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

Rainfall warning: Up to 70 mm expected across Fraser Valley

Environment Canada issued a weather warning heading into the long weekend

Chilliwack students take the lead as mental health advocates

About 100 Chilliwack youth prepped to make a difference during Mental Health Week

Chilliwack PEO: ‘We who are sisters’

International oganization celebrating 150 years of service

No more mobile vendors on Harrison beach

The approval of an updated business licence bylaw means Nolan Irwin is without a cart

BC Ferries to pilot selling beer and wine on select routes

Drinks from select B.C. breweries and VQA wineries to be sold on Swartz Bay to Tsawwassen route

VIDEO: Alberta man creates world’s biggest caricature

Dean Foster is trying to break the world record for a radio show contest

VIDEO: Giants draw first blood in Western Conference championships

In Game 1 of the best-of-seven series between Vancouver and Spokane, the G-Men emerged triumphant

Multiple people injured after deck collapses during celebration

Emergency responders rushed to the Langley home

B.C. RCMP receive application for Police Cat Services

RCMP announced the launch of the Police Cat Services unit as an April fools joke

Rats available for adoption in Vancouver

In a social media post the City of Vancouver says you can adopt a rat for $5.

Kirkland Signature veggie burgers recalled due to possible metal fragments

Recalled products came in 1.7 kg packages with a best before date of Apr. 23, 2019

Chaos at the ferry terminal for people heading from Vancouver to the Island

Easter crowds create backlog at Tsawwassen ferry terminal

Parents of 13 who tortured children get life after hearing victims

One of their daughters fled their home and pleaded for help to a 911 operator

Crews battle Burnaby blaze; 2 people sent to hospital

Emergency Support Services helping residents displaced by fire

Most Read