Updated with comments. Lacombe Alberta: Herr Lecturer, Journalist Andrew Nikiforuk, warns $260B worth of oil and gas industry liabilities could be dumped on taxpayers. “Most companies that have gone into fracking are short of cash, highly indebted and barely making a go of it.”

Subject: Nice To Hear The Truth–Right Here In Alberta!!
Date: Fri, 11 Oct 2019 13:37:14 -0600
From: Stewart Shields email hidden; JavaScript is required
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It was a very nice change to hear a journalist’s opinion on the energy industry who refuses to have the weight of the oil industry placed around his neck!! Maybe Andrew was simply lucky to have arrived in Alberta for his energy talk just before Kenney’s Energy War Room got it’s full commission?

Will others carrying similar messages to Andrew’s be snatched and thrown in Jail—by members of Kenney’s Kamikaze Gang—with huge sums demanded to be donated to the UCP Party for their release??

But seriously –it was encouraging to hear someone singing out the truth about how our publicly owned petroleum resources have been managed since Lougheed’s departure from the Alberta Conservative scene!!

It was indeed hard to remain silent when a public member inquired about where the government subsidized the Alberta petroleum industry?? Remembering that the Alberta Conservative government of Ralph Klein caused a petroleum migration to Alberta—that foreign- as well as domestic bitumen developers could cash-in on a “Super Socialist” system of having their entire Capital Cost recovered by the Alberta State for those developing a bitumen business by receiving the results of the Alberta Public’s Royalty production– until their capital costs were covered?? This was totally unheard of in the free world—and brought the entire energy world to Alberta’s door to reap the rewards of Klein’s drunken stupidity!! Soon Alberta was booming with bitumen production—without any thought of the requirements needed to back-up these massive piles of production!! We now can appreciate that the industry leaders are very poor in laying any long term plans—expecting governments to take care of their needs cradle to grave!!

While the Alberta NDP government did indeed try to move the petroleum industry into greater action on the host of idle wells the Conservative governments since Klein allowed to remain an Alberta eye sore—with a $265 million loan-against the industries own $30 million advancement to the Orphan Well Fund—the idle well numbers continue to rise over those reclaimed year after year!!

NiKiforuk pointed out plainly to the Lacombe audience that Albertans were dead wrong to try to make Trudeau the crap goat for the failure of petroleum prices -caused by over production and greedy Oil Barons without nay long term plans for their production!!

Many Conservative heads dropped a few inches in the Lacombe audience when told that each Premier since Lougheed in Alberta had actually dropped the owning public’s royalty take from a bbl. of oil??

The background to the total Nikiforuk presentation was the fact that Alberta’s present financial situation was the result of bad management by the Conservative governments left in power year after year to assist the greedy industry in raping the Alberta Owning Public!!

Stewart Shields

Herr Lecturer in Lacombe warns $260B worth of fracking liabilities could be dumped on taxpayers, Journalist Andrew Nikiforuk has studied the economic, environmental effects of fracking since 2004 by Todd Vaughan, Oct 9, 2019, Lacombe Express.com

Burman University’s Herr Lecture Series returned with a talk by Andrew Nikiforuk, an investigative journalist who has won seven National Magazine Awards and the Governor General’s Award For Non-Fiction.

Since 2004, Nikiforuk has been investigating the fracking industry in Canada — particularly in Alberta and British Columbia.

Nikiforuk, who is an Albertan landowner, said his talk focuses on two primary messages: One being that the oil and gas fracking industry has created a financial mess, particularly in Alberta, and the second issue being that fluid-injection technology like fracking has created an environmental mess which includes increasing seismic activity and other environmental impacts.

Financial impact

Nikiforuk said that fracking has created a financial mess for the oil and gas industry.

“It has driven down the price of both oil and gas; and at the same time the technology is high cost,” he said.

“Most companies that have gone into fracking are short of cash, highly indebted and barely making a go of it.”

Nikiforuk says indebted fracking companies are a problem for municipalities and the Province because they don’t pay the taxes they owe, they do not reclaim aging oil and gas wells and they do not pay their service leases to landowners. This has resulted in over $260 billion in liability for the province of Alberta.

“They are a drain on rural communities,” he said.

Nikiforuk said that no Albertan government, including the PC, NDP and UCP governments of the past have had or have a strategy for this issue and the current government has chosen to blame the issue of commodity prices on the Federal Government and environmental groups.

Nikiforuk said it is human nature to find a scapegoat, but the liability issue will affect everyone.

“$260 billion worth of liabilities is going to be dumped on taxpayers and that should not be happening. The regulator said that wouldn’t happen, well I am sorry guys — it is happening big time. The regulator didn’t do its job,” he said.

Environmental impact

Nikiforuk second message was on the relationship between fracking technology and the creation of earthquakes — which is extensive.

”About 80 per cent of the earthquakes in Alberta today are the product of fluid-injection in one form or another, whether that is wastewater disposal, acid gas injection or hydraulic fracturing,” Nikiforuk said.

The Province has recently instituted a traffic light system, which is supposed to prevent large-scale earthquakes and hold companies responsible, but Nikiforuk said this not enough due to the unpredictable nature of seismic activity.

