Public input started Wednesday to the Colorado Oil & Gas Commission on possible changes to the financial obligations drilling companies must comply with to clean up “orphaned wells.”

In February, the COGCC started examining the rules governing the “financial assurances” companies must provide to ensure no orphan wells are left uncapped, or sites not remediated properly. The commission put out a call for input by way of written or oral testimony – the written testimony was due by March 15. Industry representatives presented to COGCC Wednesday morning, and the public testimony was scheduled for 6 p.m. Wednesday. The meeting is being held via video conference on Zoom.

An orphaned well is one that is no longer operating for whatever reason, and that must be “plugged, remediated and reclaimed” by the state. Often they’ve been abandoned by bankrupt companies, or left behind when state regulators shut down a bad operator.

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There are 215 orphaned wells in the state, and 454 “associated orphan sites” as of July 1, according to the Commission’s 2020 report. By way of comparison, Wyoming has about 2,700 orphaned wells that need to be addressed, according to the Casper Star Tribune.

David Nelson, former commission director and currently with David Graham & Stubbs, told commissioners “there is no orphaned well crisis.”

“Five thousand wells have been plugged in the last few years,” Nelson said. “That’s 25 times more wells than COGCC has had to close. These voluntary plugging programs are less burdensome to staff than the orphaned well program.”

Nelson said Colorado has 1/10 as many orphaned wells as Wyoming, 1/40 of Pennsylvania and 1/70 of Oklahoma’s.

Matt Lepore, former commission executive director and current principal of Insight Energy Law LLC, urged commissioners to “define the problem we’re trying to solve.”

“This is not the beginning of the rulemaking on this issue, it’s but the latest chapter of what’s been unfolding for the last several years,” Lepore said. “We are not of the mind that this is a a problem that calls out for $30-$60 million per-year contribution to some orphaned well fund.”

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Then Gov. John Hickenlooper signed an executive order in 2018 requiring the annual report of number of wells and remediation efforts. It also increased the budget for the state’s program from $445,000 to $5 million, which allowed the commission to increase the number of full-time employees to four.

That order upped the amount of financial assurances, or bonding, oil and gas companies must put up with any drilling permits. Those bonds range from $2,000-$5,000 per “surface well,” or $10,000 to $20,000 for drilled wells, depending on depth. Additionally, companies must “maintain general liability insurance of $1,000,000 per occurrence” to cover any property damage or injuries.

The hearing will continue Thursday.