The White House announced it will send $1.15 billion to states to clean up thousands of methane-emitting orphaned oil and gas wells, the first tranche of allotments from the $4.7 billion that congress approved for orphaned well cleanup in the recent infrastructure package.
In 2021, U.S. Senator Ben Ray Lujan (D-NM) introduced the Revive Economic Growth and Reclaim Orphaned Wells (REGROW) Act, which was included in the recent infrastructure bill.
Senator Lujan had the following to say about the impact of the REGROW Act on the environment and the economy, “One silver lining is that cleaning and remediating these sites also creates technical, good paying job opportunities. While cleaning up the environment and making it safer for the public is always a priority, we always need to do it in a way that is good for the economy. This is another example of how we can get that done.”
Funds will be directed to 26 states that submitted notices of intent to the Interior Department late last year. The allocations range from $25 million (Alabama) up to $107 million (Texas), with more to be provided in the form of grants.
Active and abandoned wells can emit a range of gases, including methane, a greenhouse gas over 80 times more potent than carbon dioxide. Additionally, gases such as benzene can leak into groundwater, contaminating critical aquifers.
“It’s a pretty big problem that’s flown under the radar for a long time,” said Adam Peltz, a senior attorney with the Environmental Defense Fund. Noting that lawmakers will need to revisit funding amounts as more orphaned wells are identified.
Hundreds of thousands of documented abandoned wells dot the country, a legacy left by oil and gas companies that didn’t stand the test of time or relics of a time before documentation of a responsible party.
The Interior Department reports 130,000 documented abandoned wells across the country. As recently as 2018, the Environmental Protection Agency estimated that the number of abandoned onshore wells alone could be as high as 2 million to 3 million.
This problem is not new for many states, Ohio for example has had an orphan well program in place since 1977 and has plugged over 1,000 wells (22/year on average). However, even Texas, which plugged 1,477 orphan wells in 2020 is not plugging enough wells to even begin to address this problem.
Additionally, over 1 million wells that are essentially orphaned wells exist but are not classified as such due to legal loopholes. Classifications vary by state, but common designations include inactive, idle, and temporarily abandoned wells
Adrienne Sandoval, director of New Mexico’s Oil Conservation Division, estimates there are about 1,700 abandoned or orphaned wells and more than $290 million in remaining liabilities for the wells on state and private land. Plugging wells costs about $55,000 each, Sandoval said, an increase from about $35,000 in past years, due to inflation and worsening well conditions. As wells get older, they become harder and more expensive to plug, further emphasizing the need for immediate action to remedy this issue before it gets out of hand.
The state is typically able to plug about 50 wells each year, Sandoval said, but will be able to increase efforts significantly with the federal funds allocated in the REGROW Act.
“One silver lining is that cleaning and remediating these sites also creates job opportunities,” Senator Lujan said. “While cleaning up the environment and making it safer for the public is always a priority, we always need to do it in a way that is good for the economy” and adds “This is another example of how we can get that done.” He believes these remediation efforts will create technical jobs that offer good pay.
While addressing the backlog of orphan wells is a massive challenge, just as important is preventing wells from becoming abandoned in the first place. With over 1.7 million active oil and gas wells and growing, responsible ownership is of the utmost importance. Ensuring that companies set aside money for cleanup is essential to ensure we don’t end up in this situation again.
Companies are starting to place an increased emphasis on mitigating emissions as the industry looks to be a source of clean energy moving forward.
Just as energy has powered amazing technological advances and innovations, these same innovations can now come full circle to help the industry mitigate its environmental impact. Addressing this problem now prevents this problem from spiraling out of control as the industry moves toward a cleaner future by eliminating methane-induced damage.
While $4.7 billion might seem like a lot, plugging wells can be expensive. Depending on the specifics of the well (age, depth, geography), costs can vary considerably. Traditional sealing methods like cement provide a cheap option that works up to 70% of the time, but when it doesn’t, costs can spiral out of control (upwards of $1 million in some cases). BioSqueeze® provides a solution for wells with leaks in existing cement, penetrating deep into tiny leakage pathways to create a gas-tight seal using natural biomineralization. Efficient and effective plugging is paramount for addressing the growing problem of orphan wells, and the experts at BioSqueeze Inc. are ready to help.
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