British Columbia’s Oil and Gas Commission says the province is the first in Western Canada to impose legal timelines for the restoration of oil and gas wells and the regulation is part of a new liability management plan that ensures all the costs of reclaiming oil and gas sites continues to be paid by industry.
In March, BC Auditor General Carol Bellringer warned that the number of inactive oil and gas wells that have not been properly decommissioned was rising, despite legislation that gave the Commission more powers to speed the process. AG Bellringer’s report said there were almost 7,500 inactive oil and gas wells in BC that had not been property decommissioned and contamination from oil and gas activity can affect human health, ecosystems, and water and air quality.
Energy Minister Michelle Mungall says the regulation enhances the Commission’s checks of a company’s financial health and history to ease pressure on a fund that supports the reclamation of orphaned wells. It will return inactive wells more quickly to their previous state, set a clean-up timeline, and impose requirements for decommissioning wells.
One percent of approximately 25,000 oil and gas wells in BC are orphans that are restored through the industry-funded levy. In a news release, the Commission said that a new liability levy to fund site restorations will be phased in over three years to ensure the Commission has adequate funds to restore all orphan sites.