The looming crisis over orphan wells

From ToxicLeaks

Why orphan wells matter[edit | edit source]

As if fracking, pipelines and the fossil fuel industry weren’t already enough of an environmental and climate change crisis, there is the ongoing debate about what to do with abandoned sites and the debris left behind. In the United States, no one is sure exactly how many “orphan wells” have been left unplugged by individuals and companies who went out of business, moved on to other sites, or just won’t clean up. It’s a problem especially where fracking is permitted and small well operators abound.

The U.S. Environmental Protection Agency estimates as many as 3 million abandoned wells in the country, based on research paper findings. States like Pennsylvania, Texas and Wyoming have drilling histories dating to as early as 1859 – before the U.S. Civil War. The EPA in 2018 is exploring how to do a comprehensive count of the abandoned oil and natural gas wells, but it is still reviewing the process.

These so-called “orphan wells” present the potential for environmental catastrophe in multiple ways. When left unplugged, they are leaking methane into an atmosphere that’s already choking on carbon with soaring levels of greenhouse gases (GHG). A study of 138 abandoned wells in four U.S. states found more than 40 percent were leaking methane compared with less than one percent of those properly plugged, usually with cement. Such wells account for up to 4 percent of fossil-fuel industry methane.

The abandoned wells also can cause ground water contamination, other pollution, and even explosions. In one Pennsylvania case, authorities think a house explosion was caused by a gas well drilled in 1881. The U.S. state alone has an estimated 8,000 abandoned oil and gas wells that need to be plugged, but the program responsible for orphan wells, funded by permit fees, could afford to plug only six in 2017.

Scope of the orphan well problem[edit | edit source]

Orphan wells are defined by the absence of anyone to hold accountable for capping and clean up. That’s compared with abandoned wells which, for a variety of reasons, are no longer in service, and in many cases have been safely closed. Efforts to plug orphan wells have stepped up, but they remain a hazard.

That’s true beyond the United States, with concerns over orphan wells in places as diverse as Nigeria, which says it has lacked the capacity to meet sustainable decommissioning standards but wants to avoid North America’s crisis; to the Russian Federation, where an April 2018 study describes an “acute problem” with abandoned and orphaned oil and gas wells. In Pakistan, 60 percent of about 1,000 wells are either abandoned or dry, which has raised possibilities about their potential for geothermal energy.

Wells have been abandoned in Venezuela because of the country’s financial and political crisis, but industry sources say Venezuela has no known legislation on plugging abandoned wells. That’s also true in nations including Oman and Egypt, while countries like Angola and Ukraine set “generally accepted” goals – but these underscore the differences from one government to another, and for both land and offshore wells that are decommissioned. An overview of some national laws is available from the Global Carbon Capture & Storage Institute, and there are increased calls to develop international approaches.

Yet it’s Canada where orphan wells have raised the most awareness of environmental costs, particularly in the Alberta province where – as in other locations – taxpayers are on the hook when companies bail.

The Canadian debate over orphan wells[edit | edit source]

By December 2016, authorities in the oil region of Alberta said the list of orphan wells had doubled to 1,400 and warned that they’d be cleaning up for decades. “The list of abandoned wells reads like the graveyard of Alberta’s oil and gas industry,” the Calgary Herald said. Terra Energy, responsible for 100 orphan wells, had closed in March. Tuscany Energy, responsible for Alberta wells, filed for bankruptcy.

That’s left citizens concerned about the cleanup costs they’re covering as well as the worry over toxic environmental impacts. The Orphan Well Association, a nonprofit supported by the Canadian energy industry and government, keeps a running list. As of September 2018, there were more than 2,000 orphaned wells, more than 2,700 segments of abandoned pipeline, and hundreds in other categories. More than 1,000 sites in total were abandoned by Lexin, including two wells within the City of Calgary.

The November 2018 tab is at USD$58.7 billion, according to the Alberta Energy Regulator, but figures are much higher in the Price of Oil investigative journalism series conducted by leading Canadian media outlets. Their findings point to what Canadian legislator David Swann calls a “silent financial tsunami.”

Future directions for Canada[edit | edit source]

There are no easy answers for Canadians. Globe and Mail editor Wendy Cox notes there are about 72,000 oil and gas wells across western Canada that haven’t produced in five years, and thousands have remained inactive for two decades. A separate six-month Globe and Mail investigation finds a number of companies, including Chinese-backed Sequoia Resources Corp., that have left communities in the dust.

What their work points to is the need to clean up more than orphan wells, and tackle the regulatory environment – not just in Alberta, but in Saskatchewan and British Columbia too – that has allowed for high-risk, walk-away and casino-like investment within a framework of poor government oversight.

Beyond that, Canadians need to mitigate the environmental and climate impacts of orphan wells. So do other countries, with an urgency that ends the fossil fuel era and turns to carbon-free renewable energy.