Bill C-221 (Historical)

Environmental Restoration Incentive Act

An Act to amend the Income Tax Act (oil and gas wells)

This bill is from the 43rd Parliament, 2nd session, which ended in August 2021.

Sponsor

Shannon Stubbs  Conservative

Introduced as a private member’s bill. (These don’t often become law.)

Status

Defeated, as of March 10, 2021
(This bill did not become law.)

Summary

This is from the published bill.

This enactment amends the Income Tax Act to establish a tax credit for the closure of oil and gas wells. It also sets out a requirement for the Minister of Finance to make an assessment respecting the implementation of possible tax incentives for the closure of oil and gas wells.

Similar bills

C-221 (43rd Parliament, 1st session) Environmental Restoration Incentive Act

Elsewhere

All sorts of information on this bill is available at LEGISinfo, an excellent resource from Parliament. You can also read the full text of the bill.

Bill numbers are reused for different bills each new session. Perhaps you were looking for one of these other C-221s:

C-221 (2021) An Act to amend certain Acts in relation to survivor pension benefits
C-221 (2016) Safe and Regulated Sports Betting Act
C-221 (2013) National Strategy for Sickle Cell Disease and Thalassemic Disorders Act

Votes

March 10, 2021 Failed 2nd reading of Bill C-221, An Act to amend the Income Tax Act (oil and gas wells)

Debate Summary

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This is a computer-generated summary of the speeches below. Usually it’s accurate, but every now and then it’ll contain inaccuracies or total fabrications.

Bill C-221 seeks to amend the Income Tax Act by providing a tax credit for oil and gas well decommissioning costs to small and medium-sized producers, and to assess flow-through shares.

Conservative

  • Incentivizes private funding for cleanup: The bill creates a non-refundable tax credit and proposes flow-through shares to help small and medium-sized producers raise private funds specifically for oil and gas well remediation.
  • Protects taxpayers: By enabling private sector funding for cleanup, the bill reinforces the polluter-pay principle and protects taxpayers from potentially billions in remediation costs.
  • Creates jobs and supports workers: The bill will stimulate immediate job creation for skilled workers in the oil and gas service sector by accelerating well decommissioning and reclamation activities.

NDP

  • Opposes the bill: The NDP opposes Bill C-221, stating it is not the way forward and violates the polluter pays principle by providing incentives for companies to fulfill legal obligations.
  • Criticizes subsidies and tax breaks: The party views the bill as an inefficient subsidy to the fossil fuel industry, arguing the proposed tax credit and flow-through shares are inappropriate for predictable cleanup costs.
  • Problem needs different solutions: While acknowledging the serious problem of inactive and orphan wells, the party believes the bill is not the solution and suggests regulatory measures are primarily provincial responsibility.

Bloc

  • Bill violates polluter pays: The Bloc opposes the bill because it violates the polluter pays principle by having taxpayers fund environmental cleanup that should be the industry's responsibility.
  • Tax credit is a subsidy: The proposed tax credit is viewed as a subsidy, providing more financial support to the oil and gas industry rather than funding the energy transition.
  • Taxpayers should not pay: It is unfair and illogical for taxpayers to collectively pay for the environmental damage caused by oil and gas companies while receiving no collective benefit from their profits.
  • Cleanup needs energy transition context: Public funds for closing wells would only be justifiable if part of a comprehensive energy transition plan, ensuring funds are not just a subsidy for the fossil fuel industry.

Liberal

  • Supports energy sector: The government acknowledges the struggles faced by oil and gas workers and companies due to the pandemic and low global prices.
  • Funds well cleanup: The government provided over $1.7 billion to provinces for cleaning up orphan and inactive wells, creating jobs and addressing environmental concerns.
  • Opposes bill C-221: Liberals oppose Bill C-221, arguing the proposed tax credit is untargeted compared to the government's existing, more effective support measures.
  • Balances support and environment: The government balances support for the industry and workers with environmental goals, including reducing emissions and addressing methane leaks.
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Environmental Restoration Incentive ActPrivate Members' Business

February 25th, 2021 / 6 p.m.

The Assistant Deputy Speaker (Mrs. Alexandra Mendès) Alexandra Mendes

Are you still having issues with your Internet connection? Your frame keeps freezing and your voice stops.

We can hear you now.

