+ RMA Rural Municipalities
of Alberta

Resolution 14-18F

Reclamation of Non-Producing Oil and Gas Sites on Agricultural Lands Owned by Bankrupt Companies

Date:
November 21, 2018
Expiry Date:
December 1, 2021
Active Status:
Active
Sponsors:
Lac La Biche County
District:
5 - Edmonton East
Year:
2018
Convention:
Fall
Category:
Energy
Status:
Incomplete Information
Vote Results:
Carried
Preamble:

WHEREAS many oil and gas production companies have declared bankruptcy in the last several years; and

WHEREAS many of the wells, compressor stations, battery and satellite sites and facilities owned by these bankrupt companies have been abandoned and not reclaimed; and

WHEREAS many of these properties are located on agricultural land and hinder the regular field operations of livestock and crop producers; and

WHEREAS the mandate of the Orphan Well Association is to manage and reclaim properties abandoned by bankrupt oil and gas companies; and

WHEREAS the activities of Orphan Well Association are limited by the funds available and therefore cannot currently reclaim all of these properties in a timely fashion;

Operative Clause:

THEREFORE, BE IT RESOLVED that the Rural Municipalities of Alberta request that the Orphan Well Association prioritize the reclamation of abandoned oil and gas sites on the following basis:

  1. Health, safety and environmental needs
  2. Agricultural land
  3. All other lands
Member Background:

Currently the number of sites the Orphan Well Association is tasked with cleaning up exceeds the annual budget available. Lac La Biche County is requesting that the Orphan Well Association, subject to health, safety, and environmental concerns, reclaim abandoned sites on actively farmed property prior to reclaiming abandoned sites on unfarmed property.

RMA Background:

RMA has no active resolutions directly related to this issue.

Government Response:

Alberta Energy Regulator

The Alberta Energy Regulator may designate the wells, facilities, and pipelines of a bankrupt company, where there are no responsible working interest participants, as orphans. When this happens, the Orphan Well Association (OWA), an industry-funded not-for-profit organization, manages the orphaned infrastructure.

Questions about the prioritization process to decommission and reclaim orphaned energy infrastructure based on public safety and the environment should be directed to the OWA. Similarly, the OWA also has the authority to select contractors.

Alberta Energy

Alberta Energy is currently administering a loan to the Orphan Well Association (OWA). We understand that their assessment of decommissioning and reclamation work is based on science and on-the-ground experience. Public safety and environmental protection is their top priority. Inspections are an important activity that ensures protection of public safety and the environment and inspection results support the OWA’s risk assessment with higher risk sites being prioritized.

Development:

The response by the Government of Alberta indicates that public safety and environmental protection are priorities in the reclamation of oil and gas wells, although the actual prioritization process is completed by the Orphan Well Association (OWA), which has not yet provided a response to the resolution. A status of Incomplete Information has been assigned to this issue until a response from the OWA has been received.

Provincial Ministries:
Energy
Provincial Boards and Organizations:
AER
Back to Resolutions Database