Ohio University survey shows jobs, hotel occupancy rising because of Utica Shale play – Columbus – Columbus Business First
February 26, 2014
Reclaiming Abandoned Wells-bibliography
December 26, 2013
Sent: Thursday, December 26, 2013 2:16 PM
Subject: Costs to reclaim the land after abandonment
Subject: Costs to reclaim the land after abandonment
So how much does it cost to plug an abandoned oil or gas well and to reclaim the land? Of course, there is no quick and easy answer because there is plugging and there is plugging and what does one mean by reclaiming. This issue of bubbles takes a quick, elementary look at this issue.
First plugging: In the recent past, plugging might have been satisfied by dropping a treated wooden cylinder into the top of the well. As used telephone poles met the treating and dimensional requirements, they were used according to some sources. As to reclaiming, that could simply mean removing equipment, but might also include removal of pads, pipes, mud and water pits, roads, structures, and tanks as well as replanting of a re-graded surface; a wide range indeed.
What is out there on the web? The headlines are unsettling:
“Hundreds of abandoned drilling wells dot eastern Wyoming like sagebrush, vestiges of a natural gas boom that has been drying up in recent years as prices have plummeted.”
And this story’s lead is also disturbing:
“The companies that once operated the wells have all but vanished into the prairie, many seeking bankruptcy protection and unable to pay the cost of reclaiming the land they leased. “
To read this full recent New York Times article, see http://www.nytimes.com/2013/12/25/us/state-may-act-to-plug-abandoned-wyoming-wells-as-natural-gas-boom-ends.html?_r=0
So what does it really cost to plug and abandon a well and reclaim the land?
Plugging was covered about four years ago in a Propublica article, to wit: “The task of finding, plugging and monitoring old wells is daunting to cash-strapped state governments. A shallow well in good condition can sometimes be plugged with cement for a few thousand dollars. But costs typically run into the tens of thousands, and a price tag of $100,000 or more isn’t unusual.” See http://www.propublica.org/article/deteriorating-oil-and-gas-wells-threaten-drinking-water-homes-across-the-co
Another estimate, for just the reclaiming costs, based on actual costs from 800 wells in New Mexico, estimate that reclaiming the surface of an abandoned well site costs between $16,500.00 to $50,000.00.
Several other sources have tried to answer these questions.
1. Ohio has a question and answer page on this at http://oilandgas.ohiodnr.gov/orphanwellprogram
2. New York regulations are discussed in a 26 page document at http://www.dec.ny.gov/docs/materials_minerals_pdf/dgeisv1ch11.pdf. The opening states “State law requires operators of most oil, gas and solution mining wells in New York State to maintain financial security with the Department to ensure that the wells are properly plugged and abandoned after their economic life is over. Financial security requirements were substantially increased in 1985 to more closely match the actual costs of plugging operations.”
2.Specific details about plugging etc. including some sketches are offered.
3. Congressman Markey had made some inquiries about some abandoned wells in New Mexico and the following is illuminating: http://www.nmlegis.gov/lcs/handouts/WNRC%20110711%206%20Response%20to%20Markey%20Letter%20on%20GAO%20Report.doc
4. See also http://wyofile.com/dustin/aftermath-of-a-drilling-boom-wyoming-stuck-with-abandoned-gas-wells/
5. A state by state table on bonding to cover clean up and plugging costs is at http://portal.ncdenr.org/c/document_library/get_file?uuid=d21aca89-8d97-46bc-aa59-d26667cc98ac&groupId=8198095
6. There are a large number of wells that are abandoned, idle, or ‘orphaned.’ See http://groundwork.iogcc.org/sites/default/files/Orphaned%20Wells%20Case%20Study_0.pdf
7. And also see http://iogcc.publishpath.com/about-us
8. See a case study at http://groundwork.iogcc.org/topics-index/orphaned-wells/the-state-perspective/iogcc-case-study-orphaned-and-abandoned-wells-inno
9. And an older report (fall 2007) by the National Energy Technology Laboratory goes into much detail on tracking and curtailing abandoned well problems from the Versailles Pennsylvania methane field drilled in the early 1900s. See http://www.netl.doe.gov/newsroom/versailles/Versailles%20Methane%20Emissions%20Project%20-%20Final%20Report.pdf
More digging should be undertaken, but the message seems to be: 1) Not all firms will be in a position to properly close down a drilling and production operations; 2) Requiring bonding, while a good idea, too often results in inadequate funds; 3) Taxing the industry to establish a fund to cover the expenses ultimately redounding to the state may well be prudent; and 4) State regulations as to definitions, what constitutes proper plugging and land reclamation need to be in place before drilling is undertaken.
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Happy New Year
Edward K.
Streamlining SEQR
December 18, 2013
Streamlining SEQR
How to Reform New York’s “Environmental” Planning Law
by: E.J. McMahon and Michael Wright
Complete report in PDF format
December 16, 2013
EXECUTIVE SUMMARY
Major residential, commercial and industrial developments throughout the country are subject to an array of federal and state laws designed to protect the environment, buttressed nearly everywhere by local land-use regulations addressing the community impacts of such projects.
