The Alberta Energy Regulator cut scores of jobs this week as part of a reorganization that comes amid landowner concerns that oversight of oil and gas operations will suffer.
Layoffs at the regulator began Wednesday in Edmonton and among operations staff in Calgary, and continued on Thursday with Calgary head-office employees and in field locations, according to an internal memo seen by The Globe and Mail.
The AER declined to give the number of staff layoffs or provide other specifics. The Alberta government said in October it expected the regulator to reduce its 1,200-person work force by 270 full-time-equivalent positions, as part of a reduction in its annual budget. Last month, AER said it had cut “a couple of dozen staff." With this week’s reductions, the number could tally up to around 200.
“We are in the process of rolling out our new structure, with notifications to staff happening this week,” AER spokeswoman Cara Tobin said in an e-mail.
The AER announced in January that under the new design, employees would be focused on four main functions: adjudication and regulatory decisions; environmental, energy, and safety oversight; energy information; and stakeholder engagement, which is industry and community outreach.
The layoffs and revamp follow a tumultuous year for one of the province’s most important regulatory agencies. In September, three investigations concluded that Jim Ellis, the former chief executive, and his top lieutenants tried to carve out a lucrative new business for themselves when they started a side project to provide regulatory training to other jurisdictions. The project, called the International Centre of Regulatory Excellence, used the AER’s resources and staff, even though it was set up to arrange its own contracts.
The agency is still in the process of hiring a permanent CEO to replace Gord Lambert, who has held the position on an interim basis since Mr. Ellis resigned in late 2018.
Premier Jason Kenney’s government installed a new board and began a review of the AER last summer, saying it needed to be more responsive to the industry, partly by speeding up approvals. This comes as the province also deals with billions of dollars in underfunded liabilities tied to aging oil and gas wells amid the industry’s financial troubles.
Daryl Bennett, a director of landowner advocacy group Action Surface Rights (ASR), was supposed to take part in an AER hearing on Thursday. But earlier this week, he got a call saying the hearing would be postponed as a result of restructuring at the regulator.
Mr. Bennett told The Globe the message was clear: The AER inspector who was supposed to present evidence and be cross-examined at the hearing may no longer have a job.
“They’re firing 200 people tomorrow,” he told the ASR annual meeting in Taber, Alta., on Wednesday.
Mr. Bennett said he was worried the AER would lay off reclamation inspectors, who visit sites to make sure cleanup work is up to standard. And if the inspector on the case is fired, he wondered what happens to that inspector’s evidence at the hearing. That information included photos and written reports that Mr. Bennett said show an oil company failed to adhere to a list of criteria for reclaiming a site in southern Alberta.
But his concern extends beyond that single case. If layoffs target reclamation inspectors, he said, and the regulator redirects funding and jobs toward fast-tracking oil and gas licences, the agency will lose a crucial layer of oversight and prioritize industry over landowners.
Mr. Lambert said in a memo to staff this week that the organizational changes will allow the regulator to achieve its mandate and “build resiliency” as it deals with its reduced budget. “While the decisions we’ve made will mean new opportunities for some, they will mean layoffs as well,” he wrote.
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