What happens when an oil and gas well reaches the end of its economic life?
Clearly, the well should be plugged by the operator, but it doesn’t always happen.
An operator may declare bankruptcy or simply abandon the well for financial reasons, so that it becomes an unattended or “orphan” well. While an operator is required by law to provide financial assurance, the costs to plug all the wells abandoned by an operator may greatly exceed the financial assurance, leaving the state as the “payer” as a last resort.
The impact is a backlog of orphan wells that the state is unable to manage either logistically or financially.
Tsunami of Orphan Wells
“Orphan wells in the best of times are a big deal. The potential for a coming tsunami of additional orphan wells is of concern to many."
- Adam Peltz, senior attorney at the Environmental Defense Fund
Environmental Risk
Methane Emissions
Methane (CH4), if leaked into the atmosphere before being used, absorbs the sun's heat and warms the atmosphere. Methane is considered a greenhouse gas much more potent than carbon dioxide. The EPA’s Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990–2016 shows abandoned wells to contribute 3.4% of all methane emissions relating to oil and gas activity.
Groundwater Pollution
Unplugged orphaned wells have the potential to contaminate groundwater. Deterioration of an orphan well's casing and cement could allow the wellbore to become a conduit for the movement of potentially hazardous fluids into potable aquifers.
Surface Contamination
Orphaned well sites may still have old equipment, contaminated soil from small spills and other waste at the surface. Oil, natural gas and brine seeping from the old wells can contaminate soil, rivers and lakes.