Prohibiting oil production in Quebec will cost $100 million
Quebec will have to open its coffers to put an end to the search for and production of hydrocarbons. Companies in the industry will receive a total of $100 million and will be reimbursed 75% of the costs to close their existing wells.
The Minister of Energy and Natural Resources, Jonatan Julien, tabled a bill to this effect on Wednesday in the National Assembly. It is the companies themselves who will have the obligation to plug the wells to cease their activities.
“We have always said it elsewhere in this commitment that we made, that, in our desire to put an end to these activities, we were going to do it in a responsible way, in an equitable way, justified the minister in conference Press. This is why the bill includes the establishment of a compensation plan that provides for the reimbursement of expenses incurred by companies to acquire and maintain their license in Quebec.”
The sum of $100 million will compensate holders of oil and gas exploration and exploitation permits who have paid “exploration and development costs” between October 2015 and 2021. The amount is five times lower than what was claimed by the industry. The bill does not provide for any compensation for the loss of income or profits from a hypothetical operation.
An external auditor, chosen by the government, will be given the mandate to choose the companies that will receive compensations. In total, 62 wells will be plugged.
If the bill is passed, Quebec will become the first state in North America to prohibit the exploitation and exploration of hydrocarbons on its territory.
On Wednesday morning, the leader of the Liberal Party, Dominique Anglade, explained that industries should be compensated “at the lowest cost and in a non-improvised manner”. “The CAQ has accustomed us to improvising things on the corner of the table, she accused. What I would like to see is that ideally this figure tends towards zero with the companies. “wolves”. “With Mr. Julien as a shepherd, I am not surprised to see that he increases the bids. He has been opening the door to them for nine months, when he could have simply said that there will be no compensation. It really shocks me,” she commented at a press briefing.
The Parti Québécois described the decision to compensate the industries as “unacceptable”.