Legislation would allow Pennsylvania companies to bid on well-plugging contracts

Legislation recently introduced in the state House would amend current law to provide well-plugging contracts to Pennsylvania companies.

In Pennsylvania, there are 26,000 orphaned oil and gas wells, according to Department of Environmental Protection (DEP) estimates. The agency also believes there are thousands of undocumented wells.

Under current law, out-of-state companies receive preferential treatment when bidding on contracts to plug these wells.

“I am introducing House Bill 2528 in an effort to change the current practice of not allowing Pennsylvania companies to participate in a key aspect of environmental stewardship,” state Rep. Jim Struzzi (R-Indiana) said. “These short-sighted policies stifle our business community and drive jobs and dollars to other states. My legislation would level the playing field for our businesses and take advantage of everything our energy-related industries have to offer here in the Commonwealth.”

Under the bill, the DEP will allow any Pennsylvania company, regardless of size, to bid for a contract that the department plans to award for plugging oil or gas wells. Pennsylvania companies would be eligible before the agency awards the bid to an out-of-state company.

The state expects to receive more than $400 million in federal funding to address abandoned and orphaned oil and gas wells.