In the upstream oil and gas industry, an orphan is a well, pipeline, facility or associated site that does not have a legally responsible and/or financially viable party to deal with its decommissioning and reclamation responsibilities.
The AER first investigates possible orphans to search for responsible parties before designating individual properties (wells, pipelines, facilities or sites) as orphans. If you have any questions or concerns about possible orphans, please contact the AER Customer Contact Centre toll free at 1-855-297-8311.
Funded primarily by industry, the OWA’s job is to close wells, facilities and pipelines that do not have a solvent and responsible owner—known as orphans—to protect people and the environment, and remove the potential risk of unfunded liability. The OWA is an independent, non‐profit organization that operates under the delegated legal authority of the Alberta Energy Regulator (AER).
We are led by an independent Board of Directors with industry, regulatory and government representatives who oversee our operations, priorities and strategic planning.
The OWA is primarily funded by the annual Orphan Fund Levy, which is paid by the oil and gas industry in Alberta. The levy is based on estimated abandonment and reclamation activities for the upcoming year and is set by the AER in consultation with the OWA, the Canadian Association of Petroleum Producers, and the Explorers and Producers Association of Canada.
The AER allocates the Orphan Fund Levy to each oil and gas producer in Alberta based on their proportionate share of deemed industry liabilities as determined through the AER's Licensee Liability Rating Program and the Oilfield Waste Liability Program.
The OWA also receives funds collected by the AER through First Time Licensee and Regulator Directed Transfer Fees, which are paid by oil and gas producers.
In additional to regular funding through the Orphan Fund Levy, the Province of Alberta has committed a total of $335 million in repayable loans to the OWA, with a grant of $30 million from the Government of Canada to cover interest charges for the first $235 million. The remaining $100 million loan will also be interest-free for the OWA. The Government of Canada has separately supported our work with a $200 million repayable loan.
Compensation to landowners for unpaid surface lease payments from a defunct or insolvent company is not within the OWA’s legislated mandate. If you have any questions about applying to receive lease payments for your land, we encourage you to call the Alberta Surface Rights Board toll free at 310-0000, then 780-427-2444, or visit www.surfacerights.gov.ab.ca.
The OWA requires files to be sorted in boxes that are clearly labelled by well files, surface land files and engineering/pipeline/environment files. Please do not send mineral lease files, correspondence files or contract files. A list of the box contents is requested whenever it is available.
To contact us regarding files, please call (403) 297-6416.
The OWA works across the province. After risk-assessing and prioritizing our inventory to ensure public safety and environmental protection, we look for opportunities to bundle projects regionally to maximize efficiencies. We deploy Prime Contractors so that, wherever possible, they work on several projects in an area, approaching them as one larger initiative from a workforce and supply-chain view, regardless of the corporate holder of orphaned liabilities.
The OWA’s procurement approach ensures a fair process where we select contractors who:
The OWA has identified 22 Prime Contractors—or contractors of choice—to manage field activities and ensure the safety of all workers on site. Part of their role is to select subcontractors, of which there are currently a total of close to 600. The role of a Prime Contractor has several legal and safety requirements. The OWA must ensure that any company being assigned as a Prime Contractor has the capability to meet these legal requirements.
The OWA recently completed a process to add Prime Contractors to perform additional work based on the recently announced $100 million loan from the Government of Alberta. With the new Government of Alberta and Government of Canada loans, we are planning a new process in collaboration with our Prime Contractors to select preferred subcontractors. The process will involve interested vendors submitting information about their experience, technical expertise, location, safety record and rates. This process is currently under development and will be posted to our website when finalized.
We expect that there will be substantial interest in participating in our subcontractor selection process. As a result, we are focusing our attention first on our largest spend areas.
Information will be updated on our website as plans move forward.
For more information on how to work with the OWA, visit Request for Information.