Saskatchewan established the Oil and Gas Environmental Fund on May 17, 1989, pursuant to Section 18.2 of The Oil and Gas Conservation Regulations, 1985.  In June 2007, an amendment was made to The Oil and Gas Conservation Act that provided for the continuance of the existing Oil and Gas Environmental Fund as The Oil and Gas Orphan Fund.  The Oil and Gas Orphan Fund provides the government with a means to address the costs of abandoning and decommissioning orphan wells and facilities and reclaiming the sites, as well as the containment of environmental emergencies arising from oil and gas operations.  The legislative authority for the fund and the specific provisions of the fund are found in The Oil and Gas Conservation Act and the regulations thereunder. (Updated November 2010)

Section 18.6(1) of The Oil and Gas Conservation Regulations, 1985 provides the details of how the levy is calculated for each licensee:

Orphan fund levy
18.6(1) A licensee shall pay an orphan fund levy for each fiscal year, as required by clause 20.98(c) of the Act, calculated in accordance with the following formula:

Orphan fund levy = A/B X Annual Budget

where:

A is the licensee's liability for all upstream facilities, wells and unreclaimed sites licensed to the licensee, as calculated at a date and in a manner specified by the minister;

B is the sum of the upstream oil and gas industry's liability for all licensed upstream facilities, wells and unreclaimed sites, as calculated by the minister; and

Annual Budget is the amount that is required to conduct work specified in subsection 18.5(1) for a fiscal year as determined by the minister after any consultation with the fund advisory committee that the minister considers necessary.