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(Mother Jones)   Plugging old oil wells is going to cost millions   (motherjones.com) divider line
    More: Obvious, Bureau of Land Management, Natural gas, Cost, United States Secretary of the Interior, United States Department of the Interior, Petroleum, Methane, Carbon dioxide  
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733 clicks; posted to Business » on 24 Jan 2022 at 8:42 AM (17 weeks ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook



19 Comments     (+0 »)
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2022-01-24 1:23:25 AM  
Nah. Just not going to happen. The Law of Money is externalities and rent-taking: somebody always has to pay other than the beneficiary who gets the profits. The ultimate payers are the workers, the customers and the tax payers (small).

Funny how capitalists always refer to their risks to justify their big profits, but always dump the risks and costs of doing business on somebody else, although quick to demand payment of money owed to them.

It's a paradox, I think. The risks they dump justify their profits but the rents they scoff up are slander and communism.
 
2022-01-24 4:06:45 AM  

brantgoose: Nah. Just not going to happen. The Law of Money is externalities and rent-taking: somebody always has to pay other than the beneficiary who gets the profits. The ultimate payers are the workers, the customers and the tax payers (small).

Funny how capitalists always refer to their risks to justify their big profits, but always dump the risks and costs of doing business on somebody else, although quick to demand payment of money owed to them.

It's a paradox, I think. The risks they dump justify their profits but the rents they scoff up are slander and communism.


Unfettered capitalism has always been about privatizing profits and socializing losses. That's why we need a system of laws and regulations to rein in and tame its worst tendencies, as well as a social safety net that keeps workers from becoming indentured servants.
 
2022-01-24 7:00:09 AM  
Have we tried plugging the wells with senators?
 
2022-01-24 9:04:21 AM  

Tr0mBoNe: Have we tried plugging the wells with senators?


That would be preferable to what is likely to happen: forcing American taxpayers to cap and clean up oil wells.
 
2022-01-24 9:19:35 AM  

Tr0mBoNe: Have we tried plugging the wells with senators?


Fark user imageView Full Size
 
2022-01-24 9:52:02 AM  
Damn, how does one invest in this or get into the business? This is rock solid opportunity.

I bet you will need strong political connections to get the contracts and I bet the companies are not publicly traded.
 
2022-01-24 11:38:13 AM  
so, like an hour of net income from exxon, shell, bp, etc?
 
2022-01-24 11:41:27 AM  
Using estimates from a 2021 Government Accountability Office report, the cost of plugging all 130,000 abandoned wells could range from $2.6 billion to more nearly $19 billion.


That's somewhere between 2% and 17% of one year's revenue for US oil and gas producers.  So they could plug all the wells over a few years and still remain quite profitable.  I fail to see the problem here.
 
2022-01-24 12:54:39 PM  

badplaid: Damn, how does one invest in this or get into the business? This is rock solid opportunity.

I bet you will need strong political connections to get the contracts and I bet the companies are not publicly traded.


A geologist that lives in my neighborhood has worked a few decades cleaning up toxic waste companies dumped in the MA area before the EPA was created.  Think General Electric, Boeing, Amtrak, etc.
The US government has been unwilling to regulate polluters in the past few decades, so expect superfund contracts, but few preventive measures.
For example, shrinking carbon tax credits to eliminate the fossil fuel industry.  Or holding big polluters responsible for the damage associated with climate change.
 
2022-01-24 1:38:17 PM  
"In a memo, the agency wrote that more than 130,000 documented wells exist across the country that lack a responsible company on the hook to pay for cleanup-the remnant of more than 150 years of extracting oil and natural gas."

Why? We're these wells drilled by ghosts? Did they miraculously come into being without any human involvement? Was there somehow no flesh and blood human involved? Did nobody own these wells any any point in their existence?

Oh... right.  This is capitalist America, where we privatize the profits and socialize the risks.
 
2022-01-24 1:40:51 PM  

pearls before swine: Using estimates from a 2021 Government Accountability Office report, the cost of plugging all 130,000 abandoned wells could range from $2.6 billion to more nearly $19 billion.


That's somewhere between 2% and 17% of one year's revenue for US oil and gas producers.  So they could plug all the wells over a few years and still remain quite profitable.  I fail to see the problem here.


The problem is that there's no way our government would even consider doing this.
 
2022-01-24 2:21:43 PM  

inglixthemad: Tr0mBoNe: Have we tried plugging the wells with senators?

That would be preferable to what is likely to happen: forcing American taxpayers to cap and clean up oil wells.


Gas and heating oil prices going up again, I predict.
 
2022-01-24 2:22:26 PM  

Farking Clown Shoes: brantgoose: Nah. Just not going to happen. The Law of Money is externalities and rent-taking: somebody always has to pay other than the beneficiary who gets the profits. The ultimate payers are the workers, the customers and the tax payers (small).

