In Pittsburgh this week, Joe Biden unveiled a new infrastructure plan that will serve as the centerpiece for his economic agenda. Spending $2 trillion over eight years, the sweeping plan includes a wide range of measures, from building out electric vehicle charging stations to de-leading municipal water mains.
As part of the plan, Biden wants to spend an “immediate up-front investment” of $16 billion to plug abandoned oil and gas wells and clean up old mines. He says that money will create “hundreds of thousands” of union jobs. It’s also supposed to stop planet-heating methane and other pollution from escaping wells and mines. “Many of these old wells and mines are located in rural communities that have suffered from years of disinvestment,” a fact sheet for the plan says.
Left alone, those wells and mines pose dangers to the environment and to people
Hazards from abandoned infrastructure are a serious and often ignored problem. Left alone, those wells and mines pose dangers to the environment and to people. They’ve also been a financial headache for states and federal agencies left with the enormous costs associated with safely retiring them.
The money could cover some of the costs of remediating the oldest wells and mines, which were dug before companies were required to put aside money for what happens to the site at the end of its life.
“Our infrastructure is crumbling,” Biden said during an address in Pittsburgh yesterday. “Put simply, these are investments we have to make.”
$16 billion could go part of the way toward sweeping up the crumbs of neglected resource-extracting infrastructure. But experts and advocates say it’s only a first step toward fully reckoning with the toxic holes in our landscape left by abandoned wells and mines.
There are 500,000 abandoned mines in the US, according to the Bureau of Land Management. Before the 1970s, it wasn’t unusual or illegal for companies to simply walk away from mines when they were no longer profitable. Waste from those mines has polluted the surrounding soil, water, or air. Metals from these mines can leave behind highly acidic water, which puts fish and the people who eat those fish at risk. Dust from mines can also spread arsenic, lead, and even radioactive material, harming nearby communities.
Many of the companies responsible for creating these hazards have left governments with the tab to clean it all up. Between 2008 and 2017, federal agencies spent about $287 million a year remediating and monitoring abandoned mines.
Then there’s the even bigger problem of abandoned oil and gas wells: at least 57,000 out-of-commission wells in the US are considered “orphans” because whoever operated them either can’t be identified or can’t afford to plug them. On top of that, there are even more “idle” wells that do have owners but haven’t been used in years and are in danger of becoming orphans. Altogether, there are over 2.1 million of these wells languishing in the US, according to an Environmental Protection Agency estimate.
Even if the wells are no longer in use, they can still do harm if not properly handled. If they’re not plugged or if the plug fails, the well can spew out oil, gas, and saltwater that might contaminate freshwater or soil.
“It’s like a ticking climate bomb.”
Unplugged wells also release methane, a potent greenhouse gas. Methane is far more powerful than carbon dioxide when it comes to trapping heat. The EPA estimates that orphan and idle wells are responsible for about 280,000 metric tons of methane a year, which does about the same harm to the climate as 2.1 million cars do in a year. So plugging those wells would help shrink US greenhouse gas emissions.
“It’s like a ticking climate bomb,” says Ben Beachy, a director at Sierra Club. “It’s something that we’re gonna have to deal with one way or the other.”
The problem could get even worse in the future. If Biden follows through with his campaign goal of putting the US on track to transition to 100 percent clean energy by 2050, someone will eventually have to foot the bill for plugging up 3.8 million open wells — including active ones — in the US. That’ll add up to $280 billion, according to Greg Rogers, who co-authored a report on abandoned wells for the financial think tank Carbon Tracker. Taking that into consideration, Biden’s initial $16 billion offer for orphan wells is a drop in the bucket.
States are already losing a lot of money because of abandoned wells. Even though there are now regulations that require companies to set aside money to pay for decommissioning a well, companies can get away with putting up very little money in a lot of states. In Ohio, a company can put up a $15,000 “blanket” bond to cover an unlimited number of wells. It’s a paltry sum considering the average cost of plugging a single well in the state in 2019 was $100,000.
States are already losing a lot of money because of abandoned wells
“States accept bonds which basically are equal to pennies on the dollar of the cost to actually do this end-of-life work [to plug wells],” says Rogers. “It’s really a subsidy from the state governments to the oil and gas industry.”
The economics of well remediation are daunting, and the current lack of funding could leave wells dangerously unplugged — particularly after state budgets took a hit from the pandemic.
The average cost of safely plugging an older well falls somewhere between $40,000 to $50,000. But for newer wells that are typically deeper, the cost can reach $300,000, according to Rogers’ report.
If Biden is going to send federal money to states to help them cover those costs, Rogers says he needs to attach strings that will force companies to take greater responsibility for cleaning up after themselves. That might include prioritizing funding states that set higher bonds for extractive companies.
“Don’t set the conditions for this problem to continue to repeat itself.”
“Don’t set the conditions for this problem to continue to repeat itself,” says Rogers. “Increase the bonding amount. Get rid of blanket bonds.”
Rogers and Beachy are optimistic that all that spending will lead to more jobs, especially for people who previously worked in oil and gas fields or mines. “We have got to make sure that we are proactively, creating good family sustaining jobs in the same communities where workers are facing energy transition,” says Beachy, who’s from West Virginia, where the decline of coal has already cost jobs.
Cleaning up the mess of the past is at the core of Biden’s overall infrastructure plan, which would be funded by an increase in corporate taxes. The plan also allocates money to replace all of the nation’s lead pipes, which have poisoned children — particularly in communities of color like Flint, Michigan. It also invests in speeding the transition to electric vehicles and a clean energy grid.
But environmental advocates like Beachy are pushing for even more ambitious plans. Sierra Club is part of a network of progressive organizations that have endorsed an infrastructure and pandemic recovery agenda called the “THRIVE Act” that would spend $10 trillion over the next decade. Sen. Ed Markey (D-MA) is expected to introduce it as a bill in April.
Democrats will face an uphill battle in Congress to turn any infrastructure plan into actual policies. Whether they come to fruition or not, someone will pay for the costs that come with abandoned wells and mines — whether those costs come from cleaning the mess up or living with the environmental consequences.