New Mexico could get another $25 million in federal funds to clean up abandoned oil wells - Carlsbad Current Argus

New Mexico to get $25M more from feds to clean up abandoned oil wells

New Mexico could get another $25 million in federal funds to clean up abandoned oil wells
Adrian Hedden

Clean up of abandoned oil wells in New Mexico was funded by $25 million more in federal money Monday as the U.S. Department of the Interior provided a total of $660 million in grants for the work in several states.

There was an estimated 1,700 abandoned oil and gas wells, known as “orphaned wells” by industry terms in New Mexico, throughout its fossil fuel operations in southeast Permian Basin and northwest San Juan Basin.

The wells are typically orphaned when an oil and gas operator determines it financially unviable, and although companies typically pay into bonding agreements that’s often insufficient to full remediate the site, meaning state government agencies must pick up the tab.

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The latest public funding for that work came via the Infrastructure Investment and Jobs Act signed by President Joe Biden in November 2021, which included the Revive Economic Growth and Reclaim Orphaned Wells (REGROW) Act sponsored by U.S. Sen. Ben Ray Lujan (D-NM).

The $25 million for New Mexico was part of the first phase of grant funding under the infrastructure bill dedicated to addressing legacy pollution around the U.S., with the state eligible for up to about $72.2 million overall.

This came after an initial $25 million grant was provided to New Mexico, and states have until the end of 2023 to apply for the formula grant funds.

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Lujan also recently reintroduced the Abandoned Well Remediation and Research Development Act (AWRRDA) to fund expanded research on abandoned wells in the U.S. on federal, state and tribal lands.

He said plugging and cleaning up abandoned well sites would help the U.S. curb pollution and address human impacts on climate change.

“This effort to plug abandoned wells and slash methane emissions is an issue I’ve championed – because the health of our communities and environment are at risk,” Lujan said. “This welcome investment from the Biden administration will support our bipartisan movement in Congress to safeguard our communities and create more jobs while boosting economic growth in New Mexico.”

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Interior Secretary Deb Haaland said in a statement announcing the nationwide funding that abandoned oil wells constituted “environmental injustice” and the problem must be solved to protect communities from the impacts of energy development while creating jobs.

“Bidenomics and President Biden’s Investing in America agenda are enabling us to confront long-standing environmental injustices by making a historic investment to plug orphaned wells throughout the country,” Haaland said.

“These investments are good for our climate, for the health of our communities, and for American workers. With this additional funding, states will put more people to work to clean up these toxic sites, reduce methane emissions and safeguard our environment.”

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Through the infrastructure bill, the DOI committed $4.7 billion in total to the problem.

The $660 million announced June 10 was the first phase of the formula grant funding.

The DOI said “millions” of Americans live within a mile of an abandoned oil well, and that plugging the wells would support the Biden administration’s agenda of reducing methane emissions and creating jobs amid a transition toward less-pollutive forms of energy.

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That concern was echoed in a study published June 20 by McGill University and the Environmental Defense Fund in the journal Environmental Research Letters.

The study showed about 4.6 million people live within half a mile of an orphaned oil and gas well.

This joined a report from the EDF that showed 14 million people lived within a mile of such a well, and estimated the nationwide remediation cost could exceed the $4.7 billion federal appropriation by 30 to 80 percent.

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“And it will certainly not cover the large number of orphaned wells which are undocumented – whose very existence we know of but whose exact locations and depth remain unknown,” said Mary Kang, assistant professor at McGill University’s Department of Civil Engineering.

She said the U.S. must development policy to better monitor oil and gas wells, making it better able to identify when wells go abandoned.

“We need to rapidly develop a framework and environmental monitoring datasets to prioritize wells for plugging, since tens of thousands of wells will be plugged in a matter of years,” she said.

Adrian Hedden can be reached at 575-628-5516, achedden@currentargus.com or @AdrianHedden on Twitter.