Canada federal budget grants aid for Alberta 'orphan' oil wells

The oil-rich Canadian province of Alberta has obtained federal aid to help clean up the rising number of oil wells whose owners have gone bankrupt, the province's premier said after the release of the federal budget on Wednesday.

The budget allocated C$30 million to Alberta to stimulate economic activity and employment in the resource sector, which Premier Rachel Notley said will be used to clean up the so-called "orphan" wells that are normally a provincial responsibility.

The number of so-called orphan wells in Canada spiked after the 2014 oil price crash as layoffs swept the oil patch and companies went bankrupt. Alberta, which produces about 80 percent of Canada's crude, had more than 1,500 orphan wells last month, up from 26 in 2012.

Federal help would speed up the clean up of the old wells, which can contaminate soil and affect animal and human health. It would also grant jobs to some of the tens of thousands laid off oil workers.

It is yet unclear how or over what period the C$30 million will be used.

"We'll have more details to roll out in the days to come, but generally speaking, yes, the idea was to focus on orphan well reclamation," Notley said of the federal funds in a news conference.

The Canadian Association of Petroleum Producers said it welcomed the move.

(Reporting by Ethan Lou in Calgary, Alberta; Editing by Bernard Orr)