Alberta making changes to oil and gas licenses (4 Visits)
The Alberta Energy Regulator is looking to keep bad operators out of the oil patch, in order to reduce the growing number of bankrupt companies that have walked away from unprofitable wells. They were granted new powers to vet potential companies looking to extract oil or gas from the province, allowing them to not issue a license.
There have been a surge in abandoned wells, since a 2016 court ruling allowed a bankruptcy trustee to eliminate unprofitable wells from company assets. The case is now before the Supreme Court after a Queen's Bench judge and the Alberta Court of Appeal found that provincial environmental rules are superseded by federal bankruptcy law.
1800 wells representing over $100 million in liabilities have been abandoned since the initial court ruling. The regulator will now examine company histories, and their directors, when they apply for licenses to drill a well. They will look for indicators of poor past performance and try to ensure companies won't continue this trend.