Alberta Court of Queen’s Bench Chief Justice Wittmann rules for creditors instead of clean-up when energy companies go bankrupt, Rules against Albertans, water, land and air

Comment by an Albertan: “The AER are so photogenic and look so good unless you know what they are up to. Wittmann really cooked this one. The AER gets to dump a shitload of orphans off on the public and the ATB gets to recoup their losses on loans they never should have made in the first place.”

[Refer also to:

The Steve Harper government appointed Justice Neil Wittmann as Chief Justice of Court of Queen’s Bench in 2009: “I’ll now be responsible for the whole province.”]

Read first: SECURED CREDITORS’ RIGHTS THREATENED: OIL AND GAS WELLS MUST BE MADE ENVIRONMENTALLY SAFE BEFORE CREDITORS PAID by Harry J. Thompson, 1992Dalhousie Journal of Legal Studies

ABSTRACT

The recent decision of the Alberta Court of Appeal in Panamericana de Bienes y Servicios S.A. v. Northern Badger Oil & Gas Ltd. may have a detrimental effect on secured creditors by allowing a provincial administrative body to circumvent the ranking provisions contained in the Bankruptcy Act. This note summarizes the court’s analytical approach in such cases.

Excerpts from the Full paper:

The recent decision of the Alberta Court of Appeal may have a detrimental effect on secured creditors by allowing a provincial administrative body to circumvent the ranking provisions contained in the Bankruptcy Act.2

Northern Badger Oil and Gas Limited was placed into bankruptcy on July 7, 1987 and Collins Barrow Limited was appointed Trustee in Bankruptcy. Panamericana held a floating charge debenture security over certain assets owned by Northern Badger. In May 1987,
Panamericana applied for and obtained a court order appointing Vennard Johannesen Insolvency Inc .

… Receiver and Manager of all the undertaking, property,
and assets of the Defendant, Northern Badger Oil
and Gas Limited with authority to manage, operate, and
carry on the business and undertaking of the Defendant
…. 3

Included in the assets were licences to operate thirty-one oil and gas wells, eleven of which were producing and the balance standing in a nonproducing condition. Northern Badger held about ten per cent ownership interest in each welL

The Energy Resources Conservation Board (ERCB) was concerned the wells would be improperly managed and thus left orphaned as opposed to abandoned.4 The ERCB made its concerns known to the receiver in July 1987. The receiver reported that twenty-one of the wells had been transferred to other parties. The remaining wells were subsequently transferred to Sen ex Corporation by a court approved sale on January 15, 1988.
The agreement between the receiver and Senex contained a ‘black out’ clause whereby the purchaser could exclude any interest in wells which were valued at less than the cost of abandonment. Consequently, seven wells were passed back to the receiver and they will all require abandonment at a considerable cost. In May 1989, the ERCB learned of the black out clause and, through an Order-in-Council obtained on June 6, 1989, enjoined the receiver to submit plans for abandonment programmes for the seven wells.

The key issue examined in this case is whether a court appointed receiver or manager of an insolvent and bankrupt oil company must comply with an order of the ERCB.

Trial Decision5
The trial judge found the ERCB’s order tantamount to a claim and, therefore, concluded that the ERCB ranked as an unsecured creditor. Mr. Justice MacPherson’s authority came from the definition of the term ‘creditor’6 and the usage of the term ‘provable claim’? found
in the Bankruptcy Act.B Having found that the ERCB ranked as a creditor, Mr. Justice MacPherson held that the Order-in-Council was ultra vires as it attempted to undermine the provisions of the federally enacted Bankruptcy Act regarding the ranking of creditors.

Appeal Decision
The Alberta Court of Appeal reversed the decision of the lower court. Mr. Justice Laycraft, speaking for the full court, held that the ERCB had the power, when authorized by the Lieutenant Governor-in-Council, to order the abandonment of wells ‘by some person’. Mr. Justice Laycraft further stated that a public officer or a public authority given the duty to enforce a public law did not thereby become a creditor of the party bound to obey. By following this analysis, the court found no violation of the priority provisions under the Bankruptcy Act. The Appeal Court concluded that a receiver, regardless of who
appointed it and notwithstanding its lack of legal title in the property, assumed the licencee’s obligations and was, therefore, bound by such orders. It made no difference that the evidence failed to establish that the orphaned wells presented any danger”.

Reasons for Judgement
The process of abandonment of oil and gas wells is part of the general law of Alberta enacted to protect the environment and mankind. Therefore, it was unnecessary to establish that the wells posed a threat in the instant case.

Alberta’s regulatory scheme regarding oil and gas is contained in the Energy Resources ConservationAct9 and the Oil and Gas Conservation Act. Under regime, the ERCB, with authorization of the Lieutenant Governor-in-Council, has wide general powers to regulate the industry. The regulatory regime contemplates that all wells drilled will one day be abandoned and that the ERCB will have jurisdiction over the process.

