hazzmatt1

Using biosolids to revegetate inactive mine tailings

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Vale Canada (a global mining company with an integrated mine, mill, smelter, and refinery complex in operations Sudbury, Ontario) has been working with Terrapure Environmental (an industrial waste management company) to utilize biosolids on its main tailings area.

For over 100 years, tailings from the milling operation have been deposited in the Copper Cliff Central Tailings impoundment. The facility is still active, but approximately 1,300 hectares are inactive and need reclamation work.


The Big Nickel in Sudbury (Photo Credit: pizzodisevo)

Over the decades, Vale has had some success in revegetation of its tailings area, but there are still large areas of bare or sparsely vegetated tailings, which have led to wind-erosion-management challenges. To control dust, Vale uses agricultural equipment to cover the tailings with straw or hay, as well as a chemical dust suppressant. These practices are costly, and they have to be done continuously to maintain an appropriate cover at all times. In 2012, Vale decided its tailings needed a permanent vegetative cover—not just to suppress dust and reduce erosion, but to improve overall biodiversity. They entered into discussions with Terrapure Organics Solutions (formerly Terratec Environmental) to collaborate on a trial project to apply biosolids on the mine tailings.

In 2012, Vale decided its tailings needed a permanent vegetative cover—not just to suppress dust and reduce erosion, but to improve overall biodiversity. They entered into discussions with Terrapure Organics Solutions (formerly Terratec Environmental) to collaborate on a trial project to apply biosolids on the mine tailings.

THE CHALLENGE

The biggest challenge was forging a new path for this type of work. Applying biosolids to mine tailings had never been done before in Ontario. Just to get the right permits and approvals took about two years. Vale Canada and Terrapure worked closely with the Ontario Environment Ministry to ensure standards compliance. Some of this work included helping to determine what those standards should be. Terrapure was able to contribute to these discussions, leveraging decades of expertise in safe biosolids application to agricultural land. Once the Environmental Compliance Approval came in April 2014, the team had to figure out the best application method and proper amount to encourage vegetation, which meant a lot of testing and optimizing.

THE SOLUTION

At first, Terrapure mixed biosolids into the surface layer of the tailings. Over time, however, the team learned that applying biosolids to the surface, without mixing, allowed for greater rates of application and coverage at a lower cost.

Terrapure also had to experiment with the right tonnage per hectare. After seeding four trial plots with different amounts of biosolids coverage—20, 40, 60 and 80 dry tonnes/hectare—it was determined that 80 dry tonnes was best for seed germination. At the time, it was the maximum allowable application rate. By the end of 2014, approximately 25 hectares of tailings were amended. Where the biosolids were applied, there were impressive results. Wildlife that had not been seen feeding in the area in years started to return. In 2015, the Ontario Environment Ministry approved an increase in the biosolids application rate to a maximum of 150 dry tonnes/hectare, which was necessary for providing higher organic matter and nutrient levels, and for stabilizing the tailings’ pH levels. This approval also increased the cap on the amount of biosolids that could be delivered to the maximum application rate per hectare. To enhance the program even more, Terrapure and Vale partnered with the City of Greater Sudbury to blend leaf and yard waste with biosolids. By blending these materials, the mixture becomes virtually odourless, its nutrients are more balanced and it allows for a more diverse application.


Glen Watson, Vale’s superintendent of environment, decommissioning and reclamation, surrounded by lush vegetation covering part of the company’s Central Tailings Facility in Sudbury

THE RESULTS

As of 2018, Terrapure has successfully covered over 150 hectares of Vale’s tailings with municipal biosolids. Vegetative growth and wildlife are well established on all areas where the team applied organics. Just as importantly, this project has diverted more than 25,000 dry tonnes of valuable biosolids from becoming waste in the landfill. Following the success of the initial trial, the Environment Ministry widened the approval to include all areas of the inactive tailings and a portion of the active tailings. At the current application rate of 150 dry tonnes/hectare, Vale’s central tailings facility could potentially require another 195,000 dry tonnes of biosolids. That’s more than 30 years of biosolids utilization, at an annual rate of 6,000 dry tonnes of material. Needless to say, Vale is very pleased with the results, and the relationship is ongoing. In fact, the Vale team is evaluating other sites in the Sudbury area for this type of remediation, ensuring a long-term, environmentally sustainable rehabilitation program.

