The Ohio Department of Natural Resources is starting a new phase of a process to address idle and orphan oil and gas wells.
As part of the Orphan Well Program, the state is looking for contractors to plug about 200 wells in the next year all over the state, with millions in legislature-approved funding ready to pay them.
Orphan and idle oil and gas wells are wells that either weren’t closed properly, aren’t producing any product or have no owner.
“By law, a well can’t just sit there,” said Mark Bruce, spokesperson for the ODNR’s Division of Oil and Gas Resources Management. “It either needs to be producing or in a certain defined status.”
Wells that are not producing but are also not plugged can be prone to leaks and “may pose a threat to public safety, the environment, conservation of natural resources and economic development,” the ODNR said in an announcement of the contractor search.
Plugging the wells uses cement and materials to isolate anything left in the oil and gas wells, including gas, oil and chemicals used in the drilling process. The process of well plugging is intended to keep the contents of the well from entering underground drinking water as well.
Up to $25 million in bid awards is available for the project. The Ohio Legislature passed House Bill 225 in 2018, which increased the portion of the state’s oil and gas well fund revenues used for plugging idle and orphaned wells from 14% to 30%.
The request for contractors comes as the department also conducts their review of rules for well plugging. The oil and gas division is working on a draft amendment to the Ohio Administrative Code to “ensure that the rules regarding the plugging of wells address current industry operations (i.e. horizontal drilling),” according to a summary of the amendment goals written by the division.
The amendment, which has not been filed with the state yet, also aims for better planning by the well owner and “clear standards” for the community and regulators, according to the ODNR.
A main revision to the rules would require a well owner to submit their own plugging plan to the Division of Oil and Gas Resources Management during the process of applying for a well-plugging permit, according to Bruce.
Currently, companies and well owners don’t have to submit a plugging plan to the division prior to getting the permit.
The Orphan Well Program has been in effect since 1977, and thus far has found almost 1,000 wells in need of plugging.
In the third quarter of 2019, Ohio saw its active horizontal shale wells produce record amounts or oil and natural gas. Compared to third-quarter 2018 numbers, oil production was up 29.84 percent and natural gas increase by 11.27 percent, according to state data.