Biden administration announces $650 million to plug orphaned gas and oil wells

BY ZACK BUDRYK - 07/10/23 

Greg Nash

Secretary of the Interior Deb Haaland answers questions during a Senate Energy and Natural Resources Committee hearing to examine the President’s proposed FY 2024 budget for the Department of the Interior on Tuesday, May 2, 2023.

The Interior Department announced Monday more than $650 million in Bipartisan Infrastructure Law funding to plug abandoned oil and gas wells.

The $660 million in funding, available to 27 states, will go toward the plugging of so-called orphan wells, or wells abandoned for extraction by the oil and gas industry.

Orphan wells are associated with major safety and health hazards, many of them associated with methane leaks. Methane is also a major driver of climate change, due to its capacity to trap more heat in the atmosphere than carbon dioxide.

The Environmental Defense Fund estimates about 14 million Americans live within a mile of an orphaned well. Separate research indicates such infrastructure particularly affects communities of color, which because of the practice of redlining host a disproportionate amount of urban gas and oil wells.

“These investments are good for our climate, for the health of our communities, and for American workers,” Interior Secretary Deb Haaland said in remarks Monday in Kansas with Rep. Sharice Davids (D-Kan.). “With this additional funding, states will put more people to work to clean up these toxic sites, reduce methane emissions and safeguard our environment.”

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Kansas has already received $25 million in initial funding to plug its abandoned wells, and is eligible for another $25 million of the new funding. The bipartisan law includes a total of $4.7 billion for orphan well management, including the $2 billion in grants from which the $660 million derives.

The administration previously announced $560 million in grants to plug orphaned wells in August 2022, with eligible states plugging nearly 3,000 wells so far using that funding.

States have until Dec. 31 to apply for the next round of grants. Potential grant amounts range from $1.6 million for Alabama to $79.6 million for Texas. The administration is also set to offer performance grants under the infrastructure law, guidance for which will be issued later in the year.