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hazzmatt1

Ski Slope on the roof the Copenhagen’s New WTE Facility

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The City of Copenhagen’s new waste-to-energy facility has quickly become a popular destination with the city’s residents as it has a 600 metre ski slope on its roof.

The idea of topping a municipal plant with an urban ski resort won a string of accolades for the Danish architecture firm Bjarke Ingels Group (BIG). The park itself was designed by SLA Architects. Two years ago the architectural model went on display at the Museum of Modern Art in New York.

In an interview with the Guardian, city resident Ole Fredslund said, “I live so close by that I could follow the development. I guess 90% of the focus is on the fact that there’s a skiing hill coming, so in a way it’s very clever. Everybody talks about the ski hill to be, not the waste plant to be.”


Photograph: Mads Claus Rasmussen/EPA

The entire WTE facility cost $840 million Canadian to construct. The facility sits on top of a plant that has been producing heating for homes since 1970. Work began on the facility in 2013.

Eventually, the entire ski run will be divided into three slopes with a green sliding synthetic surface, plus a recreational hiking area and an 80 meter (264 foot) climbing wall. Once the whole project is completed, the roof will contain ski slopes, green spaces and hiking trails. The slopes will have ski lifts to take people up to the top of the runs.

The innovative waste-to-energy plant can burn 31 tonnes of waste per hour while cutting emissions by 99.5%, which makes it capable of converting 360,000 tonnes of waste every year. Its total net energy efficiency of 107% is among the highest in the world for a waste-to-energy facility

The plant currently processes waste from 550,000 residents and 45,000 businesses and produces electricity and heating to approximately 150,000 households.

Babcock & Wilcox Vølund designed and built the facility. It is owned and operated by Amager Ressourcecenter (ARC), a corporation jointly owned by five Copenhagen-area municipalities.


Image courtesy of SLA Architects
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John Nicholson

Toronto Offering Community Grants for Innovative Waste Management Ideas

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The City of Toronto recently released a request for applications to participate in its Waste Reduction Community Grants Program. The deadline for to submit an expression of interest is March 1, 2019.

The Waste Reduction Community Grants Program is part of the City’s Long Term Waste Management Strategy, which identifies the need to support grassroots initiatives that reduce waste. The program launched last year and awarded more than $116,000 toward ideas that included the development of signage and programming for tenants of a downtown building, establishment of a sharing library for special event materials for the community, educational training on reducing textile waste and making sustainable fashion choices, and a program aimed at reducing lunch packaging in schools.

Initiatives eligible for funding include those that promote waste reduction and reuse, increase waste management education and engagement, and align with the City’s Long Term Waste Management Strategy. Priority will be placed on initiatives that promote waste reduction in apartment buildings and condominiums, and involve multilingual communities, equity-seeking groups and Neighbourhood Improvement Areas. 


City of Toronto Campaign: What happens when you recycle wrong
 shows how bad things happen when you toss garbage into theblue bin

Groups eligible to apply for funding include resident, tenant, neighbourhood and business associations, service clubs, community organizations, registered charitable organizations, environmental organizations and school groups, clubs and councils.  The following eligibility criteria must be met to participate in the program:

  1. the project must demonstrate how it aligns with the Long Term Waste Management Strategy and supports the City’s aspirational Zero Waste goal;
  2. the organization must be incorporated and have non-profit status. Organizations without these prerequisites may apply if they enter into a trusteeship agreement with an incorporated non-profit organization; and
  3. your group/organization must fall into one of the eligible categories below.

The grants support the City’s Long Term Waste Management Strategy and reflect its guiding principles:

  • working with community partners to enhance access to waste diversion programs;
  • increasing public engagement; and
  • working together to deliver services.

The strategy puts priority on reducing and encouraging the prevention of waste, maximizing its value before disposal, and supporting the move towards a circular economy. Waste diversion, which minimizes the amount of waste sent to landfill, follows reduction and reuse in order of priority.