In considering the issue of whether the assets in the estate of the insolvent well licencee should be distributed to creditors or applied to the cost of abandonment, the court applies a two step analysis. The first step is to ascertain if Northern Badger had in fact a ‘liability’ and the second step determines to whom the liability is owed.

The abandonment of wells is an expense inherent in the nature of the oil and gas industry. The moment a well is drilled, a liability is created. However, a public officer or public authority given the duty of enforcing a public law does not become a creditor of the person bound by the law. Had the ERCB elected to bear the cost of abandoning the wells and then sought recovery as permitted under the Bankruptcy Act, it would have ranked as an unsecured creditor. As the ERCB was not owed any money, however, the case is distinguished from instances where “some actual impost had been levied against the citizen and a sum of money was due and owing to the specific public authority involved.”ll

The final issue to be determined is whether the receiver, acting as the operator of the oil wells, had a duty to abandon them in accordance with the law.

The receiver takes full responsibility for the management, operation, and care of the debtor’s assets without taking legal title to them.12 The receiver has autonomy from those who procured the appointment. A receiver is an officer of the court and as such its actions become actions of the court. Where the receiver is aware of a legal obligation, it is bound to carry this through, notwithstanding that the obligation relates to assets which are not legally owned by the receiver.

In this case, the receiver had managed the assets of the authorized licencee for more than three years. There was no other entity with whom the ERCB could deal. The receiver cannot now say that, while functioning as a licencee to produce the wells and to profit from them, it assumed none of a licencee’s obligations. The court stated it would be a remarkable rule of law which would permit a receiver to walk away from a well which has blown out of control on the basis that remedial action would diminish distribution to secured creditors.13

Conclusions
This case addresses the issue of statutorily imposed duties on a receiver. Mr. Justice Laycraft suggests that a statutory duty may be established in situations relating to health, the prevention of fires, the clearing of ice and snow, and the demolition of unsafe structures by
suggesting that each duty relates to the general law and that the enforcing authority may not become a creditor under such circumstances.

The court will look at the powers of the authority seeking the order. If it is within the statutory scheme of the authority to make such an order, the court will consider the nature of the claim. This is a two step process; the first step is to ask if there is a liability and the second step is to determine to whom the liability is owed. If the liability does not fall into the category of “when some actual impost had been levied against the citizen [or company] and a sum of money was due and owing to the specific public authority involved”, 14 it will escape the ranking provisions of the Bankruptcy Act.

The final determination is the extent to which the receiver is bound by the order. The Court of Appeal stated that, where the order was properly enacted under the statutory scheme, it creates a statutory duty which binds the receiver.

The result is that a public authority, validly operating under its enabling statute, may enforce orders requiring a cash outlay to the detriment of secured creditors.

[Emphasis added]

2002 CCME 600,000 abandoned hydrocarbons wells in Canada

Slide from Ernst presentations. Dr. John Cherry (Chair Council of the 2013 Canadian Academies Frac Review Panel) wrote Chapter 4 for the above 2002 report, recently removed from the CCME website.

Creditors get priority over environment in Redwater Energy insolvency: judge, Decision could lead to many more abandoned wells in Alberta by Tracy Johnson, May 19, 2016, CBC News

Alberta Chief Justice Neil Wittmann has ruled to put lenders ahead of clean-up costs when energy companies go bankrupt.

The Redwater Energy case is one that the energy sector, international investors, bankers, lawyers and regulators were all watching closely.

Redwater was a tiny oil and gas company that went into insolvency in the spring of 2015. It owned a stake in 16 producing oil and natural gas wells, as well as nearly 70 more inactive wells. It owed its bank, ATB Financial, a little more than $5 million.

Redwater’s bankruptcy trustee, Grant Thornton, wanted the ability to sell the producing wells in order to pay back debt.

However, the Alberta Energy Regulator (AER) argued that any proceeds from asset sales needed to go first to clean up the mess — namely those 70 non-operational wells, that have not been subject to the costly decommissioning process. [The AER could have prevented this mess in the first place, had the “regulator” made Redwater clean up its abandoned wells years ago before granting approvals for any new wells.] 

The judge ruled Wednesday that secured creditors, such as banks, have priority over environmental concerns.

“The immediate reaction from the lending community certainly will be a positive because they will have certainty when they lend as to what will be ahead of them and behind them,” said David Bish, a partner and insolvency expert with Torys.

The case was heard over two days in December 2015. The decision took five months [Why so quick, including time off at Christmas? A mere preliminary motion by AER in the Ernst vs Encana case took eight months for Justice Wittmann to rule on, and seven months for a preliminary motion by Alberta Environment, excluding Christmas], as it’s widely expected to be appealed.