Funny how capitalists always refer to their risks to justify their big profits, but always dump the risks and costs of doing business on somebody else, although quick to demand payment of money owed to them.

It's a paradox, I think. The risks they dump justify their profits but the rents they scoff up are slander and communism.

Unfettered capitalism has always been about privatizing profits and socializing losses. That's why we need a system of laws and regulations to rein in and tame its worst tendencies, as well as a social safety net that keeps workers from becoming indentured servants.


Regardless of the economic system we use, there need to be safeguards against the predators in our society.
 
2022-01-24 2:24:31 PM  

My Second Fark Account: pearls before swine: Using estimates from a 2021 Government Accountability Office report, the cost of plugging all 130,000 abandoned wells could range from $2.6 billion to more nearly $19 billion.


That's somewhere between 2% and 17% of one year's revenue for US oil and gas producers.  So they could plug all the wells over a few years and still remain quite profitable.  I fail to see the problem here.

The problem is that there's no way our government would even consider doing this.


Fine them a few billion for destruction of property and littering.

Per offence.
 
2022-01-24 2:27:41 PM  

Target Builder: "In a memo, the agency wrote that more than 130,000 documented wells exist across the country that lack a responsible company on the hook to pay for cleanup-the remnant of more than 150 years of extracting oil and natural gas."

Why? We're these wells drilled by ghosts? Did they miraculously come into being without any human involvement? Was there somehow no flesh and blood human involved? Did nobody own these wells any any point in their existence?

Oh... right.  This is capitalist America, where we privatize the profits and socialize the risks.


I bet it's a giant game of "not me". I also bet many of those companies responsible no longer exist.
 
2022-01-24 5:06:04 PM  

Target Builder: "In a memo, the agency wrote that more than 130,000 documented wells exist across the country that lack a responsible company on the hook to pay for cleanup-the remnant of more than 150 years of extracting oil and natural gas."

Why? We're these wells drilled by ghosts? Did they miraculously come into being without any human involvement? Was there somehow no flesh and blood human involved? Did nobody own these wells any any point in their existence?

Oh... right.  This is capitalist America, where we privatize the profits and socialize the risks.


Because the companies that drilled the wells eventually sold them to other companies, which they cannot do without federal or state government approval (whatever jurisdiction the well falls under). So the original drilling company (company A) drills it in 1978 and produces it for 12 years then decides to sell it company B, who then produces it for 5 years before selling it to company C, who then produces it for 18 years before selling it to company D. It is now 2013 and the well is owned by the fourth different company. Each sale of the well has to get regulatory approval before the sale can go through, so the either the feds or the state have approved the sale 3 different times. Company D is producing the well for 2 years then goes bankrupt in the 2015 oil crash. Who is on the hook for the eventual plug and abandonment of the well? The regulatory body that sanctioned the sales that's who. If the regulatory body in question gave a damn about the longevity of the well and the environment they would never have sanctioned a sale to a company that didn't have a massive amount of money set aside in an  account for the eventual P&A of every wellbore in that company's portfolio, but since governments are always thinking ahead and plan for that they do their due diligence right..... Of course not. They only care that the well produces as long as possible and the government gets a royalty check.

I work in the oilfield and have done lots of P&A work in my career. The companies in question are no doubt culpable, but the regulatory body is the one responsible for ensuring that the next company in line has the ability to P&A those wells.
 
2022-01-24 5:08:54 PM  

badplaid: Damn, how does one invest in this or get into the business? This is rock solid opportunity.

I bet you will need strong political connections to get the contracts and I bet the companies are not publicly traded.


Exactly what I have planned as soon as I retire from my company. I will turn consultant for the federal or state government and manage plug and abandonments. P&A work is an engineering challenge and fairly cost efficient, until you get into that one trainwreck of a well where everything goes wrong.
 
2022-01-24 6:57:09 PM  
Oil wells. How about we do gas first?

We probably all know that a shell game gets played where the nasty polluters all get sold off to a shell company and the original owner skates away. Then the shell company goes bankrupt and leaves the problem to taxpayers. This has been done with a company buying up all the old leaky gas wells in the US. It has been documented. I wish I could link to a documentary about this. I saw one recently by? Propublica? Vice? that makes no particularly Earth shaking claims, but still manages to show very obvious patterns of bad behavior and legal and financial shenanigans. The documentary might be a decade old by now.

The US is a huge resource producer and consumer. There is going to be waste, pollution, graft and corruption at every stage.
 
2022-01-25 8:57:33 AM  
Coal mines have a related problem.  Lots of them are a lightning strike away from a thousand year fire.
 
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