More information about the Waste Reduction Community Grants, the 2018 recipients and the application process is available at https://www.toronto.ca/wastegrants.

For a detailed program overview, please refer to the Application Guidelines.

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hazzmatt1

Ontario: Orphaned Eco-Fees Raises Legal Questions for Electronics Industry

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by Jonathan D. Cocker, Baker McKenzie

Ontario’s waste electrical and electronic equipment (e-waste) stewardship obligations are being transitioned to a circular economy legal regime.  The government-overseen e-waste program is being wound-up and will effectively cease as of June 30, 2020. The program has managed to generate such a surplus of funds from consumers it otherwise would pay the electronics recycling industry that it’s obtained approval from the Ontario government to grant the industry, and presumably in turn, consumers a “fee holiday” in order to expend the surplus. The fee holiday started on February 1st, 2019 and runs until June 30, 2020.

This means no eco-fees (or Environmental Handling Fees) on electronics are to be charged and remitted for the next 17 months when the program ends.

No Relaxation For Electronics Industry During Fee Holiday

But what if the electronics supply chain and retailers somehow continue to pass the now orphaned eco-fee down the supply chain and ultimately to consumers in spite of industry’s inability to remit it.  Most consumers will not likely be aware of this reprieve in obligation. Most suppliers and retailers have systems already programed to charge the fee. It’s not clear any regulatory authority is actively policing industry on this. So if it’s business as usual in electronics sales, where will the money go and what are the risks?

Whose Money Is it Anyway?

The e-waste program, like all government-overseen plans in the province, funds its ongoing program costs with an eco-fee cost imposed upon consumers. The rates are rigidly set and the supply chain and retail parties simply pass the eco-fee through to point-of-sale and then remit to the program. No risks or rewards are assumed by these parties and there is no opportunity to internalize or otherwise alter the eco-fee for competitive or profit purposes.

The fees have not been, and cannot credibly be claimed as, margin adjustments when charged in an identical manner to unwitting consumers.  It would be difficult for industry to claim title to the monies, whether as an advance or an investment. The monies are simply consumer overpayments relative to the costs of the soon-to-be-defunct program, and the amount at issue is not insignificant. Orphaned eco-fees which could be passed to consumers during the holiday could potentially be as high as one hundred million dollars.

Duty of Care for Orphaned Eco-Fees

As the e-waste program can no longer accept eco-fees charged after February 1st, 2019, it raises questions as to what proactive measures the electronics industry, including brand owners and importers, must take to ensure no such fees continue to be passed on to consumers who should otherwise be enjoying the fee holiday they’ve effectively funded.

Ignorance of the holiday may not protect electronics companies. Through their participation in the e-waste program, industry will be deemed to have knowledge that any post-February 1st, 2019 eco-fees are effectively orphaned.  Nor are any parties clearly insulated from risk. Continued charging of the eco-fee by supply chain parties, effectively compelling retailers to recapture the costs from consumers, may also create legal uncertainty. All parties may have a duty of care here.

Be Neither Recipient Nor Beneficiary of Orphaned Eco-fees?

Resetting systems and processes to eliminate the eco-fee will be laborious. Instead, some parties within the electronics industry may be inclined to accrue the orphaned eco-fee for a future mutually-beneficial use, such as supporting industry-segmented private producer responsibility organizations which will rise from the ashes of the government program. This, however, may appear as industry doing indirectly what it cannot do directly and may not be defensible if and when someone comes asking about the treasure trove of orphaned fees.

It’s clear that the 17-month fee holiday journey to a private circular economy model for electronics provides no time off for industry.  It must act now to address any unsanctioned charging of orphaned eco-fees.  The holiday has already started.

