Alberta, B.C. Receive New Funding Under Federal Oil Well Cleanup Program
The Alberta, British Columbia, and federal governments have unveiled a new round of funding to help clean up inactive oil and gas sites in the province, including C$400 million in Alberta and $120 million for B.C.
The funding in Alberta includes $100 million for cleanup in Indigenous communities, The Canadian Press reports. The rest of the money is to go to fossil producers who paid for closure work in 2019 or 2020.
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Alberta Energy Minister Sonya Savage said the money will help preserve the environment while creating jobs.
The cash is part of a federally-funded site rehabilitation program announced last May to direct up to $1 billion toward reclamation projects in Alberta (and $1.7 billion in total). Just over $300 million has been delivered to 633 Alberta-based companies so far, and contractors have until the end of 2022 to complete the work.
“This program is going to help significantly address the problem of a very large inventory of inactive wells,” Savage told a virtual news conference Friday. “This will help move some of that inventory along to closure.”
She said more than 36,000 companies applied for the earlier rounds of funding, and the subsequent work created an estimated 1,500 jobs.
Savage said Alberta has about 94,000 inactive wells. An assessment by The Narwhal in 2018 put the number closer to 155,000, not long before a senior Alberta Energy Regulator official said it could take more than 2,800 to clean them all up.
In B.C., Energy Minister Bruce Ralston said the second half of the funding was set to be dispersed in the coming months after the first $50 million supported about 1,000 jobs and reclamation activities at nearly 1,900 sites, CP writes. He said the first round included $15 million worth of work on sites in B.C.’s agricultural land reserve and dormant well sites located in habitat that is critical to the at-risk northern mountain population of woodland caribou.
Ralston said he expects the latest installment of $120 million in federal funds to create a similar number of jobs as the first, with priority going to local and Indigenous workers. Oilfield service workers will be matched with sites nominated for cleanup by Indigenous communities, local governments, and landowners, the minister added.
“By aligning the nomination and the application processes, we’re able to ensure that local knowledge and concerns get first priority,” Ralston told media Thursday, adding the reclamation work supports jobs during the economic slowdown due to the COVID-19 pandemic.
The bulk of B.C.’s $120-million share of the federal funding is aimed at cleaning up more than 8,500 dormant wells, which are sites that have been inactive for five years and aren’t likely to return to service. The program provides eligible companies up to $100,000 or 50% of the cost of a site cleanup, whichever is less, CP says.
B.C. has also earmarked $15 million to address 770 orphan wells, sites owned by companies that are insolvent, can’t be located, or no longer exist. Another $5 million is set aside to address legacy sites and the impacts of historical oil and gas activities on communities and wildlife.
These two reports by The Canadian Press were first published February 11 and 12, 2021.