Ecojustice expressed concerns about a recent report recommending changes to how old oil and gas wells and infrastructure are properly closed and cleaned up in Alberta and allegedly prioritizing industry profit while shifting responsibility to the public.
The provincial government published the report’s final version titled “Mature Asset Strategy: What we heard and recommendations” last week. In a press release, the environmental law charity urged Alberta to scrap the strategy and instead develop one that puts the public interest first and ensures polluters take responsibility for their own mess.
“This proposal has too many unanswered questions and is not in the best interest of Alberta,” said Susanne Calabrese, managing lawyer of Ecojustice’s Alberta office, in the press release. “It should be soundly rejected.”
Ecojustice’s press release said the public has closely scrutinized the 52-page report on old oil and gas wells and infrastructure, also known as mature assets. According to Ecojustice, the strategy recommends shifting the cost and burden of cleaning up away from industry while being unclear about the funding of the recommendations.
Ecojustice claimed that the report reduces corporate payment obligations and environmental protections and recommends imposing a legacy asset insurance fund. This fund will address the liabilities tied to closed assets and be managed by the province. Ecojustice said the meaning of “managed” here was vague.
“Public funds are used to pay for essential services for all Albertans, like educating our children and caring for our sick,” Calabrese said in Ecojustice’s press release. “This report hides whether public funds will be used instead to pay for the clean-up of billions of dollars in environmental harms — that industry is already legally obligated to pay for and has profited from.”
Ecojustice noted that most of the participants in the closed-door consultations that led to the report were oil and gas companies, with 64 of the 96 participants being private sector companies and six being oil and gas trade associations.
‘Polluter pays’ principle
Ecojustice lawyers said that the mature asset strategy goes against the principle that those who make the mess should pay for it. Ecojustice explained that the report suggests an integrated package shifting the economic and environmental risks from the oil and gas industry to the public.
“Failure to force industry to pay what it owes jeopardizes the health, safety, and financial future of all Albertans,” Calabrese said in Ecojustice’s press release. “Companies must pay to clean-up their own messes and our government must do more to hold them to account to pay their obligations, especially to municipalities and landowners.”
Ecojustice lawyers added that the strategy prioritizes industry over the public by recommending new types of companies to offload liabilities, reductions to environmental regulations and clean-up standards, risk-based clean-up policies, and artificially raised gas prices.
Ecojustice said that these suggestions may place the financial burden on Alberta’s taxpayers and risk their health and safety. Ecojustice noted that delaying the proper clean-up and closure of oil and gas wells and infrastructure jeopardizes the environment, economy, and communities.
“The bill for inactive well clean-up alone is anywhere from $33 to $88 billion — or could be much worse,” Calabrese said in Ecojustice’s press release.
“The report recognizes that the fossil fuel industry in Alberta is on shaky ground and is struggling to meet its basic financial obligations,” said Tanya Jemec, Ecojustice’s staff lawyer for finance, in the press release.
“But confusingly, the report contorts itself to make recommendations to not only keep this withering industry afloat now, but to expand and extend the life of the industry, using government intervention and resources,” Jemec added in Ecojustice’s press release.