By Victor Skinner, The Center Square contributor
Louisiana is asking the federal government for more than $401 million to plug thousands of orphaned oil and gas wells, joining 25 other states vying for $4.7 billion reserved for that purpose.
The Louisiana Department of Natural Resources identified 4,605 orphaned wells in need of remediation at an estimated cost of $401.7 million in the state’s notice of intent to apply for a grant through the Infrastructure Investment and Jobs Act.
The document states Louisiana lost 12,256 jobs in the oil and gas industry between March 1, 2020, and November 15, 2021, a 23.42% dip.
An Interior Department memo issued last week showed the 26 states that applied for the funding documented a total of more than 130,000 abandoned or orphaned wells, or nearly double the amount the Interior documented across 30 states in 2019.
The Infrastructure Investment and Jobs Act signed into law by President Joe Biden in November includes $4.7 billion to restore and plug orphaned wells, and the Interior Department issued guidance for state grant applications last month.
A total of 26 states have signaled they intend to apply for grants for the work, though the Interior Department has not yet published the full amount of grant funding eligible for each state, according to The Hill.
“These legacy pollution cleanup efforts will advance the department’s goals of environmental justice by helping historically marginalized communities address the devastating and long-lasting effects of legacy pollution,” the Interior Department memo read.
Simple math shows Louisiana is asking for more than $87,000 to plug each well identified in its notice, while total federal funding for the work would cover about $36,000 per well, if all 130,000 identified are funded.
A 2021 survey of idle and orphaned oil and gas wells conducted by the Interstate Oil and Gas Compact Commission showed Louisiana has plugged 3,450 orphaned wells since it launched its state program in 1993, including 219 in 2018, one in 2019 and 135 in 2020.
The total cost of plugging the 135 wells in 2020 was $5.9 million, or about $44,000 each, including restoration, according to the report.
Louisiana’s more than 4,600 orphaned wells do not include about 23,000 wells with state approval to remain idle. Unlike many other states, nearly all of the orphaned wells in Louisiana are associated with known operators, according to the commission.
A 2020 report by Columbia University and Resources for the Future, an environmental think tank, showed the effort to plug all of Louisiana’s orphaned wells could employ 1,000 people full-time for a year and annually reduce methane emissions by 558 metric tons, NOLA.com reported.
The methane reduction from capping the wells would be equivalent to removing the annual greenhouse gas emissions of more than 3,000 cars, according to the news site.
The Louisiana DNR collects about $4.5 million a year through its orphaned wells program, the Oilfield Site Restoration Program, and has spent about $64 million to plug wells since 1993. The Oilfield Site Restoration Program plugs about 160 orphaned wells each year, the state website showed.