Merger puts California's idle well regulations to the test
Credit: 2427999 from Pixabay

Merger puts California's idle well regulations to the test

The acquisition of Aera Energy by California Resources Corporation poses a significant challenge for the state's new legislation aimed at managing orphan wells.

Joe Fassler reports for DeSmog.


In short:

  • California's largest gas producer, CRC, plans to merge with Aera Energy, potentially becoming the primary holder of idle oil and gas wells.
  • New state law AB 1167 requires companies to secure bonds for the decommissioning of such wells, putting the merger under scrutiny.
  • The enforcement of AB 1167 is uncertain, raising concerns about future environmental hazards and financial burdens on taxpayers.

Key quote:

"We have to put some kind of brakes on this slow-moving crisis, and we are now presented with a very significant opportunity to do that."

— Ann Alexander, director of energy solutions at the NRDC

Why this matters:

Addressing the orphan well problem requires coordinated efforts between governments, environmental organizations, and the oil and gas industry. Orphan wells can leak methane, a potent greenhouse gas, contributing to climate change. Methane's ability to trap heat in the atmosphere far exceeds that of carbon dioxide in the short term, making these emissions particularly concerning for global warming.

Abandoned oil and gas wells leave the ocean floor spewing methane.

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