What AER & Synergy Hanky Panky this time?
This “news” was already reported in the media more than three months ago.
AER and its vile Synergy trying to deflect from the huge spill/leak/frac hit? at an abandoned sour gas well in Frac Frenzy Fox Creek, only 6 km from the town and near busy campground?
Why regurgitate old news? And why now?
Study is not needed! Action is needed! Simple solutions abound! Here’s one: Immediately require bonds are paid upfront, in full, to be held in trust, before any new approvals are given, especially to notorious bullies/law violating aquifer frac’ers like Encana. Another: disallow the big brute companies from selling off their polluting, aging wells/facilities to little nothing players sure to bankrupt themselves soon as they finish sucking a few million out. Make the brutes produce their wells/facilities until they are done, especially in all the formations they soured by hydraulic fracturing and water injection for enhanced recovery. And make the brutes clean up. The big companies are sitting on billions in cash, and are causing most of the liabilities by selling off their no longer massively profitable assets to fly by night junk operators who fully intend to walk from clean up. These actions could be quickly and easily implemented by any govt that gave a damn.
Once a well/facility is appropriately cleaned up, reclaimed, landowner satisfied and signs off on it, company gets their money back. Easy peasy.
All landowners forced into enduring the abusive, polluting industry on their private properties must also be fully paid in advance sufficient funds to be held in trust to fully deal with the inevitable clean up with additional emergency funds for the many things that go wrong, eg frac quakes damaging a driveway, home or barn foundation; aquifer gets contaminated; water well is destroyed; spills, on or off lease; health and or soils/crops harms; etc. Problem solved. The endless crooks will not be able to operate under appropriately protective measures, and will leave, good riddance. Alberta will be much better off without them. Grossly over paid CAPP and other industry lobby groups will cry like the spoiled babies that they are. Let them cry.
Most important must do! Stop funding and get rid of Synergy Alberta and all it’s gunky evil tentacles and groups. Stop funding so called environmental, but really just enabling “controlled opposition” NGOs. Stop the mega millions given to Lies & Propaganda funding (notably Kenney’s new sinister 30 Million dollars annually to propagandize and croon for the polluting oil and gas industry and Steve Allen’s flake of a witch hunt to intimidate and threaten ordinary citizens – tax payer funded mafia for the oil and gas industry). Use the money to start cleaning up. So Super Simple. (repeated in red below)
Text in [square brackets] by J Ernst.
Snaps below from ASRG FB Page
’Ticking time bomb:’ Alberta group wants aging oil wells to be election issue by The Canadian Press, April 9, 2019, Red Deer Advocate
A coalition of Alberta landowners, researchers and former regulators says it could cost as much as $70 billion to clean up more than 300,000 orphan oil and gas wells in Alberta. The Alberta Liabilities Disclosure Project released the numbers Monday in Calgary.
“Fiscally and environmentally, this is a ticking time bomb,” lead researcher Regan Boychuk told a news conference. “They sit idle and they may look harmless, but they’re not. All wells leak eventually and that’s why it’s so important they are plugged and reclaimed properly.” Boychuk said it’s not too late to make well cleanup a campaign issue before the April 16 provincial election.
“This is the moment when politicians are the most receptive,” he said. “The day after the election is when politicians are the least receptive to public concern. That’s why we are making this data public today to try and influence this debate.”
He said most political parties are talking about boosting Alberta’s resource sector but not about the environmental costs involved. “We can either spend money on drilling more wells or spend money on cleaning up.” Boychuk said about $200 million is being held by the Alberta government as a deposit to pay for the cleanup of unreclaimed wells. The problem gets worse once the additional costs of tailing ponds, mines and pipelines are included.
Shirley Dorin, 86, said she and her husband had decades of frustration after allowing an oil well to be drilled on their property near Didsbury in central Alberta in 1970. There was constant flaring that lit up their house, she said, and she developed Parkinson’s disease. Production equipment was eventually removed a few years ago but the site, which has had several owners, still remains. “We didn’t know what it was like to have your life controlled by an oil company and we really didn’t know what we were in for, that’s for sure,” Dorin said. “We want it gone.”
