Abandoned oil and gas wells dot the landscape, especially in the Appalachians. Because these “orphan wells” pose hazards to people and the environment, the federal government plans to send $5 billion to dozens of states between now and 2030 in order to plug them—a worthwhile goal. But the influx of funds is no substitute for functional governance; many states lack the capacity to put those dollars to use. The result is a case study in the variance between states in a time of resource constraints.
The scale of the orphan-well problem remains uncertain. States have only rough estimates of how many wells they must plug. Pennsylvania has a list of 30,000 documented orphans, but some estimates pin the number anywhere from 200,000 to 750,000. Ohio has documented 20,000 wells, but more than 70,000 may lurk in the shadows.
The influx of federal money may carry some upsides. Ohio expects $326 million through 2030 for well-plugging from the feds, while Pennsylvania will see about $400 million. Closing wells can create “this huge regional jobs boom that enables the clean energy subsurface uses and protects the population,” said Adam Peltz, director and senior attorney at the Environmental Defense Fund.
But orphan wells are a problem, too, not just an opportunity. “It’s basically a Herculean task that they’re biting off a bit here and there,” said Daniel Mallinson, a professor of public policy and administration at Penn State University’s Harrisburg campus. “There’s a lot of wells out there that, until somebody runs across one in some manner, we don’t know about.”
Appalachia doesn’t have a systematic approach to finding orphan wells. Industry players often make the discoveries—shale gas drillers, for example, searching an area before they drill a new well. Pennsylvania law requires companies to search the surrounding 1,000 feet near prospective well pads. “We can methodically go through these areas and locate these wells, but that plan is not in place,” said Alex Nikulin, the cofounder of Binghamton University’s Geophysics and Remote Sensing Research Laboratory.
For now, the challenge seems far larger than current numbers suggest. Whenever researchers look for undocumented wells, the map lights up. “In three of four areas we flew in Pennsylvania, we would have, for every well in the state database, we would find at least two wells that were unreported,” said Richard Hammack of the National Energy Technology Laboratory in Pittsburgh. At one state park, Hammack reports five unreported wells for every one on the map.
It’s vital to strike the right balance. If agencies focus too much on finding the lost wells, they will fail to plug the existing ones. But state officials—eager to report progress—can also err by picking low-hanging fruit, targeting environmentally benign but easy-to-plug wells. “There’s an environmental cost to bringing equipment in,” Hammack said. “You have to balance that against the environmental damage done by the well if it’s left unplugged.”
It’s easy to imagine well-plugging mutating into another tale of government inefficiency, but at least one state—Ohio—has developed a model program.
The Buckeye State boasts a stable, dedicated source of funding—a severance tax on oil and gas—and employs dozens of sophisticated staffers who understand the orphan-well problem. And it has dozens more preapproved contractors to bid on plugging contracts. The shale gas boom drove revenue to the state oil and gas division from $10 million in 2014 to $76 million just four years later. Between 2013 and 2021, well-plugging contracts receiving bids jumped from ten to 202.
The federal cash influx has caused problems, however. Dozens of states received money at the same time from the Infrastructure, Investment, and Jobs Act (IIJA). That Biden administration cornerstone has kicked off a run on labor. “We’ve seen a significant increase in the price to plug a well since the IIJA passed,” says Jason Simmerman, an orphan well project engineer with the Ohio Department of Natural Resources, who estimates a jump of more than 50 percent. “There’s only so many rig-hands to go around and there is competition for them between new activity and this legacy closure activity,” the EDF’s Peltz said. “Also, the cost of cement has gone up—just about every cost has gone up.”
The flood of money boosted demand before labor supply could meet it. While Ohio doesn’t follow Davis-Bacon requirements—which impose a wage floor comparable with wages of other laborers in the area—the federal program does, pushing up costs further. Some states are trying to advertise the high-wage, high-demand work to laborers; others import them. (Peltz said North Dakota is bringing in Ukrainians.)
