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Home / Industry / Energy /  Nationwide work starts to plug abandoned gas and oil wells

Nationwide work starts to plug abandoned gas and oil wells

Stacks of steel pipes used for drilling oil wells at a drilling site on the land that the University of Texas System overseas in Andrews, Texas, US, on Thursday, June 2, 2022. Every day, the University of Texas System makes about $6 million off a mineral-rich swath of land it manages in the US�s largest oil field. Photographer: Jordan Vonderhaar/Bloomberg

Pennsylvania could eventually receive $400 million for a project designed to stop leaking methane, a greenhouse gas

EMSWORTH (PENNSYLVANIA) :About 30 years ago, Ralph Molenda learned that he had an abandoned gas well leaking under his driveway. The top of the well, it turned out, had been covered decades earlier with a piece of wood and a cast-iron skillet.

About 30 years ago, Ralph Molenda learned that he had an abandoned gas well leaking under his driveway. The top of the well, it turned out, had been covered decades earlier with a piece of wood and a cast-iron skillet.

The well is now among several hundred that Pennsylvania regulators plan to fill and seal over the next year, as part of a federal effort aimed at plugging abandoned oil and gas wells, a safety and environmental hazard that states have made little progress on for years.

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The well is now among several hundred that Pennsylvania regulators plan to fill and seal over the next year, as part of a federal effort aimed at plugging abandoned oil and gas wells, a safety and environmental hazard that states have made little progress on for years.

“It’s definitely a relief. I didn’t think it would actually ever get done," said Mr. Molenda, a retired carpenter, as he stood next to a 12-foot-tall pipe that vents gas to keep it from migrating into his home.

Methane leaking from cracked and rusting wells from more than a century of oil and gas development has long posed risks to homes and businesses in states such as Ohio, Wyoming and Texas. Over the years, many companies simply walked away from wells when production dwindled.

Now the threat posed by the emissions of methane, a potent greenhouse gas, has created more urgency to seal them.

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Last year’s infrastructure bill included $1.15 billion in grant funding under the U.S. Methane Emissions Reduction Action Plan to plug abandoned wells.

In August, the Department of the Interior gave $560 million to 24 states under the program. Millions of people live within a mile of hundreds of thousands of orphaned oil and gas wells, the department said.

With the initial grant money, Texas will begin plugging 800 wells this fall, while Kentucky will plug more than 1,000 wells and Louisiana will plug more than 250 wells, according to the Interior Department. It said 15 states, including California, Mississippi and West Virginia, will also use some of the funding to measure methane emissions.

Pennsylvania could eventually receive a little over $400 million from the federal government through the program, according to the state Department of Environmental Protection, which oversees well plugging. The process involves clearing out wells that can extend several thousand feet and filling them with concrete. Over the next year, the DEP plans to hire contractors to plug about 300 high-priority wells from an initial $25 million grant received in August—far more than the 54 wells the state paid contractors to plug over the past five years.

Don Hegburg, a geologist who oversees the DEP’s plugging program in southwest Pennsylvania, said the new program will keep oil and gas from migrating into homes and water sources from some of the most high-risk wells. “It’s a rare opportunity," he said.

And yet, the program will barely make a dent in terms of the total number of abandoned wells. The state has documented nearly 27,000 orphaned wells, and there could be 200,000 or more undocumented ones, according to the DEP.

Methane emissions from Pennsylvania’s abandoned oil and gas wells accounted for between 5% and 8% of the state’s greenhouse-gas emissions, according to a 2016 study by researchers at Princeton and Stanford universities. They found that 10% accounted for 90% of emissions.

In Pennsylvania, there was little oversight of well plugging for nearly a century after the nation’s first oil well was sunk in Titusville in 1859.

In 1921, the state required companies to plug wells, but the law was rarely enforced, according to Jeremy Weber, an associate professor at the University of Pittsburgh. In 1984, the state required companies to pay for a bond on each well to ensure that it would be plugged later. But many say such bonding has been inadequate in Pennsylvania and elsewhere.

In July, Pennsylvania Democratic Gov. Tom Wolf let a law take effect that freezes the bonding amount for another decade for conventional oil and gas drillers at $2,500 a well, the level first set in 1984. The DEP said it costs $68,000 on average to plug a conventional well, which is drilled vertically—unlike horizontal wells used in fracking.

The DEP hasn’t said what bonding level is appropriate.

Dan Weaver, president and executive director of the Pennsylvania Independent Oil & Gas Association, said the industry supported the bill to pause increasing bonding levels, because a proposal backed by the Sierra Club and other groups to raise the amount to $38,000, for new wells and those drilled since 1985, would have put some companies out of business.

Mr. Weaver said that while he opposes raising bonding for existing wells, he would support some increase on new wells because companies could factor in that added cost. “It needs to be somewhere in the middle," he said of the bonding amount.

He said his constituent oil-and-gas companies welcome the federal support to find and plug more wells.

From the start of the year through August, the DEP cited companies for abandoning a total of 267 conventional wells without plugging them, according to an analysis of its compliance database by David Hess, who was head of the DEP from April 2001 to January 2003 under two Republican governors. He praised the influx of federal funding but said the number of wells cited as being abandoned this year is close to the number that contractors will plug over the next year.

“That’s in a nutshell what happens," said Mr. Hess. “In terms of the tools that the state has to prevent well abandonments, the biggest one, bonding, is entirely inadequate and a shambles at this point."

A spokesman for the state DEP said the department is working to confirm Mr. Hess’s analysis.

Contractors are already ramping up hiring in anticipation of the added work.

Plants & Goodwin, a Bradford, Pa.-based company that plugs wells, now employs 100 workers, up from 50 at the start of the year. It still needs 20 to 30 service rig workers and cement pump laborers, said Luke Plants, its chief operating officer.

He said workers are in short supply because gas companies have increased drilling in response to higher prices. That also drives demand for plugging projects initiated by companies because drillers don’t want old wells to affect new ones, he said. “We’re hiring workers as quickly as we can," he said.

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