The US Department of the Interior (DOI) has announced $775m in funding for 21 states to address orphaned oil and gas wells as part of President Joe Biden’s Investing in America agenda.
This initiative, backed by the Bipartisan Infrastructure Law, aims to manage legacy pollution. To date, over $1bn has been allocated by the US government to this cause, aiming to create jobs, boost economic activity, and reduce methane emissions while protecting surface and groundwater resources.
The Bipartisan Infrastructure Law represents the largest investment in legacy pollution cleanup in American history, including $4.7bn specifically allocated for orphaned well plugging.
The funding is distributed across three types of grants, initial, formula, and performance grants. Since the law’s enactment, states are said to have plugged more than 8,200 orphaned wells.
According to the Department’s Orphaned Well Program Office, these investments have created over 7,200 jobs and contributed more than $900m to the economy in the last two fiscal years.
US Secretary of the Interior Deb Haaland said: “President Biden’s Investing in America agenda is enabling us to confront long-standing environmental injustices by making a historic investment to plug orphaned wells throughout the country.
“These investments are good for our climate, for the health of our communities, and for American workers. With this third round of additional funding, states will put more people to work to clean up these toxic sites, reduce methane emissions, and safeguard our environment.”
As per the DOI, orphaned oil and gas wells are a significant issue as they can pollute surface and groundwater, release air pollutants, and emit methane, a potent greenhouse gas. This initiative supports the broader US Methane Emissions Reduction Action Plan and the President’s Justice40 Initiative, which aims to allocate 40% of federal investment benefits to historically marginalised communities, said the DOI.
Since August 2022, the Department has awarded $565m in initial grants to 25 states, including $444m in Phase 1 formula grants to 18 states.
The DOI revealed that the newly released Phase 2 Formula Grant guidance marks the beginning of the next application period for states to request approximately $775m in formula grant funds.
This guidance encourages the use of project labour agreements and a unionised workforce for well plugging and site remediation. It also requires states to measure methane emissions from orphaned wells, screen for impacts on groundwater and surface water, and prioritise wells affecting nearby disadvantaged communities.
Additionally, the Bipartisan Infrastructure Law allocated $250m for cleanup at well sites on national parks, national forests, national wildlife refuges, and other public lands. Nearly $150m of this funding has been distributed over the past three years.
Earlier this month, the DOI announced $52m in funding for Colorado, Illinois, and West Virginia. Colorado will receive $25m to plug 106 wells and complete decommissioning and restoration at about 200 additional sites.
Illinois will use its $25m to plug up to 460 wells, while West Virginia has been allocated nearly $2m to plug approximately 16 wells.
In June 2024, the Department awarded $126.7m under President Biden’s Investing in America agenda to Alaska, Arizona, Indiana, New York, and Ohio to address legacy pollution. This funding will facilitate the plugging of nearly 600 wells and prepare additional undocumented wells for future remediation.
