State and federal authorities overseeing oil and gas operations in Wyoming anticipate millions in federal funding to clean up wells, pipelines, pads and other related facilities left “orphaned” or otherwise unremediated by operators.
There are more than 2,307 orphaned well sites in Wyoming, according to state and federal estimates.
The Wyoming Oil and Gas Conservation Commission, which oversees facilities on state and private lands, lists 1,307 well sites in its orphaned well program and is set to receive $25 million from the bipartisan Infrastructure Investment and Jobs Act. The Bureau of Land Management, which oversees facilities that tap federal minerals in Wyoming, estimates more than 1,000 orphaned wells in the state. The federal agency will tap into $250 million set aside for federal orphaned well remediation nationwide.
“Orphaned wells are a legacy that we must address, as they can release methane, pollute groundwater, and pose a hazard to people and wildlife alike,” BLM Director Tracy Stone-Manning said in a press release.
For its part, Wyoming BLM estimates the cleanup work on federal wells in the state will create or sustain up to 300 industry-related jobs. Meantime, the WOGCC expects the federal funds to clean up state and private facilities will support what’s already a robust orphan-well-remediation program. The state has cleaned up more than 4,713 orphaned well sites since 2014, according to the agency. Of those, 186 were converted to water wells for nearby ranchers.
Who pays
The federal push to clean up more orphaned wells is long overdue and will benefit landowners and others who suffer the environmental risks, according to advocacy groups. But, they say, the cost of clean up shouldn’t fall to American taxpayers.
“The people who drill the wells and profit from them are responsible for cleaning them up,” Powder River Basin Resource Council and the Western Organization of Resource Councils board member Bob LeResche said. The federal government is “doing something good for the environment and surface owners, but they’re doing it with taxpayer money, which is just wrong.”
When it comes to holding operators responsible for cleanup, the state has generally done a better job than the BLM, LeResche said. Of the $32 million the state has spent to remediate orphaned wells since 1997, $21 million was covered by bonds posted by operators, according to the WOGCC. The rest of the expense was covered by a conservation tax applied to all oil and gas operators in the state.
The BLM, however, still allows for a nationwide “blanket bond” of $150,000, just a fraction of actual remediation costs for many operators. The federal agency is also slow to add wells that are known to be inactive to its orphaned well list, LeResche said, sometimes waiting more than six years to pursue responsible parties.
The Powder River Basin Resource Council and others are pushing the BLM to revise its bonding rules to increase dollar amounts and speed up the timeline for remediation work, LeResche said.
Orphaned well legacy
Coal-bed methane gas wells, primarily in northeast Wyoming, make up most of the orphaned wells in Wyoming, according to state officials. The industry tanked beginning in 2010, mostly due to low natural gas prices and the proliferation of hydraulic fracking that redirected the industry to shale gas plays outside the state.
“The people who drill the wells and profit from them are responsible for cleaning them up.”
Bob LeResche, Powder River Basin Resource Council
For a 20-year period before the coal-bed methane boom, the state had documented 500 orphaned wells. After the coal-bed methane bust, it documented 6,020 orphaned wells, according to the state. The CBM bust and the string of bankruptcies that followed added pressure on state officials to revise Wyoming’s bonding and reclamation rules.
The BLM needs to do the same, LeResche said, otherwise continuing to use federal taxpayer dollars “is bailing out the culprits who were leaving these wells unreclaimed and unplugged.”
Here in Wyoming, we don’t like big government and we don’t want hand-outs and we won’t take fed money to help the poor, but when it comes to energy, pretty please Mr. Big Government may we have more money? We will do anything to keep oil companies happy, since no one in Wyoming seems to know how to do anything but dig for oil and they chase away anyone from the outside who might bring something new and prosperous to the state. Smart people scare us in Wyoming.
Working oil and gas. Working state, federal, local and Blm I have plugged many wells states past 20 years . I understand many statues changed. I would like submit CV my 40+ years oilfield experience
Don’t condemn the oil companies. The fault lies with state/federal policy makers. a simple program set up similar to the UST fund could of been set up years ago. As simple as 10 cents per MCF gas extracted whether sold/vented and say $1 bbl oil would of prevented this plugging headache. The blame lies with all the state legislator’s and congress. All that servrd one day in past 50 years share the blame.
It’s great for the residents of Wyoming and the country that this problem is being more seriously addressed. I know the answer, but how many of Wyoming’s legislative politicians voted for the infrastructure bill? This is not an isolated example of the Republican hypocrisy. Your points are right on, Bob.
Who couldn’t see it coming; that the taxpayers of the United States would end up with all the remediation costs for the coal bed methane bust. BLM only required a mere pittance of bonding for this industry. I can only shake my head when contemplating how stupid Wyoming legislatures or how corrupt they must be to have allowed the CBM drilling with a bond that most likely would not cover the cost of an auto accident that might happen on the way to a drilling site. Or not even the cost of moving some dirt placed to hide well sites and equipment. Shame on Wyoming legislature and all those who voted them in for allowing this abomination to persist and be started in the first place. I am not a rocket scientist but I knew 30 years ago that these CBM producers would end up with their hands in taxpayer’s pockets just like them welfare ranchers or Wyoming Stock Growers with their taxpayer subsidized nonsense. BS
Eliminating these “orphan wells” would be fantastic! They ruin so much of the views of this beautiful state plus they are hazards! I vote yes!!!!!!