The pandemic highlighted a problem that was already becoming noticeable, not just in the Bakken, but in other plays across the nation — a rise in the number of abandoned and orphaned oil and gas wells.

North Dakota Department of Mineral Resources Director Lynn Helms has told the Williston Herald on previous occasions that the problem was manageable prior to the coronavirus pandemic. But there was a dramatic increase after COVID-19 dropped world demand 30 percent and Russia and OPEC started a concurrent price war that glutted world supply.

As part of our Road Map Series looking at the shape of things to come for the oil and gas industry, we’ve looked at carbon capture and blue hydrogen as well as salt cavern storage. A less glamorous reality on the road ahead for the oil and gas sector will be plugging abandoned and orphaned wells.

While it is an environmental problem that looms large for the nation, it is also being seen as a way to create job opportunities for workers in the oil and gas sector come what may in a low-carbon world.

North Dakota has already identified 95 more wells, in addition to the 280 or so that were plugged last year, which need to be dealt with. The legislature, meanwhile, allocated $6 million in funds specifically for that purpose during the most recent biennium. Helms believes it’s a problem that isn’t likely to end any time soon.

“There’s still some ripple effects from the pandemic,” Helms said. “We’ve still got some operators that are struggling financially. And so, I don’t think it’s going to end with these 95 wells.”

Helms expects to add at least another 50 to 100 wells over the next year or two.

Nationally, the scope of the abandoned well problem is much greater than that. In West Virginia and Pennsylvania, the Ohio River Valley Institute estimates there are enough abandoned wells to keep oilfield workers busy the next 15 to 20 years.

Nationwide, the EPA estimates there are 3.2 million abandoned wells in the United States. These wells are all emitting greenhouse gases like methane, which is 84 times as intense as carbon dioxide when it comes to climate change.

Curtis Shuck, with the Bakken-born Well Done Foundation, estimates each well their non-profit has plugged emits around 2,500 metric tons of greenhouse gas. Well Done has plugged five wells in Montana. It’s next plugging ventures are getting set for Pennsylvania and Louisiana.

President Joe Biden, meanwhile, has already bought into the idea of plugging and reclaiming abandoned wells as good both for the environment and for providing oil and gas workers with jobs in the low-carbon world he hopes to build.

Biden has proposed spending $16 billion to plug and reclaim oil and gas wells nationwide. That proposal has so far survived negotiations, and it’s still in the big bipartisan infrastructure deal that’s being worked out between Democrats and Republicans.

Momentum has also been gathering for a national restart program Bakken-style, with a bill Sen. Kevin Cramer helped introduce. It basically scales up North Dakota’s Bakken Restart, which plugged 280 some wells and reclaimed about half of them, to a $4.5 billion program that would help unemployed oil and gas workers across the nation get jobs while stopping an environmental problem.

North Dakota’s well plugging program this summer is meanwhile expected to hire around 30 to 39 people per well plugged, Helms told the Williston Herald. The 95 newly identified wells will be plugged and reclaimed in 20-well batches, adding around 600 jobs to the hard-hit sector. Oil and gas lost around 13,000 jobs during the pandemic.

The slower pace, Helms said, is absolutely necessary now that activity is picking up in the Oil Patch. There’s a labor crunch now, as companies try to woo workers back to the Bakken, and North Dakota inspectors are also a lot busier.

“Unlike the last half of last year, when there was little to no drilling activity, and not much going on in terms of work-overs and that sort of thing, our inspectors could dedicate 90 percent of their time to witnessing funding operations,” Helms said. “Now, we don’t have that luxury.”

North Dakota has taken several steps to reduce its abandoned well problems in the future. The number of abandoned or temporary wells allowed on a single blanket bond has been reduced, and the Department of Mineral Resources is now allowed to require single well bonds for abandoned wells. There have also been changes to rules regarding transfer of abandoned wells.

“I think a lot of people are under the impression that the well-funded, well-capitalized companies that drill these wells are the ones that end up with a well becoming an orphan, and that’s not the case at all,” Helms said. “It generally is operator No. 3 or 4. The wells get transferred two or three times and that’s the point at which they are not able to pay their expenses or bank enough money to pay for the plugging and reclamation.”

That’s a dynamic that’s only likely to increase as the industry moves forward in a low carbon world, where everything is under an ESG microscope.

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