Though different jurisdictions have varying criteria for what exactly qualifies as an orphaned or abandoned oil well, generally speaking, an oil well is considered abandoned when it has been permanently taken out of production. Similarly, orphaned wells may have different legal definitions across different jurisdictions, but can be thought of as wells whose legal owner it is not possible to determine.
Once a well is abandoned, it can be a source of toxic emissions and pollution contaminating groundwater and releasing methane, making orphan wells a significant contributor to national greenhouse gas emissions. For this reason, several state and federal programs have been initiated to plug wells; however, many of these programs are under capacity. In states like Texas and New Mexico, these programs do not have enough funding or staff to fully evaluate and implement mitigation programs.
North Dakota dedicated $66 million of its CARES Act pandemic relief funds for plugging and reclaiming abandoned and orphaned wells.
According to the Government Accountability Office, the 2.1 million unplugged abandoned wells in the United States could cost as much as $300 billion. A joint Grist and The Texas Observer investigation in 2021 highlighted how government estimates of abandoned wells in Texas and New Mexico were likely underestimated and that market forces might have reduced prices so much creating peak oil conditions that would lead to more abandonment. Advocates of programs like the Green New Deal and broader climate change mitigation policy in the United States have advocated for funding plugging programs that would address stranded assets and provide a Just Transition for skilled oil and gas workers.
The REGROW Act, which is part of the Infrastructure Investment and Jobs Act, includes $4.7 billion in funds for plugging and maintaining orphaned wells. The Interior Department has documented the existence of 130,000 orphaned wells nationwide. An EPA study estimated that there are as many as two to three million wells across the nation.
New York State is expecting to receive $70 million from the Act in 2022 which will be used to plug orphaned wells. The state has 6,809 orphaned wells, and the NYSDEC estimates it will cost $248 million to plug them all. The NYSDEC uses a fleet of drones carrying magnetometers to find orphaned wells.
In 2023, state governments in Pennsylvania, Ohio, and California reported a shortage of trained staff necessary to implement federally funded well capping programs. Qualified oil field workers were also in short supply in Pennsylvania and Ohio. Federally funded well plugging contracts are required to meet Davis-Bacon Act standards for prevailing wages, in order to ensure that the training of new oil field workers will contribute to local economic development in rural areas.
State definitions
State legislatures in the United States have specific definitions based on local needs and priorities. For example, the section on abandoned wells in Texas' Natural Resource Code defines an "inactive well" as "an unplugged well that has had no reported production, disposal, injection, or other permitted activity for a period of greater than 12 months."
Pennsylvania's definition of abandoned well includes not producing for 12 months, "considered dry and not equipped for production within 60 days after drilling, re-drilling or deepening, and from which the equipment needed to extract resources or produce energy has been removed."
Ohio legislation defines "idle and orphaned wells" based on whether or not a well bond has been forfeited or the money to plug it is unavailable. It defines a "temporary inactive well status" as not having produced for two (non-horizontal wells) or eight (horizontal wells) statutorily defined reporting periods or one that has produced "less than 100,000 cubic feet of natural gas or 15 barrels of crude oil."
Environmental impacts
Orphaned and abandoned wells can cause environmental damage by leaking pollutants into the atmosphere or water supplies. Important determinants of how much orphaned and abandoned wells impact the environment include the techniques used and precautions taken when first drilling the well, whether it is a gas well, oil well, or combined oil and gas well, and if and how the well was sealed.