Natural gas facilities on farmland near Dawson Creek. (Tom Fletcher/Black Press)

Natural gas facilities on farmland near Dawson Creek. (Tom Fletcher/Black Press)

Fund to be set up for ‘orphaned’ B.C. oil and gas wells

Levy to cover costs of decommissioning, capping wells

The B.C. government is changing the way it deals with abandoned oil and gas wells, shifting from a tax on industry to payments into a dedicated reclamation fund for cleanup and restoration of drill sites.

Energy Minister Michelle Mungall introduced changes to the Oil and Gas Activities Act Wednesday to make the change. The amendments also grant the B.C. Oil and Gas Commission new authority to require oil and gas permit holders to perform restoration work on inactive sites.

The commission’s website currently has a list of about 200 orphaned sites, including some not drilled and some listed as having restoration completed.

“We are taking action to deal with the growing number of orphaned well sites by cleaning them up, as well as preventing this from happening in the future,” Mungall said.

The amendments also give the commission authority to block roads in the event of an emergency at an oil or gas site, and to recover the costs of emergency activities from the licence holder.

B.C.’s oil and gas industry is confined mainly to the northeast corner of the province, east of the Rocky Mountains. Gas and gas liquids development has expanded greatly with the use of horizontal drilling and hydraulic fracturing of shale deposits in the region, leading to proposed investments in large-scale liquefied natural gas exports.

BC legislatureLNG