Several Alberta-based energy companies continue to be audited by the Alberta Energy Regulator (VRE) for repeated failures to pay due fees and remediate regional well locations.
Last month, the AER shut down the foreign-owned company SanLing Energy after years of not paying landowners, local taxes or local vendors.
SanLing Energy also owed security payments of US $ 67 million to AER related to well locations and infrastructure decommissioning.
Despite repeated non-compliance with previous maintenance and cleaning orders, SanLing was harvesting more than 3,781 BOE (Barrels of Oil Equivalent) per day from Alberta’s oil mineral reserves for years.
“If SanLing or any Alberta company wants to do business, they have to follow our rules. We cannot allow a company that has ignored the rules to keep working – it’s not in Alberta’s best interest, ”said Blair Reilly, AER Director of Enforcement and Contingency Management.
“Repeated attempts by the AER to bring SanLing into line have failed. As a result, the AER has little confidence in SanLing’s ability to conduct its operations safely and is taking this action to protect the public and the environment, and to minimize financial risk. “
Despite the open questions, the compliance dashboard of the AER SanLing has already marked six times.
In September 2020, the company failed to pay bail, was unable to abandon dozens of wells as required and improperly stored waste.
They also failed to decommission 2,266 wells, 227 facilities and 2,170 pipelines, and failed to follow regulatory requirements to establish a detailed operational plan for their suspension period.
Kris Kinnear, president and energy owner of the Alberta Energy Network, is increasingly concerned about how long the energy producer has been operating in Alberta despite repeated failures by the province and its partners.
“For years they have harvested our provincial resources without paying landowners, council taxes, or the vendors who operate their oil fields. This allowed the Alberta government to cope with those liabilities, ”Kinnear said.
He said the best solutions to these problems often come from the industry itself because its success and future depend on a sustainable industry.
“I think we can innovate. Using industry experts and Alberta’s offerings, a system could be created to help liability companies become good corporate citizens of Alberta,” he said.
“You can become part of the solution instead of being the problem.”
Two weeks ago, AER also announced that it would direct the Orphan Well Association (OWA) and the Working Interest partners of another Calgary-based energy company, Mojek Resources Inc., to take over its wells and facilities after the company had several Spills not cleared had to comply with several orders.
The regulator says the escalation of enforcement was deemed necessary after the Calgary-based company failed by March 5 to comply with a Jan. 4 order requiring the suspension of its wells and facilities, the cessation of its pipelines, and evidence of its existence proper maintenance of all of its facilities provided assets.
AER said the OWA and Mojek partners should suspend all of their oil and gas resources and ensure they are in a safe condition while they fix the violations at the Mojek sites and confirm a working emergency number.
Mojek holds AER licenses for 32 wells, 35 pipelines and one facility and owes AER $ 1.76 million in security for its end-of-life obligations and debts to OWA and AER.
“We work with licensees to make sure they understand the Alberta rules, and the majority of companies follow those rules,” said Reilly.
“When this is not the case, we take steps to protect public safety and the environment.”
Dhaliwal is a Western Standard reporter based in Edmonton