This week, the Biden Administration announced a $1.15 billion program to clean up abandoned oil and gas wells across the nation.
The financing for the program originates from the Infrastructure Investment & Jobs Act, signed into law by President Biden on November 15, 2021. The $1.15 billion benefits states from the $4.7 billion that the government will spend.
Twenty-six different states will be receiving a portion of the funds. Still, Texas is getting the most prominent piece of the pie: Texas is eligible to receive $107 million from the initial $1.15 billion and $343 million over the entire life of the program.
When an oil or gas company is done with a well, it is legally required to clean up the surrounding area, remove any tanks, pipes, or wellheads, and “plug” the well with concrete. However, energy producers have not always executed all the requisite step over time.
United States Department of the Interior (DOI) Deb Haaland conveyed within a January 31 press release: “We must act with urgency to address the more than 100,000 documented orphaned wells across the country and leave no community behind. This is good for our climate, for the health of our communities, and for American workers.”
Many of those “orphaned wells” are in Texas, where energy producers have been drilling for oil since 1886. They present a danger to the surrounding community. Communities near abandoned wells have complained of oil and chemically tainted water leaking from the unused wells.
Methane emissions also arise out of the unplugged wells. Scientists believe that methane emissions have a significant impact on climate change. The leaking methane gas can also lead to unexplained illnesses for vulnerable residents.
Some unplugged wells have even sparked fires and exploded in the past, resulting in fatalities. These abandoned wells also have the potential to poison drinking water.
The federal government is now interceding.
The funds provided by the program will be used to “identify and plug orphan wells, remediate and reclaim lands impacted by oil and gas development activities and remove the infrastructure that’s associated with the wells,” according to President Biden’s Senior Infrastructure Advisor Mitch Landrieu.
“This program is clearly historic,” Landrieu heralded. “Never before has this country taken on a cleanup effort like this for these orphan wells, but President Biden said we need to clean them up, and that’s what we’re going to do because it’s good for our health, good for our climate and good for our workers.”
U.S. Rep. Lizzie Fletcher (D-Houston), who sponsored the provision in the infrastructure bill to address the abandoned wells, touted how the program would be a good job creator.
“As we work to recover from the pandemic, the funding that was announced this week and the additional funding that is still slated to come in future rounds will really provide incredible opportunities to get our skilled oil and gas workforce back to work in Houston, across Texas, and across the country,” Fletcher commented.
This program will not be the first time Texas has undertaken a plan to address abandoned wells in the state. In 1992, the Railroad Commission began aggressively plugging wells across Texas by tapping into bonds, taxes, and other fees collected from drillers. According to the Texas Tribune, it managed to plug nearly 31,600 wells at the cost of more than $243 million.
Last year, Grist, a nonprofit climate magazine, reported on abandoned oil wells in New Mexico and Texas. Its research found nearly 18,000 abandoned wells in Texas, substantially more than the 6,000 the state officially reports.
The magazine estimated that Texas would need to spend just under $1 billion in total cleanup costs to address all the abandoned wells in the state.
The Infrastructure Investment & Jobs Act has met with much controversy from republican policymakers, especially regarding its high price tag. Mitch McConnell criticized the plan when it was first introduced, saying it was “a Trojan horse,” the funding for which relied on “more borrowing and massive tax increases on all the productive parts of our economy.”
Others have said that the scope of the act is too broad, encompassing more than can be described by the term ‘infrastructure.’
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, a nonpartisan group that advocates for fiscal moderation, commented, “We’re at a point about where our debt is about to reach unprecedented levels, and that comes with a lot of risks,” said “We should put out a bill that is investment in infrastructure and doesn’t fall to the trick of calling everything you want infrastructure.”