Redwater Energy

In 2015 Redwater Energy was petitioned into bankruptcy. The trustee appointed under the Bankruptcy and Insolvency Act (Canada) notified the Alberta Energy Regulator (AER) that it would only be taking control of Redwater Energy’s economically viable oil and gas wells but was disclaiming all ownership and responsibility for 107 uneconomic wells, all of which had significant environmental remediation and reclamation obligations attached to them. The AER issued orders to the trustee, requiring remediation of the wells. The trustee refused to comply with the AER orders, and successfully defended its position in the Alberta courts. The AER applied for and obtained permission to appeal the matter to the Supreme Court of Canada.

The Clinic was retained as legal counsel by the Action Surface Rights Association, an Alberta-based landowner advocacy group with concerns that uneconomic wells were not being managed correctly in Alberta and that landowners needed a voice in these proceedings. As legal counsel, the Clinic advised and assisted the Association in first applying for and obtaining intervener status in early 2018 for the appeal. The Clinic then advised and assisted the Association with preparing and filing written argument, and we appeared as legal counsel for the Association at the Supreme Court of Canada in February 2018.

In Orphan Well Association v Grant Thornton Ltd, 2019 SCC 5, the Supreme Court of Canada found in favour of our client’s position and ruled the trustee could not disclaim the uneconomic wells and thus would have to comply with AER remediation orders on those wells.

Related documents

The Action Surface Rights Association is grateful for the assistance provided by the Public Interest Law Clinic in a case with wide implications across Canada on whether polluters can walk away from their environmental liabilities associated with clean up and remediation. The work of staff and students at the Clinic made it possible for the Association to intervene before the Supreme Court of Canada and advocate for the protection of landowners and the environment. Hopefully the students at the Clinic also benefited by having the rare opportunity to appear at the Supreme Court. The Clinic's assistance was invaluable in giving affected landowners a voice in a dispute largely fought between industry, bankers and governments.

Daryl Bennett

Action Surface Rights Association