FRANKFORT (Aug. 25, 2022) – As part of his Better Kentucky Plan Stronger Communities Program, Gov. Andy Beshear today announced a $25 million grant to plug orphan oil and gas wells across the commonwealth. The initiative is expected to create 180 jobs.
“This initial grant will not only create jobs, but it will allow us to significantly reduce the environmental blight that these orphaned oil and gas wells cause to farmers and other private landowners,” Gov. Beshear said.
The Stronger Communities Program will use grant funds provided through the federal Bipartisan Infrastructure Law (BIL) to allow communities, businesses and local governments to benefit from this well capping, as well as projects focused upon energy efficiency, forestry, renewable energy, waste management and water.
Specific segments of the BIL grants program will collectively empower Kentucky to make significant progress in reclaiming abandoned mine lands and redeveloping brownfields.
The orphan well-plugging program will have a broad footprint across Kentucky. While over a dozen Kentucky counties have higher densities of orphaned wells, initial efforts will prioritize areas with wells prone to leakage, hindering land development, affecting communities, damaging croplands or negatively impacting water resources.
Interested contractors are encouraged to bid through the Finance Cabinet on “packages” of orphan wells identified by the Division of Oil and Gas as eligible for this program. Information on the program and how to apply can be found here. The division estimates that up to 1,200 wells could be capped though this initial grant.
The Finance and Administration Cabinet has issued 17 requests for proposals and contracts could be awarded by the end of September that will plug 312 abandoned wells.
“The Kentucky Oil and Gas Association (KOGA) appreciates the opportunity to partner with our federal and state leaders, including Gov. Beshear, to help secure and administer these critical orphan well-plugging funds,” KOGA Executive Director Ryan Watts said. “This funding will go a long way in protecting the environment while reducing the surface impact of these orphan wells.”
Kentucky estimates there are 14,000 orphaned oil and gas wells to be plugged. The division has the potential to receive an additional $79 million in the next phase of the five-year BIL program.
“This program will be a great shot in the arm to our well-plugging efforts,” Energy and Environment Cabinet Secretary Rebecca Goodman said. “I encourage all interested contractors to quickly apply.”
The Governor’s Better Kentucky Plan aims to help the commonwealth lead in the post-COVID economy by applying federal dollars to build new schools, deliver clean drinking water, expand access to broadband, build stronger communities and improve our roads and bridges and expand our electric vehicle infrastructure.