Federal fund could help plug New Mexico's abandoned wells - Albuquerque Journal

Federal fund could help plug New Mexico’s abandoned wells

A drilling rig south of Carlsbad in September 2019. (Eddie Moore/Albuquerque Journal)

Copyright © 2020 Albuquerque Journal

As New Mexico’s energy production looks to bounce back from historic lows, some regulators and lawmakers support the idea of a new federal fund to give oil and gas workers jobs plugging abandoned wells.

There are more than 700 orphaned or abandoned oil and natural gas wells in New Mexico, said Adrienne Sandoval, director of the Oil Conservation Division of the state’s Energy, Minerals and Natural Resources Department.

Plugging each well has a price tag of about $35,000, meaning it would cost upward of $24 million to plug all the abandoned wells in New Mexico.

Sandoval said federal money to expand the state well plugging program could support 100 jobs, with additional jobs for complete site remediation.

“The work could start tomorrow,” she said during a Monday hearing of the U.S. House Natural Resources Committee. “…We could begin ramping up contracts immediately.”

The OCD oversees about 57,000 active wells. When wells are no longer productive, they are filled with cement, dirt and plugs to prevent contamination of soil, water and air.

New Mexico operators plug wells and remediate sites with state supervision. If a company goes bankrupt, the state steps in. New Mexico plugs about 50 wells a year by contracting with local companies.

The program is funded by about $2 million in financial assurance from operators, $1 million each year from the Bureau of Land Management, and a reclamation fund fueled by taxes on operators.

But that money is not nearly enough to address all abandoned wells. The state’s funding may also be in jeopardy during the pandemic as operators limit oil production.

Sandoval said active rigs in the state had dropped from 113 in January to 66 in May. And as of May 5, more than 4,000 oil and gas workers had filed for unemployment.

“Operators face tough economic decisions,” Sandoval said. “With limited capital and the possibility of bankruptcy, the oil and gas operators may not be able to plug wells and reclaim (sites).”

Lawmakers said funding an expanded plugging program for New Mexico and other oil-producing states would stimulate the local economy.

“This is a great opportunity to put many people who have lost their jobs back to work, and in a way that supports cleanup of our lands and waters,” U.S. Rep. Ben Ray Luján said during the hearing.

U.S. Rep. Xochitl Torres Small and U.S. Sen. Martin Heinrich, both Democrats, also issued statements of support for more federal money to plug abandoned wells on state and tribal land.

Theresa Davis is a Report for America corps member covering water and the environment for the Albuquerque Journal. Visit reportforamerica.org to learn about the effort to place journalists in local newsrooms around the country.

Home » News » New Mexico News » Federal fund could help plug New Mexico’s abandoned wells

Insert Question Legislature form in Legis only stories

Albuquerque Journal and its reporters are committed to telling the stories of our community.

• Do you have a question you want someone to try to answer for you? Do you have a bright spot you want to share?
   We want to hear from you. Please email yourstory@abqjournal.com

taboola desktop

ABQjournal can get you answers in all pages


Questions about the Legislature?
Albuquerque Journal can get you answers
Email addresses are used solely for verification and to speed the verification process for repeat questioners.
Blake's still serving up the food that makes it ...
ABQnews Seeker
The late Blake Chanslor launched his ... The late Blake Chanslor launched his eponymous restaurant way back in 1952.
Filmed in ABQ, 'Flamin' Hot' tells the story of ...
ABQnews Seeker
"Flamin' Hot" begins streaming Friday, June ... "Flamin' Hot" begins streaming Friday, June 9, on Hulu and Disney+.
Local actress lands part in New Mexico-filmed Cheetos movie
ABQnews Seeker
On June 9, "Flamin' Hot," starring ... On June 9, "Flamin' Hot," starring New Mexico native Lora Martinez-Cunningham, is set to stream on both Hulu and Disney+.
Country duo LOCASH making stop at Isleta with Kane ...
ABQnews Seeker
LOCASH recently released the single, "Three ... LOCASH recently released the single, "Three Favorite Colors" which has already become a hit at its concerts.
Pitino is high on UNM newcomers as Lobos start ...
ABQnews Seeker
A wide variety of updates on ... A wide variety of updates on Lobo hoops as UNM players start summer workouts, including Pitino's thoughts on rivalry scheduling and much more.
APS Superintendent Scott Elder to step down at the ...
ABQnews Seeker
The Albuquerque Public Schools board is ... The Albuquerque Public Schools board is parting ways with Superintendent Scott Elder. He was officially given the full position just over two years ago. ...
Local golf: Lobo Herron has memorable run -- and ...
ABQnews Seeker
For Carson Herron, golf's longest day ... For Carson Herron, golf's longest day started when the alarms went off around 5:45 a.m ...
Lobo football adds transfer receiver from Mississippi State
ABQnews Seeker
Mississippi State transfer wide receiver Kaydin ... Mississippi State transfer wide receiver Kaydin Pope, listed at 6-feet, 175 pounds, announced his intention to transfer to New Mexico on Wednesday via social ...
Details emerge in Albuquerque triple homicide: Police say shooters ...
ABQnews Seeker
Late Wednesday, police detailed what they ... Late Wednesday, police detailed what they believe happened at the Northeast Albuquerque home just before midnight Saturday.