November 16th, 2018

Orphan well deal could see building toppled

By Gillian Slade on February 8, 2018.

The Hitch'n Post Saloon building on South Railway may soon be demolished, as it sits on an abandoned well site.--NEWS PHOTO GILLIAN SLADE


gslade@medicinehatnews.com 
@MHNGillianSlade

The streetscape on South Railway could be changing.

The Hitch’n Post Saloon at 210 S. Railway St. could be demolished in an agreement with the Alberta Oil & Gas Orphan Well Abandonment and Reclamation Association, it was revealed at the development and infrastructure committee meeting on Wednesday.

The committee will recommend to council that costs be equally split with the OWA to address hazardous material abatement, demolition of the property, registration of a utility right-of-way and restrictive covenant on the property that would allow the city to pursue leasing opportunities with interested parties.

The city’s portion of the bill would be $460,000, funded from community capital.

Several years ago, OWA asked the city to be the title holder of the property in exchange for sharing the costs associated with demolition. In return OWA would take care of the gas well situation on an ongoing basis, which is the crux of the matter, said Grant MacKay, manager of land and business support.

The gas well on site is estimated to have been drilled in the 1890s, although there are no records, OWA director of operations Pat Payne said.

The gas well is believed to have been originally drilled to supply gas for a kitchen in a building on the site. It may have been for what was called the American Hotel, said Payne. There was also a Ming Tree Cafe there at some point.

In March 2008 the property was one of several up for public auction due to tax arrears.

“Any unpaid taxes were cleared up by the property owner and the property did not change hands at that time,” said MacKay.

In 2016, the OWA purchased the property from the owner, who had owned it for sometime, said MacKay.

However, the property belongs to the city.

“The Orphan Well Association paid for the acquisition cost but they are not entitled to own property through their mandates … that governs their association,” said MacKay.

OWA refers to it as a tri-party agreement. The owner was willing to sell the property to OWA. On receipt of the purchase price it would turn over the title to the city, said Payne.

“Our contribution was the funding and the city’s contribution is to hold title to the property,” said Payne.

Another building cannot be constructed on site. There will be a registered utility right-of-way on part of the site that will contain the gas managing equipment, said MacKay. No further building on site ensures there will be no future issue regarding gas in a structure, and ensures ongoing access to the well management equipment.

There have been expressions of interest from nearby property owners to perhaps use the lot for parking, a green space or a patio, the development and infrastructure committee was told on Wednesday.

OWA has developed a soil gas management system comprised on very shallow extraction/vertical wells in the ground around the building. These are connected with slotted pipes to a vacuum unit that collects the gas, said Payne.

“The unit has been pretty reliable. It collects the gas and removes it out of the soil so it doesn’t enter into any of the adjacent buildings and it doesn’t present a public safety risk,” said Payne.

The city does regular testing at adjacent buildings for public safety and calls OWA if there are any issues with the unit. OWA will do repairs if and when required, said Payne. Routine inspections are also done annually. OWA will pay the applicable electrical bill for the vacuum unit.

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