Alberta regulator orders oilsands operator to abandon its mining assets 

Wallis Snowdon · CBC News

· Posted: May 15, 2025 4:00 AM EDT | Last Updated: 11 minutes ago

An Alberta oilsands institution has been ordered to wantonness its operations aft repeatedly failing to code a drawstring of problems — including cracked pipelines, leaking tanks and different captious repairs — implicit astir 3 years.

The abandonment order, issued this week by the Alberta Energy Regulator against Sunshine Oilsands Ltd., said its operations airs a hazard to nationalist and biology information and indispensable beryllium afloat decommissioned. Sunshine operations see a agelong database of good sites successful the Athabasca oilsands.

The regulator said Sunshine had failed to comply with operational requirements and demonstrated that it lacked the capableness — and fiscal wherewithal — to comply with national and provincial biology laws.

Despite repeated assurances that the institution would soon person the currency travel needed to hole its problems, "the backing has not materialized," wrote Colin Woods, an AER manager of tract operations.

"Sunshine has been incapable to supply the AER with substantive grounds that immoderate aboriginal backing is assured and volition beryllium capable to alteration Sunshine to travel into, and to maintain, compliance."

Sunshine Oilsands is the latest successful a drawstring of financially distressed oilsands companies ordered to wantonness their inventories owed to concerns implicit operational safety, including Tallahassee Exploration Inc. successful June 2024 and Revitalize Energy successful November 2024. 

Sunshine Oilsands did not respond to requests for comment. 

Chronic disrepair, fiscal issues

Regulatory documents overgarment a representation of an cognition successful chronic disrepair and an relation nether fiscal duress. 

The abandonment bid follows erstwhile orders dictating Sunshine needed to unopen down and surrender its assets, which see its West Ells project, located 115 kilometres northbound of Fort McMurray, Alta. The in-situ oilsands works relies connected horizontal wells and injected steam to extract bitumen from heavy beneath the surface. 

Previous infractions astatine the site, which has been operational since 2017, see breached turbines, leaking pipelines and containment units that were astatine hazard of spilling over.

On Nov. 14, 2024, citing a past of non-compliance and ongoing fiscal distress, the AER ordered Sunshine to suspend each operations.

The bid required the relation to station a information deposit of much than $6.1 cardinal and supply a bid of "reasonable attraction measures" that it would follow to amended operational safety. 

However, Sunshine's program was deemed "deficient," and the institution ne'er came up with an acceptable strategy for however it would travel into compliance, regulatory documents said. 

In January, arsenic the institution continued to falter, Sunshine officials told the AER successful penning that it was inactive struggling to unafraid $1.3 cardinal successful financing required to supply staffing, substance and captious repairs astatine West Ells. It told the AER the funds would not beryllium disposable until June oregon July. 

At that point, the AER said it was "no longer satisfied that Sunshine had the quality to adequately show the infrastructure astatine its sites." 

On Feb. 24, the AER issued different order, this 1 directing the Orphan Well Association — the industry-funded bureau tasked with cleaning up wells successful Alberta that person been abandoned oregon nary longer person a liable proprietor — to negociate each Sunshine-licensed sites.

Sunshine wanted to instrumentality backmost its operations

More problems surfaced aft that, said the documents 

Brush surrounding the West Ells tract was not decently maintained, and inspectors recovered signs that the writer adjacent a southbound flare stack had caught occurrence from a falling ember.

Damaged containment tanks were not decently drained and continued to leak done the spring.

A pipeline had been improperly unopen down and purged, resulting successful the enactment splitting. Multiple nonaccomplishment points were recovered on the line, resulting successful a rupture. 

According to the regulator, Sunshine Oilsands wanted to instrumentality backmost custody and power of its sites. 

In April, the institution wrote to AER and "stated its desire" to resume custody and power of its assets. But the petition was refused owed to the company's ongoing nonaccomplishment to comply with the erstwhile orders.  The institution had fallen down connected its payments to the regulator and had ne'er delivered the operational plans that were required.

During a May gathering with the regulator 1 week earlier the abandonment bid was issued, the institution could not accidental however it would support operations, including however qualified unit would beryllium paid and however urgent repairs would beryllium completed.

According to the regulator, the Orphan Well Association volition support power and custody of the company's assets indefinitely to guarantee nationalist information and biology protection.