Some environmental advocates are calling for more scrutiny of how federal money is being spent to clean up orphan oil and gas wells.
Money authorized in the federal Infrastructure Investment and Jobs Act is meant to plug orphan wells. Those are wells with no owner, and they’re different from abandoned wells, which have stopped producing but still have a responsible owner on the books.
The Capitol Forum, a news and analysis organization that aims to inform policymakers about how laws impact markets, found recently that some states are putting abandoned wells on lists of sites that could be cleaned up with the federal money. The report found three such wells in Pennsylvania.
“And what that means is that every dollar that gets diverted to clean up an abandoned well is a dollar that is no longer available to clean up the legacy orphan wells,” said Peter Morgan, a senior attorney with the Sierra Club.
Pennsylvania has upwards of 200,000 estimated orphan and abandoned wells, many drilled before modern regulations took effect. The state has documented about 25,000 of these wells, and got $25 million in the first round of federal well-plugging money.
So far, 24 wells have been plugged and more than 160 are under contract.
Unplugged wells can leak methane, a greenhouse gas that can pollute groundwater and irritate respiratory issues.
Morgan said Pennsylvania’s Department of Environmental Protection doesn’t have the resources to make sure companies are following laws about plugging wells.
“Any system that relies so heavily on self-reporting by the industry is going to run into problems, especially when industry is aware that, essentially, the cop’s not on the beat,” he said.
A report from DEP released at the end of last year said inspectors found more than 3,000 newly-abandoned wells over the 5-year review period.
Morgan said there’s nothing in the federal law to make sure drillers plug their own wells first, before applying for money to clean up orphan wells. He said that could push the problem even further into the future.
DEP said it thoroughly reviews well records to identify responsible parties. If one is found, DEP said it works to get that company to pay for the well cleanup.
DEP spokesman Neil Shader said the agency has bonding requirements for all oil and gas wells drilled after 1985, meaning that companies must put money up front that will be forfeited to the Commonwealth if the company fails to plug an abandoned well.
“DEP is examining additional enforcement measures to ensure that operators do not burden Pennsylvania taxpayers with additional well-plugging burdens,” Shader said.
But Sierra Club and other groups have argued bonding amounts are inadequate. A law passed last year caps the bond amount for each new conventional well at $2,500 for the next 10 years.
DEP estimates the cost of plugging one well averages $33,000. But complications can drive the cost up to $800,000.
Rep. Greg Vitali (D-Delaware) is sponsoring a bill to give back authority to DEP’s Environmental Quality Board to raise bond amounts. It passed the House Environmental Resources and Energy Committee on May 23. If it passes the full House, it faces an uncertain future in the Republican-controlled Senate.
The Senate had a similar make-up last year and passed the bonding restriction 29-21.