About the Author

Jonathan D. Cocker heads the Firm’s Environmental Practice Group in Canada and is an active member of firm Global Consumer Goods & Retail and Energy, Mining and Infrastructure groups. Mr. Cocker provides advice and representation to multinational companies on a variety of environment, health and safety matters, including product content, dangerous goods transportation, GHS, regulated wastes, consumer product and food safety, extended producer responsibilities and contaminated lands matters. He appears before both EHS tribunals and civil courts across Canada. Mr. Cocker is a frequent speaker and writer on EHS matters, an active participant on EHS issues in a number of national and international industry associations and the recent author of the first edition of The Environment and Climate Change Law Review (Canada chapter) and the upcoming Encyclopedia of Environmental Law (Chemicals chapter).

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John Nicholson

Global Waste-to-Energy Market Analysis and Forecast to 2027

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According to a recent research report prepared by Research and Markets Inc., the global waste-to-energy (WTE) market is poised for strong growth for the forecast period up to 2027.

The report, entitled “Global Waste to Energy Market Analysis & Trends – Industry Forecast to 2027”, states some of the prominent trends that the market is witnessing include demand in focus towards energy generation, rising government initiatives and stringent regulations, and increasing popularity of renewable energy resources.

The study presents detailed market analysis with inputs derived from industry professionals across the value chain. A special focus has been made on 23 countries such as U.S., Canada, Mexico, U.K., Germany, Spain, France, Italy, China, Brazil, Saudi Arabia, South Africa, etc. The market data is gathered from extensive primary interviews and secondary research. The market size is calculated based on the revenue generated through sales from all the given segments and sub segments in the research scope. The market sizing analysis includes both top-down and bottom-up approaches for data validation and accuracy measures.

Market Research Report

A similar market study prepared by Market Research, entitled Global Waste To Energy Market Analysis, Drivers, Restraints, Opportunities, Threats, Trends, Applications, And Growth Forecast To 2027, predicts growth in the WTE market.

The Market Research report states that increasing adoption of renewable energy resources globally is a key factor driving growth of the global waste to energy market. In addition, government policies on waste deposable & treatment techniques, low price of fossil fuel, and development in thermal technologies such as incineration, gasification, and pyrolysis that lowers the carbon emissions are other factors expected to boost growth of the global waste to energy market over the forecast period.

The Market Research report cautions that the high cost associated with waste to energy generation is a key factor restraining growth of the global waste to energy market. Additionally, lack of awareness regarding waste to energy benefits, and emission of flue gases in thermal waste to energy technology that causes health issues are other factors expected to hamper growth of the global waste to energy market over the forecast period.

The Market Research report predicts that the rising demand of low cost technologies for treating local waste is also expected to generate potential opportunity for key players in the global waste to energy market over the forecast period.


  • Shenzhen East Waste-to-Energy Plant , China

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hazzmatt1

Fish waste used to fertilize cannabis plants

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As reported by the CBC, a company in south central Ontario has developed a closed loop system in which fish fertilize cannabis plants, while the cannabis plants filter the water for the fish.

Green Relief facility in Flamborough, Ontario is the only licensed cannabis producer in the world growing using aquaponics — an advanced, soil-less form of sustainable agriculture where fish and plants are grown together in a natural ecosystem environment.

Aquaponics combines the best attributes of aquaculture and hydroponics, without the need to discard water or add chemical fertilizers. It produces 10 times the crop yield per acre and uses 90% less water than conventional farming.

“This is the agriculture of the future,” stated Warren Bravo in an interview with the CBC. He is a former concrete contractor who co-founded the company with friend Steve LeBlanc in 2013. “If you’re not latching on to sustainable agriculture technologies now, you’re going to be a dinosaur.”

Green Relief’s closed-loop system, which raises 6,000 tilapia and 4,500 plants at any given time, uses 90 percent less water than conventional agriculture, while delivering 10-20 percent better yields than traditional methods, Bravo said.

Every five weeks, Green Relief purges one of its 16 fish tanks, donating some 300 market-size tilapia to Second Harvest, a food charity which delivers the fish to a homeless shelter’s kitchen.

A $60 million expansion is underway at the company’s rural base outside Hamilton, about an hour’s drive west of Toronto, which will add 15,000-20,000 kilograms to annual output. The project also includes manufacturing and packaging operations, to process plants from its satellite operations.

