: Enhancing the Knowledge Base on Shale Oil and Gas in Canada (PDF, 1.4 MB)