If Premier Wall can collect $156 million from the federal government to invest in a worthwhile, environmentally triggered cleanup of abandoned and orphaned oil wells, then we say, more power to you, go get it.
If it means putting a few hundred, or perhaps over 1,000 oilpatch service employees back to work under a temporary contractual basis, we see nothing wrong with that, especially if we take into consideration the fact the Saskatchewan oil industry has sent several billions of dollars into provincial and federal coffers over the past eight hard-running years.
A $156 million return with a brief thank you note from a senior government would be nice right about now.
The critics will line up to knock the suggestion, as well they should, because that is their job.
They will point to the big, bad, oil companies that have raked in billions of dollars in profits, and ask why they and their employees deserve any bailout, even if it does come in the form of a scheme to put them back into the employment fold with a worthwhile project that will improve the environment.
Sealing and cleaning up around 1,000 or more abandoned wells is a good thing.
It should not be too difficult to identify the orphan wells that could be tended to first, and that could include long-time sites that had been left in states of neglect for several years.
In some instances, it may well be impossible to discern who bore responsibility for their care and attention decades ago. The companies involved would have disappeared. Some will have gone out of business, others taken over by another company who, in turn, may have been purchased by some other company, who, in turn, merged with another company and so on and so forth. Trying to track back and place responsibility of the cleanups would probably lead to all kinds of legal entanglements and unnecessary costs associated with it which could be circumvented.
The industry itself has set a course for orphaned wells cleanup and they (especially the producing companies) are contributing to a universal, industry-driven neutral fund that tends to that very issue. In other words, the industry recognized the problem of abandonment and the lack of responsibility in the past, and took steps to rectify the situation. So they showed initiative and have set out a course of action.
With $156 million in incentive funds, that cleanup program could be accelerated with a progress plan. An orphaned well identification project is already underway, so the time is ripe for this cash injection.
It’s not as if this infusion of money will launch irresponsible activities. This is not like the big banks (too big to fail) and insurance kingdoms taking their bailout money and keeping it for themselves, which is generally what happened when they went to the trough about eight years ago.
Knowing the oil industry as we do, we will go out on the limb and suggest that if this $156 million (and you can call it bailout money if you wish) is handed over, it will be used to do the job for which it is intended; and the jobs will be done efficiently within an allocated time schedule.
We don’t see this as a cash grab, but rather a potential acceleration of a program that is already in place that can be used to effectively close in the truly orphaned wells that might otherwise be left to fester for quite some time.
