A de-commissioned pumpjack is shown at a well head on an oil and gas installation near Cremona, Alta., Saturday, Oct. 29, 2016. THE CANADIAN PRESS/Jeff McIntosh

Bankrupt energy companies can’t abandon old wells, Supreme Court rules

An estimated 1,800 wells representing more than $100 million in liabilities have been abandoned since the case came to court

The Supreme Court of Canada says the trustee for a bankrupt Alberta energy company cannot simply walk away from unprofitable wells on agricultural land without having to clean up.

The high court’s 5-2 ruling overturns an Alberta Court of Appeal ruling that upheld a 2016 decision in the Alberta Court of Queen’s Bench that effectively allowed a bankrupt energy company to sever its connection with unprofitable and unreclaimed wells when the company’s assets were sold off to creditors.

The Supreme Court ruled today that the bankruptcy trustee, Grant Thornton Ltd., cannot walk away from its end-of-life obligations to render abandoned wells environmentally safe.

The ruling turned on the conflict between federal bankruptcy law and provincial jurisdiction over the environment and energy sector.

Alberta’s provincial energy regulator ordered the trustee for Redwater Energy Corporation to comply with end-of-life requirements to render the abandoned properties environmentally safe.

The company’s trustee did not comply, and filed its own counterclaim that included a challenge to the regulator’s action, citing the paramouncy of federal bankruptcy law.

Since the case came to court, an estimated 1,800 wells representing more than $100 million in liabilities have been abandoned.

Alberta’s energy regulator and the Orphan Well Association, an industry-funded group that cleans up wells that have been left unreclaimed, appealed the ruling to the high court.

A group with the support of thousands of farmers also wanted to see the high court reverse the decision.

The Action Surface Rights Association intervened in the case because it believes rights of landowners have been overlooked in the case.

Like us on Facebook and follow us on Twitter.

Just Posted

RCMP urge caution for back to school drivers

Police are asking drivers to slow down and watch for pedestrians

Speth to take oath of office at special school board meeting

Speth is the newest trustee to join Fraser Cascade school district

Mission-Matsqui-Fraser Canyon MP talks pharmacare in Agassiz

Jati Sidhu was holding town halls throughout the area on the Liberal’s plan to provide drug coverage

UPDATE: Police response on Cheam First Nation a ‘non-event’, RCMP say

More than two dozen RCMP and ERT vehicles were at the First Nation looking for a known fugitive

Harrison Lagoon closed due to E. coli

Water samples tested too high for the bacteria

Sts’ailes invites adults to become engaged in Halq’eméylem with new video series

‘Qw’oqwel te Qw’oqwel’ gives language learners an immersive way to learn Halq’eméylem

Memorial to deceased teen stays in place through Labour Day

Hundreds of tributes have been left at the Walnut Grove skate park

Wife charged in husband’s death in Sechelt

Karin Fischer has been charged with second-degree murder in the death of her husband, Max

B.C. Hydro applies for rare cut in electricity rates next year

Province wrote off $1.1 billion debt to help reverse rate increase

Speculation tax forces sale of Greater Victoria’s iconic ‘Tulip House’

Bob and Jan Fleming selling their retirement home famous for its thousands of tulips

New police force in Surrey must avoid VPD, RCMP errors made in Pickton case: Oppal

Boots are scheduled to be on the ground by spring 2021

Man at centre of dropped HIV-disclosure case sues province and 10 cops

Brian Carlisle of Abbotsford says Mission RCMP defamed him and were ‘negligent’ in their investigation

Conan turns to the Property Brothers for tips on buying Greenland

Jonathan Scott suggests removing glaciers and mountains to bring in ‘more natural light’

Forests minister visits B.C. town rocked by multiple mill shutdowns

A third of Mackenzie turns out for rally, not much to cheer about

Most Read