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04/16/2026 | Press release | Distributed by Public on 04/16/2026 10:17

Federal Orphaned Oil and Gas Well Program Provided Benefits at a High Cost, New Research Finds

Federal Orphaned Oil and Gas Well Program Provided Benefits at a High Cost, New Research Finds

Date

April 16, 2026

News Type

Press Release

What's the story?

There are millions of orphaned oil and gas wells across the country that pose a range of environmental and health risks. To address these and provide an economic boost in the wake of the COVID-19 pandemic, the 2021 Infrastructure Investment and Jobs Act dedicated $4.7 billion to decommission orphaned oil and gas well sites. Both political parties pitched the program as a "win-win" for the environmental and economic benefits. However, new data complicates that picture.

New research from Resources for the Future (RFF) examines data from about 2,150 wells plugged in the program and estimates that the societal benefits were roughly $30-$40 million, while costs totaled $147 million. However, for wells with high methane emissions, the benefits of plugging easily outweighed the costs.

Expert Perspective

"The relatively small benefits we measured are rough estimates; however, they suggest that the program has more muted environmental and economic benefits than many had hoped. For future programs, policymakers should consider more precisely targeting funding to decommission wells with the most harmful environmental impacts, such as high rates of methane emissions."

-Daniel Raimi, RFF Fellow, Director of the Communities in the Energy Transition initiative

What are the benefits and costs?

RFF researchers looked at data from decommissioning efforts for orphaned oil and gas wells in Michigan, North Dakota, Oklahoma, Pennsylvania, Texas, and West Virginia. Using data from each of these state governments, the paper finds an average decommissioning cost of $67,000 per well site, with a handful of sites costing more than $1 million.

The authors measured two main categories of decommissioning benefits. The first set of benefits is the reduction in methane emissions from plugging the orphaned wells. While precise data on methane emissions was only available for roughly 100 wells, RFF researchers estimate that the benefit of reduced emissions ranges from $1.4-$9.3 million compared with plugging costs of $5.9 million.

The second, and much larger, set are the benefits for local property owners since decommissioned sites can be repurposed for more productive purposes. The authors estimate an increase of around $29 million for agricultural and residential property values near decommissioned oil and gas wells.

The paper notes that these estimates do not include monetary benefits of job creation, ecosystem services not captured in property values (such as carbon sequestration and runoff prevention), and only partially capture reductions in risk to public health and the environment. Therefore, the real benefits of the program are likely to be higher.

Expert Perspective

"Decommissioning orphaned oil and gas wells can drive meaningful increases in property values. This can provide an economic boost to communities who've been impacted by these wells. However, due to a lack of quality data on wells' impact on things like water quality and public health, it's much harder to determine the full range of benefits the program might have created."

-Christina Cilento, Manager of the Communities in the Energy Transition initiative

️ Where do we go from here?

Ultimately, these findings suggest that the program in the Infrastructure Investment and Jobs Act provided meaningful benefits to local communities in the form of methane reductions and property value increases. But these benefits likely fell short of the program's cost.

This research also highlights a need for better data on the methane emitted by orphaned wells over time. However, this would require high-quality and low-cost technologies that quantify methane emissions, which are not widely available. Policymakers could consider more investment in these technologies to better understand wells' methane behavior and be able to more effectively use funds from the orphaned well program.

The authors also note that although state governments require oil and gas operators to plug wells at the end of their useful lives, companies often walk away from old wells through bankruptcy procedures with limited financial penalty. This suggests the need for states to reform regulations to ensure taxpayers are not shouldered with tens or hundreds of billions of dollars in cleanup costs.

Where can I learn more?

Read the paper, "Costs and Benefits of Decommissioning Orphaned Oil and Gas Wells: Evidence from Six States," by RFF Fellow Daniel Raimi and Manager of the RFF Communities in the Energy Transition Initiative Christina Cilento.

Resources for the Future (RFF) is an independent, nonprofit research institution in Washington, DC. Its mission is to improve environmental, energy, and natural resource decisions through impartial economic research and policy engagement. RFF is committed to being the most widely trusted source of research insights and policy solutions leading to a healthy environment and a thriving economy.

Unless otherwise stated, the views expressed here are those of the individual authors and may differ from those of other RFF experts, its officers, or its directors. RFF does not take positions on specific legislative proposals.

For more information, please see our media resources page or contact Media Relations and Communications Manager Annie Tastet.

Resources for the Future Inc. published this content on April 16, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on April 16, 2026 at 16:17 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]