Alberta, Canada's oil province, will clean up 5% of its inactive wells by 2023
A regulatory report on Thursday said that the number of inactive gas and oil wells in Alberta, Canada’s largest fossil fuel producing province, dropped 5% from 2022 to 2023, indicating progress in reclamation and decommissioning work.
Alberta has 79,000 inactive wells compared to 83,000 in 2012. Inactive wells are no longer producing oil or gas, and must be permanently plugged. The land surrounding them should also be restored.
Canada is the fourth largest oil producer in the world and the sixth largest gas producer. Its western provinces have hundreds of thousands active and non-active wells. Some of these wells are orphans. This means that the companies who owned them have either gone bankrupt, or ceased to be.
The companies spent C$769,000,000 ($548.23,000,000) on well closures. Site Rehabilitation Program of the Alberta Government spent C$174 millions, and Orphan Well Association funded by industry spent C$149 Million.
In a recent statement, Laurie Pushor said that the data showed the industry was making significant progress in cleaning up oil and natural gas wells and pipelines.
The report shows that ongoing efforts and attention will be necessary to keep the number of inactive wells from increasing.
Alberta's number of inactive wells increased by 5% per year between 2000-2020 as the energy sector expanded rapidly. Environmental campaigners warned that taxpayers would end up paying billions in costs for well cleanup if energy companies are not held accountable.
In 2022, the AER implemented a mandatory closing spending quota that required industry to collectively spend on closure and cleanup. The quota for this year was C$700,000,000, which means that companies spent more than 10% of the amount.
The regulator reported that 91% of the companies with well licenses in Alberta met their spending quota. This left 54 companies owing a total of C$5million.
The AER ordered Sunshine Oilsands to cease operations last month due to its non-compliance to environmental and safety regulations. Reporting by Nia William in British Columbia, Editing by Bill Berkrot
(source: Reuters)
