The Pembina Institute calls it a positive step that recognizes health concerns about odours from processing plants.
The regulator is bringing in new rules this year to reduce the potential negative effects of energy industry gas emissions, including flaring, venting and burning off gas.
It has also accepted most of the recommendations in a report released in March by a panel into complaints that Baytex Energy Inc.'s (TSX:BTE) operations are creating powerful gassy smells in the Peace River area.
The regulator said existing heavy oil and bitumen operations in the region must capture all produced gas by Aug. 15.
Calgary-based Baytex and four other companies in the area use an unusual method of heating bitumen in above-ground tanks to extract oil.
"Though this decision is long-overdue — odours were first reported by residents in 2009 — it provides one tangible example where the Alberta Energy Regulator has established a transparent public process to deal with a major public concern," Pembina spokesman Chris Severson-Baker said in a release Wednesday.
"We hope this represents the beginning of a new approach to addressing the environmental and health concerns of Albertans."
The regulator did not accept two recommendations in the report that pertain directly to health, saying they fall within the provincial government's jurisdiction.
One recommendation calls on the Alberta government to conduct studies to better understand the potential link between effects of oilsands odours and emissions on human health.
The other recommends that the government help local physicians consult with environmental health experts to help diagnose symptoms associated with odours and emissions from oilsands operations, and to help physicians provide proper treatment.
An Alberta Health official said these two recommendations are under review.
Severson-Baker said Pembina will be watching to see how the provincial government deals with these issues that are aimed at protecting the safety of people who live near energy projects.