Saskatchewan Premier Brad Wall announced Monday he asked the federal government for $156 million to help fund oil and gas well cleanup efforts. In a press release he said the program “will stimulate economic activity and job creation while at the same time delivering environmental benefits.”
But Saskatchewan already has a fund in place for dealing with so-called “orphan wells,” or wells that have been left behind by companies or individuals who are no longer financially able to pay or legally responsible. Since 2009 the province has collected payments from wells in operation, and if the well doesn’t meet a particular threshold for financial stability the province may demand a refundable deposit as a guarantee. As of last fall that fund held $11.4 million in payments, up a million dollars from the previous year, plus another $45 million in refundable deposits.
The Alberta NDP government said in a statement on Tuesday that the province — despite having about seven times as many orphan wells as Saskatchewan — will not seek federal money because “industry should continue covering costs related to remediating abandoned wells.”
So why does Saskatchewan need $156 million now?