The Wyoming Oil and Gas Conservation Commission ("WOGCC") reportedly unanimously voted to raise the state's bonding requirements for oil and gas wells on Tuesday.
We recently discussed Wyoming's abandoned wells in our post Left Holding the Bag – Who is Responsible for Idled or Orphaned Wells? Under many circumstances, the state is left with the financial burden of plugging these wells.
This week's increase in Wyoming bonding requirements is an effort by the WOGCC to ensure the state will have the funds necessary to address plugging abandoned wells in the future. The bond acts as a financial assurance for the state if the company does not reclaim a well, as the WOGCC may use the bonds to help offset the state's plugging and reclamation costs.
The proposed changes to the bonding requirement sought a $150,000 blanket bond, a substantial increase in the blanket bond requirement covering all of a company's wells in the state. This drastic increase in the blanket bond was not approved by the WOGCC, however.
The new rules instead require a blanket bond of $100,000, which is reported to be in-line with surrounding states, or $10 per foot for all wells.
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