BY MIYA KING-FLAHERTY
PROGRAM MANAGER
New Mexico is rich in oil and gas. With that wealth comes a mess – literally.
The state is home to more than 60,000 wells that will eventually need to be plugged to prevent methane leaks, groundwater contamination and long-term environmental degradation that place New Mexicans’ climate and health at risk. Right now, hundreds of these wells are already abandoned, and thousands more are dangerously close. Unless we act, New Mexicans – not the out-of-state corporations profiting from our public resources – will be stuck with a cleanup bill that could top $1.6 billion.
Oil and gas operators are legally responsible for plugging wells and cleaning up after themselves. But not all follow the law, leaving the state holding the bag. Worse, our laws make it easy for corporations to walk away.
Current bonding requirements – meant to ensure corporations have money set aside for cleanup – are woefully inadequate. State law caps bonding at $250,000 per operator for active wells even though it costs an average of $163,000 to plug just one well. Some corporations have as little as $105 set aside per well.
Meanwhile, nearly a third of oil and gas operators in New Mexico are out of compliance with the law, holding more inactive wells than they’re allowed. Inactive wells – those that haven’t produced for 15 months and aren’t approved for temporary abandonment – are often the ones left behind next.
The state has inventoried over 600 abandoned wells in New Mexico, and 1,400 more are likely to join that list soon. While recent federal grants have helped plug some, those programs are on hold. We can’t rely on federal dollars to help with this large and growing problem. But we can look to our state regulators to adopt common-sense reforms to address the problem.
The New Mexico Oil Conservation Commission is considering long-overdue updates to bonding rules that require oil and gas corporations to set aside money to clean up after themselves. Bonding works like insurance or a retirement plan for a well.
Matching bonding to actual costs is not a punishment; it’s a guarantee. It ensures that when a well reaches the end of its life, there is the right amount of money set aside to plug it properly. Let’s get behind and support these rules.
The commission will hold a public hearing Oct. 20-Nov. 7. Please visit the Energy, Minerals and Natural Resources Department page to learn how to comment in support here. For more information, contact miya.king-flaherty@sierraclub.
(Featured image from WikiMedia Commons.)
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