With partners, Green Relief is also building facilities in Thunder Bay, Ontario and Halifax, Nova Scotia that will each produce some 20,000 kilograms annually, Bravo said.

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hazzmatt1

UN Report Highlights Environmental, Health Risks from E-Waste

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As reported by the IISD, Seven UN entities released a report calling for a new vision for e-waste based on the circular economy. The report highlights that annual e-waste production is worth over USD 62.5 billion, underscoring the significant opportunity in moving towards a circular economy.

The report titled, ‘A New Circular Vision for Electronics: Time for a Global Reboot,’ finds that the global economy generates approximately 50 million tonnes of e-waste annually, or approximately six kilograms per person on the planet. Less than 20 percent of this e-waste is recycled, resulting in global health and environmental risks to workers who are exposed to carcinogenic and hazardous substances, such as cadmium, lead and mercury, and to soil and groundwater, which are contaminated by e-waste in landfills, placing food and water systems at risk. Low recycling rates also contribute to the loss of scarce and valuable natural materials: for example, up to seven percent of the world’s gold may be currently contained in e-waste. Under a business-as-usual (BAU) scenario, the UN University (UNU) predicts e-waste could nearly triple to 120 million tonnes by 2050.

“There is a trail of e-waste generated from old technology” that needs to be addressed, the report states. One-half of all e-waste is personal devices, such as smartphones, screens, computers, tablets and TVs, and the rest is household appliances and heating and cooling equipment. Europe and the US generate nearly one-half of global e-waste annually.

The report argues that systematic collaboration with major brands, small and medium-sized enterprises (SMEs), civil society and other stakeholders is necessary to change the system and reduce e-waste. The report calls for a circular economy in which resources are valued and reused in ways that create decent, sustainable jobs and minimize environmental impacts. To capture the global value of materials in the e-waste and circular value chains, the report suggests manufacturer or retailer take-back programs and better product tracking. The report also recommends developing recycling infrastructure and scaling up the volume and quality of recycled materials to meet the needs of electronics supply chains. Further, the report explains that cloud computing and the Internet of Things (IoT) can support gradual de-materialization of the electronics industry.

The Platform for Accelerating the Circular Economy (PAGE) produced the report on behalf of seven UN entities that collaborate on the E-waste Coalition: the ILO; the International Telecommunication Union (ITU); UNEP, the UN Industrial Development Organization (UNIDO), the UN Institute for Training and Research (UNITAR), UNU and the Secretariats of the Basel, Rotterdam and Stockholm (BRS) Conventions, with support from the World Economic Forum (WEF) and the World Business Council for Sustainable Development (WBCSD). The UN launched the report at the WEF in Davos, Switzerland. 

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John Nicholson

Results of Waste Data Analysis in British Columbia vs. other Provinces

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Vancity Credit Union recently published the results of a waste data analysis study it conducted in British Columbia. The results show that B.C. residents dispose of 549 kg of waste per year per resident. The total disposal rate is the second lowest per capita for a province in Canada. Nova Scotia residents generate the least amount of waste on a per capita basis.

The report, entitled State of Waste: How B.C. compares in the war on trash, 
looked at detailed data from municipal, provincial, and national databases. It concludes that while B.C. industries, businesses, and individuals are taking steps to curtail their production of waste, local reduction, compost and recycling targets aren’t on track and will likely be missed. The report also reveals that Delta has emerged as Metro Vancouver’s biggest producer of domestic trash, generating 465 kilograms for every single family residence in 2017, while Vancouver more than doubled North Vancouver’s production per single family residence.

Most solid waste produced in the region consists of construction debris, uneaten food and soiled paper.

The report also found:

  • B.C. produced 549 kilograms of garbage per person in 2016, which is 30 per cent less than the national average but almost 60 per cent more than a province-wide target for the year 2020.
  • B.C. diverted 40 per cent of its solid municipal waste from landfill and incineration to recycling and compost facilities, more than all other Canadian provinces except Nova Scotia, but well behind a common regional and municipal target of 80 per cent for the year 2020.
  • Spoiled and uneaten food – most of which could be diverted as compost – represents about 25 per cent of all residential garbage that is either thrown into B.C. landfills or is incinerated.
  • Half of all waste diverted in Metro Vancouver in 2016 came from the demolition, construction and land-clearing sector, with concrete the most common material diverted.

