Managing Environmental Liability: An Evaluation of Bonding Requirements for Oil and Gas Wells in the United States

2018 ◽  
Vol 52 (7) ◽  
pp. 3908-3916 ◽  
Author(s):  
Jacqueline S. Ho ◽  
Jhih-Shyang Shih ◽  
Lucija A. Muehlenbachs ◽  
Clayton Munnings ◽  
Alan J. Krupnick
2016 ◽  
Vol 43 (5) ◽  
pp. 2283-2290 ◽  
Author(s):  
Amy Townsend‐Small ◽  
Thomas W. Ferrara ◽  
David R. Lyon ◽  
Anastasia E. Fries ◽  
Brian K. Lamb

2020 ◽  
Vol 22 (4) ◽  
pp. 945-955
Author(s):  
Andrew J. Sumner ◽  
Desiree L. Plata

A database to unify physicochemical parameters of oil and gas wells with chemical additive disclosures helps highlight chemical transformation potential across the United States with geospatial specificity, informing improved industrial practice and environmental assessment.


Elem Sci Anth ◽  
2021 ◽  
Vol 9 (1) ◽  
Author(s):  
Mary Kang ◽  
Adam R. Brandt ◽  
Zhong Zheng ◽  
Jade Boutot ◽  
Chantel Yung ◽  
...  

Orphaned oil and gas wells are abandoned wells for which the cost of environmental impacts usually falls on governments and the general public. Government agencies responsible for well plugging often face funding shortfalls and many orphaned wells remain unplugged. To address this and support the oil and natural gas industry, federal governments are already spending, or considering spending, billions of dollars to plug orphaned oil and gas wells. Here, we analyze oil and gas data for the United States and Canada and identify policy recommendations that can best address environmental impacts of abandoned and orphaned wells. At least 116,245 wells across 32 states and four Canadian provinces/territories are operated by companies filing for bankruptcy in the first half of 2020, which may be an indication that many wells will be orphaned in the near future. Moreover, there are 4,700,000 historic and active oil and gas wells in the United States and another 790,000 in Canada. Of these, 2,000,000 and 310,000 wells are active in the United States and Canada, respectively. Thus, three of five wells ever drilled in the United States are currently inactive (2,700,000 wells), but only one in three are plugged (1,500,000 wells). Plugging involves isolating zones containing oil, gas, and water and is the main strategy for well abandonment. If the orphaned well stimulus funding comes through, tens of thousands of wells will be plugged within a few years. Well plugging at this scale far exceeds current rates of plugging, and it is important that we work to ensure long-term environmental benefits of well abandonment to water, air, climate, ecosystems, and human health. Minimizing environmental impacts of the millions of abandoned and orphaned wells in the United States, Canada, and abroad will allow for an economically beneficial and environmentally safe transition to a carbon-neutral economy.


2020 ◽  
Vol 55 (1) ◽  
pp. 563-570
Author(s):  
James P. Williams ◽  
Amara Regehr ◽  
Mary Kang

2021 ◽  
Author(s):  
Daniel Raimi ◽  
Alan J. Krupnick ◽  
Jhih-Shyang Shih ◽  
Alexandra Thompson

Millions of abandoned wells are scattered across the United States, causing significant methane emissions and creating a variety of health and environmental hazards. Governments are increasingly interested in decommissioning such wells via tougher regulations or direct spending, but want to do so efficiently. However, information on the costs of decommissioning wells is very limited. In this analysis, we provide new estimates of the costs of decommissioning oil and gas wells and the key drivers of those costs. We analyze data from up to 19,500 wells and find that median decommissioning costs are roughly $20,000 for plugging only, and $76,000 for plugging and surface reclamation. In rare cases, costs exceed $1 million per well. Each additional 1,000 feet of well depth increases costs by 20 percent, older wells are considerably more costly than newer ones, natural gas wells are nine percent more expensive than wells that produce oil, and costs vary widely by state. Surface characteristics also matter: each additional 10 feet of elevation change in the 5-acre area surrounding the well raises costs by three percent. Finally, we find that contracting in bulk pays off: each additional well per contract reduces decommissioning costs by three percent. These findings suggest that regulators can adjust bonding requirements to better match the characteristics of each well.


2021 ◽  
Author(s):  
Daniel Raimi ◽  
Alan J. Krupnick ◽  
Jhih-Shyang Shih ◽  
Alexandra Thompson

Millions of abandoned wells are scattered across the United States, causing significant methane emissions and creating a variety of health and environmental hazards. Governments are increasingly interested in decommissioning such wells via tougher regulations or direct spending, but want to do so efficiently. However, information on the costs of decommissioning wells is very limited. In this analysis, we provide new estimates of the costs of decommissioning oil and gas wells and the key drivers of those costs. We analyze data from up to 19,500 wells and find that median decommissioning costs are roughly $20,000 for plugging only, and $76,000 for plugging and surface reclamation. In rare cases, costs exceed $1 million per well. Each additional 1,000 feet of well depth increases costs by 20 percent, older wells are considerably more costly than newer ones, natural gas wells are nine percent more expensive than wells that produce oil, and costs vary widely by state. Surface characteristics also matter: each additional 10 feet of elevation change in the 5-acre area surrounding the well raises costs by three percent. Finally, we find that contracting in bulk pays off: each additional well per contract reduces decommissioning costs by three percent. These findings suggest that regulators can adjust bonding requirements to better match the characteristics of each well.


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