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New orphan well law to fetch $200M in federal money – New Orleans, Louisiana

New Orleans, Louisiana 2022-05-18 14:25:18 –

The law, which positions Louisiana to receive an estimated $ 200 million in federal grants to repair orphan wells, became a law on Tuesday. One of the first bills It was enacted from the regular session in 2022.

Senate Bill 245Sponsored by Senator Brett Alan, R-Franklin, Initial batch Of the 17 bills signed by Governor John Bel Edwards. The newly passed law has given the Department of State (DNR) changes to certain legislation regarding the restoration of oilfield sites. More flexibility About the amount of money you can spend to block and restore abandoned wells in a particular fiscal year.

There are about 4,600 abandoned oil and gas wells throughout Louisiana, many of which are leaking and polluting the environment.The total price tag to fix them all About $ 650 million..

When he first proposed the bill in March, Allin allowed DNR to maximize the amount the state could receive from the infrastructure investment and employment law that President Joe Biden signed in November. Said.

Louisiana will receive the first $ 25 million grant and will be able to compete among 26 states for a $ 2 billion share allocated based on performance. States that are more economically efficient in repairing orphan wells can receive a larger share, Allain said.

Prior to the new changes, the state could only fix non-preferred wells if it did not limit the number of preferred sites that could be restored in a particular fiscal year. Thanks to the new law, DNR secretaries have the authority to combine low-priority wells into attractive bidding packages. In doing so, the total number of isolated wells is reduced “in a cost-effective manner”.

The state receives an estimated $ 150 million at the low end. This is what Alllain calls a “conservative” estimate and states that it could approach $ 200 million.

Restoration of orphan wells is done by state-paid industrial contractors. Funds that depend on fees Collected in oil and gas production.

New orphan well law to fetch $200M in federal money Source link New orphan well law to fetch $200M in federal money

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