December 2024
In July 2020, the Government of Alberta announced a new liability management framework, and the AER released new requirements through Directive 088 in December of 2021. This report tracks industry performance as it relates to liability management and the impact of the liability management requirements over time. The purpose of this report is to improve transparency about industry’s management of conventional oil and gas liabilities and to develop performance measure baselines and ongoing assessments both of industry as a whole and individual licensees. This report will be updated annually, and additional data will be added as the liability management program expands.
- For 2023, the industry-wide closure spend requirement was set at $700 million. Together, licensees spent over $769 million, surpassing the requirement by 10%.
- 91% of licensees were compliant with their 2023 mandatory closure spend, leaving 54 noncompliant licensees with an outstanding amount of $5 million in missed closure quota (less than 1% of industry wide closure spend requirement).
- In total, over $1 billion was spent on closure in 2023, which comprised the licensees’ reported eligible spend of $769 million, closure spend funded by Alberta Government’s Site Rehabilitation Program (SRP) of $174 million, and the industry-funded Orphan Well Association (OWA) spend of $149 million.
- Industry continues to work on the backlog of inactive infrastructure. In 2023, the inactive well count decreased from 83 000 to 79 000 (5% decrease).