”You can’t control the timing of these things and no one has a clue where all the faults are. This is a high-risk activity,” he said.

Overall impact

Ultimately, Nikiforuk said the health, environmental and community costs of fracking are not worth subsidizing an industry.

“It is more expensive to extract this resource than the market is paying for it and that is a problem. In a rational market place, you would stop producing but nobody stopped because they need to generate cash to keep themselves going,” he said.

Nikiforuk said the industry generally pays very little in royalties, gets their water for free and are heavily subsidized.

He said the province needs to recognize that this is a symptom of a new volatile era of oil and gas.

“We need to recognize we have a massive problem with suspended and orphaned wells. We need to put people back to work addressing that liability rather than digging the hole bigger financially and environmentally,” he said.

Nikiforuk added that the liability of this issue affects us all, but is particularly being imposed on landowners.

“They are saying this system sucks, the regulator doesn’t represent us, we aren’t being paid for service leases; water is being drained from our community and municipal taxes aren’t being paid,” he said.

“This industry is a liability for rural communities in this province and the Province needs to respond and see that the big picture does not look good.”

Going forward

Nikiforuk said there are still things Albertans can do, including applying pressure on their municipal and provincial representatives.

They need to stop being in a state of denial about where the industry is,” he said. “The industry is mature in this province, it is highly indebted and it is becoming increasingly unprofitable.

“You will not change that by subsidizing the industry. You will create a disaster for the province.”

Comments to the article in the Red Deer Advocate:

Julie Ali
It is pretty clear to me that all Canadians are going to be stuck with the $260 billion in environmental liabilities because this is the way we have been set up by Conservatives in Alberta.

The Tapcal Trust Fund was set up in Lougheed’s time; it allowed the PCs to have access to money from unknown donors to maintain a 44 year old dynasty.

Who donated to this fund? What did they get in return? Did they get their 3 wishes and more? Was one of these wishes to backend the environmental liabilities and then be able to walk away from these costs at the end of a profitable business period?

No sort of effort has been made to ensure that the AER is responsible; in fact the PCs set up REDA specifically so that the AER can’t be sued and is above the law. Who on Earth makes the energy regulator immune and allows this sort of protection?

The NDP did not repeal REDA; the UCP folks are shoring up the propaganda of Synergy Alberta groups with the war room that is immune to FOIP requests which allows it to operate with impunity. To see such a disgraceful disregard for our democratic rights after REDA indicates that the new Conservatives (UCPs) are worse than the old Conservatives (PCs).

But Albertans don’t know, don’t care and seem to be willing to trade non-renewable resources, water supplies given free to CAPP, environmental integrity that is lost to pollution, earthquakes and water on fire for the almighty buck.

It’s a bad trade. But there you go.

Domenico Mancuso
Everyone is entitled to their opinion, whether it’s right or typical NDP hysteria.

Emmanuel Logos
Not hysteria Domenico. I'm one of those landowners who is living the reality of having energy production infastructure being orphaned on their land. I have an industrial operations on my land that NO ONE is in control of or willing to take responsibility for. It's just left in limbo, because the operator went bankrupt, after only 18 months in business. Is this well leaking? Don't know, can't know, as there is no one checking on the safety of it. Is there an Emergency Response Plan, that protects my family if there is ever a leak? The answer to that would be no, beacause there is NO ONE to facilitate one. Is my family at risk? Is my property at risk? I'd say yes and all this because the AER won't take steps to protect rural Albertans. On top of that, our local county is owed nearly a million in back taxes from the same energy company. All this from just one energy company. And as time rolls along we see more and more of these companies going under, adding to an already tenous sector. The oil patch in Alberta is a disaster on the verge of collapse. Most of it caused by the industry itself and by a regulator who has not properly looked after the interest of the province.
Like · Reply · 2 · 11h
Chris Kostashuk
You're getting old Domenico, I'd be more careful about expressing your stupid opinions. My generation isn't going to be kind to yours when you need it most. You can rot in old folks homes like your parents did.
Julie Ali
Domenico Mancuso: It is hardly hysteria when the information is provided by the AER itself. No one dug this information out.
The industry regulator did the work for us.
But sure, ignore the $260 billion in liabilities. You won't be around to pay for themess; our grandkids will pay.

Jennifer June Dyck
Already companies are walking away to leave the mess for us tax payers to clean up

Ken Sonnenberg
Liberal hysteria!

Dan Tkachuk
????? …. now there is a human trait ….. blame the politician …. dumb climate denier!!! Or show me the PROOF!
Julie Ali
So it's Liberal hysteria when the AER- the CAPP energy regulator tells us that there is a $260 billion dollar liability for taxpayers?
Wow. Synergy Alberta sure is good at propaganda.
With all these sheep, the wolves have no problems.

Refer also to:

October 8, 2019: Andrew Nikiforuk presents “Disruptive Shaking: The Impact of Fracking on Rural Communities” at Centre For Peace And Justice – Herr Lectures, Lacombe, Alberta

To learn about the history and science of frac’ing, read Nikiforuk’s Slick Water

Andrew Nikiforuk honoured with USA National Science in Society Award for Slick Water. “NASW’s Science in Society Journalism Awards honor and encourage outstanding investigative and interpretive reporting about the sciences and their impact for good and ill.”

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