The Narwhal reports that the proposed pilot program targets 20,000 inactive wells that were drilled prior to 1980. The non-cash incentive is estimated to reduce future royalty payments by $100 million over three years. Royalty credits can only be redeemed against new oil and gas development projects. This amount is in addition to the $740 million regulatory minimum the industry must spend on well-site rehabilitation in 2023.
Critics argue that it’s corporate welfare and violates the polluter pay principle which requires “a company to pay for the lifecycle maintenance of a site through to closure.” But Premier Danielle Smith counters that “the failures of the current system lead to the accumulation of orphaned sites, land left to sit without reclamation, as well as unpaid taxes and leases.”
Red Deer Ironworks manufactures, rebuilds, and recertifies all major flow-control and pressure-pumping equipment for new oil and gas development projects and lifecycle maintenance at O&G production sites.
Source:
Anderson, Drew
Alberta wants to subsidize oil and gas companies to clean up their mess. Here’s what you need to know
The Narwhal
