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Oil and Gas Bonding Reform and Orphaned Well Remediation Act

S. 4642 · 116th Congress · Sep 22, 2020 · Lineage

A BILL

To amend the Mineral Leasing Act to ensure sufficient bonding and complete and timely reclamation of land and water disturbed by Federal and Indian oil and gas production, and for other purposes.

1. Short title; table of contents

(a)
Short title— This Act may be cited as the “Oil and Gas Bonding Reform and Orphaned Well Remediation Act”.
(b)
Table of contents— The table of contents of this Act is as follows:

2. Findings

Congress finds that—
(1)
according to the Interstate Oil and Gas Compact Commission, there are in existence not fewer than 56,600 orphaned well sites, and as many as 746,000 undocumented orphaned well sites, across the United States on Federal, State, Tribal, and private land;
(2)
(A)
orphaned well sites—
(i)
pose significant public health, safety, and environmental risks; and
(ii)
should be remediated; but
(B)
there are no identified responsible parties to provide for the remediation of those sites;
(3)
it is reasonable for the Federal Government—
(A)
to provide financial resources to States and Indian Tribes to rectify the long-term public health, safety, and environmental risks described in paragraph (2)(A)(i);
(B)
to support the creation of jobs relating to the remediation and reclamation of orphaned well sites; and
(C)
to update policies to ensure that wells are not orphaned in the future;
(4)
under the Mineral Leasing Act (30 U.S.C. 181 et seq.), the Secretary of the Interior (referred to in this Act as the Secretary) is required—
(A)
to ensure the complete and timely reclamation of all Federal onshore oil and gas lease tracts; and
(B)
to secure financial assurances in the form of bonds, sureties, or other approved financial arrangements for remediation, reclamation, and well closure;
(5)
with respect to the Federal onshore oil and gas leasing program, the Secretary—
(A)
is required—
(i)
regularly to review existing onshore oil and gas financial assurances; and
(ii)
to increase the amount of those assurances, as necessary; but
(B)
in practice, often fails to carry out the activities described in subparagraph (A);
(6)
the Secretary—
(A)
implements well and financial assurance adequacy review policies inconsistently across field offices of the Department of the Interior;
(B)
has failed to track systematically data relating to potential liabilities and the adequacy of financial assurances; and
(C)
does not maintain information relating to actual reclamation costs incurred for inactive, orphaned, or inadequately reclaimed wells and lease tracts;
(7)
due to the shortcomings in the required minimum financial assurance amounts and the ineffectiveness of the Secretary in tracking and reviewing those financial assurances, the cost of reclaiming existing Federal onshore oil and gas wells and lease tracts far exceeds the amounts posted as financial assurance; and
(8)
the inadequacy of the Secretary in the administration of financial assurances for Federal onshore oil and gas activities—
(A)
poses a threat to land, water, and other resources; and
(B)
is a major financial liability to the taxpayers of the United States, who are often responsible for the costs of reclaiming onshore oil and gas wells and lease tracts that are inactive, orphaned, or inadequately reclaimed by lessees.