Still, wages are just one piece of the puzzle. Some experts argue that contractors’ equipment costs outweigh labor costs, given how expensive it can be to drag heavy machines into forests or residential areas.
If states do a good job on the administrative side, they can reduce costs by, say, sharing data. Here, too, Ohio leads: Buckeye State officials survey a well site and provide the information before putting a plugging contract up for bid. More information means more predictable well-plugging.
Not every state has learned from its example. “Pennsylvania doesn’t provide the level of information that Ohio does,” Penn State’s Mallinson said. “Ohio shares more information about the specific wellhead and the context of geography around the well that are important in thinking about what resources are required to access and cap a well.” Without better data, bids get twisted. Pennsylvania bidders go in relatively blind, so they make riskier bids—again driving up prices.
While Ohio offers a model that other states can learn from, the state has its own problems.
According to a 2022 audit, ODNR’s Division of Oil and Gas Resources isn’t spending as much as legally required on plugging wells. Though law dictates that it spend 30 percent of the previous year’s orphan well fund on getting wells plugged, the program has struggled to hit that mark. In 2021, the audit noted, the division spent only $11 million of a required $23 million to plug wells.
Once again, manpower is the biggest problem. “Our challenge has been to attract more contractors to accomplish this important work,” ODNR director Mary Mertz wrote in her reply to the audit report. As it stands, the state lacks enough workers to oversee and prepare orphan wells—and workers to plug them.
Other Appalachian states are sure to fare worse. With more money coming in for more projects, Mallinson worries that the Pennsylvania Department of Environmental Protection’s lack of capacity could be a bottleneck. “There’s a lag here in even getting a good, trained workforce to do this kind of work; it’s an area where there’s a lot of graying of the workforce,” he said. Without staff, states can’t get the money out fast enough. And without laborers, dollars chase workers and costs rise. Mary Kang, a professor at McGill University who’s studied orphan-well emissions, echoed Mallinson: “There’s capacity issues; there’s not a lot of companies who are available to plug,” Kang said. “It’s not like companies are fighting to get these plugging contracts.”
Some Pennsylvania pols decry understaffing in harsh terms. “The understaffing of the DEP, in my view, is deliberate,” said Congressman Greg Vitali, a Democrat from Havertown and chairman of the House Environmental Resources and Energy Committee. “We give away so much money to these non-essential causes, all the various grants to legislators and their districts, but we neglect the core function of government.” Vitali called DEP woefully under-resourced. “We are spending good taxpayer money to plug a very limited amount of wells when, as that is happening, we don’t have the enforcement personnel to prevent new wells from being abandoned,” he argued.
Markets can respond to labor shortages by training more workers to meet the contracts put up for bids. But without the administrative work on the state side, delays may set in. “You can’t contract at volume unless you have sufficient capacity at the agency to handle it,” EDF’s Peltz said. “All of the actual work is contracted out to pluggers anyway. It’s not like they’re creating a division within the agency. But you need the people in place at the agency to oversee a plugging program at scale.”
Ultimately, plugging every well is almost certainly impossible. The money and labor simply don’t exist. In a big state like Pennsylvania, with hundreds of thousands of orphans lost to the hollows and hills from Harrisburg to Aliquippa, the crucial task is to find the wells that most threaten residents, flora, and fauna.
The one-time torrent of federal funds may induce more state funding—if the public demands it. But if self-imposed barriers undermine the plugging project, the money will be remembered as another bureaucratic boondoggle. Peltz worries about states walking away from well-plugging entirely, telling Washington, “You have put too many strings on this money, we’re not gonna bother.”
The plugging program, then, is an important public-policy experiment. Can federal government funds rejuvenate state capacity to fix big problems? Can national infrastructure efforts sustain rural economies and galvanize voters? Or will slow-moving programs, understaffed and overlooked, reveal the American system of government to be rusty and worn?
Photo by David Walter Banks for The Washington Post via Getty Images