The B.C. Oil and Gas Commission says it has designated 401 wells and three facilities formerly owned by Ranch Energy as orphans.
The commission said June 17 it made the decision after the Court of Queen’s Bench of Alberta approved a transaction that will see 414 oil and gas sites owned by Ranch transferred to Erikson National Energy Inc. The commission says it is liable for unsold assets.
"The Commission has been preparing for this possibility for many months," it said in a statement. "The orphan designation of the Ranch sites will allow further site clean-up and restoration work to be done."
Ranch was placed into receivership in July 2018, and the commission says it will cleanup the sites through its orphan site reclamation fund.
Last year, it estimated the cleanup tab between $40 million to $90 million. Some work has already been ongoing.
"Throughout the court proceedings, the Commission took action to complete high priority work on Ranch sites to ensure public safety and protection of the environment," the commission said.
"This included the abandonment (permanent plugging) of 11 wells, as well as draining water levels in a storage pond to safe levels. The Commission continued to inspect Ranch sites to ensure the ongoing safety of operations throughout the proceedings."
The commission says it is now responsible for 770 orphan sites in B.C. Of those, 56 sites are substantially restored, which it says is less than 3% of all oil and gas wells in the province. The rest are in the care and control of viable companies, the commission said.
"We will continue working with land owners impacted by the Ranch decision," the statement said.
The commission says it is spending more than $27 million in 2020/21 through its orphan program. That includes the abandonment of 80 wells, as well as the investigation of 40 sites, remediation of 20 sites, and reclamation of 15 sites.
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