In a classic case of high-minded ideology failing to be successfully implementable, our government’s attempt to legislate a ‘producer pays’ policy aimed at solving this problem has only created vast swathes of legal subversion, as so displayed during the RedWater Energy bankruptcy proceedings, whereby a court decided investors were to be paid back before the AER receives funds for well clean up. As a result, inactive wells still to this day litter Alberta’s landscape and overall, it is still an unresolved issue. Notley’s government, in all their high-minded green zeal, did little more than muse upon the idea of cleaning up these hidden health hazards. Yes that’s right, there is a huge opportunity to create an actual meaningful impact on our environment, that will create jobs, that will increase the property value of thousands of homeowners, and the Alberta NDP are nowhere to be found on it.
Abandoned wells, which can leak methane (a more potent greenhouse gas than CO2), also contaminate soil and groundwater. The wells are everywhere and with roughly 100,000 abandoned and inactive wells existing, they are all too numerous. Abandoned wells are not only found on ranch land near rural communities such as Oyen and Hanna, but they are all too numerous within city limits and town boundaries as well. As a result, the abandoned wells end up depressing property values as fears over natural gas leaks into a resident’s basement dissuade purchasers.
But since Alberta law allows taking wells off the property record, the effect of property value reduction is hidden and looms large. There have been gains towards fixing this problem with government regulation. But the jury is still out on their effectiveness. For example, it remains to be seen whether the new licensee liability rating program’s benefits towards addressing the inactive well problem will outweigh the potential costs of decreased industry M & A activity. Another more tangible example is the recent success at converting abandoned wells into geothermal power plants. Yet still, despite these strides, the problem is still seemingly insurmountable without additional attention from both the public and private sectors.
Recently the Petroleum Services Association of Canada appealed to the federal government requesting a loan to buffer jobs lost from the downturn to clean up the wells. This request represented a change from a previous desire tabled by Saskatchewan Premier Brad Wall for a straight-up bailout. That motion was quashed almost immediately it seemed by Trudeau’s Liberals. Industry remains hopeful that a loan would be a more palatable option for the federal government that in the past, has been keen on bailing out Ontario’s automakers and historically tough on Alberta’s fossil fuel industry.
If there is one thing an ideologically driven government needs, it is at least consistency. The Alberta NDP have signaled the strongest commitment among any North American government to improving the state of our provincial environment. But their signals lack substance. Going it alone by imposing the strictest of carbon taxes and emissions caps on Albertans is not going to make any meaningful impact on the global stage for addressing climate issues. What it will do however, is cost Alberta billions of dollars through placing impediments in front of the business community as investment in our province slowly dwindles.
An opportunity exists where investment in the environment will lead to a direct economic benefits. Cleaning up abandoned wells within city limits will increase property values as well as reducing the risk of disaster. This will create jobs in what is now one of Alberta’s worst recessions on record, and this will help save the brain drain already occurring as highly skilled oilpatch workers leave the industry and province in droves. If the Alberta NDP were at the very least consistent in applying their radical ideology, maybe Alberta would be, dare I say it, better off after all.