Abandoned wells in Alberta

The provincial government has several lines of defence against paying well clean-up costs. Healthy companies are required to keep enough assets on hand to cover the cost of decommissioning. Even if that contingency fails, industry funds an Orphan Well Association to do the work.

However, the current recession in the oilpatch has meant a quickly mounting caseload for the OWA. This ruling, allowing the separation of producing assets from those that are not economic, threatens to unleash a wave of costs that could overwhelm the OWA’s budget.

The OWA argued in the case that its funding would have to be substantially increased if it had to take on all the bad wells in the province.

AER response [Was this case a set-up by AER to get legal precedent set for oil companies and banks to avoid all and any clean up in Alberta?]

The Alberta Energy Regulator said it is not yet able to comment on the decision. But Bish said the AER could still have some firepower.

The regulator put out a bulletin recently reminding people that it has other ways of going after companies that don’t take care of their environmental obligations. That message was aimed at directors and officers of oil companies. [The AER is industry controlled. It doesn’t go after companies to clean up before they go bankrtup or when they break the law and frac community drinking water aquifers or poison families illegally venting sour gas! Why would the AER do the right thing and go after executives of oil companies?]

“The AER has very expansive powers with respect to steps that it could take against directors and officers and those are unquestionably intimidating,” [Ha! As if. Directors and officers control the AER. They’ve got decades of experience making sure the AER doesn’t regulate oil and gas companies, except for show, every now and then, like when the regulator’s legally immune, Charter violating, fraudulent bullying ass was hauled before the Supreme Court of Canada] said Bish.

“So I don’t think that anyone can breathe a sign of relief and feel like — it’s done we don’t need to worry about the AER — they still have teeth.” [Made out of pink cotton candy?]

A few of the comments:

Bluesberry

From the article: “The judge ruled Wednesday that secured creditors, such as banks, have priority over environmental concerns.”

Banks over environment! This is just so wrong!!

It’s also why most Canadians fear the global financial elites who meet regularly to plan their strategy and tactics. If they can’t push their agenda through the World Bank, International Monetary Fund and World Trade Organization, they move to secret massive trade agreements, such as the Trans-Pacific Partnership (TPP), the Transatlantic Trade and Investment Partnership (TAFTA) and the Trade in Services Agreement (TISA). If The Alberta Energy Regulator has any firepower, I would sure like to see it – sooner rather than later..

My personal feeling is that, when countries bow before the corporate elite, what firepower can a little Province have against greed and capitalism.

Never 4Get – Never 4Give….(The 1 Who Lies)

….secured creditors should now own the wells and as such be forced to clean them up….if you don’t pay your car loan it becomes the bank’s and as such their problem or asset as the case may be….

Jabberwocky
@Never 4Get – Never 4Give….(The 1 Who Lies)
The system is broken and the tax payer is again on the hook for the clean up. This is totally unacceptable and this leak and responsibility needs to plugged and moved back to the banks, insurance companies, and the owners of the wells. Quit the corporate welfare cheques as this is totally absurd.

preConfederation
The judge ruled Wednesday that secured creditors, such as banks, have priority over environmental concerns. And the clean-up Bill goes to all Albertans. Sounds about right. Anyone could have seen this coming except for the MPs and PM Harper. Water, Water everywhere and not a drop fit to drink.

GRUMPY OL MAN
of course, screw the environment, the taxpayer will cover it!

Jason Allan
Alberta Chief Justice Neil Wittmann has ruled to put lenders ahead of clean-up costs when energy companies go bankrupt.

Albertans put Albertans ahead of Canada for clean-up costs too .
http://calgaryherald.com/business/energy/oilfield-services-group-asks-ottawa-to-fund-500-million-oil-and-gas-well-cleanup

The legacy begins .

CaptainCanada
Utter B.S.! This judge should be removed from the bench!

@CaptainCanada

For what? Making a ruling you disagree with?

You may not like the decision, but critical to your rights and freedoms is a predictable legal system where the courts rule on the basis of the law as it is written, and not on the basis of the law as you feel it should read.

BRADlie WALLeye
@Semi Retired

for protecting/enabling white collar crooks, wake up already

CaptainCanada
Well, if the banks and “secure creditors” want the money, they should also pay for the clean up costs! What kind of system allows someone to profit or reclaim finance while off loading liability to the tax payers? Which we all know these people aren’t! All this moeny will probably be siphoned off through KPMG type companies into tax free jurisdictions!

You invest and profit from this business, you should pay to clean it up! and just because they are broke today, doesn’t mean these creditors actually lost money. They’ve been in operation for years!

