The Biden administration has laid out an interagency framework for working with states and tribes to distribute the $4.7 billion allocated for closing and remediating abandoned oil and gas well sites across the US under the Infrastructure Investment and Jobs Act signed into law in November.
Four federal agencies: The US Environmental Protection Agency, and the Depts. of Interior, Agriculture and Energy, and the Interstate Oil and Gas Compact Commission, whose members are governors from oil and gas-producing states, signed a memorandum of understanding on Jan. 14 to establish a plan to work together to be able to roll out the funds quickly.
The DOI has documented at least 130,000 abandoned oil and gas wells in the US. Sites that have no known owner, or the owner is insolvent and cannot pay for remediation, are considered to be abandoned. If the wells are not closed off, or “plugged," properly, methane and other chemicals can leak and contaminate nearby land and groundwater.
The new infrastructure law allows states to apply for $25 million in initial grants, and establishes larger formula grants to fund proper closure and cleanup of orphaned oil and gas wells and well sites. Nearly every state with documented orphan wells submitted a notice of intent (NOI) by the Dec. 31, 2021, deadline declaring interest in applying for a formula grant, DOI says.
The MOU establishes an interagency task force, led by the Bureau of Land Management, to identify and inventory orphaned wells and associated pipelines, facilities and infrastructure, and to prioritize for potential federal funding sites that pose the most risk to the environment or public health. The MOU also establishes state and tribal grant programs for states and tribes to establish and manage their own orphan well plugging, remediation and restoration programs.
In a statement, Interior Secretary Deb Haaland said that the new infrastructure law “is poised to make critical investments to help clean up … legacy pollution – and it will take an all-of-government approach to implement the program.”
DOE Secretary Jennifer Granholm said in a statement that capping unplugged oil and gas wells will provide construction workers in the oil and gas sector “to land skills-matched jobs that will protect the health of their communities.”