Environmental activist Russel Russel L. Honoré said Tuesday that Louisiana should take a three-prong approach to relieving citizens of the burden of tending to abandoned oil and gas wells:
- Seek a state audit of the Department of Natural Resources, Office of Conservation and the Louisiana Oilfield Site Restoration Program.
- Seek legislation that would plug holes in restoration laws so that people who drill wells will be forced to properly close them.
- Meet with the U.S. attorney in New Orleans to make sure there is no escape for oil and gas companies that are responsible for properly closing down their wells in Louisiana.
Honoré, standing under the late morning sun across East St. Mary Boulevard from the Petroleum Club, said there are some 4,600 abandoned wells in Louisiana that might cost as much as $650 million to properly plug and restore to their natural state.
He contended that too often oil and gas producers form limited liability companies to shirk their responsibilities in properly closing down wells and state taxpayers are left with the bill. He said under state law, oil and gas operators “agree to clean up when they are done with their wells,” but fail to do so. If they claim bankruptcy, he said, Louisiana citizens must step up and pay the shortfall with public money.
Honoré also decried that boards charged with oversight for closing down wells are dominated by oil and gas executives, who allow operators to walk away from failing or exhausted wells and leave their machinery in place, sometimes at risk to wildlife and other people who live near the wells and pipelines. He said there too little accountability in such a system to protect citizens.
Don Briggs, former president of the Louisiana Oil and Gas Association, sits on the Oilfield Site Restoration Commission that oversees the site restoration program started in 1993. He said the board uses money that is put up by well operators – not money generated by taxpayers. While the number of orphan wells exceeds 4,000, he said the number has not declined in recent years because lingering low commodity prices for oil and gas caused many operators to go out of business in recent years.
“We’ve plugged thousands of wells,” he said, “but we still wind up having them. Companies go broke.”
Patrick Courreges, spokesman for the Department of Natural Resources, said the money used to plug abandoned wells is “public money” in that the department is charged with overseeing it, but it does not represent money generated through sales or property taxes. It is money raised through the oil and gas operators themselves.
He said two fees fund the restoration program: the orphan well fee, which is based on fees per barrel of oil or per feet of natural gas; and fees assessed companies that hold inactive wells. The latter fee generates about $2 million a year.
While Honoré said the oil and gas industry dominates the composition of the restoration commission, Courreges said there are 10 members that include the secretary of the Department of Natural Resources; commissioner of conservation; two places for LOGA; two places for Mid-Continent Oil & Gas Association; one spot for the Nature Conservancy; one spot for the Louisiana Wildlife Federation, Sierra Club and Audubon Society; and one vacant spot. Briggs described the composition of the board as “diverse.”
Honoré was unconvinced and called the system “corrupt,” adding that the board showed no accountability. He called upon Gov. John Bel Edwards to remove representatives of the oil and gas industry from the commission, although he conceded that many energy industry companies were not at fault.
Harold Schoeffler, a longtime activist with the Sierra Club, told the crowd of about 30 that he was concerned about abandoned wells and oil pipelines left scattered around Lake Dauterive and Lake Fausse Pointe State Park, which comprises about 6,000 acres in the Atchafalaya Basin.
“They are all over the place out there and it’s getting worse,” he said.
Honoré, a retired Army lieutenant general, came to public attention in 2005 when he was sent with troops to New Orleans to restore order in that city following Hurricane Katrina.