The thousands of abandoned oil wells and the environmental and safety hazards they pose to the public—as well as legal problem for the oil and gas industry—have gone relatively unchecked over the years in Louisiana…until now. In mid-April, a set of bills designed to reform state cleanup of these oil wells started making their way through the Louisiana Legislature in response to a scathing report released in 2014 indicating that these oil and gas wells were not being properly regulated, inspected, or managed, many years after being abandoned by operators, placing both the public and environment at risk.
The state of Louisiana reportedly has close to 60,000 oil and gas wells, at least 3,000 or so that have not even been plugged up. Mysteriously, the state never ordered the more than 85 percent of inactive wells that were reported by operators as no longer being used to be plugged, even those these inactive wells pose serious environmental and safety risks.The report specifically listed over 20 recommendations for how the Department of Natural Resources’ Offices of Conservation should address the orphaned wells, as well as additional steps for the Legislature itself to take.
Necessary Changes in the Law
One of those steps taken thus far includes the introduction of Senate Bill (SB) 371, which would allow the state to facilitate collecting some of the cleanup costs associated with plugging abandoned wells from past operators. As of now, the Office of Conservation is limited to only collecting cleanup costs that exceed $25,000; SB 371, however, would lower that threshold to $50,000 for land-based cleanups and $100,000 for water-based cleanups. However, an amendment added to the bill would require that these changes to be delayed until the price of oil exceeds $60 per barrel in order to placate the oil and gas industry.
The bill would also assign annual fees paid by some companies to the state’s oilfield restoration fund and oil and gas regulatory fund. It would also require that any wells that do not have future utility have to be plugged within 90 days. Any operators who want to close wells but keep them useable for the future—which constitutes around 1,000 of the wells currently in Louisiana—would then have to pay this fee that goes into these specific funds.
In addition, SB 427—also approved by the Senate panel—would allow private companies to plug these abandoned oil wells and obtain financial credits from the state of Louisiana for doing so. However, these credits would take the place of the current requirement that companies first put up financial security pledges before they drill new wells.
Environmental Hazard Attorneys
Private companies aren’t the only culprits when it comes to exposure to negative environmental and safety hazards; sometimes our state and local agencies aren’t doing enough to regulate and monitor serious health and safety hazards.
If you’ve been harmed by an environmental hazard, contact Harrell & Nowak today. Having spent years litigating against these negligent parties, the attorneys of Harrell & Nowak can be your trusted environmental hazard lawyers in New Orleans, Metairie, Kenner, and surrounding areas throughout Louisiana.