Her son, Mark, is president of Dorin Land and Oilfield Management, and is a member of the coalition.
“We can’t develop our land,” he said. “Albertans simply can’t afford to wait another four years for variable solutions as the mess continues to grow.”
Experts say Alberta must address oil and gas well cleanup that could cost billions: ‘This is a ticking time bomb’ by Emma McIntosh, April 9, 2019, Star Calgary
Cleaning up Alberta’s oil and gas wells could cost between $40 and $70 billion, a figure that demands attention during the provincial election, researchers said Monday.
The estimate from the newly formed Alberta Liabilities Disclosure Project (ALDP), an independent coalition of 15 organizations and individuals, is based on data from the Alberta Energy Regulator obtained through a Freedom of Information request. The group called on leaders of Alberta’s political parties to take action on the future financial crisis.
“Fiscally and environmentally, this is a ticking time bomb,” said Regan Boychuk, the group’s lead researcher and a founder of Reclaim Alberta.
“The question is who’s going to pay for it and when … This is the moment when politicians are most receptive.”
Alberta has more than 300,000 oil and gas wells that will need to be cleaned up, Boychuk said. As the infrastructure ages, it can leak toxic chemicals into the surrounding air, soil and water.
Loopholes in Alberta’s laws have allowed companies to delay and ultimately walk away from cleanup responsibilities, leaving behind more than 3,000 orphan wells that are now the responsibility of the industry-funded Orphan Well Association. Many more are dormant, as Alberta doesn’t impose cleanup deadlines on oil and gas producers.
Supreme Court of Canada says bankrupt energy companies must clean up old oil, gas wells before paying off creditors
Though pipelines and the economy come up every day on the campaign trail, the costs of cleaning up the oilpatch haven’t, said Boychuk. The disclosure project released its estimate in the hope that party leaders will start discussing it, and there will be some transparency about the problem.
Any party that wants to form government in Alberta should impose cleanup deadlines, said Boychuk. It’s the “lowest-hanging fruit” that could help solve the problem, he added.
The Alberta Liabilities Disclosure Project adds another number to previous estimates of the cost of cleaning up wells in the oilpatch.
Its $40 to $70 billion in estimated cleanup costs are significantly higher than those released publicly by the Alberta Energy Regulator (AER), which said it would cost $30 billion to reclaim oil and gas wells as well as steam-extraction facilities. Of that, $18.5 billion was for oil and gas wells specifically, Boychuk said.
In November, a joint investigation by National Observer, Global News and The Star revealed the total cost of cleaning up Alberta’s oil and gas liabilities could be as high as $260 billion — a figure used in internal regulatory documents by AER experts to account for cleanup costs for wells, pipelines and waste ponds in the oilsands. Wells and steam extraction facilities made up about $100 billion of that estimate.
The ALDP estimate used the same liability data on individual wells, but didn’t have the data on costs associated with cleaning up the steam-extraction facilities, Boychuk said.
So far, the province has collected about $1.6 billion in liability security from oil and gas companies, with about $200 million of that allocated for well cleanup.
There are over 300,000 oil and gas wells dotting every corner of the province in Alberta — all of which need to be reclaimed. But who’s going to pay for the cleanup? And by when?
In the wake of the joint investigation, the Alberta Liberals proposed cleanup timelines on defunct wells, which is now part of the party’s election platform. The governing NDP included cleanup timelines in its platform as well.
The United Conservatives, meanwhile, have pledged to “streamline” the well abandonment process and ask the federal government for tax incentives and financial support to speed up environmental reclamation.
The lack of action is a “failure of leadership,” said Alberta Liberal Party Leader David Khan.
