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Financial liabilities and environmental implications of unplugged wells for the Gulf of Mexico and coastal waters

Author

Listed:
  • Mark Agerton

    (University of California Davis)

  • Siddhartha Narra

    (Louisiana State University)

  • Brian Snyder

    (Louisiana State University)

  • Gregory B. Upton

    (Louisiana State University)

Abstract

Plugging and abandoning (P&Aing) wells is a policy priority because unplugged wells present potential financial and environmental risks to the public. Offshore wells, compared with land wells, generally produce more, cost more to P&A and present different environmental risks. Here we estimate that the cost to P&A all 14,000 unplugged, non-producing wells in US Gulf of Mexico offshore waters, inland waters and wetlands is US$30 billion. Wells in shallower waters closer to shore make up 90% of inactive wells but only 25% of total P&A costs. They also present larger environmental risks. Prior owners of wells in federal waters (deeper and farther from shore) can be held liable for P&A costs if the current owner does not P&A them. We find that 88% of outstanding P&A liability in federal waters is associated with wells currently or formerly owned by one of the large, financially stable ‘supermajor’ companies.

Suggested Citation

  • Mark Agerton & Siddhartha Narra & Brian Snyder & Gregory B. Upton, 2023. "Financial liabilities and environmental implications of unplugged wells for the Gulf of Mexico and coastal waters," Nature Energy, Nature, vol. 8(5), pages 536-547, May.
    • Handle: RePEc:nat:natene:v:8:y:2023:i:5:d:10.1038_s41560-023-01248-1
    DOI: 10.1038/s41560-023-01248-1
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