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Groups urge government to include water subsidies in gas royalty review

Public health, public policy and environmental organizations say the government must expand its current review of the fracking industry’s natural gas royalty rates to include the significant ways that the industry’s water use is subsidized.

In an open letter published today, 11 organizations, including public health, conservation, environmental law and public policy groups say the fracking industry’s already formidable water use is poised to explode, that the industry pays nothing or next to nothing for its water, and that it is exempt from treating the massive amounts of water that it pollutes.

The groups are urging the B.C. government to link its review of the financial breaks that fracking companies get through the province’s natural gas royalty regime to include water because without water there is no natural gas production.

“Virtually all of our gas is fracked. This has resulted in exponential increases in water use by oil and gas companies,” said Donna Forsyth, a former legislative advisor in the Ministry of Environment and Climate Change Strategy who helped draft BC’s Water Sustainability Act.

“But the companies pay the provincial government almost nothing for that water, even though they are permanently removing it from the water cycle forever.”

Forsyth, who has prepared a technical brief to the government that accompanies the open letter, notes that when fracking companies pay the government for their water they pay virtually the same as companies that are required to treat their water.

“Other industries that use our water effectively ‘borrow’ it. They use it. Then they treat it. And then they discharge it back into the environment,” she said. “The fracking industry permanently removes water from the water cycle and poisons it prior to injecting it into the earth in disposal operations that can trigger earthquakes. They should pay far more for their water.”

Tens of thousands of new natural gas wells are slated to be fracked in the coming years if construction of the Coastal GasLink pipeline, the subject of ongoing conflict on Wet’suwet’en territory, is completed along with a liquefied natural gas plant in Kitimat.

“Health warnings are clearly posted at facilities where fracking wastewater is stored. There have been documented instances of that wastewater leaching into the ground at such facilities and poisoning groundwater. The health risks associated with the fracking industry are many and warrant this government taking a much more serious look at the many ways industry activities are subsidized,” said Larry Barzelai of the Canadian Physicians for the Environment.

“It’s appalling the government is allowing the fracking industry to permanently pollute billions of litres of fresh water taken from our lakes, rivers and streams, and pay almost nothing for it—less than the cost of a pint of beer for every Olympic swimming pool worth of water. It’s time to stop giving companies a free ride to poison BC’s most precious natural resource,” said Alexandra Woodsworth, campaigns manager at Dogwood.

“The paltry fees that the industry pays for water are completely unjustified, especially when we know that this industry must be rapidly wound down, not up. The way to start this industry wind down is to dramatically increase both the royalties that companies pay on the gas they produce and the rental fees they pay for water, our most precious of all natural resources,” said Ben Parfitt, a resource policy analyst with the BC office of the Canadian Centre for Policy Alternatives.

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