“It’s really hurting our energy industry, too,” Khan added, because responsible companies could end up paying for the cleanup of abandoned wells through the Orphan Well Association.
One of the ALDP economists who verified the estimate said the next step should be to factor in the social and environmental costs of leaking wells. Contamination caused by the aging infrastructure can damage land for generations, and can harm the health of people living around them, said University of Calgary economics professor Lucija Muehlenbachs.
One landowner, Dwight Popowich, said a well on his property in Two Hills, Alta., about 140 km east of Edmonton, was quietly sold to a company that went bankrupt a year and a half later. It’s been sitting on his land since 2012, and has no responsible owner.
Popowich and his wife planned to sell their land and retire in Edmonton, but they fear the well has dragged down their property value.
“We’re really in a mess here,” he said.
Another landowner, Mark Dorin, said his family started noticing headaches when an inactive well on his land near Didsbury, about 80 kilometres north of Calgary, started leaking. It caused issues for his family for years, and the leak was plugged only after they hired a lawyer and called in provincial officials, although the well still hasn’t been cleaned up.
“The elected officials in Alberta aren’t listening,” Dorin said. “We’re literally being gassed in our homes.”
ALBERTA LIABILITIES DISCLOSURE PROJECT (ALDP) [Just another AER Synergy Alberta group? “Controlled Opposition?”]
MEMBERS & SUPPORTERS [ALDP does not list who their members are, they mix their members and supporters as one list.]
Individuals (selected) [Wonder who did the selecting. AER? CAPP?]
Robert Ascah, Former Director, University of Alberta Institute for Public Economics
Regan Boychuk, Researcher
Vern Bretin, Alberta Farmer & Landowner
David J Cooper, Emeritus Professor of Accounting; University of Alberta
Emily Eaton, Associate Professor of Geography; University of Regina
Gordon Laxer, Founding Director of The Parkland Institute
Thomas Schneider, Associate Professor of Accounting; Ryerson University
David Swann, Retired MLA and Former Leader of the Alberta Opposition
Organizations (selected)
AbPolEcon
Alberta Wilderness Association
Climate Justice Edmonton
Climate Justice Saskatoon
The Council of Canadians [Enables frac’ing by calling for frac regulations]
Dorin Land and Oilfield Management [An oilfield company? Led by AER? Interesting that Mark Dorin is media spokesperson for ALDP]
Keepers of the Athabasca
Progress Alberta
Reclaim Alberta
Letter to Alberta Minister of Energy and Alberta Energy Regulator
Dear Minister Savage and Alberta Energy Regulator Executives,
We are writing alongside the Alberta Liabilities Disclosure Project (ALDP) to express our strong concern about the government’s management of corporate oil and gas cleanup liabilities. The ALDP is an association of experts, citizens, former energy regulators, and academics calling for full transparency about the staggering cleanup costs associated with oil and gas activity in our province.
This crisis is not unique in the world. Instead, it reflects widespread inaction on the part of [inaction or deliberate set-up/enabling by govt after govt?] governments in holding companies accountable for the cost of well and facility abandonment or decommissioning, and reclamation of these sites. Indeed, two respected international analysts estimate that “the industry’s global environmental debt is several trillion dollars, an amount far greater than that officially reported in corporate financial statements.”
Recent defaults by companies such as Sequoia and Trident, which added thousands of wells to a growing inventory of wells without viable owners in Alberta have — yet again — highlighted the inadequate government leadership on this issue.
Using site-by-site cleanup estimates from the Alberta Energy Regulator’s own internal study, the ALDP applied them to the companies that are registered as operators for every oil and gas well in Alberta. The data for this alternative analysis reveals that roughly 1500 companies are responsible for up to $64.6 billion in oil and gas well cleanup obligations.
We respectfully request your review of our detailed company-by-company analysis and that you work with us to provide the leadership on addressing this colossal and growing public liability, including making public more independently verified estimates of Alberta’s oil and gas liabilities annually. The ALDP also asks for a meeting with Robert Wadsworth, Vice President of Closure and Liability at the Alberta Energy Regulator, to discuss these issues and potential reforms.
