In this episode I interview Jim Crompton, oil and gas industry expert, professor at the Colorado School of Mines, and owner Reflections Data Consulting, LLC. He is also an instructor at Top Energy Training which helps educate regulators, inspectors, policymakers, and oil & gas industry professionals so that they can develop informed public policy and regulations around complex issues in the oil and gas industry, like orphan wells.
We discuss all aspects of the orphan wells issue, from the size of the problem, advancements in technology that may help industry better prioritize the abandoned wells that require attention, what landowners should do if they find an abandoned well on their property, and incentive mechanisms that might help solve this problem.
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About Jim Crompton
Jim Crompton is an industry expert and professor at my alma mater, the Colorado School of Mines. Jim retired from Chevron in 2013 after almost 37 years. He is the owner of Reflections Data Consulting LLC where he continues his work in the area of data management and analytics for oil & gas industry.
He’s on the board of the Society of Petroleum Engineers (SPE) Digital Energy Technology Section and is a Distinguished Lecturer on the topic of “Putting the Focus on Data”. He co-authored book The Future Belongs to the Digital Engineer with Dr. Dutch Holland. He is also a lecturer for TOP Energy Training which is a resource for oil and gas training. It is an educational consortium that is composed of Colorado School of Mines, Penn State University, and The University of Texas at Austin. They design and create online courses for oil and gas professionals, focusing on the fundamental technology, science, and engineering of oil & gas operations.
Since 2012, they have delivered more than 42,000 hours of content to professionals as part of their program for field inspectors and regulatory personnel. This is really important work that is helping educate regulators, inspectors, and policymakers so that they can develop informed public policy and regulations around complex issues in the oil and gas industry, like orphan wells.
We Discuss
Introduction
- Background, experience in oil and gas industry
- What do you do now
What are Orphan Wells
- What are orphan wells?
- How big is the issue? How many orphaned wells are there in the United States?
- For the number of wells that are classified as orphaned, how many of these are actually documented and known vs. assumed based on say a statistical analysis?
- Let’s talk about bonding requirements with state regulators. We’ve talked about the requirement that operators have to put up a surety bond to cover the closure of any abandoned wells should the company go bankrupt. How much do state bonding requirements cover the plugging & abandonment of these orphan wells?
- How much does it cost to properly P&A one of these orphan wells?
- With all of the spending at the federal level, how much funding in things like the infrastructure bill has been set aside for closing wells?
How Oil & Gas Wells Should be Plugged & Abandoned
- I know it varies by well but in general how are wells plugged & abandoned?
- What type of research is going on at universities to study things like P&A or cementing optimization or novel new ways to plug and abandon wells in a more cost efficient manner?
- What is the typical timeline for plugging & abandoning a well and removing surface equipment? Does this process take days, weeks, months?
- What happens when a well depletes and stops producing oil & gas in commercial quantities. I know it varies by jurisdiction but in general, how long does a well have to be shut-in before the operator has to P&A the well (assuming they have no plans to produce in the future)?
Environmental and Emissions Concerns with Orphan Wells
- So I can completely understand if you are a surface owner that an orphan well on your property presents a problem because of the expense that removing the old production equipment would entail so that you could use the land again, but what kind of environmental concerns do orphan wells present?
- How big of an issue are methane emissions from orphan wells? How good is the methane emission data around these wells?
- How much methane does a typical orphan well emit?
- Where are most orphan wells located or are they pretty evenly spread across the major oil producing regions? Which wells are the highest priority for closure; are they prioritized by methane emissions?
- What kind of monitoring is done with orphan wells once they’ve been identified? Do regulators require pre/post abandonment monitoring and if so, what type of data is collected?
- What recourse do landowners have if they have an orphan well on their property? How can they make sure it is on someone’s radar to eventually plug & abandon properly?
Future Developments
- What are the business opportunities around orphan wells? It seems like there is going to be an increasing demand for companies to provide services to address this issue, is this correct?
- I know that non-profit organizations like the Well Done Foundation have started to help this issue but they aren’t plugging orphan wells to make money.
- Whether it is good or bad I know that things like carbon cap & trade and other carbon pricing mechanisms have started to gain traction. In fact in Episode 102 we talked about this in more detail and the fact that API came out endorsing carbon pricing for the first time in 2021. Do you think that carbon credits of some kind will actually make it profitable to build a business around plugging & abandoning these wells by selling the credits you would get from plugging the worst methane emitting orphan wells?
How to Contact Jim
Resources Mentioned in This Episode
- API supports carbon pricing, new technologies to address climate change risks | S&P Global Commodity Insights
- Top Energy Training – Educational consortium composed of Colorado School of Mines, Penn State University, and The University of Texas at Austin focusing on the fundamental technology, science, and engineering of oil and gas operations. Podcast listeners get 10% off your first course purchase – just use the code “PODCAST” at checkout!
- Responsible Gas Initiative at the Colorado School of Mines exists to help better understand the challenges and opportunities related to the future of natural gas in a low-carbon economy. They work with partners to define the prospects for responsibly sourced gas, using empirical, credible data and independent certification.
- Biden Administration Announces $1.15 Billion for States to Create Jobs Cleaning Up Orphaned Oil and Gas Wells
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