Rogue methane leaks from idle wells carry four big takeaways for policymakers

An ongoing methane leak involving several long-term idle wells in Southern California is raising safety concerns for nearby residents and highlights an important climate issue. Southern California has some of the worst air quality in the country, and leaks like these compound the negative impacts on some of the country’s most vulnerable populations. Both in California and across the country, many hundreds of thousands of end-of-life oil and gas wells are idle. That means that they are just sitting around awaiting proper site closure, which involves plugging the wells with cement to prevent gases or liquids from escaping and threatening the environment and public health.

Several such wells were recently found to be leaking methane — a powerful greenhouse gas that often escapes from oil and gas facilities alongside other toxic pollutants — in the Morningstar section of Bakersfield, CA. Local residents are concerned about the possibility of subsurface methane migration to homes and other structures in the vicinity.

While CalGEM and other agencies work to investigate and remediate the situation, four takeaways are already emerging:

1) The importance of plugging help via the Biden Administration’s Infrastructure Investment and Jobs Act

When long-term idle wells are determined to be orphaned (i.e. lacking a financially solvent owner of record and no responsible party to close the well except for the state), those wells are typically put on a state’s plugging lists. California’s list, for example, is several thousand wells deep. Nearly 130,000 wells are on such lists nationwide. Unless Sunray Petroleum, the last operator of record of the leaky wells in Bakersfield, turns out to have the funds to pay for their closure, these leaking wells will land on California’s list, too.

Historically, California and most states have been underfunded to plug and remediate orphan wells. That is starting to change, thanks to legislation introduced by Senators Ben Ray Luján and Kevin Cramer and signed by President Biden., The Infrastructure Investment and Jobs Act includes $4.7 billion to close orphan wells nationwide over the next several years, perhaps as many as 50 to 100,000 wells depending on costs. The funding mechanism, overseen by the Department of Interior, will begin disbursing funds to more than 25 states starting this summer. This will surely come as a relief to the nine million Americans living within a mile of an orphan well.

Just yesterday we saw those funds in action as the Interior Department announced $33 million to remediate nearly 300 orphan wells across the country, including in Bakersfield.

2) It’s generally a bad idea to allow wells to remain idle for years and years

Far too many wells across the country have been idle for ten years or more. Such wells should either be returned to service or plugged. Failing to do so runs the risk of environmental degradation from idle wells, including methane emissions like those from the Bakersfield wells, as well as the possibility of groundwater, surface water and land contamination from saltwater leaks and spills.

Furthermore, the longer a well remains idle, the more likely it is to become orphaned. Long-term idle wells pose increasing risks to the environment, public safety, the climate and the taxpayer.

3) The problem with these end-of-life wells is vast enough that policy reform is needed

Unfortunately, while the $4.7 billion in the Infrastructure Act is by far the largest investment in closing old wells in the nation’s history, the scale of the problem is sufficiently large (perhaps in the tens of billions of dollars) that even that sum will not cover all of the currently orphaned wells in the country, let alone active and idle wells that might become orphaned in the future.

In order to tackle this problem fully, states and the federal land management agencies need to adopt laws and regulations to ensure that all oil and gas wells are plugged in a timely fashion, at the end of their useful lives, with industry funding. This is, in fact, how the system is supposed to work — every state requires non-productive wells to be plugged. However, when operators go bankrupt and they have not put up enough money through financial assurance mechanisms to pay for well closure, the result is orphan wells that become the public’s responsibility to clean up.

There are a variety of mechanisms that oil and gas agencies can use to prevent this from happening, including reform of how financial assurance rules work, tighter idling requirements, more scrutiny on well transfer, and standing up industry-funded orphan well closure funds. The Infrastructure Act recognizes the need for changes and it awards states that undertake such reforms with additional funds — up to an additional $70 million each. The signal to states is clear – the time to act is now.

4) In the meantime, keep close tabs on risky older wells

Most states have requirements for operators to regularly renew their idle well status, and many states have idle well testing requirements, but every state can, and should, do better. Leading practices include regular annular pressure monitoring to detect leaks within wells’ underground casing, and regular surface leak detection. When end-of-life wells cannot be closed immediately because of financial constraints, it is essential that those wells are tested frequently to ensure they are not endangering safety, public health, the environment or climate.

While the end-of-life leaky wells near Bakersfield are investigated and mitigated, the lessons for the country are clear. Wells like these, especially when they are in close proximity to population centers, should be plugged when they’re done producing. Wells should be checked frequently for problems in the meantime. Furthermore, states and the federal land management agencies should be adequately funded to quickly close any wells that slip through the cracks. We have the tools to solve this problem and new incentives to tackle it now – let’s act so families who live near oil and gas development can rest easier.