Another important component of any stimulus or bill would also be instituting guardrails in the form of enough bond requirements, the recent report from Columbia University and Resources for the Future noted. This measure would ensure oil and gas companies do not come to rely on taxpayer money to fund the majority of future well cleanup.
Jill Morrison, executive director at the Powder River Basin Resource Council, a landowners group, has been tracking Wyoming’s bonding and well cleanup regulations for years, continually advocating for the state to hold companies liable for cleanup.
Morrison pointed to the country’s existing problem of inadequate bonding requirements for oil and gas companies and the risk of letting “industry off the hook,” if a federal stimulus program went into full swing.
Raimi’s report acknowledges this risk but leaves many of the policy specifics to lawmakers.
Abandoned wells can have environmental and public health consequences if left unplugged. If a wellbore deteriorates, it can potentially leach oil, gas or fluids into nearby water supplies. Wells left unplugged can spew out about 0.13 metric tons of methane on an annual basis.
“Federal funding could exacerbate this problem if states and companies see it as alleviating their responsibility to plan for future remediation costs adequately,” the report states. “To avoid this, a federal program could prioritize plugging wells abandoned decades ago that were not subject to modern regulatory frameworks.”
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