We look forward to meeting and discussing these concerns to hopefully find real leadership on this, one of the largest financial and environmental risks faced by current and future Albertans.
Sincerely,
on behalf of the Alberta Liabilities Disclosure Project: [These the members of ADLP? Which were previous energy regulators?]
Alberta Wilderness Association
Dr. David Cooper (Emeritus Professor of Accounting, U of Alberta School of Business)
Dr. David Swann (Retired MLA and former Leader of the Alberta Opposition)
Gordon Laxer (Founding Director of the Parkland Institute)
Keepers of the Athabasca
Mark Dorin (President of Dorin Land and Oilfield Management)
Regan Boychuk (Lead Researcher, Alberta Liabilities Disclosure Project)
Robert Ascah (Former Director of the Institute for Public Economics)
Dr. Thomas Schneider (Associate Professor of Accounting, Ryerson University)
Vern Bretin (farmer and landowner)
A few excellent ASRG comments to the articles below:
Oil and gas well cleanup costs could hit $65 billion, says industry watchdog, Alberta government urged to undertake detailed review of cleanup costs by Paul Cowley with files from The Canadian Press, July 18, 2019, Red Deer Advocate
Cleaning up Alberta’s abandoned oil wells will cost much more than companies have prepared for, says a group that studied the situation.
[Nothing new about this. Companies, AER and its ancestors, and govts have known about their deliberate multi-billion dollar shortfall for decades. World renowned investigative journalist Andrew Nikiforuk has been reporting on it for years.]
The Alberta Liabilities Disclosure Project estimates it will cost 1,500 companies nearly $65 billion to meet all of their oil and gas well obligations. [It will most likely be much more than that]
Making matters worse, is that recent oilpatch bankruptcies by Sequoia and Trident have added thousands more wells without viable owners to the list of wells that need reclamation.
[Many expect that most companies intend to walk, and have always intended to walk, from their tax and landowner lease payments, clean up, abandonments and environmental responsibilities, soon as the profits are raped out. Provincial and federal govts/regulators/courts/Orphan Well Farce Association set up the slippery, beautiful, easy bankruptcy escape trails]
The group, which says it is a non-partisan coalition of former regulators , researchers and landowners affected by aging oil and gas wells, calls on the province to undertake a detailed company-by-company analysis of their liabilities and provide leadership on tackling the problem.
[Study is not needed! Action is needed! Simple solutions abound! Here’s one: Immediately require bonds are paid upfront, in full, to be held in trust, before any new approvals are given, especially to notorious bullies/law violating aquifer frac’ers like Encana. Another: disallow the big brute companies from selling off their polluting, aging wells/facilities to little nothing players sure to bankrupt themselves soon as they finish sucking a few million out. Make the brutes produce their wells/facilities til they are done, especially in all the formations they soured by hydraulic fracturing and water injection for enhanced recovery. And make the brutes clean up. The big companies are sitting on billions in cash, and are causing most of the liabilities by selling off their no longer massively profitable assets to fly by night junk operators who fully intend to walk from clean up. These actions could be quickly and easily implemented by any govt that gave a damn.
Once a well/facility is appropriately cleaned up, abandoned, landowner satisfied and signs off on it, company gets their money back. Easy peasy.
All landowners forced into enduring the abusive, polluting industry on their private properties must also be fully paid in advance sufficient funds to be held in trust to fully deal with the inevitable clean up with additional emergency funds for the many things that go wrong, eg frac quakes damaging a driveway, home or barn foundation; aquifer gets contaminated; water well is destroyed; spills, on or off lease; health and or soils/crops harms; etc. Problem solved. The endless crooks will not be able to operate under appropriately protective measures, and will leave, good riddance. Alberta will be much better off without them. Grossly over paid CAPP and other industry lobby groups will cry like the spoiled babies that they are. Let them cry.
