14,000 inactive oil and gas wells in US remain unplugged, posing risks for leaks, researchers say

It could cost up to $30 billion to plug all of the currently unused wells.

May 8, 2023, 11:01 AM

There are tens of thousands of inactive offshore oil and gas wells that remain unplugged in the U.S., posing the risk of possible leaks into the ocean, according to new research.

Over 14,000 inactive oil and gas wells in the Gulf of Mexico's offshore waters, inland waters and wetlands are unplugged, according to a study published in Nature Energy on Monday.

Boom is deployed to contain oil in Perdido Bay in Orange Beach, Ala., June 19, 2010.
Kari Goodnough/Bloomberg via Getty Images

Plugging and abandoning these wells could prevent environmental risks but could cost more than $30 billion, the researchers said.

There have been about 82,000 wells drilled in the Gulf of Mexico coastal waters in Louisiana, Texas and Alabama, according to the paper. The researchers combined federal and state agency data on offshore wells in the Gulf of Mexico and found that 14,000 non-producing wells have not been plugged and abandoned. There are more inactive, non-producing wells that have not been plugged and abandoned than currently active wells in this region, the researchers found.

Oil and gas operations for offshore and coastal waters are much more expensive than onshore, Gregory Upton, interim executive director of Louisiana State University's Center for Energy Studies, told reporters during a news conference last Wednesday.

About 13,000 of these active wells are in state or shallow federal waters, which exacerbates the environmental risks. In a deepwater wellhead, it is relatively unlikely that methane released will reach the surface, Upton said.

A pelican rests on a piling with an oil rig in the background, April 18, 2011 in Dauphin Island, Ala.
Mario Tama/Getty Images, FILE

Wells closer to the surface tend to be shallow, therefore any oil leaks would be more likely to affect the coastal ecosystem, Mark Agerton, assistant professor at the Department of Agricultural and Resource Economics at the University of California, Davis, told reporters in a news conference on Wednesday. In addition, methane leaks from shallow water infrastructure are likely to reach the surface, Upton added.

"The shallower the water, the more likely there is to be some kind of, of environmental damage," Agerton said.

Although offshore and coastal water wells have accounted for less than 3% of all wells ever drilled in the U.S., they've accounted for approximately 15% of all US oil production over the past two decades, Upton said.

Federal and state rules require operators to plug and abandon wells after the production of oil or gas stops, which involves placing cement plugs in the wellbore and the upper portion of the well. This can prevent hydrocarbons and other forms of environmental pollution from on leaking from the well, and prevent underground saltwater from polluting fresh groundwater reservoirs, according to the paper.

An oil drilling rig setup in the Permian Basin oil field, March 13, 2022 in Midland, Texas.
Joe Raedle/Getty Images, FILE

However, in some states, it is "fairly straightforward" to get an extension on plugging these wells, Agerton said.

Some states have orphan well programs, Upton said. When no financially viable company can be liable for the plugging of the wells, the state takes legal responsibility for the site restoration, Upton said. This can happen if a company goes bankrupt, Agerton said.

However, since oil and gas operations offshore and coastal waters are much more expensive than onshore, "very few" of these wells have been plugged using funds from the orphan well programs, Upton said.

Fire boats battle a fire at the off shore oil rig Deepwater Horizon, April 21, 2010 in the Gulf of Mexico off the coast of Louisiana.
U.S. Coast Guard/Getty Images, FILE

The paper highlights the environmental importance of prioritizing the plugging of state and shallow water wells, and the potential financial liability to companies, the authors said.