The U.S. Department of Interior rolled out its long-awaited Orphaned Wells Program Office for capping orphaned oil and gas wells on federal lands Thursday, a move that included the $63.8 million to cap wells in 16 states including the Montana.
Interior Secretary Deb Haaland framed the program as historic during the press conference, pointing out that most of the orphaned wells targeted were in national parks, forests or wildlife refuges.
“Millions of Americans live within just one mile of an orphaned oil or gas well. These are environmental hazards that jeopardize public health and safety by contaminating groundwater, emitting methane which adds to the climate crisis and litters our landscape with rusted, and dangerous equipment,” Haaland said.
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Just one Montana well was on the list, which included few sites associated with oil and gas leasing by the Bureau of Land Management, the major driver of U.S. onshore oil and gas development. Wyoming, which has more productive leases than any other state, had 12.
The Bipartisan Infrastructure and Jobs Act passed by Congress in 2021 included $4.7 billion to deal with abandoned oil and gas wells. Most impactful, at least in Montana, has been Interior grants to states, some $560 million awarded last year. Montana’s Board of Oil and Gas Conservation, which received $25 million, expects to cap all 237 state regulated wells by next year for roughly half the federal funding it received.
“This is federal grant money and one of the biggest targets with the Department of Interior is methane emissions. So, we evaluated the wells, but we’re going to cap all of them,” said Ben Jones, state petroleum engineer.
The oldest well being plugged was drilled in 1918, Jones said. The state will make sure there are no longer emissions coming to the surface at each site and that groundwater isn’t being contaminated. Cement will be used to cap bore holes for hundreds or thousands of feet, depending on circumstances at each site.
Jones said the state contracted with six different companies to cap the wells. With two contractors working during the first half of the year, 35 wells have been plugged so far, but the number of contractors will swell to five this summer. Jones expects more than a hundred wells to be capped in the coming months.
Methane, a greenhouse gas, is more than 25 times as effective at trapping heat in the atmosphere than carbon dioxide. The Interior estimated in 2022 that there were 3.5 million abandoned wells in the United States, 39% of which were capped.
Montana is not among the top 11 states which account for most abandoned wells, neither is Wyoming. But the number of wells in Montana is still significant. There are 2,443 producible well bores on federal land in Montana, according to BLM data.
At a remediation cost of $20,000 to $145,000 per well, BLM doesn’t hold enough bonding money per well to cover the costs of cleanup. The federal Government Accountability Office in 2018 estimated that on average BLM holds a bond of $2,122 for each well.
In May, Wild Montana estimated using GAO analysis that the bonding shortfall at BLM would eventually cost taxpayers $48 million to $3 billion just for the Montana federal wells. The group argued that BLM shouldn’t continue issuing leases without requiring enough bond money to cover costs.