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hatrack

(59,439 posts)
Sun Sep 19, 2021, 07:38 PM Sep 2021

Wave Of Oil Company Bankruptices Since 2016 Leaves Louisiana To Deal W. Abandoned Wells, Leaks

The wave of bankruptcies that hit the oil industry is exacerbating the environmental fallout from Hurricane Ida, according to Louisiana officials. There are 446 orphan wells in areas hit by the storm that are under state jurisdiction, according to the Louisiana Department of Natural Resources. Of those, more than a third were left behind by companies that went bankrupt since 2016, based on an E&E News analysis.

State officials still haven’t been able to reach all the sites to inspect them for leaks and damage since Ida struck the New Orleans area as a Category 4 storm on Aug. 29 — and it’s likely that at least some of them are leaking, according to the Louisiana Oil Spill Coordinator’s Office (LOSCO). “It’s the old perfect storm scenario,” said Patrick Courreges, a spokesperson for the DNR, which oversees orphan wells.

The problem highlights how climate change and the oil industry’s economic woes are compounding the environmental problems in vulnerable areas like Louisiana. Hurricanes are becoming stronger, which in turn can cause more damage to the state’s abandoned oil and gas wells. Orphan wells are sites that have been abandoned by their previous owners, which typically leave state or federal agencies in charge of cleaning them up. Unless they’re properly plugged, they can pollute the air, surface and aquifers with crude oil, gas, salt water or other waste products.

Researchers have said there are as many as 3 million orphan wells across the U.S., and they’re a source of climate-warming emissions including methane, the main component in natural gas (Energywire, May 20, 2019). State oil and gas regulators have been warning for years that the oil industry’s bankruptcy crisis would leave them responsible for a wave of orphan wells. Oil prices dipped from 2014 to 2016, then plummeted when the pandemic hit in 2020 before rebounding this year as economic activity picked back up. At least 266 producers have become insolvent in the last six years, according to the law firm Haynes & Boone LLP. The results were clear in Louisiana. The state had about 2,900 orphan wells awaiting cleanup for several years, but bankruptcies were one of the main factors that pushed the number to roughly 4,500, Courreges said.

EDIT

https://www.eenews.net/articles/climate-bankruptcies-a-perfect-storm-for-oil-leaks/

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Wave Of Oil Company Bankruptices Since 2016 Leaves Louisiana To Deal W. Abandoned Wells, Leaks (Original Post) hatrack Sep 2021 OP
They cost over $100, 000 to undo. Crazy expensive for government and another subsidy to oil applegrove Sep 2021 #1
Because requiring companies to have an escrow Phoenix61 Sep 2021 #2

applegrove

(118,020 posts)
1. They cost over $100, 000 to undo. Crazy expensive for government and another subsidy to oil
Sun Sep 19, 2021, 07:41 PM
Sep 2021

companies who just didn't bother to decomission their wells over decades knowing nobody it Texas would enforce it. Alberta did the same thing too. Now there are 95,000 orphaned or abandoned wells there.

Phoenix61

(16,952 posts)
2. Because requiring companies to have an escrow
Sun Sep 19, 2021, 08:23 PM
Sep 2021

account to cover that expense would make too much sense.

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