By Alex McCuaig

Abandonment jobs

City receives high marks for embarking on well abandonment program

Sep 12, 2019 | 5:37 PM

Medicine Hat, AB – The city’s move to launch an abandonment of more than 2000 gas wells is being widely praised as a forward-thinking move and industry-leading initiative.

“What the city is doing with its 2000 wells, I think that’s really smart,” said Cathy Linowski, head of the Medicine Hat College’s environmental reclamation program.

The three-year program is estimated to cost $90-million with costs roughly divided equally annually over the length of the program.

The city expects there to be job losses at the Natural Gas and Petroleum Resource (NGPR) division but experts in the field expect a significant boost in employment over the length of the program. This at a time when labour and expertise in the field is readily available due to the downturn in the oil and gas commodity prices.

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Linowski says she expects a boost to the college’s program as its specializes in environmental reclamation of the short-grass prairie.

“Our program is specifically designed for the environment around southeast Alberta, southwest Saskatchewan,” she said. “How you reclaim a well here in the dry, mixed-grass prairie is very different from the foothills or if you go up to central Alberta into the parkland or up in the boreal.”

The research lead for a group of researchers, former regulators and landowners examining the well abandonment issue also said the city’s move and timing for the program is something many of the oil and gas industry players could learn from.

“I think the city of Medicine Hat should be applauded for taking the initiative – going much further than anyone else in the oil and gas industry,” said Regan Boychuk, lead researcher for Alberta Liabilities Disclosure Project. That includes large industry players, he added.

As for job creation, Boychuk said it’s good for the local economy and the scale of the issue province-wide could put oilfield workers back on the job for years to come.

“That’s $90 million for the service sector of Alberta’s oilpatch that they hadn’t been expecting and it’s going to be welcome activity in the Medicine Hat area,” said Boychuk. “In this downturn, counter-cyclical work to keep people employed cleaning up wells – there is hundreds of thousand of wells in Alberta to be cleaned up. There is decades of work. We should be holding industry accountable to do their work while they are still around.”

The city was losing an estimated $30 million a year its gas assets leading up to Wednesday’s announcement.

In a statement provided to CHAT News, Mayor Ted Clugston said the losses were too much.

“It was a difficult day on Tuesday and the decision was definitely not made lightly. We simply cannot continue to produce gas at a loss,” said Clugston in the statement.

However, we would want to reassure our citizens that we are still in the gas business and we will ensure continuity of supply.”

The abandonment program is expected to run from 2020 to the end of 2022.