Most important must do! Stop funding and get rid of Synergy Alberta and all it’s gunky evil tentacles and groups. Stop funding so called environmental, but really just enabling “controlled opposition” NGOs. Stop the mega millions given to Lies & Propaganda funding. Use the money to start cleaning up. So Super Simple.]
Rural Municipalities of Alberta president Al Kemmere said the companies that own the wells were able to profit off of them, but many have been able to avoid their obligations by declaring bankruptcy or simply walking away, leaving someone else to clean up.
“I don’t think that that is a good approach. I think they need to be held responsible for what they’ve left on the landscape.”
The scale and cost of the cleanup is a concern to member municipalities, said Kemmere.
“This is not a quick fix.”
The industry-funded orphan well cleanup program will be seeing more wells added as oilpatch companies continue to struggle, he predicted.
“Unfortunately, when they leave those (wells) in the orphan well program, industry is not going to be funding it adequately, so it ends up on the back of taxpayers, and I don’t think that was the intent years ago when this took place.” [Many think it most assuredly was. The Orphan Well Program is a scam just like the AER and its vile Synergy groups are.]
Kemmere said he hopes there are some “financial models that can come forward that can entice the cleanup.”
In a joint statement, Environment and Parks Minister Jason Nixon and Energy Minister Sonja Savage said the Alberta Liabilities Disclosure Project is an “advocacy group that includes several anti-development member organizations.
“Well liabilities is an important issue in Alberta and in all oil- and gas-producing jurisdictions [Yes! All intentionally set up to hang ordinary non-profit raping citizens with], and we will provide further comment on their findings once we have had the opportunity to review the report,” they say.
Mark Dorin, a Red Deer member of the disclosure project [And oilfield management firm president, see above], said the Alberta Energy Regulator is not collecting the money it is supposed to from the oil and gas industry to cover the costs of the wells that were added to the program the previous year.
“They must do it by law, but they don’t,” he said. “The government doesn’t want to act according to law because they’re afraid to trigger oil companies into bankruptcy.”
[That’s a bullshit Synergy Alberta response! Alberta would be far better off economically without those companies. Let ’em fail, let ’em run. Govts don’t and haven’t acted because they have been busy enabling industry’s rape & pillage, and CAPP et al demands of them, provincially and federally. The $260 Billion mess in Alberta is intentional, has been for decades and is expected to be a lot more by the time AER/govts finish their massive deregulation plans (while lying and promising the public regulations, the boring song whistled over and over, enabled by Synergy Groups and NGOs). It’s no different than the mining industry across Canada walking from it’s billions in damages and toxic liabilities, decade after decade after decade.]
Alberta has the best oil and gas regulations in the world and this should not be happening, he said. [Mr. Dorin just shouted out his true Synergy colours! Alberta does not have the best regulations in the world, far from it. AER has the best DEREGULATIONS in the world!]
“They’ve ignored the best oil and gas laws in the world and now we have a crisis because they have not followed them.
“We need to start following the law and we need to come up with new solutions.” [That is true! Read the simple solutions provided – for free – by Ernst in red font above and email by Stewart Shields below]
Dorin said the bankruptcies of Sequoia and Trident are only the “tip of the iceberg” and Alberta’s well cleanup problem is only going to get worse without action being taken. [Of course it will get worse, that’s the intent by industry, govts and regulators across Canada! Read Rob Schwartz’s excellent comments at the top of this post.]
The disclosure project said when Trident went under, it left behind 3,200 wells and an unpaid cleanup bill of nearly $330 million.
The AER said its official energy cleanup estimate of $58.65 billion is split into $28.35 billion for coal and oilsands mines and $30.2 billion for oil and gas wells, facilities and pipelines.
It says the total security held for mining as of June 2018 is approximately $1.46 billion and the total for oil and gas is about $224 million.
