The U.S. Department of the Interior (“DOI”) on April 12 issued guidelines (“Guidance”) to states for applying the first $775 million in seed funding for oil well plugging and of orphan gases.
Funding is provided by the bipartisan Infrastructure Act (“BIL”).
BIL is providing $4.7 billion to ensure the proper closure of abandoned orphan oil and gas wells.
The DOI has previously said that nearly all states with documented orphan wells have submitted a notice of intent indicating their interest in applying for a formula grant to fund the closure and remediation of orphan wells and well sites. He had previously signed a memorandum of understanding with the Departments of Agriculture, Energy, the U.S. Environmental Protection Agency and the Interstate Oil and Gas Contract Commission to establish the framework of program implementation.
The DOI Guidance is intended to help States to:
- Begin development of their hookup programs
- Remediation of high priority wells
- Collection of additional data regarding the number of orphan wells in a State
Application procedures are addressed by:
- setting out the application process for states and provides requirements for conducting activities under initial grants authorized by Sec. BIL 40601(c)(3); and
- describing what the DOI considers best practices for establishing, conducting, and reporting program activities to plug, remediate, and recover orphan wells on public and private lands.
The Guide also covers:
- Key definitions
- Permitted Uses of Initial Grant Funds
- Instructions for Initial Grant Applications
- Required Items
- Recommended items
- Restrictions on use of funding
- Recommended standards for measurement, patching and correction
- Measurement or estimation of air and water pollution before and after sealing
- Well plugging and site remediation standards
- Federal and Tribal Coordination
- Reporting requirements
- Davis-Bacon Law Requirements
- Additional Terms and Conditions
A copy of the Guide can be downloaded here.