Mikey
This is an example of how corporations have undermined democracy.
Governance has been corrupted, so the law is corrupted.
Since we all know this industry has not and will not clean up its colossal poisonous wastes, the real question is, “How do these powerful elite criminals continue with impunity?”
Answer – “People voting in the center keep things this way.”

lhkirkland
I know many people may not have heard of Panamericana de Bienes y Servicios S.A. v. Northern Badger Oil & Gas Ltd., which established that environmental liabilities take precedent over creditor liabilities about three decades ago (Alberta set the precedent for the rest of Canada with it), but today’s ruling, which turns the Northern Badger principle around is disappointing, to say the least. If the new ruling stands, there will be even more orphan wells for future generations to deal with. I hope that AER can successfully appeal – if not, the banks have succeeded yet again in having their interests protected over the environment. And shame on ATB! Your current motto may be “We serve only one community. Alberta.” You may believe it your fiduciary duty to try to recoup some of the money lost by Redwater, but it is at the expense of the environment – you do not serve me!

Jon Van
Alberta’s Orphan Well Association argued during the Redwater Energy insolvency case that its funding would have to be substantially increased if it had to take on all the bad wells in the province.
————————————————————————————————————————

And people in Alberta wonder why their pipelines have been universally rejected ? Their record and reputation have preceded them is why ! Albertans can build all the pipelines they want………..in Alberta !

yokelman
The lenders are the ones need to also their money when companies go bankrupt, clean the mess first and whatever is left that is what the lenders get.

ThinkorThwim
This could be so easily handled simply by passing a piece of legislation saying that any awards for environmental damages or clean-ups left unpaid by a company then pierce the corporate veil and are applied to the owners/shareholders in proportion of their ownership of the company.

Give companies two years to adapt their plans before the legislation took effect, and by the time it became the law of the land there wouldn’t be a company left that didn’t have a solid clean-up plan and the insurance to pay for it.

Gordon Howe
I’m in the oil and gas patch so let me explain where the Orphan Well Fund’s budget comes from. Whatever budget they require for the year is billed to the existing oil and gas companies, There is a formula in the industry that takes each companies individual liabilities divided by the total oil & gas patches environmental liabilities and that company has to write a check for that percentage. Please tell me the Simple Simons out there don’t actually think the tax payor is going to pay this? Make… » more

alphaomego
@Gordon Howe

From the article published on CBC, May 11, 2015:

“In the past 12 months alone, 540 wells have been abandoned, almost as many as have been reclaimed in the past 21 years.”

Obviously existing oil and gas companies are not contributing sufficient funds as the OWF is only able to reclaim approximately 30 wells a year.

http://www.cbc.ca/news/canada/calgary/alberta-sees-huge-spike-in-abandoned-oil-and-gas-wells-1.3032434

yokelman
Canada has as stupid justice system. [It’s not a justice system, it’s a legal system – two very different things. Corporations, politicians and their enablers are protected and get justice; citizens and the environment, including water, get exorbitant law.]

Charliehoople
….this is CAPP (Canadian Association of Petroleum Producers) many years ago telling the regulator they want the ability to manage their liabilities as they deemed appropriate…. There are far too many inactive wells sitting in western Canada. … Too bad we dont have a politician in Alberta with the courage to fix this mess.

[Emphasis added]

Alberta court rules insolvent oil company’s assets won’t be used to clean up idle wells by Geoffrey Morgan, May 19, 2016, Financial Post in Calgary Herald

A precedent-setting court decision is expected to add to the number of orphaned oil and gas wells dotting the Alberta landscape and leave the Alberta Energy Regulator with mounting costs to clean up the problem.

In a ruling Thursday, Alberta Court of Queen’s Bench Chief Justice Neil Wittmann said money from the sale of bankrupt Redwater Energy Corp.’s assets should not be used to clean up idle oil wells, but would instead be used to pay back the company’s creditors, which include the provincially owned bank ATB Financial.

The decision, widely anticipated in the oilpatch, allows Redwater’s creditors to accept responsibility only for the company’s economically viable, and therefore valuable, wells. It will likely result in Redwater’s roughly 70 inactive oil wells being orphaned — meaning there is no longer a financially responsible party to clean them up. [Just what oil and gas companies in Canada need! Free and complete escape hatch from clean up. Imagine how companies are celebrating!]

There are already more than 700 orphan wells in Alberta, which will take years and millions of dollars to clean up from an industry-funded Orphan Well Association. Calls for federal government funding to fix the problem mean taxpayers may contribute to the clean up as well.

The AER had argued the sale of Redwater’s assets should be used to clean up its 70 inactive wells. “We are disappointed with the court’s decision,” AER spokesman Riley Bender said Friday, adding the regulator is reviewing the details before choosing whether to file an appeal. [Or, did the AER do this intentionally to set legal precedent for the oil and gas industry to conveniently escape clean up responsibility, while appearing to be a regulator?]

“The AER is continuing to assert that companies must not be allowed to walk away from their responsibilities, even in times of economic uncertainty,” Bender said. [Then why did / does the AER fraudulently help companies get away with creating toxic messes amid endless non-compliances, continuously deregulate while lying to the public claiming to improve regulations, and look the other way when rules and laws are violated by companies? ]

The court decision sets a precedent when many juniors and some larger oil and gas companies – including Penn West Petroleum Ltd. — have warned they may need to seek protection from their creditors.