In New York, however, these regulations are wrapped in the added red tape of the State Environmental Quality Review Act, or SEQR.
In this, as in so many areas of regulatory policy, the Empire State is an outlier. Less than one-third of all states have similarly comprehensive environmental review statutes —and fewer have laws as broadly applicable as New York’s SEQR.
Nearly 40 years after its enactment, can SEQR be reformed to strike a better balance between environmental protection and economic growth? That’s a crucial question when much of New York, especially upstate, is suffering from what could be described as a severe development deficit.
While it would be difficult to quantify SEQR’s role in discouraging investment and job creation in New York, the added regulatory imposition certainly does little to expedite the building of new homes, businesses, factories and civic facilities. As currently written and interpreted, SEQR can be exploited to produce costly delays and uncertainty for the kind of job-creating projects New York desperately needs. Several of the state’s regional economic development councils have identified SEQR as an obstacle to development.
Governor Andrew Cuomo has responded to these complaints by allowing his state Department of Environmental Conservation (DEC) to float proposed rule changes designed to improve SEQR in response to years of complaints from private-sector developers. DEC says it is aiming to make the process more efficient and predictable “without sacrificing meaningful environmental review,” but the ideas it is considering don’t go far enough to achieve this goal.
This paper suggests that further changes are needed to truly streamline SEQR. At a minimum, the law should be revised to:
- Reduce the potential for undue delays by imposing hard deadlines and incentives to ensure the process can be completed within a year.
- Mandate “scoping” of environmental impacts at the first stage in the SEQR review process, but also more tightly restrict the introduction of new issues by lead agencies later in the process.
- Eliminate the law’s reference to “community and neighborhood character” as an aspect of the broadly defined environment potentially affected by projects, since the concept already is defined by local planning and zoning laws.
Industry groups have proposed other, more specific changes that also deserve enactment as part of any meaningful SEQR reform process.
1. ORIGINS AND BACKGROUND
The peak of America’s postwar economic boom in the 1960s coincided with a growing public awareness of the increasingly troubling environmental impacts of untrammelled industrial, commercial and residential development.
The health hazards of air pollution in major metropolitan areas had been highlighted by incidents such as a four-day temperature inversion blamed for dozens of deaths in New York City in 1965. Water pollution was also a serious problem; in the nation’s industrial heartland, portions of the Great Lakes were literally dying— becoming uninhabitable by fish or plant life. Stretches of storied major waterways such as the Hudson River had become seriously polluted. During the same period, perceived assaults on the built environment of neighborhoods and communities had led to a grassroots backlash against major highway expansion projects in some cities.
These concerns led to the enactment of the National Environmental Policy Act (NEPA), signed by President Richard Nixon on January 1, 1970. NEPA required federal agencies to prepare assessments and impact statements of proposed major projects and policy changes affecting the “human environment,” broadly defined to include both “the natural and physical environment and the relationship of people with that environment.”1
NEPA would be the primary model for laws in states including New York, whose State Environmental Quality Review Act (SEQR) was enacted in 1975.
While NEPA applies only to federal executive branch agencies, SEQR applies to the actions of state and local agencies in New York. In relatively rare cases where the two jurisdictions overlap, the respective reviews can be coordinated, so that the impact statement required by NEPA can be used to fulfill obligations under SEQR.2
It’s important to note that these laws were not designed as government’s primary line of defense against pollution—a purpose served by other statutes and regulations largely adopted after NEPA in the 1970s.3
NEPA’s overarching goals extend well beyond protecting the natural ecology of air, water, plants and animals to encompass the regulation of “aesthetic, historic, cultural, economic, social, or health [impacts], whether direct, indirect, or cumulative.”4 In similarly broad language, SEQR defines environmental factors to also include “noise, resources of agricultural, archeological, historic or aesthetic significance, existing patterns of population concentration, distribution or growth.”5
New York’s law goes a big step further by also regulating potential impacts on “existing community or neighborhood character”—an amorphous concept that, in some cases, has been construed broadly enough to block projects otherwise permissible under existing local land-use ordinances.6
NEPA and SEQR also differ in several other significant respects.
Federal courts have determined that NEPA mandates for federal agencies are “essentially procedural.”7 In other words, the law’s principal effect is to describe the process federal agencies must follow to implement a major new policy or project—but not to shape outcomes consistent with its lofty aims.8
New York’s SEQR, by contrast, can be used to force changes to “mitigate” environmental impacts—not only dictating how a project is built, but effectively deciding whether it gets built at all. Perhaps even more importantly, SEQR requires an Environmental Impact Statement (EIS) if the project “may” cause a significant adverse environmental impact, whereas NEPA effectively requires an EIS only if a proposed action will “significantly affect the quality of the human environment.”9 This further expands the scope of actions covered by the state law. And before a project can win final approval, SEQR requires that adverse environmental impacts be “minimized to the maximum extent practicable.”10
SEQR’s broader scope and its requirement for “maximum extent practicable” mitigation as a condition for potential approval make it more expansive and stringent than its federal counterpart, NEPA; indeed, as will be shown below, it is among the most expansive and stringent laws of its type in any state.
GDACC 
