PA Environment Digest Blog: DEP Begins Accepting Grant Applications Oct. 9 To Plug Orphan Conventional Oil & Gas Wells Abandoned By Their Owners

Wednesday, October 2, 2024

DEP Begins Accepting Grant Applications Oct. 9 To Plug Orphan Conventional Oil & Gas Wells Abandoned By Their Owners

On October 2, the Department of Environmental Protection announced it will begin accepting applications on October 9 for grants to plug orphan conventional oil and gas wells abandoned by their owners.

The new program is part of the $76 million in funding Pennsylvania received from the federal Infrastructure Investment and Jobs Act for plugging wells abandoned by conventional oil and gas well owners.

The program offers grants of up to $40,000 to plug orphan wells 3,000 feet deep or less, and up to $70,000 for wells deeper than 3,000 feet.

The grants will be available to qualified well pluggers for orphan wells, which are wells that were abandoned by conventional oil and gas well owners before April 18, 1985.

[A “Qualified Well Plugger” is a “person who demonstrates access to equipment, materials, resources and services to plug wells in accordance with statutory and regulatory requirements.”

[A Qualified Well Plugger, a parent or subsidiary business entity, must also be in compliance with “any statute administered by the Department, a regulation promulgated under a statute administered by the Department or a plan approval, permit or order of the Department,” according to the application presentation.

[An “Orphan Well” as defined in Section 3203 of the Pennsylvania Oil and Gas Act is “a well abandoned prior to April 18, 1985 that has not been affected or operated by the present owner or operator and from which the present owner, operator or lessee has received no economic benefit other than as a landowner or recipient of a royalty interest from the well.”]

"By prioritizing the capping and plugging of orphaned and abandoned wells, my Administration is making meaningful strides in reducing greenhouse gas emissions while also supporting thousands of good-paying energy jobs across Pennsylvania," said Governor Shapiro. "Pennsylvania has a long legacy as an energy leader – and these wells are proof of that. Now, we are continuing that legacy by plugging and capping them, improving air quality, reducing emissions, protecting public health, and creating jobs. We are rejecting the false choice between protecting jobs and protecting our planet – and my Administration will continue to draw down as much federal funding as possible to do this critical work."

“Orphan wells can leak methane, a potent greenhouse gas, into the atmosphere and pollute groundwater. It is not a matter of ‘if’ an orphan well will be a threat to the environment and public health – it’s a matter of ‘when’,” said DEP Acting Secretary Shirley. “This new program will allow private entities to plug lower-risk and lower-cost orphan wells while DEP focuses on priority wells that can be more expensive to plug. Plugging these orphan wells creates good-paying jobs and improves the environment. We are encouraging any qualified well pluggers to apply and help improve the economy and the environment.”

Since day one, the Shapiro Administration has been dedicated to maximizing every opportunity to plug orphaned and abandoned wells in Pennsylvania, successfully plugging over 260 wells so far — more than in the previous 10 years combined.

[DEP Issued 763 Violations For New Well Abandonments So Far In 2024]

DEP is aggressively going after operators who are walking away from wells and stepping in with emergency plugging contracts where needed to protect public health.

[So far in 2024, DEP issued 763 new or continued violations to conventional oil and gas well owners for abandoning and not plugging wells. Read more here.]

Pennsylvania has more than 350,000 conventional oil and gas wells abandoned by well owners, contributing nearly 8 percent of the state's total methane emissions.

Methane is especially hazardous, being up to 86 times more potent than carbon dioxide, which poses a potential risk to life and property, significantly warming the planet, and contributing to harmful air pollution.

DEP has identified an initial list of over 27,000 orphaned and abandoned wells abandoned by their owners and is prioritizing those posing the highest risks under the new federal well plugging funding.

DEP said it will continue to focus new plugging contracts on these high-priority wells, along with nearby wells, to maximize efficiency and preempt environmental threats.

Meanwhile, the grant program will fund wells lower on the current priority list so that they do not become environmental hazards in the future.

Apprenticeship

Recently, the United Mine Workers of America announced a new apprenticeship program to train workers to plug wells and restore well sites.

$11 Million In State Funding

The 2024-25 budget allocated $11 million to DEP’s Office of Oil and Gas Management, ensuring that Pennsylvania can fully leverage available federal funds for well plugging.

[The funding is for DEP’s Oil and Gas Regulatory Program generally to fill a deficit in revenues because the program is supported by permit application fees that have dropped dramatically with the pull back of the shale gas industry in Pennsylvania.

[As of September 20, DEP received revenue from only 758 shale gas well permits of the 2,000 they estimate they need to support the program.

[Since August 23, Baker Hughes reports the number of natural gas drilling rigs in Pennsylvania has dropped by 33% as part of an industry attempt to increase natural gas prices.

[Marcellus Drilling News reported on September 10 Coterra Energy has pulled all its active shale gas drilling rigs from Susquehanna County until natural gas prices ‘recover.’

[On October 1, Reuters reported EQT, the largest natural gas driller in Pennsylvania will lay off 15% of its employee workforce.]

How To Apply

For all the details, visit DEP’s Orphan Well Plugging Grant Program webpage.

PA Oil & Gas Industry Public Notice Dashboards:

-- PA Oil & Gas Weekly Compliance Dashboard - Sept. 28 to Oct. 4 - Five More Abandoned Shale Gas Well Violations; Failure To Disclose Fracking Chemicals; Failure To Report Waste Generation & Disposal; Lawnmower Causes Conventional Pipeline Gas Leak [PaEN]

-- DEP Issues Violations To 7 Shale Gas Drillers For Failure To Submit Monthly Waste Generation, Disposal, Production Reports - 1 Company For 3 Years; 2 More Drillers Fail To Disclose Fracking Chemicals [PaEN]

-- PA Oil & Gas Industrial Facilities: Permit Notices, Opportunities To Comment - October 5 [PaEN]

-- Susquehanna River Basin Commission Sets Oct. 30 Hearing On The Proposed 2025 Fee Schedule; Water Withdrawal Requests, Including 4 Supporting Shale Gas Development [PaEN]

-- DEP Posted 72 Pages Of Permit-Related Notices In October 5 PA Bulletin [PaEN]