CALGARY, A.B. – The Alberta Energy Regulator has issued an order against privately held oil and gas company Sequoia Resources Corp. after it warned it is ceasing operations “imminently” and won’t be able to maintain thousands of wells and pipelines in the province.
In a letter posted on its website, the AER says Calgary-based Sequoia indicated in two meetings in late February that it wasn’t able to abandon and reclaim its licensed properties as a result of “defaults in municipal tax payments”, the AER says it owns licences for 2,300 wells, almost 200 facilities and nearly 700 pipelines.
The industry-funded Alberta Orphan Well Association’s inventory of licensed wells left behind by companies that can’t or won’t look after them has more than tripled from almost 1,200 to nearly 4,000 as oil and gas prices slumped over the past two years.
PricewaterhouseCoopers Inc. says on its website it has been named a trustee for Sequoia after the company filed a notice of intention in court last week to make a proposal under the Bankruptcy and Insolvency Act.
In its order, the AER warns that Sequoia is still responsible for its licensed properties, including cleanup at the end of a well’s life, and failure to comply could result in it reassessing eligibility of related entities, ordering security payments and pursuing other enforcement options.
It says failing to comply could result in the company’s partners being invited to bid to take over licenses in which they hold an interest.
(THE CANADIAN PRESS)