The executive director of the Orphan Well Association said the disclosure project’s cost estimates seem much higher than actual costs his organization incurred to clean up 800 inactive oil and gas wells last year.
“With all the work we did last year, the average cost on the abandonment side, or decommissioning, as we call it, was $34,000 per well and $27,000 to reclaim a site,” said Lars DePauw. [Who believes the oil and gas industry’s sweet pet Orphan Well Program dribble?]
I don’t know how they came up with their numbers.” [Easy, read Emmanuel Logos’ brilliant comment posted to this Red Deer Advocate article, copied below]
Emmanuel Logos
I’m saddened by the fact, that Ministers of the Crown, would resort to using their newly formed, fascist war room rhetoric, to vilify Alberta landowners, such as myself, who are being denied their legal rights, and are not being treated fairly, in regards to the clean up of orphaned wells on their lands.
Also a let down, is the response from the Orphan Well Association (OWA), to this story. The OWA director states that he does know where the ALDP got their cleanup numbers from. Well, he just needs to ask the Alberta Energy Regulator (AER). The ALDP, through freedom of information requests, used AER data to come up with their numbers. The OWA also leaves out a few facts that readers should be aware of.
Firstly, not all well sites are the same, in regards to clean up. Site conditions, plays a huge part in determining the final clean up cost. Some will take significantly more in clean up costs, than others. Were the 800 OWA sites, from 2018, relatively clean sites or were they badly contaminated? To give the impression that it only takes around $60,000 to clean a well site, is a red herring, meant to make industry look more responsible than it has been, and to deflect from the fact that there is not enough industry funding available to clean up the current and future mess.
Secondly, the OWA states that it cleaned up 800 wells last year. However, they neglect to mention the fact, that without a $235 million loan from government, they would not have been able abandon those wells. Again, another deflection from the fact that industry hasn’t been paying enough to cover the true costs of clean up.
****
Subject: A Complete Overhaul Of Our Petroleum Ownership And The Structure Of That Ownership!!
Date: Thu, 18 Jul 2019 13:53:13 -0600
From: Stewart Shields email hidden; JavaScript is required
To: United Conservative Party of Alberta email hidden; JavaScript is required, goodale email hidden; JavaScript is required, email hidden; JavaScript is required, email hidden; JavaScript is required
CC: Alberta NDP email hidden; JavaScript is required, email hidden; JavaScript is required, Doreen Mueller email hidden; JavaScript is required, fishcreek email hidden; JavaScript is required, innisfail email hidden; JavaScript is required, letters email hidden; JavaScript is required, Liberal Correspondence email hidden; JavaScript is required, Office of the Premier email hidden; JavaScript is required
One has cause to believe that Alberta really don’t have a public regulator to govern the actions of our 0il developers– and a group of laws to guild those involved in developing the Public’s petroleum products for the owning Alberta public!! Taking this a step farther a questionnaire should be mailed out to every Alberta residents to gage their understanding on things an owner should know about his property!! Like how much money did the Alberta economy gain from petroleum in the last fiscal year? How much production was returned to the developers as Candy– from our governments to the producers ??
Reviewing the numbers and obligation below—can anyone justify the AER asking all these energy companies combined to supply $60 million to the Alberta Orphan Well Fund?? This is not enough to cover the liabilities of any of the top 10 indebted companies for reclamation!! Why are we allowing the AER to simply kick the can further down the road?? Kenney suggest the AER needs a work-over –I totally disagree—the AER as we know it– should be promptly disband and sent home!! There is a reason why Alberta sits at the very bottom of public earners from our petroleum properties -of all the free market countries!! The total shame is no present government has the balls to step in front of the industry—simply because their public have never been informed of what is really going on with property they own! A Crown Corporation must by law deliver to it’s ownership a quarterly report for those interested in their shared properties!! Our ownership is not taken that serious—so we never get a written report on our progression or lack of it- because of the structure of our energy ownership!!
