SOURCE: The Narwhal
DATE: March 12, 2019
SNIP: Nearly 400 kilometres north of Fort St. John is a large, leaking fracking pond owned by Ranch Energy Corporation, a Calgary-based company that went into receivership last year leaving 700 gas wells in B.C. and a sea of debt.
The storage pond is filled with 113,000 cubic metres of sludge and water that may be contaminating soil and groundwater through a documented leak in its outer lining, according to the B.C. Oil and Gas Commission.
Twenty months ago, the commission issued an order to Predator Oil BC Ltd., the company that sold Ranch the wells, to empty the pond and test for contamination.
But nothing has been done. Ranch’s receiver, Ernst & Young, says it’s an expense the estate cannot afford.
The story of Ranch — pieced together by The Narwhal from a review of receivership documents and B.C. Oil and Gas Commission documents — highlights some of the mounting financial and environmental problems created by B.C.’s fracking industry.
And that’s even before a fracking blitz gets underway in the province’s Peace region, already covered by thousands of wells, to supply gas for the $40 billion LNG Canada project that will ship liquefied natural gas overseas.
Fracking, or hydraulic fracturing, involves the injection of large amounts of water and proprietary chemicals into the ground to release gas.
When companies like Ranch become insolvent, the provincial government is left holding much of the substantial clean-up bill for the industry equivalent of a dine and dash.
300 to 500 Ranch wells could still be designated as orphans, leaving the commission responsible for additional clean-up costs it estimates at $40 million to $90 million — but with less than $14 million budgeted for the orphan fund over the next year.
John Werring, a senior scientist and policy analyst with the David Suzuki Foundation who trekked more than 10,000 kilometres in B.C. to document fugitive methane emissions from gas wells, said potential contamination of groundwater and impacts on wildlife and vegetation are some of the main concerns associated with leaking fracking ponds.
He pointed to his field work in the Montney formation in B.C.’s Peace region, one of the largest shale gas resources in the world, where he saw other fracking ponds that appeared to be leaking.
“In particular, animals like moose and caribou are attracted to what they call mineral licks. They would be around these areas where we saw leaks,” Werring said.
“The smell was terrible. We took samples of the water and found there were high volatile organic compounds. Downstream of the slope where these ponds were leaking all the vegetation was dead.”
Werring’s research showed that less than six per cent of all abandoned wells in B.C. are on sites that have been reclaimed and replanted.
“Most of the wells that are abandoned still have infrastructure on site — well heads, buildings, things like that that need to be dealt with,” Werring said. “There are a lot of these wells out there that are not properly abandoned. So there’s a huge liability there that now falls on the Crown.”
“A lot of these wells are dangerous. They could deteriorate, fall apart, cause major environmental problems. Unless somebody fixes them it could be an ongoing liability not just from a financial perspective but from an environmental perspective. The question comes down to, ‘Who’s going to pay for all of this?’”
According to an affidavit from James O’Hanley, the oil and gas commission’s vice-president of applications, filed as part of Ranch’s receivership proceedings, B.C. has 326 designated orphan well sites, of which 310 require further restoration.
The oil and gas commission’s service plan also reveals the glacial pace of orphan site restorations in B.C. even as the number of sites rapidly increases.
In 2017-18, the commission restored six orphan well sites. In 2018-19, it forecasts that it will restore just three, noting that other sites have work underway.
[Read the rest of this excellent in-depth piece about abandoned fracking wells in BC in The Narwhal.]