CAMROSE, Alta. – The petroleum industry should be forced to set up a fund to pay for farmland reclamation work at oil well sites where leases have been abandoned or the company has gone broke, said the president of Alberta’s umbrella farm organization.
“Why should the government be paying out tax dollars? Surely the energy industry should be responsible for those leases,” said Ron Leonhardt, the head of Wild Rose Agriculture Producers.
Right now farmers can apply to the surface rights board for compensation if they have complaints and the government must either write off the expense or go after the company.
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Leonhardt said larger com-panies are passing their less profitable wells to smaller companies who try to get the last drop of production. But smaller companies are at more financial risk and may go broke, leaving the landowners with a mess and no company to pay compensation or lease fees.
“What we have to do is take a different view. Instead of saying things are working well, say look, the energy industry has got to be responsible for the mess,” Leonhardt told Cec Purves, chair of the surface rights board during the Surface Rights Association annual meeting.
Set aside funding
“There has to be money set aside in a bond. Thousands of wells have to be reclaimed and the companies don’t exist any more.”
Eleven years ago the surface rights board paid farmers about $18,000 from government coffers for delinquent oil companies. Last year it paid out about $600,000 and this year expects to pay out $700,000.
Purves said all sides agree there should be an oil industry funded program so companies, not government, pay compensation.
“Everyone is trying to get something in place by 1996,” said Purves.
But Karl Zages, a surface rights consultant, said he’s not holding his breath.
“They’re saying ‘we’d like a fund’, but they’ve been saying it for a long time,” said Zages.
David Lloyd, head of the field services branch with Alberta Environment, said there is a proposal for the industry to pay for the cleanup of 60 wells this year. Forty of the wells have been abandoned. At the other 20 wells, some reclamation work has been done, but no surface reclamation.
