A Simple Solution for Alberta’s Inactive Well Problem and Lack of ‘Liability Management’
By Regan Boychuk, Mark Dorin, and Vern Bretin for Polluter Pay Federation
Mainstream media outlets have recently reported that there are some 100,000+ inactive wells in Alberta. Contrary to Alberta law, a federal COVID 19 job creation plan threw $1.7 Billion at the problem. Such dollar amount may appear significant; however, Alberta’s reality is that is a drop in the bucket in terms of funding what could be a $70 Billion problem for the Alberta and federal taxpayers.
The most recent reports (November/December 2020) dealing with zombie companies and inactive wells are by the New York Times, CTV W5 ‘Dirty Legacy‘ episode and Global News. The media focuses on problems, including the following:
- No Timelines: Unlike other jurisdictions, Alberta has no legislated or regulated time lines for certain forms of land cleanup (called reclamation). (However, the adverse effects of released substances of concern must be mitigated immediately).
- Lack of Security: Unlike other jurisdiction, Alberta rarely requires that an oil and gas developer post a bond or some other form of surety (to cover activity “end of life” obligations).
- Lack of Oversight and Management: The Alberta Energy Regulator is charged with enforcement of some of Alberta’s laws that govern oil and gas liability management. Overlooked is that the Surface Rights Board is to play an equally important role.
Solutions Readily Available at Law: The Federation has a different focus. We consider Alberta’s unique statutory scheme (the polluter alone must pay for cleanup), we know that the current so-called Liability Management Framework, which is policy based, is not working, and we recognize that our home-grown solutions at law are being ignored. We focus on solutions, particularly those readily available at law. Simply put, waiting for the Alberta Energy Regulator to take the actions required by law is how we got into this mess over time. Our solutions focus on the actions landowners can take, which will save themselves and other taxpayers from bearing costs reserved at law to be paid only by the oil and gas producer (the polluter or potential polluter ).
Our Simple Four-Step Plan
One of these solution or means of ensuring the taxpayer does not end up funding landowner losses (as required by Alberta law) is the simple four-step plan summarized in the Don’t Sign Campaign PowerPoint Presentation, and the brochure provided below.
Step 1 is the key: Landowners must refuse to sign “surface lease” and pipeline or power transmission line “right-of-way” agreements. This will trigger a return to the rule of law and, in future, unlike in the past, industry may begin offering agreement with terms and conditions that actually protect land rights and the taxpayer.
Don’t Sign Campaign Brochure
No Timelines? No Problem
Alberta’s unique statutory scheme contemplates that one may not be able to estimate the duration of time required to properly restore land to its productive capability. We have solutions at law unique to our jurisdiction. At the Polluter Pay Federation we take the view that it is time to actually implement the “Made in Alberta” solutions set out in our various laws.
For more information download the PowerPoint Presentation