What Are Orphan Wells?

 

Orphan Well:   

In Texas, an orphan well is an inactive, non-producing well that has been dormant for a minimum of 12 months.

 

WHAT IS AN ORPHAN WELL?

Although sometimes used interchangeably, “abandoned” and “orphan” wells are fundamentally different.

“Abandoned” wells usually refer to wells that are no longer productive or economically viable, and have been properly “plugged” by an operator.

“Orphan” wells are wells that have not gone through the plugging process, or have no identifiable owner. According to the Texas Railroad Commission (RRC), the regulatory body that oversees Texas oil and natural gas development, an orphan well is an inactive and unplugged well that has not produced oil or natural gas for a minimum of 12 months.

 

It is estimated that most orphan wells across the country originate from the early days of American oil and natural gas development. Older wells – especially those drilled before the 1950s – are more likely to have been improperly abandoned and poorly documented. However, thanks to innovation and regulation, orphan wells are an incredibly rare occurrence today.

 

PLUGGING A WELL

 

Considered an essential step in managing the lifecycle of a well, responsible operators plug a well by removing the well’s piping and replacing it with a cement mixture at key intervals.  Plugging a well prevents the oil and natural gas reservoir fluids from migrating up the well, protecting both groundwater and the surrounding area. The well pad may also be reclaimed and reseeded to blend with the nearby ecology.

 

Texas regulations require well operators to strategically place cement plugs throughout the wellbore at each productive horizon and usable quality water strata to prevent fluid or gas migration into the air and groundwater. Each well must meet the state's requirements and any additional requirements identified in a notice of intent to plug. 

RULES AND REGULATIONS

As with other operations related to oil and natural gas development, the Railroad Commission of Texas (RRC) regulates orphan wells in the Lone Star State, including enforcement and clean up. Texas state law requires all oil and natural gas well operators to pay – in the form of a bond, letter of credit or cash deposit – to plug orphan wells. 

The RRC received a $25 million initial grant to plug abandoned oil and gas wells from the U.S. Department of the Interior in 2022. So far, the agency, which has the critical mission of protecting public safety and environment, has plugged 762 orphaned wells with the initial grant federal funding.

In FY 2024 and with state funding, RRC plugged 1,012 abandoned wells, exceeding the agency’s annual performance measure for well plugging. RRC also exceeded its goal for abandoned sites investigation and clean up, achieving 104 percent of its target, and 180 percent of its target for surface locations to be remediated.

Early 2025 has seen success as well with 593 wells plugged as of May 2025 through RRC’s State Managed Plugging program (utilizing oil and gas industry revenue).

Texas first established a payment system for abandoned wells in 2005. This authorized the RRC to “reimburse surface estate owners up to 50% of the documented cost or the average Commission cost” to plug the well.  In 2011, Texas created the Oil and Gas Regulation and Cleanup (OGRC) Fund, replacing previous well-plugging funds, in order to streamline the source of funds to continue to plug wells in a timely manner. In partnership with funding from the Infrastructure Investment and Jobs Act, the OGRC plugged a total of 1,256 wells in FY2024. 

 

 

RESPONSIBILITY AND REMEDIATION

In Texas, oil and natural gas operators are financially responsible for plugging both abandoned and orphan wells. By setting aside money before operators begin to drill, the state is able to cover most of the costs of plugging wells in the unlikely event they become orphaned.

Companies are also able to reclaim, or restart operations from orphan wells. The responsibility of closing and plugging the well is then shifted to the operator who took over the well. To encourage operators and mineral rights owners to voluntarily plug orphan wells, the Texas legislature passed Senate Bill 1146, referred to as the “Good Neighbor Bill”, which reduces the legal liability of responsible parties, encouraging them to step in without fear of being held accountable for future issues related to wells they didn’t originally own. 

“The successful passage of the Good Neighbors Bill is another example of ongoing efforts to reduce the number of orphan wells in Texas, it received broad support from industry stakeholders during the 89th Texas Legislative Session, a testament to the state’s commitment to environmental stewardship,” said Ed Longanecker, President, Texas Independent Producers and Royalty Owners Association.

Oil and natural gas operators in Texas are increasingly more involved in the plugging of wells, both directly or indirectly via the OGRC Fund and the Infrastructure Investment and Jobs Act that provides $4.7 billion for orphaned well site plugging in the United States.

 

“Approximately 92% of the wells plugged in Texas on an annual basis are done so by the operator of record with no use of the Texas Railroad Commission's Oil and Gas Regulation and Cleanup Fund." -Texas Independent Producers and Royalty Owners Association (TIPRO)

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JOB CREATION OPPORTUNITIES  

A Columbia University report estimates that over 120,000 jobs could be created via a federal program to plug as many as 500,000 orphaned wells in the United States.  

FAST FACTS

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Orphan wells in Texas account for less than 1 percent of all drilled wells in the state.

Texas plugged the most orphan wells of any state per last counting in 2018.

4,551 wells plugged and closed in Texas from 2018 to 2020