How to Make the Oil Industry Go Bust

How to Make the Oil Industry Go Bust
Fix, Blair. (2023). Real-World Economics Review. No. 103. March. pp. 2-25. (Article - Journal; English).

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Alternative Locations

http://www.paecon.net/PAEReview/issue103/Fix, https://www.econstor.eu/handle/10419/270856

Abstract or Brief Description

Can the oil industry afford to clean up its mess? If by ‘mess’ we mean fossil-fuel-induced climate change, the answer is almost certainly ‘no’. But what if we look at a more limited cleanup scenario, restricted to the remediation of conventional oil and gas wells? Even then, it seems that the oil industry may already be bankrupt.

As a case study, this paper estimates the solvency of the (conventional) oilpatch in the Canadian province of Alberta. By law, Albertan oil companies are required to pay for well remediation. To date, however, the oil industry has saved little for this expense. Instead, it has assumed that future oil production will pay for existing cleanup liabilities. But will it?

Using cleanup estimates from the Alberta Liabilities Disclosure Project, I estimate the past, present and future solvency of the (conventional) Alberta oil industry. I find that at present, the oilpatch sits on the precipice of insolvency.

Language

English

Publication Type

Article - Journal

Keywords

Alberta cleanup insolvency oil pollution

Subject

BN Law
BN Money & Finance
BN Power
BN Policy
BN Production
BN Region - North America
BN Science & Technology
BN State & Government
BN Business Enterprise
BN Capital & Accumulation
BN Conflict & Violence
BN Ecology & Environment
BN Industrial Organization

Depositing User

Jonathan Nitzan

Date Deposited

08 Apr 2023 01:32

Last Modified

10 May 2023 17:16

URL:

https://bnarchives.yorku.ca/id/eprint/776

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