Orphan Wells in California
As the fourth largest producer of oil in the nation, California is home to approximately 250,000 oil and gas wells. This figure includes approximately 30,000 idle wells, many of which have been idle for over fifteen years and are at risk for desertion. Costs associated with plugging and abandoning of deserted wells and decommissioning the deserted facilities attendant to oil and gas production can be significant. For example, the Division of Oil, Gas, and Geothermal Resources (the Division) plugged and abandoned two wells in the Echo Park neighborhood of Los Angeles at a cost of over $1 million. Deserted and orphaned wells represent a liability to the state, and it is important that the Division better understand the scope of that liability and steps that could be taken to mitigate that liability from escalating even further.
The Division of Oil, Gas, and Geothermal Resources within the Department of Conservation has requested for CCST to conduct this study to assess the scope of the liability to the state and explores potential mitigation measures.
CCST will assemble an expert project team to research and write the report with feedback and review from additional experts and analysts, including but not limited to experts in oil and gas well abandonment procedures, site remediation, and risk management. The research and writing process will include a literature review and identification of existing relevant datasets, including datasets from the Division. Through meetings, investigations, and literature review, CCST's team will produce a short report to address the following:
- State liability for the plugging and abandoning of deserted and orphaned wells and decommissioning facilities attendant to such wells
- Assessment of costs associated with plugging and abandoning deserted and orphaned wells and decommissioning facilities attendant to such wells
- Exploration of mechanisms to ameliorate plugging, abandoning, and decommissioning burdens on the state; including examples from other regions and questions for policy makers to consider based on current state policies.