Accelerating Inactive Oil and Gas Liabilities to Support Energy Sustainability
CALGARY, AB, Sept. 26, 2024 /CNW/ – Skye Asset Retirement Inc., (“Skye” or “Company”) has entered into a Property Transfer Agreement (“PTA”) to acquire the licenses and associated liability for a package of non-producing oil and gas wells that Skye will take through full closure and restoration. The wells are in Alberta and have been acquired from an undisclosed party.
Under the PTA, Skye will receive cash considerations equal to the cost to obtain full regulatory closure of the properties, a process that requires remediation and restoration of the sites to their original condition.
“As the energy industry continues to implement new sustainability practises, we are encouraged by the market adoption of novel solutions to manage environmental obligations,” says Skye’s Managing Director, Lindy Couillard. “By unburdening companies of their legacy liability, they can divert resources to their core purpose while still contributing to sustainability in a tangible way.”
The Company has partnered with industry leading closure company, 360 Engineering & Environmental Consulting, to expedite the closure of these sites.
“Most can agree that energy development should be balanced with the restoration of inactive infrastructure. Skye offers a simple and proactive way for solvent companies to reduce liability so they can focus on growth, knowing there is a trusted partner to manage the second half of the project’s lifecycle.”
Each of Skye’s acquisitions are underwritten by an insurance product designed to de-risk the process through to completion. Skye’s business model works within existing policy and requires no special exemptions or regulatory changes to provincial frameworks.
“We have witnessed a considerable shift over the past decade in how liability is assessed and managed. The energy industry in Western Canada alone will spend upwards of $1.4B on energy site closure in 2023, compared to $465MM in 2019. We see this upwards trend continuing as companies continue to adopt policies aimed at a net-zero industry. Skye is positioned to support bold moves in achieving these ESG mandates with our ability to facilitate large scale transfers of liability portfolios.”
About Skye
Skye is an environmental liability transfer company founded in 2017. Skye has worked with regulators and industry groups across Western Canada to establish a framework for a liability transfer. Skye is not an oil and gas producer and the Company’s singular focus is responsible asset retirement; it acquires liabilities at a fixed rate and then sees the property through the regulatory processes required to restore or re-purpose the land.
SOURCE Skye Asset Retirement Inc.
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