RKS: Stop concessions to oil lobby until they meet their obligations

News & Opinion

Canada’s oil and gas lobby are like a pig whose voracious hunger for corporate handouts from the public trough is insatiable. 

It’s time the general public demanded more accountability from our politicians and regulators, and that in turn our regulators and politicians do the same of industry. 

Now, let me be clear, my family has made a living in some form of fossil fuel extraction or servicing for the better part of the last 30 years. The hardworking men and women in this industry have made great sacrifices and contributed significantly to our country through their efforts. 

This quibble is with the members of the corporate suites, and the politicians that have looked the other way while boards abrogated their environmental and societal responsibilities while stuffing executives’ pockets with bonuses, shareholders pockets with dividends, and political campaigns with donations and resources. 

As of the end of January, there were 3,406 orphan wells in Alberta, with another 94,000 inactive wells in the province.

According to Alberta’s own numbers, they estimate that the cost to clean up every oil and gas well could be in excess of $30.1 billion. But the Alberta Energy regulator only holds about $225 million in security on those wells. 

These same producers currently have $173 million in deficient taxes to Alberta’s rural municipalities.

Yesterday, Prime Minister Justin Trudeau announced a $1.7 billion package to clean up and remediate abandoned and orphan wells in British Columbia, Alberta, and Saskatchewan. Alberta’s share of that package is $1 billion with another $200 million loan to the Orphan Well Association. 

While that figure only puts a small dent in the liabilities the province faces, it’s $1.2 billion more dollars than taxpayers should be footing for a financial and environmental liability that rests with the sector. 

Yesterday, news broke that Canada’s producers had sent a letter to federal Natural Resources Minister Seamus O’Reagan. In that letter, Canadian Association of Petroleum Producers CEO Tim McMillan encouraged the federal government to freeze the carbon tax and delay new climate change regulations.

Among the requests is suspension of environmental reporting on emissions, delays on reporting on air and water pollution, postponing new fuel efficiency standards. 

The association is using the cover of a public health emergency as leverage to fight regulations that they have up to this point been unsuccessful in fighting against. 

The lobby group argues they are financially constrained by the Covid-19 crisis, a valid argument. 

If the presence of a crisis is cause for pause on these issues, would the absence of the same crisis lead to support for these important measures? Unlikely. 

Claims that the crisis make it unsafe for staff to conduct the required monitoring without risking health and safety strain credulity, particularly when they continue to operate fly-in, fly-out camps in Northern Alberta, one of which has been the source of a significant outbreak that has spread to other provinces now as transient workers return to home

These actions are nothing more than a crass cry of “please sir, may I have some more!” as the government doles out cash to cover for the industry’s incompetent management, whose priorities have lied with increasing executive compensation, building cash reserves, cutting workforces, and providing dividends and share buybacks – all while taking generous tax cuts and incentives from the Government of Alberta intended to foster job growth. 

If we’re going to bail out anyone, it should be the families who have made this industry sustainable in spite of the messed-up priorities of its leadership, not because of it. 

While the energy sector, in all its forms, is important to Canada’s economy and recovery post-Covid-19, it’s time that we said enough is enough to the oil lobby. 

We need to stop privatizing the profits while socializing the liabilities, or we need to let them fail and be replaced by more competent and accountable operators. 

Robbie Kreger-Smith is a consultant for restaurants, communications, and marketing with previous partisan political experience in Alberta.

Connect: @RKSAlberta