Alberta’s orphan well woes are about to swell following the end of a controversial court case involving some of the biggest names in the Canadian oilpatch.
The province’s Orphan Well Association (OWA) is tasked with cleaning up oil and natural gas wells that no longer have an owner, something that is often caused by a company going bankrupt.
The OWA already has an inventory of about 1,600 wells in need of closure and reclamation. That workload is expected to more than double as the bankruptcy of Sequoia Resources is finally settled — a court case that has been followed closely by many because of its broad implications for landowners, industry and taxpayers.
With Sequoia, the OWA is expecting to inherit 1,800 to 2,000 more wells, in addition to the company’s other infrastructure, such as pipelines. The estimated clean-up cost of the Sequoia properties is about $200 million.
Everybody gangsta about the free market until the PoPo come knocking
Conservativism should also mean that if you make a mess, you clean it up, rather than passing the buck and letting the government pick up the tab.