Around 5,000 cases languish in the filing systems of a quasi-judicial board charged with resolving complaints about unpaid oil and gas contracts with Alberta’s farmers, with the pile growing each week as the province’s energy sector continues to struggle.
The Alberta 2021-22 budget has earmarked an extra $1.7-million for that body, the Surface Rights Board, so it can hire 15 extra staff and six new, part-time board members to deal with a mountain of applications for compensation. The pile is so large that farmers wait more than a year to even have their cases entered into the system.
Landowners will also be able to keep tabs on their complaints, thanks to a new tracking portal on the board’s website.
News of the cash injection for the Surface Rights Board was a pleasant surprise for Ron Huvenaars, chair of the Action Surface Rights Association, a landowner advocacy group.
“We used to get more lip service than actual service,” he said, and he’s hopeful that will change as the board boosts staffing levels to deal with the growing backlog of complaints. “Maybe it pays to raise a bit of a stink and let them know what we’re seeing."
The Surface Rights Board has a number of roles, including dispute resolution between landowners and oil and gas companies. Energy companies sign contracts with farmers when they enter land to drill. Those contracts stipulate everything from the size of the lease to the amount of money a landowner will be paid each year to compensate them for a loss of farming space and the annoyance of a rig or well on their property.
The number of landowners not being paid has skyrocketed since 2016, when the oil price downturn and resulting recession took hold of the Alberta oil patch.
Municipal Affairs Minister Kaycee Madu said the backlog of applications will double by the end of 2021 if the government doesn’t intervene.
Even so, there’s no stopping the flood of complaints. Mr. Huvenaars has heard time and again of companies routinely cutting payments to farmers as the patch fails to bounce back to prerecession levels.
“The forecast is we’ll continue to have more claims than usual as a consequence of the economic downturn and what is going on in the oil and gas sector, but that’s all the more reason to clear the backlog and then focus our attention on the new applications,” Mr. Madu said.
And while Mr. Madu admitted it wasn’t easy to find the cash in Alberta’s belt-tightening budget, unveiled Thursday, he said his government felt it crucial to address the issue.
Not only do unpaid bills hurt landowners, he said, but also the government is bound by legislation to hear applications in a timely and fair fashion.
“We continue to have a number of fiscal challenges and so this was not an easy decision, but it was one that we needed to deal with. It was tough to find that money, and I won’t minimize that,” Mr. Madu said.
The Municipal Affairs Minister said he is confident the staffing increase can help clear the backlog by the end of March, 2021.
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