The Peace River Regional District wants quarterly updates from the province on the dormant and orphan wells to be cleaned up under a new $100-million reclamation program starting this year.
The board voted June 11 to request the reports from the Oil and Gas Commission, and declined to take part in helping to identify which wells should be prioritized for restoration.
Under the program, announced in April, the province says local governments along with First Nations and landowners are able to nominate wells for priority cleanup. But the province was also deluged with more than 1,100 applications for 2,400 inactive wells the day the program opened at the end of May.
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The main issue for the regional district is staffing costs, capacity, and expertise to help the province sift through all those. Dawson Creek Mayor Dale Bumstead said Canadian Natural Resources alone applied for $60 million worth of work for its proposed sites.
“Everybody’s in the game right now trying to get into that pot of money,” Bumstead said. “It’s going to be a tough place for us to say, OK do we have the knowledge and the understanding of where the sites are, and how do we get into that prioritization?”
Fort St. John Coun. Tony Zabinsky said the Oil and Gas Commission could file its quarterly reports to the board, which would give regional communities public information about the progress and success of the program.
“They’re in charge of this right now,” Zabinsky said. “We don’t have to go down that rabbit hole of what this is going to cost us, but just get the OGC to come, give us a quarterly report, and we can then go to our constituents.”
More than 80 service companies and contractors applied when the Dormant Sites Reclamation Program opened on May 25, proposing reclamation works totalling $152 million.
The program was announced in April as part of a federal economic recovery plan for the beleaguered oil and gas sector in Western Canada.
It was work that would have taken place anyway, but on a much longer timescale – over a decade. A little over a year ago, the BC Oil and Gas Commission introduced a new levy on the oil and gas industry to raise $15 million a year for dormant well reclamation. The plan was to reclaim all orphan wells in B.C. over the next 10 years.
The federal funding will accelerate the work, and the province says the cleanup program will create 1,200 jobs.
The program will target wells that have been inactive for five consecutive years and are unlikely to be returned to service. Companies receiving federal funding pay half the costs for dormant wells.
The program is split into two phases of $50 million each, and applications for the second half will open Nov. 1.
The program will be delivered alongside a $15-million orphaned site reclamation program, and a $5-million legacy site reclamation program.
Electoral director Karen Goodings warned that both the province and the regional district must be prepared for the problems the programs will create for local roads.
“I hope that the powers that be realize that by doing all of these wells that they’re going to impact further the road conditions we are suffering from, and somebody needs to take a look at that,” Goodings said.
— with files from Matt Preprost, Nelson Bennett