Colorado will receive $79 million in federal money to clean up abandoned gas and oil wells around the state, officials announced Monday.

Colorado’s funding will come from the Bipartisan Infrastructure Bill, which set aside $1.15 billion to plug and seal orphaned wells. 

U.S. Senators John Hickenlooper and Michael Bennet, both Colorado Democrats, said the state has an estimated 625 abandoned wells and “as many as 19,000 oil and gas wells that are producing less than the equivalent of two barrels of oil per day.”

Orphan wells have been abandoned by their owner, meaning the state cannot look to an operator to pay for the costs of plugging and sealing the well. In many cases these wells are very old, going back a century or more. Others belonged to companies that went bankrupt and no longer exist.

One such well is just west of the Boulder airport. The McKenzie Oil Well was the first well drilled in the Boulder oil field in 1902 and was in production until 2007, when it was plugged. The McKenzie well is listed on the National Register of Historic Places, and Boulder’s landmark ordinance protects the well-head from being changed or stripped of its equipment. It initially produced about 70 barrels per day. The Boulder oil field at its peak produced some 80,000 barrels of oil annually.

The Colorado Air Quality Control Commission and the Colorado Oil and Gas Conservation Commission both have jurisdiction over different aspects of oil and gas production in the state. The conservation commission is primarily responsible for permitting, oversight and enforcement, whereas air quality control regulates emissions.

In mid-December, air quality control passed sweeping regulations to control methane emissions from oil and gas wells.

The new regulations are projected to cost energy producers $59 million to $142 million a year by imposing stringent requirements to capture and dispose of byproducts like methane without allowing the gases to escape into the atmosphere.

“Colorado cannot solve global climate change alone and certainly not by squeezing a single industry into arbitrary reduction goals for resources that Coloradans will rely on for decades to come,” said Dan Haley, president and CEO of the Colorado Oil & Gas Association.

It is uncertain how the federal grants will apply to the claimed 19,000 low-producing wells that are not orphaned or abandoned. Regulations already require the owners of wells that are no longer producing to plug and remediate the well site and associated roads and equipment at their own cost.

In the joint news release, Hickenlooper said: “These abandoned sites are dangerous for Colorado communities and release harmful methane into the atmosphere. Now we’ll create jobs by capping and remediating abandoned wells.”

In a news release from the Department of the Interior, Secretary of Energy Jennifer M. Granholm said: “Capping unplugged oil and gas wells is a win-win, helping to revitalize rural economies and providing opportunity to the fossil fuel workers who have powered our nation for over a century to land skills-matched jobs that will protect the health of their communities”

A July 21, 2021, paper in the journal Environmental Science & Technology analyzing the cost of plugging some 19,500 orphaned wells across the U.S. says the median cost is $20,000. If remediation is included, the cost rises to $76,000.

The grants to the state would provide $126,400 per well for the wells Hickenlooper and Bennet identified as “orphaned.”

How long jobs related to the plugging and remediation of those 625 wells will last is not addressed by either news release, nor is the disposition of any excess funding.