Oil industry executives and landowners in Alberta watched the case closely as it is expected to change the way the Alberta government regulates oil and gas well abandonment and clean up.

“It could have significant ramifications and that’s going to trigger some senior conversations between the province and the federal government,” said Brad Herald, chairman of the Orphan Well Association and vice-president of Western Canada operations at the Canadian Association of Petroleum Producers.

In the long run, Herald said, it could mean that oil and gas companies will need to pay more money into the orphan well fund for future clean up. [Needing to doesn’t mean companies will]

He also said he expects the AER will change the way it enforces oil and gas well clean up. “The province has some pretty big sticks,” he said.  [Ha! Joke of the century!]

Some of the comments in the Calgary Herald:

Lowen Thaler
And people keeps wondering why Oil and Gas companies are not that loved by Canadians (only by sector partisans).

They make a mess, get millions in paychecks, bonuses and dividends and then the taxpayer is left with the bill to clean up their garbage…..ops, sorry, not our problem anymore……disgusting!

Tomas Douglas · SAIT Southern Alberta Institute of Technology (Calgary AB Canada)
The accompaning photo is not an “abandoned gas well” since there is still a wellhead with attached flowline. An abandoned well is one that has been abandoned down hole with cement or mechanical plugs and the wellhead is removed and all the casing strings are cut off at least 1 metre below ground and the inner casing has a cement plug inserted and the outer casing is then covered with a welded steel plate.
The AER or the government will not get stuck with abandoned and clean up costs for the Redwater wells. The Orphan Well Fund will be used to pay for the abandonment and clean up costs. The Orphan Well Fund is funded by the yearly Orphan Levy which is assessed by the AER against all oil and gas companies that is based on its proportionate share of sector liability as determined by the Licensee Liability Rating (LLR). If the number of orphan wells increase and more money is required to abandon and clean up the wells the levy will be increased to cover the costs.

Diana Daunheimer
Mr. Douglas,

Not entirely correct. Please read:
http://www.orphanwell.ca/OWA%202014-15%20Ann%20Rpt%20Final.pdf

Ron Lind · Provost High School
Some of these oil companys are not paying their fair share. There should be a manditory bond posted by each one , to be used in the event of bankrupsy . And there are more than 700 orphan wells in Alberta.

Doug Mackenzie
Is the Provincial orphan well fund under-funded or is it sitting on $1.5 B ? anybody know? Diverse claims here….

Diana Daunheimer
The Licensee Liabilty Rating and the Orphan Well Fund are seperate entities, however the purpose of the LLR is such:

1 Purpose of the LLR Program
The purpose of the Alberta Energy Regulator (AER) LLR Program and licence transfer process as set out in this directive is to
• prevent the costs to suspend, abandon, remediate, and reclaim a well, facility, or pipeline in the LLR Program from being borne by the public of Alberta should a licensee become defunct, and • minimize the risk to the Orphan Fund posed by the unfunded liability of licences in the program.

5 Liability Management Rating Assessment
The AER’s LMR assessment is a comparison of a licensee’s deemed assets in the LLR, LFP, and OWL programs to its deemed liabilities in these programs. Any security deposit provided to the AER as a result of the operation of these programs is considered in determining a licensee’s “security-adjusted” LMR. The LMR assessment is designed to assess a licensee’s ability to address its suspension, abandonment, remediation, and reclamation liabilities. This assessment is conducted monthly and on receipt of a licence transfer application in which the licensee is the transferor or transferee. The determination of deemed assets and deemed liabilities in each of these programs is documented in
• this directive and Directive 011: Licensee Liability Rating (LLR) Program—Updated Industry Parameters and Liability Costs, for licences included in the LLR Program;
• Directive 024, for licences included in the LFP;
• Directive 075, for licences and approvals included in the OWL Program; and
• Directive 001: Requirements for Site-Specific Liability Assessments in Support of the ERCB’s Liability Management Programs, for licensees required to provide a site-specific liability cost estimate.

If a licensee’s deemed liabilities in these three programs exceed its deemed assets in these programs plus any previously provided security deposits (including facility-specific security deposits), it has a security-adjusted LMR below 1.0 and is required to provide the AER with a security deposit for the difference.

A security deposit determined as a result of an LMR assessment is required to minimize the possibility of the licensee’s suspension, abandonment, remediation, and reclamation costs being borne by the Orphan Fund.

For LMR calculation purposes, 100 per cent of the deemed assets and 100 per cent of the deemed liabilities of a well or facility for which it is the licensee are attributed to the licensee.

https://www.aer.ca/documents/directives/Directive006.pdf

So the AER are sitting on significant security deposits from the LLR, for the purpose of preventing exactly what has happened and been ruled upon in the Redwater case. Why is the AER not deploying that security? Great question and best of luck getting an answer from them!

