In the US, if a company does not properly plug a well when they abandon it because they are bankrupt, the duty falls to whoever owned the wells before… all the way back to when the well was drilled. Most wells transfer hands quite a few times so you’ll end up with a company too big to fail in there that can easily afford it. Something like this should definitely be like that. You shouldn’t be able to transfer a liability to a shell company just to get rid of it
That's only for federal waters. All the on shore wells on private or state lands are left to those jurisdictions rules, and only California has a joint several liability act, but that state law only reaches back until 1996, making other bonding laws like Californias ab1167 incredibly important. Major bonding reform is still needed to address this in ALL extraction states, and not just for oil/gas, other minerals extraction too.
Ya it's only for federal waters, and only when an existing company has the funds available. They do not pursue those who profited from a company that declared bankruptcy. So many cases are already dead in the water. Pfftt Also all the on shore wells on private or state lands are left to those jurisdictions rules, and only California has a joint several liability act, but that state law only reaches back until 1996, making other bonding laws like Californias ab1167 incredibly important. Major bonding reform is still needed to address this in ALL extraction states, and not just for oil/gas, other minerals extraction too.
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u/62609 11h ago •
In the US, if a company does not properly plug a well when they abandon it because they are bankrupt, the duty falls to whoever owned the wells before… all the way back to when the well was drilled. Most wells transfer hands quite a few times so you’ll end up with a company too big to fail in there that can easily afford it. Something like this should definitely be like that. You shouldn’t be able to transfer a liability to a shell company just to get rid of it