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Supreme Court rules oil companies must clean up environment before repaying creditors in cases of bankruptcy


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Supreme Court of Canada*

 

https://www.thestar.com/amp/calgary/2019/01/31/supreme-court-of-canada-says-bankrupt-energy-companies-must-clean-up-old-oil-and-gas-wells-before-paying-off-creditors.html

 

Huge news. Right now oil companies will shut down wells and will do nothing to clean them up, and then when they go bankrupt the public is left on the hook to pay the thousands of dollars per well to do environment cleanup. The ruling states that remaining assets must be sold/used to clean up these sites before creditors are repaid. This will have two large effects:

 

  1. More well sites will be cleaned up, saving public money and producing a cleaner environment (in the classic Teddy Roosevelt sense)
  2. Less investment in oil companies as there is a much larger risk of recouping nothing if they go under

 

Both are positives, in my book.

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