Bruce Mccoy · Crescent Heights Senior High
This is exactly why this provence is so screwed up.Take the money and run and leave this mess behind for someone else to pay for it ,someone needs to review this matter ,who has some sense in thier head

Diana Daunheimer
Did Justice Wittmann offer his services to preside over this ruling? He seems to be the go to Justice for the oil and gas industry.

http://ernstversusencana.ca/alberta-faces-growing…

When you take a moment to review the balance sheets of the oil and gas producers in Alberta, you will see that a number of them are nearing insolvency and many more are in dubious debt. This ruling came at a very precipitous time for the industry and I am sure, along with the financial institutions that salivated and signed over funds for the fracking free-for-all, industry are pleased with this ruling.

The AER has estimated that above the 700 or more abandoned well bores in the OWF, there are 66,500 awaiting abandonment and an additional 76,500 inactive well sites. This is a matter of great public concern, as there exists a massive public liability, that is now one more legal ruling closer to total socialization of industrial pollution.

CAPP is likely rather giddy as well. With all the new additions to the fund this will create, surely CAPP will have to add another one of their lobbyists as a director of the OWF, as the current 3 out of 5 is surely not enough, to preside over the thirty or so wells that are fully abandoned each year. Can anyone explain why the largest lobby organization in all of Canada has the greatest voting power within the Orphan Well Fund?

Directors of the Orphan Well Association

Five representatives are appointed as directors by our Member organizations. Our directors and the Member organization they represent are listed as follows:

David Wolf (Stone Petroleums Ltd.), Explorers and Producers Association of Canada

Brad Herald, Vice-President, Canadian Association of Petroleum Producers

Orest Kotelko (Canadian Natural Resources Limited), Canadian Association of Petroleum
Producers 

Dave Marks, (Cenovus Energy Inc.), Canadian Association of Petroleum Producers

Brenda Cherry, Alberta Energy Regulator

Shannon Flint, Alberta Environment and Parks (honorary non-voting director)

http://www.orphanwell.ca/OWA%202014-15%20Ann%20Rpt…

So when Brad Herald of CAPP has this to say: “The province has some pretty big sticks,” what he fails to mention is that all those sticks are up CAPP’s a$$.

Take a peek at what the lobby organization is up to now. Pretty soon the AER will be selling cookies and frozen sausages in their fundraising efforts for CAPP.

http://ernstversusencana.ca/2016-aer-admin-fees-capp…

Above and beyond, CAPP has been sending their minions to all the municipalities in Alberta asking for a reduction in the mill rate taxes to 2:1. (current mill rates in some Northern communities are 13 or 14:1, the average is 3.5:1-equating to a substantial tax break for industry) While CAPP has our local councils audience, they are also shilling for Energy East, presenting misleasding and untruthful information in the process-such as EE will reduce foreign imports and increase domestic processing.

The OWF is overwhelmed, the LLR is ineffective, our justice system seems rather corporately biased, the AER is a pathetic regulator and CAPP, a lobby organization, is on paper as running the show.

This should be cause for serious concern, where is our provincial government in all this? Right, ignoring correspondence and deleting comments from their status.

If you need more of a sobering reality check on these issues, and then some, read Slick Water, by Andrew Nikiforuk. Afterwards you will have a far greater appreciation for Justice Wittman’s ruling and what this means for Alberta.

John Clark · U of Alberta
It’s time for the NDP to clean house at the Chief Justice office! [The NDP do not make appointments or contro Alberta’s Court of Queen’s Bench, the federal government does. Harper appointed Justice Wittmann as Chief Justice of Court of Queen’s Bench in 2009: “I’ll now be responsible for the whole province.”]

Some of the comments in the Financial Post:

Frank Wells · Jasper High School
There is also a growing problem with lease payments not being paid to land owners.

Adam Knox

This has been the story of mining in Canada for a century. Rape the ground for its wealth, then allow your “subsidiary” to go bankrupt and stick the government (and the tax payer) with the clean-up bill.

Carol Goodfellow · Works at Government of Alberta
… The LLR does not consider all of the companies deemed debts, only cost of reclamation over production and well assets. It is like me going to a bank and asking for a mortgage and the bank only taking into account my employment income against the mortgage debt alone. The AER does not take into consideration the companies other debts, giving a false LLR rating. There is currently not enough funds in the Orphan Fund to cleanup all the wells on the list. Thirdly, the Government of Alberta injected 30 million into the fund about ten years ago for this very reason. Landowner’s in Alberta are well aware of this issue for years and new this would happen. Cost of abandment and reclamation should not be on the backs of taxpayers. …

Diana Daunheimer
Carol Goodfellow
Indeed, landowners in Alberta knew this would be an issue long ago, but in spite of their concerns, thousands of Right of Entry orders were issued so that oil and gas exploration and production could occur on their land, against their will. And here we are today, with over 700 abandoments in the OWF, an estimated 66,500 needing abandoment and another 76,500 that are inactive.