Environmental Restoration Incentive ActPrivate Members' Business

February 25th, 2021 / 6 p.m.

Conservative

Shannon Stubbs Conservative Lakeland, AB

Madam Speaker, I am sorry. I am out in rural Alberta. I promise I am wrapping up, but I want to thank all members for helping me do this.

The Liberal member for Davenport talked about the need to support measures that help companies avoid bankruptcy and support our environmental targets. Bill C-221 does exactly those things, but deliberately limits the use of public funds by enabling the lion’s share of financing to go specifically for remediation and reclamation by the private sector.

The Bloc members urged the polluter pay principle, which, yes, the Conservatives enshrined in law, but the fact is that voting against my bill would run against that principle, ignore the realities of small and medium-sized oil and gas businesses and workers on the edge of total devastation, and leave either a lack of remediation or only taxpayers liable.

My bill is real action, not just rhetoric, on the polluter pay principle to help the most vulnerable energy businesses; not big oil and not major multinationals, but literally the little guys. The NDP MP said that Canadian taxpayers should not foot the bill and I agree. However, inaction, doing nothing, defeating this bill, would help guarantee they would.

Frankly, the objections have been mostly ideological and geographical, with no real alternative proposals. This is a challenge across Canada in most provinces. In Alberta alone, most wells are on private land. Financially forced abandonments are magnets for rural crime, but there are tens of thousands of wells on government land, on Crown grazing leases, and thousands on indigenous reserve lands too. What happens to all of them when companies go bankrupt?

Since 2015, Canada’s energy sector has lost $200 billion and 200,000 jobs while orphan and abandoned wells have increased 300%. That is not a coincidence, but a consequence. That was before 37% of oil and gas companies had to make permanent layoffs to stay alive at the start of last year. There is little light at the end of the tunnel.

I passionately support Canada’s oil and gas workers. The sector is the most environmentally and socially responsible in the world. It is crucial to the whole country’s economy and future. Bill C-221 can help continue its unmatched stewardship, clean-tech investment and innovation exceeding standards, while protecting farmers, municipalities, land owners, indigenous communities, the environment, taxpayers, and creating badly needed jobs. I hope MPs in all parties will actually walk their talk and support this bill.

Environmental Restoration Incentive ActPrivate Members' Business

February 25th, 2021 / 6:05 p.m.

The Assistant Deputy Speaker (Mrs. Alexandra Mendès) Alexandra Mendes

Is the House ready for the question?

Environmental Restoration Incentive ActPrivate Members' Business

February 25th, 2021 / 6:05 p.m.

Some hon. members

Question.

Environmental Restoration Incentive ActPrivate Members' Business

February 25th, 2021 / 6:05 p.m.

The Assistant Deputy Speaker (Mrs. Alexandra Mendès) Alexandra Mendes

The question is on the motion.

If a member of a recognized party present in the House wishes to request a recorded division or that the motion be adopted on division, I would invite them to rise and indicate it to the Chair.

Environmental Restoration Incentive ActPrivate Members' Business

February 25th, 2021 / 6:05 p.m.

Conservative

Kevin Waugh Conservative Saskatoon—Grasswood, SK

Madam Speaker, I request a recorded vote.

Environmental Restoration Incentive ActPrivate Members' Business

February 25th, 2021 / 6:05 p.m.

The Assistant Deputy Speaker (Mrs. Alexandra Mendès) Alexandra Mendes

Accordingly, pursuant to an order made on Monday, January 25, the division stands deferred until Wednesday, March 10, at the expiry of the time provided for Oral Questions.

The House resumed from February 25 consideration of the motion that Bill C-221, An Act to amend the Income Tax Act (oil and gas wells), be read the second time and referred to a committee.

Environmental Restoration Incentive ActPrivate Members' Business

March 10th, 2021 / 3:10 p.m.

The Speaker Anthony Rota

It being 3:30 p.m., pursuant to order made on Monday, January 25, the House will now proceed to the taking of the deferred recorded division on the motion at second reading stage of Bill C-221 under Private Members' Business.

Call in the members.

(The House divided on the motion, which was negatived on the following division:)

Vote #64

Environmental Restoration Incentive ActPrivate Members' Business

March 10th, 2021 / 3:30 p.m.

The Speaker Anthony Rota

I declare the motion defeated.