Monday, February 15, 2021

Orphan oil wells should not exist

The province of Alberta alone has some 90,000 inactive oil wells (mothballed due to being no longer economic), and around 3,000 of these are so-called "orphan" wells (defined as a well "that does not have any legally responsible and/or financially able party to conduct abandonment or reclamation responsibilities").

Last year, the federal government ploughed $1 billion - a huge amount of money - into a program to clean up and/or repurpose those sites. Which maybe sounds like a good thing. But my question is why is so much tax-payers' money being pumped in to rectify a problem that is more properly the responsibility of the wealthy oil companies that created the wells in the first place?

Supposedly, the principle of "polluter pays" is already in force. Companies developing oil wells are supposed to be on the hook for reclamation liability for 25 years, after which time it becomes a federal responsibility, meaning that the oil companies are supposed to return an abandoned site "as close as possible to a state that's equivalent to before it was disturbed". But clearly they are not doing that, either going out of business, or just not attending to their responsibilities until their 25-year period expires, at which point they can legally just walk away.

Which is a rather ridiculous situation. Laws should be brought in to force them to attend to reclamation straight away, and not saddle tax-payers with their dirty work. This is just another example of the hidden subsidies that allow oil and gas companies to thrive.

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