The OWF is a CAPP pet project that remediates a trivial fraction of the abandoments each year and the LLR has proven to be ineffective. The end result, will be massive liabilties transferred to the public.

Mr-East Vancouver · Vancouver, British Columbia
The IMF (not exactly a left wing organization) estimates that we taxpayers subdidize the oil industry to the tune of 5.3 trillion dollars a year worldwide. Meanwhile the industry is destablizing the planet’s climate. We are fools to let this continue.

[Emphasis added]

[Refer also to:

2002 CCME 600,000 abandoned hydrocarbons wells in Canada

2007: Alberta’s boom bankrupting environment says top scientist

Plains Crash: In North Dakota’s oil patch, a humbling comedown

The fracking party is over, and a quiet desperation has descended on the state’s once-booming communities and the thousands of people who were drawn to them.

Judge grants railroad bankruptcy protection after Lac-Mégantic disaster, About 100 residents remain homeless for a year

Trudeau names Brian Ferguson, CEO of Cenovus (company along with Encana that’s been reduced to junk bond status) to Economic Advisory Council, possibly the most influencial people to be around PM and Finance Minister Bill Morneau

Oil bust could mean skyrocketing property taxes for ordinary residents & farms, Some Alberta municipalities hit hard as oil companies stop paying

As unconventional ponzi scheme implodes, Are Encana’s greedy law violations taking the company down?

Regulator Order Fraud? Was this AER’s plan all along? Bonavista Energy asking Alberta Court of Appeal to quash AER’s order that the company supply safe water to Sakens and their dairy herd after groundwater contaminated with sulfolane

Wyo Supreme Court awards rancher Brett Sorenson $1.1 million for CBM clean up. Justice Michael Davis: “We view Pennaco’s attempts to relieve itself of the obligations it bargained to perform more as a game of hot potato.”

How fast the greedy frac’ers fall: Privately held Sanjel broken up and sold to rivals, will only recover fraction of what it owes lenders 

Anadarko Petroleum settles U.S.-wide clean-up and health harm lawsuit for $5.15 billion, US Bankruptcy judge ruled the company should pay 19.35 billion and legal fees; Settlement ensures that: “Anadarko was not found to have done anything wrong.”

Freedom Industries, company behind W.Va. chemical spill in drinking water for 300,000 people, files for bankruptcy, faces at least 24 lawsuits

Bankrupt fracking company Norse Energy sues Cuomo Administration over delays studying impacts to health and environment

Supreme Court of Canada rules federal Bankruptcy & Insolvency Act can trump provincial motor vehicle laws if the two are in conflict

Chesapeake Energy Corporation Teams Up With Bankrupt GasFrac (Calgary) To Test Gelled (with what toxic chemicals?) LNG (Highly Dangerous) Fracking in Ohio

Industry lobby groups urge New Brunswick to lift frac moratorium. What for? To contaminate drinking water, divide and conquer communities, poison land, families and air while companies frac and go bankrupt and then demand that citizens finance their bad gambling debts?

Fracking Wells Abandoned in Boom/Bust Cycle. Who Will Pay to Cap Them?

Special Report: Uncovering abandoned oil and natural gas wells

Alberta faces growing backlog of abandoned oil and gas wells, Millions [or billions?] needed to clean up sites and mitigate environmental risk

Action needed on abandoned energy wells leaking methane in Quebec

Pennsylvania: Venango County Man Falsified Certificates Related To Plugging Abandoned Oil Wells; “The discovery of Wright’s falsification…has required the re-inspection, and likely re-drilling and re-plugging, of 95 wells”

Are Suspended/Abandoned Oilfield Wells Dangerous? Oil Field Worker Critical After Being Burned in Robertson County Explosion

Two-tiered Alberta: Urban, but not rural, home owners and businesses get inspections and protections from leaking abandoned energy wells and stratigraphic test holes: St. Albert residents sitting on abandoned oil and gas wells

Pipelines, facilities and active and abandoned energy wells can throw wrench into city planning; Trying to give city of Lethbridge more say

Planet Sludge: Millions of Abandoned, Leaking Oil Wells and Natural-Gas Wells Destined to Foul Our Future

Abandoned CSG wells ‘time bombs’

Abandoned Oil and Gas Wells Become Pollution Portals

Frac ‘n Fraud Down Under: Origin Energy execs kept aquifer contamination secret for more than 1.5 years, knew CSG (CBM) wells leaking into aquifers. Are Origin Energy CSG (CBM) wells contaminating Condamine River with ‘intensifying’ methane bubbling too?