Albertan will waken-up when their handed the bill for the $260 billion owing for environmental clean-ups and no profitable producers around to help pay for their messes!!
Most of the massive faults our petroleum industry has fallen into is very much of of their own creation!!
Shipping and selling a raw sour bitumen slurry as the cheapest hydrocarbon on the market was never an intelligent move —but upgrading that bitumen into a light synthetic crude oil makes the Alberta owner a ton more profit!! Does any owner know how much more our Crown gained from the sale of synthetic crude oil verses the same volume of a bitumen slurry? The very same thing applies with the prices for Canadian natural gas!! It made no sense to turn the pricing of natural gas that was set right hear in Canada over to the American buyer—but that’s what we did to please the Oligarchs in the energy business?”? The time is past due to ask questions and get informed!!
Stewart Shields
Cost estimates to clean up oil and gas wells lack transparency, says advocacy group by Clare Clancy, July 18, 2019, Calgary Herald
Oil and gas companies need to be more transparent about the ultimate price tag for cleaning up Alberta wells, says an advocacy group that estimates that work could cost $11.9 billion for just one industry giant.
The Alberta Liabilities Disclosure Project (ALDP) — a coalition of organizations, scientists and landowners — released data Thursday showing a breakdown of liabilities for more than 1,500 companies based on its calculations.
Canadian Natural Resources Limited tops the list, with an estimated $11.9 billion needed to clean up 73,000 oil, gas and bitumen wells, according to ALDP’s figures. The other top five companies, with liabilities estimated between $1.7 billion and $2.17 billion according to the coalition’s research, were Husky Oil Operations Limited, IPC Alberta Ltd., Imperial Oil Resources Limited and Torxen Energy Ltd.
“There’s no risk of them disappearing tomorrow,” said ALDP lead researcher Regan Boychuk, adding data obtained from the Alberta Energy Regulator included liabilities up to June 2018. “(But) in Alberta there are hundreds and hundreds of companies barely staying afloat.”
The data follows an ALDP report released in April, showing that cleaning up more than 300,000 oil and gas wells in Alberta could total up to $70 billion.
Boychuk said the estimates calculated by the ALDP are significantly more than those of company’s audited financial statements, showing that risk is being “masked.”
“When companies report their liabilities at discounted rates, without also reporting what it would cost to do the cleanup today, it makes them look — on paper — healthier than they are. But their numbers assume the companies have decades they may not actually have,” he said in a statement.
“That’s why we’re calling on the government to publicly release independently verified, undiscounted estimates of Alberta’s fossil fuel liabilities.”
Husky spokesman Mel Duvall said in an email Wednesday that the company uses industry accepted practices to calculate abandonment liabilities, which are audited externally every year. [Sure to mask mega risks? Industry would not accept them otherwise! “Practices” filled with nice escape hatch words?]
At year-end 2018, obligations stood at $2.4 billion for the company, he said, with the majority of those costs related to assets in Alberta and Saskatchewan. The company doesn’t publicly release the numbers by province, he added.
“We take our asset retirement obligations seriously and abandon in excess of 1,000 wells a year,” he said. “We were recently recognized by the Alberta Energy Regulator (AER) as an industry leader for our area-based closure program, an approach that makes asset retirement activities more efficient and cost-effective.” [Recognition by the AER means little but PR scam after scam, Hanky Panky, law violations, cover-up and lies, and reharming harmed Albertans, their communities and the environment]
CNRL didn’t respond to request for comment Wednesday.
On Thursday, the ALDP also released an open letter to Alberta Energy Minister Sonya Savage and AER officials.
“Recent defaults by companies such as Sequoia and Trident, which added thousands of wells to a growing inventory of wells without viable owners in Alberta have — yet again — highlighted the inadequate government leadership on this issue,” said the letter. [Or, intentional enabling by govt after govt?]
In a joint statement Thursday, Savage and Environment and Parks Minister Jason Nixon said they will review the ALDP findings.