“B.C. is a leader when it comes to waste reduction and diversion, but more strategies are needed to track and improve results,” stated Morgan Beall, Vancity’s environmental sustainability portfolio manager, in a press release. “The province’s capacity to absorb waste is constantly being stretched. We all have a responsibility to eliminate waste.”

The report acknowledges that it was difficult to precisely determine the amounts of waste generated, disposed and diverted and what can ultimately be avoided in each municipality and province because reporting methods vary by jurisdiction. The report calls on governments at all levels to introduce measures that standardize and make public all waste collection, diversion and disposal data.

The author of the report, Vancity, is a values-based financial co-operative serving the needs of its more than 525,000 member-owners British Columbia. With $26.4 billion in assets plus assets under administration, Vancity is Canada’s largest community credit union. Vancity uses its assets to help improve the financial well-being of its members while at the same time helping to develop healthy communities that are socially, economically and environmentally sustainable. Vancity branches divert 88% of their waste from landfill and 49 of 59 branches are net zero waste (no waste is taken to landfill).

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John Nicholson

Global Survey Results on Digital Transformation of the Waste Industry

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The results of a recent global survey indicate that the majority of companies in the waste & recycling industry give themselves a failing grade when it comes to the adoption of new technology. The survey, conducted by the AMCS Group polled municipalities and private sector companies across Europe and the US. The respondents included a significant number of organisations with more than 250 employees. More than half of respondents have more than 50 vehicles for waste collection.

The waste management industry is less than enthusiastic about the success of its digital transformation so far. This is especially true for the application of new technologies, with most companies giving themselves a failing grade, according to our survey respondents within municipalities and private sector companies across Europe and the US. 

Some 60% of the organisations surveyed gave themselves a grade of ‘unsatisfactory’ for their progress in the application of new technologies. Using the results of the research, AMCS developed the Waste Management Digital Transformation Model to help organisations take the next steps toward making the digital transformation a success.

More than 80% of participants believe that digital innovation is important for the success of the business. Outdated legacy IT systems, implementing paperless operations and a culture that is not open to change are seen as the biggest barriers. For the Digital Transformation Barometer 2018, AMCS designed an international survey to discover how successful companies are using technology to radically improve their performance.

Drivers of success for digital transformation in waste management

“The research shows that there are five elements that are critical to success in transitioning into a digital organisation,” says Mark Abbas, Chief Marketing Officer for AMCS. “Besides engaged employees and a management team that gives people the space to innovate, it is very important to have a comprehensive understanding of the digital trends and advancements in the value chain. It is also down to a smart application of new technology within the organisation and using (reliable) data to make decisions.”

Key findings from the benchmark

There were three key findings from the research as follows:

  1. Digital transformation requires leadership in change management – 83% of those surveyed said they had the right leadership and culture in place to be able to realize a successful digital transformation.
  2. The digital part of the digital transformation is the most challenging for 60% of respondents.
  3. Legacy systems are the biggest challenge to successful digital transformation for 54% of respondents.

What do the leaders do differently?

According to Abbas, the research results provide insights into a very interesting group of companies that have taken the lead in digital transformation. “This group approaches digital transformation in a completely different way and has very different priorities from the rest. Their operations are already very nearly paperless, they use digital invoicing systems and they have self-service web portals available for their customers. They are also more likely to already be using other digital techniques and applications, such as RFID, GPS Monitoring, Route Optimisation and in-vehicle tablets.”

The foreseeable future will be about evolving from data to information. Analytics and BI are making it possible to immediately calculate the profitability of routes and jobs. Coordination with subcontractors is optimised when information can be exchanged digitally. And investing in applications like digital invoicing and payments mean offices can become completely paperless.

About AMCS Group

AMCS is a supplier of integrated software and vehicle technology for the waste, recycling and material resources industries. AMCS helps its customers to reduce operating costs, increase asset utilization, optimize margins and improve customer service.

