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Words of Wisdom

"Time is what we want most, but what we use the worst."
~William Penn

Thursday, May 04, 2017

Abandoned Oil/Gas Wells and Facilities in Texas

**If you have abandoned/orphaned oil and gas wells and facilities on your property, and you need assistance, I want to hear from you.  Information located at the end of the article.**
by: Jeff Falck
Right off the bat, let me say that I am not anti-oil/gas or a member of the "Stop the Fracking" crowd.  Quite the contrary, I'm a firm believer in the Texas energy industry, it's a vital part of our state's economy and I think the majority of us want to see it done responsibly, and those who operate within the industry are held accountable for their actions.

I'll reference Chris Tomlinson of the Houston Chronicle, who posted an article in June of last year that outlined the problem with the Texas Railroad Commission very clearly.  "Don't Stick Texans With Cost of Abandoned Wells".

Picture this... "A representative of an oil exploration/production company comes to your door and says you have oil/gas reserves on your property.  You enter into an "airtight" agreement and they move forward.  
Surveys are done, roads are cut, zig zagging your property. Heavy machinery and rigs are now traveling through your once pristine property.  

You're receiving checks in the mailbox and all is well.  It's more money than you've ever seen before, but a small amount compared to what the operator is taking each month.  Not to mention what they can "skim" in the gray areas of your contracts.  

Oil/gas prices start to drop, the operator has now found your property to be "marginal" or "non-producing".  The mailbox checks dry up due to "fees" and "expenses", and the operator has stopped paying their contractors. They're not returning your phone calls.  

Weeds now grow across the once heavily traveled rig roads, and the pumpers have stopped pumping all together. Tanks are left behind filled with nothing but water, sludge and who knows what else.  All this equipment is valueless and hazardous.  

Then you finally get the notice of bankruptcy or abandonment in the mail, or you've simply given up trying to contact anyone.  You're left with a huge cleanup bill on your hands, and it may be years before you get your land back the way it was.  
What do you do now?"  

Is this your reality?

I spent the last five years, observing first hand, the rise, fall, and abandonment of an oil field services operation.

Now that I've been away from it for several months, doing research I found that Texas has in the neighborhood of 12,000 abandoned/orphaned oil and gas wells, and that is not taking into consideration surface facilities such as disposals, pipe yards and roustabout locations.

Many of these locations, once they had served their purpose, are abandoned for one reason or another, usually under the protection of "bankruptcy".   

The skeletal remains of what used to be a productive facility is now left to the landowner and taxpayers of Texas to foot the bill on the cleanup. Unfortunately, some estimates into the millions of dollars.

Where is the Texas Railroad Commission in all this?  They are locked into an understaffed and underfunded, bureaucratic, "good ol' boy" network of outdated regulations, fees, and lack of enforcement capabilities.  

After the shutdown, I sent letter after letter, calls and emails asking the question about my facility, "How can a company get away with this?"  ... to no response.  

As a landowner, if the operations and production on your property have ceased, you hope to have your land returned to the way it was when you first leased to the operating company.  Unfortunately, in many cases, that doesn't happen.  

You're forced to get legal counsel and spend a lot of your time tracking down companies that no longer exist, or individuals that have "written this one off" and scurried back to their out of state offices and gated communities, doing it all over again, and you're left with quite a mess on your hands.

Right now the Texas Railroad Commission has $14.4 million dollars budgeted for fiscal year 2017 for site remediation and well plugging, hoping to clear up 1,050 abandoned/orphaned sites this year.

Why is that?  Why should the State have to set aside $14.4 million dollars to clean up a mess left behind by irresponsible operators?  

That's enough to add over 200 inspectors to the payroll to help police the industry.  From Chris' article, it states the RRC estimates of $165 million dollars to plug/clean up over 10,000 abandoned/orphaned wells in Texas.

Think of the many ways that money could be better spent!

We, as good stewards of the Texas land, need to express the need to our State Representatives that reform is necessary within the regulatory body of the Texas Railroad Commission.  Tell them fees need to be reviewed, and penalties for poor operating procedures need to be enforceable to the letter of the law, up to and including personal liability of the operating management if possible.  It needs to be made more difficult to abandon a site without accountability.

If you have abandoned/orphaned wells or facilities on your property and cannot seem to find any information or get answers to your questions, I want to hear from you.  I am working on a network of experts, including experienced oil/gas related legal council, that can assist with such issues.  

Again, these opinions are my own, and I'm a firm believer in the exploration of oil/gas and other energy alternatives in Texas.  Let's just make sure we do it responsibly and with accountability.

Thank you for visiting Texas Online Radio, and I'll post regular updates to this subject or if you have information or stories, please submit them.


Contact info:
If you would like to set up a meeting or speak on the phone, email your contact information.

Join my Facebook page:  Texans for Responsible Energy Exploration (TREE) which will be a grassroots organization concentrating on responsible energy exploration in Texas and assistance with abandoned/orphaned wells and facilities in the State.


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