The Supreme Court of Canada ruled in favour of the “polluter-pays” principle with the decision that energy companies must fulfill their environmental obligations before paying back creditors in the case of their insolvency or bankruptcy.
This is critical to Alberta’s role as a responsible energy producer. I believe that when properly interpreted, the federal Bankruptcy and Insolvency Act does not permit an oil and gas license holder to walk away from end-of-life obligations. The vast majority of companies are responsible and play by the rules, but we need to be protected from those few that don’t.
This decision means Albertans are protected from irresponsible operators, and working families won’t have to pay for the financial and environmental liabilities left behind when companies walk away from their social, economic, and environmental obligations.
The Alberta Government, the Alberta Energy Regulator (AER), the Orphan Well Association (OWA), and the Warburg Pembina Surface Rights Group, among others, still have to complete a thorough review of this decision, but all are pleased by this progress.
I talked with Karl Zajes, president of the Warburg Pembina Surface Rights Group, who said, “This is an important, positive decision with beneficial changes for landowners across Alberta.”
This government has been cleaning up orphan wells faster than ever before. In December 2017, the Alberta Government provided a $235M loan to support and increase OWA’s efforts, to be repaid by the OWA through the annual Orphan Fund Levy starting this year. So far, over 2,400 wells have been cleaned up, creating over 1,600 jobs through over 200 Alberta contractors.
And, this government tightened up the rules by closing a loophole to keep the few irresponsible companies off the landscape – known as AER Directive 67.
This included fixing the system for assessing corporate risk, ensuring companies that don’t play by the rules, or get behind on payments to landowners, are flagged and tagged sooner. It also takes a thorough look at hard timelines and targets for operators to clean wells. This was important considering some have been inactive for over a decade.
The Notley government also made it easier for communities and industry to work together on cleaning up more sites in a single area for the same amount of money by introducing the Area-based Closure System. It has also given landowners more of a voice if inactive wells near them are posing a problem.
Overall, this decision from the Supreme Court of Canada is good for industry, good for landowners, and good for the environment. It’s how business and community should work together.
As your Alberta NDP Candidate for Drayton Valley-Devon, I’m always happy to speak with you about the issues that matter in rural Alberta and in our communities. I want to hear your thoughts on issues and plans that will affect our province, our community, and your family.
Kieran Quirke, Devon, NDP Candidate for Drayton Valley-Devon