Alberta oil and gas producer cleanup cost estimates set too low, says coalition
Posted July 18, 2019 10:37 am.
CALGARY — The Alberta Liabilities Disclosure Project says the province’s largest oil and gas companies are underestimating how much it will cost to clean up thousands of oil and gas wells drilled over past decades.
The coalition of landowners, environmentalists and others is unveiling a list of companies and its estimate of how much it would cost each to remediate its properties if it had to be done today.
It says those costs are much higher than the companies estimate because they are assuming they will have decades of cleanup time.
The coalition says Calgary-based Canadian Natural Resources Ltd. is facing the largest bill at $11.9 billion to clean up 73,000 oil, gas and bitumen wells in Alberta.
Other companies on its top 10 list include Husky Energy Inc. (second highest at $2.17 billion), IPC Alberta Ltd., Imperial Oil Ltd., Torxen Energy Ltd., Obsidian Energy Ltd., Cenovus Energy Ltd., Canlin Energy Corp., Paramount Resources Ltd. and Taqa North Ltd.
Husky spokesman Mel Duvall says the company used accepted industry practices to estimate its worldwide abandonment liabilities as of the end of 2018 at $2.4 billion, with the majority of those costs related to properties in Alberta and Saskatchewan.
In April, the coalition estimated the total cost to clean up all of Alberta’s oil and gas wells was $40 billion to $70 billion, versus the Alberta Energy Regulator’s official estimate of $58.65 billion to clean up wells plus all pipelines and other energy infrastructure.
Companies in this story: (TSX:CNQ, TSX:HSE, TSX:IMO, TSX:OBE, TSX:CVE, TSX:POU)
The Canadian Press
