Orphan Well Levy
Source: https://law.ucalgary.ca/clinics/public-interest-law/projects/orphan-well-levy Parent: https://law.ucalgary.ca/clinics/public-interest-law/our-projects/public-participation
Every year the Alberta Energy Regulator (AER) issues an Orphan Well Levy to energy companies operating oil and gas assets in the province. This levy is used to pay for the Orphan Well Association (OWA) to perform closure and reclamation for assets where the licensee energy company is bankrupt and financially unable to do so. The Oil and Gas Conservation Act (Alberta)require that the levy be sufficient to cover the Orphan Well Association’s anticipated costs for the fiscal year and any deficiency from previous years. Despite this legal requirement, it is well known that the annual levy amount does match the funds needed to for abandonment, reclamation, and other closure work in the OWA inventory of orphaned assets.
This is an access to information project for the Clinic. Over the past several years, Clinic staff and students have filed numerous requests for records under the Freedom of Information and Protection of Privacy Act (Alberta). Records produced by these requests, together with other relevant materials such as OWA annual reports, have been reviewed and considered by Clinic students. This research is intended to inform democratic dialogue on how the levy is set and develop recommendations for law reform.
This matter is ongoing.
Related documents
- Drew Anderson, "Tracking down prominent Albertans behind delinquent oil and gas companies" (March 20, 2025)
- Shaun Fluker, Drew Yewchuk, and Martin Olszynski, "Grading the 2023 AER Liability Management Performance Report" (February 10, 2025)
- Drew Yewchuk & Shaun Fluker, "The Problem with Industry Control of the OWA, and OWA Control of Oil and Gas Insolvency" (July 9, 2024)
- Shaun Fluker, Drew Yewchuk, and Martin Olszynski, "Auditor General Updates Recommendations Unaddressed by the AER on the Effectiveness of Regulating Closure Liabilities in Conventional (Non-Oil Sands) Oil and Gas" (December 22, 2023)
- Drew Yewchuk, Shaun Fluker, and Martin Olszynski, "A Made-in-Alberta Failure: Unfunded Oil and Gas Closure Liability" (The School of Public Policy, October 11, 2023)
- Drew Yewchuk, "Freedom of Information: Brokering Access for Records on Oil and Gas Liability Management at the AER" (October 11, 2023)
- Drew Yewchuk & Chris Wray, “How is the Orphan Fund Levy Set? Alberta’s Oil and Gas Clean-up Costs in 2022” (March 17, 2022)
- Drew Yewchuk, “Alberta’s Orphan and Unreclaimed Oil and Gas Assets in July 2022” (July 16, 2022)
- Nigel Bankes, Shaun Fluker, Martin Olszynski and Drew Yewchuk, “Governance and Accountability: Preconditions for Committing Public Funds to Orphan Wells and Facilities and Inactive Wells” (April 24, 2020)
In the news
- As cleanup costs mount, oilpatch may be forced to pay deposit before drilling new wells, December 4, 2025, CBC Calgary
- UCalgary Law hosts first International Colloquium on Closure Liabilities in the Energy Sector, November 18, 2025, UCalgary News
- Alberta let an oil and gas company ‘in survival mode’ take over 170 wells. Now it’s not paying its bills, November 6, 2025, The Narwhal
- Alberta to relax rule on buying abandoned oil and gas wells when municipal taxes remain unpaid, July 15, 2024, CBC Edmonton
- [LISTEN] Alberta Auditor General says AER hasn't corrected even one of his concerns, December 28, 2023, Energi Talks
- How secrecy and regulatory capture drove Alberta’s oil and gas liability crisis, October 22, 2023, The Conversation
- Public inquiry needed into Alberta Energy Regulator, U of C study concludes, October 11, 2023, CBC Calgary