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hazzmatt1

Provincial Environmental Obligations Prevail Over Federal Bankruptcy Laws – Supreme Court of Canada

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by Paul Manning, Manning Environmental Law

Recently, the Supreme Court of Canada released its decision in the case of Orphan Well Association, et al. v. Grant Thornton Limited, et al.Orphan Well Association, et al. v. Grant Thornton Limited, et al. 

The decision writes another chapter in the long running saga of whether a company’s environmental regulatory obligations survive bankruptcy and, in particular, whether the company’s trustee in bankruptcy can disclaim an asset so as to avoid environmental liability. (See our blog post The Non-Polluter Pays: Creditor Roulette and Director Liability)

The Supreme Court has now decided in Orphan Well that, after going bankrupt, an oil and gas company must  fulfill provincial environmental obligations before paying its creditors.

Background

Redwater was an Alberta oil and gas company, which owned over a hundred wells, pipelines, and facilities when it went bankrupt in 2015.

Alberta has provincial laws requiring oil and gas companies to obtain a licence to operate. As part of the licence, companies have to “abandon” wells, pipelines, and facilities when they are done. This means permanently taking these structures down. They also have to “reclaim” the land by cleaning it up. Companies cannot transfer licences without permission from the Alberta Energy Regulator (AER), which they won’t receive if they haven’t met their responsibilities.

Most of Redwater’s wells were dry when it went bankrupt. Dismantling the sites and restoring the land would have cost millions of dollars more than they were worth. To avoid paying those costs, the the trustee in Orphan Well decided to disclaim (i.e. not to take responsibility for) the redundant wells and sites under the BIA. The trustee wanted to sell the productive sites to pay Redwater’s creditors.

The AER said that this wasn’t allowed under the BIA or provincial law and ordered the trustee to dismantle the disowned sites. The trustee argued that even if the AER was correct, the provincial abandonment orders were only provable claims under the BIA. In this case, this meant the money would first go to pay Redwater’s creditors.

The Supreme  Court’s Decision

There were two main legal issues before the Supreme Court. The first was whether the BIA allowed the trustee disclaim the sites it didn’t want take responsibility for. The second was whether the provincial orders to remove structures from the land were provable claims under the BIA. If they were, that would mean the payment order set up in the BIA applied. Only money left, if any, after those payments were made, could be used to pay for taking the sites down.

The trial judge had ruled that the trustee was allowed to disclaim the disowned sites and the abandonment costs were only provable claims in the bankruptcy. The majority of judges at the Alberta Court of Appeal hearing had agreed.

The majority of judges at the Supreme Court disagreed. It ruled that the trustee could not disclaim  the disowned sites. It said the BIA was meant to protect trustees from having to pay for a bankrupt estate’s environmental claims with their own money. It did not mean Redwater’s estate could avoid its environmental obligations.

The majority also said the abandonment costs were not “provable claims”. These costs weren’t debts requiring payments; they were duties to the public and nearby landowners. This put the abandonment costs outside the BIA’s payment order scheme and as such, the majority ruled, there was no conflict between the federal and provincial laws.

(The minority of judges at the Supreme Court disagreed, arguing that there was a genuine conflict between the federal and provincial laws and the BIA being the federal law should prevail over the provincial regulations. Where a valid provincial law conflicts with a valid federal law, the federal law will normally prevail under the constitutional law “doctrine of paramountcy.”)

As the trustee had already sold or given up all of Redwater’s assets, the money from the sales was held “in trust” by the court during the lawsuit. This money must now be used to abandon and reclaim the land before anything is paid to any of Redwater’s creditors.

Click here for the full decision of the Supreme Court of Canada in Orphan Well

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Manning Environmental Law is a Canadian law firm based in Toronto, Ontario. Our practice is focused on environmental law, energy law and aboriginal law. 

Paul Manning is a certified specialist in environmental law. He has been named as one of the World’s Leading Environmental Lawyers and one of the World’s Leading Climate Change Lawyers by Who’s Who Legal. This article is only as a general guide and is not legal advice.

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