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Obama signs bill with legacy well money Funds from closure of Federal Helium Reserve to be used to remediate old federal wells sites in National Petroleum Reserve-Alaska Wesley Loy For Petroleum News
President Obama on Oct. 2 signed legislation that could steer millions of dollars toward cleanup of derelict federal wells, known as legacy wells, in the National Petroleum Reserve-Alaska.
The new law, titled the Helium Stewardship Act of 2013, is designed to eventually close the Federal Helium Reserve in Texas.
What to do with the reserve had for many years been the subject of controversy and debate in Washington.
Alaska Sen. Lisa Murkowski helped author the helium act. Murkowski is the top-ranking Republican on the Democrat-controlled Senate Energy and Natural Resources Committee.
Closure of the helium reserve is expected to generate about $500 million in revenue over the next decade, Murkowski said in a press release.
The new law dedicates some of the money to reduction of the federal debt.
It provides $50 million to remediate and close abandoned oil and gas wells on current or former national petroleum reserve land. Wells in Alaska and in other states are eligible for the funding.
But the vast majority of the $50 million is expected to come to Alaska, a Murkowski aide told Petroleum News.
‘An environmental crime’ The NPR-A is a vast tract on Alaska’s North Slope.
Murkowski and other Alaska elected officials and regulators have been pounding the Interior Department for months to do something about the reserve’s legacy wells.
Federal departments drilled 136 test wells between 1943 and 1982.
Today, the wells are the responsibility of the Interior Department’s Bureau of Land Management, which manages the petroleum reserve and also operates the Federal Helium Reserve.
Murkowski and the other critics say the BLM has neglected the legacy sites, some of which are junk-strewn and have wells that were never properly plugged and abandoned.
They have complained the BLM is moving far too slowly to clean up the legacy wells. BLM officials have countered that cleanup is extremely costly, and that many of the wells don’t really need any attention.
After the helium act cleared Congress, Murkowski said the funding should help spur action.
“For years, we fought just to get a couple of million dollars dedicated to the cleanup of the legacy wells, so I’m pleased we were able to obtain $50 million to begin seriously addressing what is nothing short of an environmental crime against Alaska,” Murkowski said. “Securing the funding during these days of tight budgets and competing federal priorities was challenging, but the legacy wells are a federal responsibility that has been ignored for far too long.”
BLM’s cleanup plan North Slope Borough Mayor Charlotte Brower welcomed the helium bill’s passage.
“For many years, BLM has lacked the resources necessary to clean up and remediate high-priority wells in a timely manner,” she said.
She noted how the Obama administration proposed a fiscal year 2014 Interior Department budget that would pay for legacy well cleanup by diverting Alaska’s share of revenue generated from oil and gas activity in the NPR-A.
Brower called that proposal “unacceptable,” and Murkowski said it would be “dead on arrival.”
Murkowski is the ranking Republican not only on the Senate Energy Committee, but also the Senate Interior Appropriations Subcommittee. Both have jurisdiction over the BLM.
The helium law allocates the well cleanup money across three fiscal years, a North Slope Borough press release said.
On Sept. 23, the BLM released a final “strategic plan” to plug and clean up NPR-A legacy wells.
The BLM said half, or 68, of the legacy wells require no action “because they have been remediated or pose no threat to the public or the environment.”
The U.S. Geological Survey continues to use another 18 wells as part of climate change studies.
The plan identifies 50 wells as requiring attention, including 16 priority wells.
The first wells slated for cleanup work are at Barrow and on the Simpson Peninsula southeast of the village.
The BLM didn’t specify a total cost to carry out the cleanup plan. But the money available from the helium bill is likely insufficient.
“BLM’s plan is a good start,” Murkowski said. “It doesn’t cover all of the sites, but it takes care of the most serious environmental threats first.”
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