Report from BC Auditor General says an increasing number of orphan wells pose risk

In a new report, British Columbia’s Auditor General Carol Bellringer writes there are nearly 7,500 inactive oil and gas wells in the province that have not been properly decommissioned. Her audit cites a lack of tools until recently on the part of the province’s energy regulator, the BC Oil and Gas Commission, to compel operators to decommission and restore well sites in a timely way.

As a result, Ms. Bellringer’s audit makes eleven recommendations to the Commission, including completion of work to develop and implement regulations, policies and procedures to ensure that operators decommission wells, and restore sites in a timely manner. Contamination from oil and gas activity can affect human health, ecosystems, water and air quality and timely restoration of non-operating well sites reduces environmental risk and financial liability.

The audit says the industry’s fund to cover decommission and restoration costs at inactive sites was short more than CAD $13 million last year and operators of oil and gas wells are currently liable for estimated restoration costs of CAD $3 billion as of February. The report covers a period from January 2015 to October 2018, but since then the Commission says the B.C. government amended legislation to give the regulator more power to ensure clean-up of inactive well sites.