CALGARY, Alberta (Reuters) - Industry fees for an oil-well reclamation program in Alberta, the biggest oil exporter to the United States in the world, will rise more than 20-fold, the Canadian province’s energy regulator said on Tuesday after undertaking the first review of the program in seven years.
The Energy Conservation Review Board said it will require 248 companies to post financial deposits totaling of C$297 million ($290 million) to ensure that the costs of well abandonment and reclamation are covered by the oil industry.
The new rules are a massive increase from the 2006 version of the program, which required 88 companies to post bonds or cash worth a total C$13 million to cover reclamation costs.
“Most of the industry will feel this,” said Darin Barter, a spokesman for the regulator.
The amount each company will have to pay will vary and will be set by assessment, Barter said.
Companies will be able to lower the cost by taking actions such as returning suspended wells to production.
The board said the new rules will be introduced in three phases, beginning on May 1 of this year, with the full amount in place on May 1, 2015.
Reporting by Scott Haggett; Editing by Peter Galloway