The Sun Will Come Out Tomorrow

Managing Orphan Well Risk through Business Cycles

Producers’ ability to retire aging oil and gas infrastructure is increasingly becoming an issue for landowners and regulators. The US could see an increasing number of orphan wells—those shut in but not plugged and abandoned—and the operator defunct due to the downturn. How should resource-development landowners react to the situation without making a long-term economic mistake?

Lieza Wilcox and Yury Issaev review financial assurance requirements in place currently and propose policy principles that could lead to the best environmental and economic outcomes.

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