Alberta premier promises new process to clamp down on delinquent oil and gas operators

Alberta Premier Danielle Smith is promising new consequences for oil and gas operators who fail to pay their municipal taxes, as delinquent companies continue to fall behind on payments.

A new complaints process will see Municipal Affairs act as a middleman between regional governments and the Alberta Energy Regulator (AER), Smith said Wednesday during an address to the Rural Municipalities of Alberta spring convention in Edmonton.

The strategy for collections will rely on municipalities to quickly point the finger at companies who have failed to pay up.

"You will be the early warning system for us that there is a bad actor out there," Smith said.

"We welcome you telling us if somebody is not paying their taxes because I can tell you, some of the things that we've observed, we are going to stop." 

Consultations that began last year have shown Alberta's current process to collect outstanding debts "isn't working," Smith said.

A member survey for the RMA, which represents 69 counties and municipal districts, found that, as of Dec. 31, 2024, at least $253.9 million of municipal property taxes have gone unpaid by oil and gas companies.

Details of the new enforcement process are expected to be released in a couple of weeks.

The new system will rely on the AER to make a call on any outstanding bill and "get it paid," Smith said. 

"That, or there will be consequences. And there are a lot of tools at AER to have consequences," Smith said. 

"We had a framework for how we wanted it done, but we had some process steps missing. We're going to fix those process steps." 

For more than a decade, municipalities have been calling on the province to help them collect unpaid taxes. Amid a surge in industry insolvencies, the RMA has said its members have few ways to hold companies accountable and recoup their losses.

In 2024 alone, unpaid oil and gas property taxes owed to rural municipalities grew by $67.8 million, more than 50 per cent higher than the outstanding taxes owed the year before. 

The province has previously promised to crack down with improved reporting measures, urging municipalities to provide company names and nominate operators for enforcement.