‘It’s a mess:’ Oil crash creating graveyard of wells abandoned on Albertans’ land

Decades before Tony Bruder was ranching in southern Alberta, natural gas wells dotted the rolling landscape.

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The number of wells – drilled in the 1950s by British American Oil, later absorbed by Gulf Canada and eventually sold to smaller companies – accessed a “sour” gas field that spread under a minimum of 14 ranches in the region, including Bruder’s property near Twin Butte.

“We have two sour gas wells on our place – they were both drilled in the ’50s, and both have been inactive since the late ’50s, early ’60s,” said the third-generation rancher. “We have several pipelines which go across our place.”

There have been near to 450,000 oil and gas wells drilled in Alberta, about one-third of which are now considered “abandoned” or “inactive” by the industry. A properly that is no longer producing but hasn’t been properly sealed poses an eco concern as a potential pathway for contaminants to pollute groundwater or soil.

A well is deemed inactive, or suspended, if there has been no activity for Twelve months.

In Saskatchewan, Premier Brad Wall has asked Ottawa for $156 million to clean up old wells in that province within an economic stimulus package to deal with the growing number of laid off oilfield services workers. Friday Canadian Natural Resources Minister Jim Carr said Ottawa would think about the request.

The Alberta government said this week it won’t make a similar request, but lawyers working with landowners across the province said it could help cope with the burgeoning environmental problem.

It’s chaos and I am unsure what the government is going to do

The downturn in the economy in the gas and oil industry has made the issue worse for a large number of home owners like Kelly Nelson, who has about 15 wells on her family’s farm near Vulcan.

“You will find six wells that the company just disappeared upon us,” said Nelson, noting it means the $3,000 to $4,000 in annual rent per equally well . disappeared in 2012. She went to the Alberta Surface Rights Board, which resolves disputes between energy companies and landowners, also it now pays the rent.

“It’s a mess and I am unsure what the government is going to do,” she said.

Enforcing the present rules has been challenge enough for the Alberta Energy Regulator, said Barry Robinson, a lawyer at Ecojustice in Calgary. He noted that last year the AER found 37,000 from the 80,000 “inactive” wells in the province weren’t in compliance using its own rules.

Another issue, he said, are wells which have been deemed “inactive” for many years, without any chance production will ever resume.

“Obviously, no one is coming back to those, nobody is going to reopen those,” he said. “So they ought to be abandoned.”

An abandoned well has got the surface equipment removed and cement poured on the well bore.

Robinson said the AER’s rules don’t put timelines on abandoning a well, noting there are at least 10,000 over the province that have been inactive for more than a decade.

Another 66,500 wells happen to be abandoned, however the land hasn’t been reclaimed. About 17,000 happen to be this way for more than a decade, he said.

“It requires time to abandon and reclaim, and that’s all fine in inactive wells, but we’ve got probably between 25,000 and 30,000 wells that have been inactive in excess of 10 years, just a slave to,” he explained. “The longer a well sits inactive, the higher the risk that you’re going to have groundwater contamination and leakage as the pipe breaks down — that kind of thing.

“The earlier these wells are properly abandoned and properly reclaimed, the better.”

Keith Wilson, an attorney in St. Albert who handles about 20 to 30 ‘orphaned’ site cases annually, said the problem continues to be brewing for a long time as companies put installing new wells in front of cleaning up old sites once the oil price exceeded US$100 a barrel.

“We all know, for sure, that they are not going to see incentive with oil at $30 a barrel, now the issue is a whole lot worse,” Wilson said.

Bruder would simply such as the province to enforce its abandonment policies.

In the meantime, he’ll keep collecting his annual rent on his two wells – a battle that’s becoming more of a concern as the companies suffer in the present economy. Nobody in the companies returned requires comment.

Bruder said it’s more likely that they’ll spend the money for $3,200 to $5,000 fee for the inactive wells than clean them up.

“The reclamation companies tell me it could cost up to $1.5 million to repair,” he explained. “The company says, ‘It’s money. It’s cheaper to pay you your annual fees compared to me to clean it up.’ ”

cderworiz@postmedia.com

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