CBM Cleanup Fraud? Wyoming Supreme Court rules Pennaco Energy responsible for CBM cleanup and back payments to two landowners, after selling wells to firm that went bankrupt

The cheap cost of oil and gas industry polluting drinking water aquifers: Companies & Pennsylvania DEP agree on fines for industry’s illegal methane migration into drinking water wells in 3 counties

Alberta Energy “Regulator” allowing more than 22,100 oil and gas wells to violate the rules for years. What other law violations is the AER allowing?

Trouble Beneath Our Feet: Leaking Energy Wells a Burning Issue; Big problem, Expensive to Fix, Impossible to Completely Stop

The end of shale gas exploration? “Output from shale wells declines so quickly that they will never be profitable – when investors realise this, the industry will collapse”

Four Of 10 Fracked Wells In Pennsylvania Projected To Fail; Time for Industry and Regulators to Move Out of Denial

Alberta oil companies walk from their responsibilities; Thousands of wells sit orphaned on people’s land with trees growing out of pump jacks and no reclamation in sight

Mountain View County will inform residents about new abandoned energy well rules

Abandoned Well May Have Caused Sullivan County Methane Leak

Perilous Pathways: How Drilling Near An Abandoned Well Produced a Methane Geyser

Calmar residents know the drill as company works to cap abandoned well

Imperial Oil leaking natural gas wells a nightmare for homeowners near Edmonton

Alberta Premier Ed Stelmach demands answers to why Calmar homes put in danger and built over abandoned gas well

AER trying to con the world again and look like a regulator? AER to study risks of aging energy infrastructure. Who’s going to do the study? CAPP?

Greedy Sods in Alberta Beg Trudeau for Half a Billion Dollars to Clean Up Oil’s Dirty Underware but Not One Penny to Help Frac’d Families & Fix Frac’d Aquifers

Set-up extraordinaire to burden Canadians with cleaning up billion-dollar profit-taking oilfield’s dirty underwear? Alberta landowners fight for enforcement by “No Duty of Care,” legally immune (even for Charter violations, gross negligence, acts in bad faith) regulator. Law violations ignored by AER, as usual

Where did Tory-Touted ‘Free Market’ Go? More theft by the oil & gas industry enabled by a politician? Premier Brad Wall begs Ottawa to make Canadians pay to clean up after billion dollar profiting oil & gas companies finish ravaging Saskatchewan

NDP Royalty Fraud? 3rd most profitable industry in the world assembles crack team to ‘quietly’ seek more subsidies, loyal media cheers. Alberta’s Big Oil Bias: Billions in subsidies & lies for oil, gas, bitumen, frac’ing; $5 million for municipal solar, $0.5 million for farm solar, $0 for home solar, $0 for the many poisoned by oil & gas, $0 for families with frac health harms, 0$ for contaminated or lost water

CNRL $68 Million Primrose “Down-and-dirty” Lawsuit. “No-one needs an excuse to bad mouth the Regulator, they hand out opportunities.”

Shoal Point NL: What Oil and Gas Industry Pollution Enablers do with Your Tax Dollars: Blame bacteria, when that doesn’t work, blame nature and change history

Frac Prosperity Prentice Style: Take $30 Million from Education, Give Hundreds of Millions (how many Billions?) to Oil and Gas Industry (and zip in royalties)

Calmar families asked to leave homes again in effort to fix Imperial Oil’s methane leak, Ordered fix made the leak worse

UK National Farmers Union Mutual Insurance New Frac Exclusion: “WE will not pay for liability arising out of any activity involving prospecting, extraction or refining of liquid or gaseous fuel. An example of such an activity is ‘fracking’”

Why does the “No Duty of Care” AER, legally immune, even for failing to protect Albertans and water from hydraulic fracturing, need a Liability Management Coordinator?

BC Gas Minister’s Leaky Well Comments ‘Ignorant,’ Scientist Says, Cornell engineer takes issue with Rich Coleman’s claim that BC is leak-freereading

Shale Gas Plagued By Unusual Methane Leaks, Scientists investigate high levels of damaging gas released in fracked areas

More on CNRL high pressure steam injection at Primrose and the Alberta Energy Regulator caving to its funder instead of regulating

Drilling and fracing cast shadow on home mortgages; underwriters concerned with the “unique risks associated with the fracing process”

Why Oklahoma Gets a Bill When the Oil and Gas Industry Abandons a Well

Taxpayers face $4.3-million bill, maybe millions more, after gas station owner fails to clean up; How many billions do taxpayers face in damages by oil & gas drilling, fracing & quaking, and ignored or covered-up by legally immune, “No Duty of Care” AER?

March 31, 2014 Devastation Day for Alberta’s Water: The Oil and Gas Industry takes over total control of Alberta’s Fresh Water as “No Duty of Care” Spying AER now a single regulator, 100% funded by industry, takes over Environmental Protection and Enhancement Act and Water Act ]

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