“Alberta Liabilities Disclosure Project is an advocacy group that includes several anti-development member organizations,” said the statement. “We will provide further comment on the validity of their findings once we have had the opportunity to review the report.”
The AER didn’t respond to questions Wednesday.
Richard Wong, manager of operations for the Canadian Association of Petroleum Producers, lauded an area-based closure approach and said it can amount to significant cost savings.
The voluntary program for upstream oil and natural gas sites allows operators to collaborate on closure programs, he said. A summary posted by Calgary firm Norton Rose Fulbright describes the area-based closure program as one that “exempts participating companies from inspection and reporting requirements for low-risk suspended wells by agreeing to spend a set amount of money permanently abandoning and reclaiming wells in a defined geographical area.” [Slick Trick!!]
“Some operators who are participating in (the program) have realized cost savings of over 50 per cent of the Alberta Energy Regulator’s closure cost estimates,” [Such a massive cost savings loudly dongs warning bells; the program being voluntary, dongs heaps more] Wong said in a statement. “These savings can be reinvested into further closure work, which helps to reduce the number of inactive sites in Alberta.” [Pffft! Like Hell! More likely used to drill & frac more wells and spend on trips to Palm Springs etc]
Boychuk slammed the government for what he says has been lack of action since the landmark Redwater court decision.
In February, Canada’s top court overturned an Alberta Court of Appeal ruling that allowed a bankrupt energy company to sever its connection with unprofitable and unreclaimed wells when the company’s assets were sold off to creditors, as if the wells were debts that the company couldn’t cover.
The Supreme Court ruled that Redwater Energy Corp.’s bankruptcy trustee, Grant Thornton Ltd., can’t ignore the company’s obligations to render abandoned wells environmentally safe.
The ruling is expected to reduce what creditors of bankrupt companies can get back when the companies’ assets are liquidated, because some of the proceeds will have to go to environmental cleanups instead of to repaying loans. [“Expected” is the key word. Will it happen in reality? Unlikely.]
Top 10 companies with the highest undiscounted well reclamation costs
(These are approximate numbers from the ALDP. A detailed list of more than 1,500 companies is online).
Canadian Natural Resources Limited, $11.9 billion
Husky Oil Operations Limited, $2.17 billion
IPC Alberta Ltd., $2.03 billion
Imperial Oil Resources Limited, $1.73 billion
Torxen Energy Ltd., $1.7 billion
Obsidian Energy Ltd., $1.5 billion
Cenovus Energy Ltd., $1.43 billion
Canlin Energy Corporation, $1.43 billion
Paramount Resources Ltd., $1.19 billion
Taqa North Ltd. $994 million
Refer also to:
Initiated after Kenney slashed $103 Million from AER’s budget? Predetermined outcome ordained by CAPP et al that taxpayers must donate more millions of dollars to the third most profitable industry in the world, and speed up already speedy approvals, and let companies put less (or no) money into the Orphan Well Farce of a Plan and walk from all clean up and frac’d aquifers?
More corporate welfare stench! 65,000 shallow gas wells qualify to get more than $23M in freebies from taxpayers. Again, not a penny for Albertans suffering frac quake damages, drinking water loss/contamination, health harm, loss of livestock etc.
AER too corrupt to stay alive? Why $100M in budget cuts? Just another Kenney/AER/CAPP scam to take more money from Alberta taxpayers?
Premier Jason Kenney gives oil & gas industry $30 million gift from taxpayers to attack concerned citizens courageous enough to speak out, Gives not one penny to fix Rosebud’s drinking water aquifers frac’d illegally by Encana, covered-up by “No Duty of Care” AER
Falling for AER/ERCB/EUB (industry)’s scam, decade after decade: AER, Surface Rights Board, Orphan Well Association bamboozling (synergizing) Albertans about Trident Exploration walking from it’s environmental and financial obligations in CMAG Synergy meeting, June 25, 2019
