Orphan wells
These wells may have been deactivated because had become uneconomic, failure to transfer ownerships (especially at bankruptcy of companies), or neglect, and thus no longer have legal owners responsible for their care.
[1] Thus the burden may fall on government agencies or surface landowners when a business entity can no longer be held responsible.
[2] A well is said to reach an "economic limit" when revenue from production does not cover the operating expenses, including taxes.
It might be tempting to defer physical abandonment for an extended period, hoping that the oil price will increase or that new supplemental recovery techniques will be perfected.
[7] Theoretically, an abandoned well can be re-entered to restore production (or converted to injection service for supplemental recovery or downhole hydrocarbon storage), but reentry is often difficult mechanically and expensive.
New tools have been developed that make re-entry easier; these tools offer higher expansion ratios than conventional bridge plugs and higher differential pressure ratings than inflatable packers, all while providing a V0-rated, gas-tight seal that cement cannot provide.
[neutrality is disputed][8] Some abandoned wells are subsequently plugged and the site is remediated; however, the cost of such efforts can be in the millions of dollars.
[8] Government-led campaigns to plug wells are expensive but often facilitated by oil and gas taxes, bonds, or other fees applied to production.
[4] Environmental non-profit organizations, such as the Well Done Foundation, also carry out well-plugging projects and develop programs alongside government entities.
New rules related to the Infrastructure Investment and Jobs Act will increase the financial assurance requirement to a minimum of $150,000 per well.
[15][16][17] The 100% industry-funded Alberta Energy Regulator (AER)—the sole regulator of the province's energy sector—manages licensing and enforcement related to the full lifecycle of oil and gas wells based on Alberta Environment Ministry requirements, including orphaned and abandoned wells.
[28] Following the 2014 downturn in the global price of oil, there was a "tsunami" of orphaned wells, facilities, and pipelines resulting from bankruptcies.
[33] North Dakota dedicated $66 million of its CARES Act pandemic relief funds for plugging and reclaiming abandoned and orphaned wells.
[34] According to the Government Accountability Office, the 2.1 million unplugged abandoned wells in the United States could cost as much as $300 billion.
