Alberta's Orphan Well Bill Hits $1.66 Billion Record

The estimated cost of cleaning up orphan oil and gas wells in Alberta has reached a new record high, according to the latest annual report from the Orphan Well Association. The total price tag now stands at $1.66 billion, a nearly 50% increase since last year.

The main contributor to this surge is Long Run Exploration Ltd., which had thousands of wells declared orphans in April after a deal with a Chinese company fell through. This has added an estimated $500 million to the cleanup costs.

The Orphan Well Association, a not-for-profit organization launched in 2002, acts as a backstop when delinquent oil and gas companies leave behind inactive wells that need to be cleaned up. The association receives funding from industry through an annual levy, although it has also received government grants in the past.

Public interest lawyer Drew Yewchuk notes that the orphan well problem continues to grow, with the number of orphans increasing substantially over the years. He cautions that taxpayers may ultimately bear the costs of cleanup, as the levies collected from industry may not be enough to fund the effort.