Gas drilling rig near Sexmith, Alta. in the Peace River region, home of B.C. and Alberta’s extensive shale gas drilling area. (Wikimedia Commons)

B.C. needs to catch up in restoring old gas wells, auditor says

Taxpayers won’t be stuck with ‘orphaned’ wells, regulator says

The shale gas boom in northeastern B.C. has left a backlog of thousands of inactive wells that need to be filled in and have their sites restored, B.C. Auditor General Carol Bellringer says in a new report.

Legislation was passed last year to require gas drillers to decommission wells, but the rules lacked a “trigger” to determine when that should happen, the audit concluded. By 2018, that left a backlog of more than 7,000 well sites that were inactive but not sealed with concrete and cleaned up.

Bellringer also found that security deposits from drilling companies did not cover growing restoration costs as horizontal hydraulic fracturing led to rapid growth in gas development.

“Decommissioning and restoration are the operator’s responsibility, but in cases where sites are ‘orphaned’ by bankrupt or absent operators, the B.C. Oil and Gas Commission becomes responsible for the work,” Bellringer wrote. “The number of orphan sites in B.C. increased from 45 in 2015-16 to 326 in 2018-19.”

Security deposits from drilling companies are put into an “orphan fund” to cover costs, but in 2016-17 the fund was short $16.6 million and the following year it was short $13.1 million.

In its response to the audit, the B.C. Oil and Gas Commission said it is developing a new “comprehensive liability management plan” based on changes to B.C. legislation passed in May 2018. The plan “holds industry accountable, addresses unrestored oil and gas sites and protects the environment and public safety,” the commission says in its response to the audit.

READ MORE: Coastal GasLink setting up B.C. work camps for pipeline

READ MORE: Stone tools at pipeline route ‘not likely’ in original location

“These new tools will address he restoration of orphan sites in a timely manner, while ensuring no direct costs to taxpayers.”

The commission has implemented a policy to restore orphan wells within 10 years of designation, and has agreed with all 11 recommendations in the audit. They include allocating $14 million for the orphan fund for the current year.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

Just Posted

Trail blows late lead, beats Vernon in OT

Owen Ozar’s goal 12 seconds into OT gives Smoke Eaters a 5-4 win over Vipers and 2-0 series lead

Columbia Basin trails to see improvements

The next intake for the Trust’s trails enhancement grant program opens April 4

Beaver Valley Nitehawks oust Nelson Leafs from playoffs

The Nitehawks eliminate number-1 division seed Nelson Leafs from playoffs with Game-6 victory

Trail wins series opener against Vernon

All scoring comes in third period as Smoke Eaters beat Vipers 3-1 in BCHL Interior semifinal opener

Unlock the potential of food, talk to a dietician

March is Nutrition Month; Celebrating dietitians helping Canadians unlock the potential of food

REPLAY: The best videos from across B.C. this week

In case you missed it, here’s a look at the replay-worth highlights from this week in the province

Kootenay Ice close out WHL tenure in Cranbrook with emotional win

The Ice finished their 21-year run in Cranbrook with a 5-4 win against the Red Deer Rebels on Sunday

Leivo nets shootout winner as Canucks edge Stars 3-2

Schaller scores first 2 goals of season for Vancouver

UBC study shows honey bees can help monitor pollution in cities

Scientists analyzed beehives in high density urban areas to those off on Galiano Island

B.C. man mourns the loss of classmate killed in New Zealand mosque attack

When he heard news of the attack, he sent a message to his friend

Ethiopia minister: ‘Clear similarities’ in Boeing crashes

Both the flight data recorder and the cockpit voice recorder were sent to Paris for analysis

Most Read