Colorado has been a leader among states in taking measurable actions to slow climate change and protect and restore our natural environment. In the recent Legislature, a handful of significant bills were passed that will begin the hard work specific to climate change. Currently, the newly empowered Colorado Oil and Gas Conservation Commission is engaged in rulemaking that will change the way the oil and gas industry operates in the state, rewriting outdated regulations and ensuring that the industry takes financial responsibility for remediation of any pollution resulting from drilling.
At the national level, too, Colorado is at the forefront of efforts to reduce greenhouse-gas emissions and take other actions to protect the environment and human health impacts of climate change: Sen. Michael Bennet and Reps. Joe Neguse and Diane DeGette, in particular, have been advocating for our future’s behalf in Congress.
Bennet is the primary sponsor of two bills now making their way through the Senate that would further require the oil and gas industry to take responsibility related to emissions. The Oil and Gas Bonding Reform and Orphaned Well Remediation Act and the Public Engagement Opportunity on Public Land Exploration Act will, if passed, together make significant progress on climate change and environmental protection. The bills are cosponsored by Sen. Martin Heinrich (D-N.M.). Similar bills have been introduced in the House.
The first, SB 2177, will require the Interior Department to establish a program to plug, remediate and reclaim orphaned oil and gas wells on federal and nonfederal land. Orphan wells occur when an operator fails to properly plug and remediate an oil or gas well, often resulting in methane emissions and other pollution. In some cases, orphan wells are created when companies take actions to intentionally avoid cleanup after shutting down production.
A recent Government Accountability Office report estimated average cleanup costs for an orphan well at $20,000 to $145,000 per well.
More than 14,000 orphan wells have been identified on federal lands nationwide, and about 57,000 orphan wells are documented on state lands. According to one estimate, the number of orphan wells in Colorado is about 300 – but the number of orphan wells may not be as critical as the amount and type of pollution certain wells are creating.
The bill also will fund new jobs while reducing methane emissions, which are particularly high in the Four Corners Area. It will modernize long-outdated bonding requirements; individual well bonds would increase to $150,000, while a statewide bond would be $500,000. (The 1960s-era bond amounts currently in place are $10,000 per individual well; $25,000 statewide; and $150,000 nationwide.) This will ensure that oil and gas companies, not taxpayers, fund cleanup in the future.
The bill will also establish standards for identifying inactive wells and when cleanup must start, and what exactly constitutes remediation and reclamation of impacted land and water resources. A publicly accessible database of information about all onshore leases will be created.
Funding the bill will cost $3 billion over the first two years and $5 billion over the next eight.
The companion PEOPLE Act, SB 2170, would ensure transparency and public participation in the leasing process, and provide specific public notice and comment periods, while also ensuring participation by local and tribal governments.
We all are aware, or should be, that fossil fuels will continue to be important for meeting our energy needs for some time to come. We are not against the oil and gas industry, which is central to our state’s economy. But we are against taxpayers being forced to pick up the bill for pollution to land and water caused by irresponsible actors and outdated bonding and leasing rules.
Bennet’s bills will begin the process of remedying longstanding failures of our system to protect the environment, and taxpayers, while providing new jobs, especially for those displaced from the energy business. They represent a strong start in the right direction.