Government officials are dusting off the record books in an effort to better understand where and in what condition old oil and gas wells are in, but it’s only taking stock of those on Crown land, leaving private landowners to deal with things themselves
The Government wants to better understand the location and status of dozens of orphan wells on Crown land, some more than 100 years old.
Orphan wells are petroleum wells that have no liable permit holder and no evidence they have been plugged and abandoned. READ MORE: * Govt pauses new oil and gas exploration * Put up for clean up, Govt tells oil drillers
While most are not thought to be hazardous, they can be. In 2002, the government paid out almost $1 million to plug two Taranaki wells which were leaking hydrocarbons in a residential area.
Within Paparoa National Park nine such wells exist – formerly part of Pike River mine operations – and the records don't show whether they have been plugged and abandoned or what state they are in.
Officials estimate there are just over 200 such onshore wells across New Zealand, the majority of which are on private land.
But the quality of information about the wells is poor.
“As it stands, there are large gaps in the orphan well database relating to both well location and well-head status. This is a barrier to informed decision-making and risk management,” Ministry of Business, Innovation and Employment officials told Energy Minister Megan Woods late last year.
The Government now plans to contact ex-permit holders and contractors as well as share information with other agencies in order to beef up the database – but only for the 40-odd wells on Crown land.
“We believe it is wrong for them to take an ad hoc approach to orphaned wells on private land. It should not be a landowners issue.” - Sarah Roberts, Taranaki Energy Watch
Plans are also underway to conduct site visits.
This kind of data sharing with the Department of Conservation would likely clear up the status of the Paparoa wells but for others, things may not be as straightforward.
In 2014, the Parliamentary Commissioner for the Environment recommended greater oversight over orphan wells, including a monitoring regime. In 2017, MBIE commissioned engineering firm Petrofac to undertake a desktop technical integrity assessment of 104 wells and report back.
However, the Petrofac report also ran into challenges because of the lack of information available.
It did not know the status of 42 of the wells, or what was in half of them.
And out of those 104, it found a third of the wells were more than 100 years old, and half were more than 50 years old.
Public v Private
The Government also maintains it won’t pay the costs linked to orphan wells found on private land that needed remediation.
Officials now estimate the cost to plug the 177 it knows about could be as much as $124m.
"The cost of plugging and abandoning individual orphan wells depends heavily on the context of the well. The median estimated cost is between $50,000 to $60,000 per well but can be upwards of $1.7m for a complex well.”
Landowners may be able to get assistance from the Crown on a no-liability basis if the former permit holder can’t be held liable, if there are Treaty of Waitangi considerations, or if there are health and safety and environment risks.
"Our first priority is ensuring the accuracy of information related to wells on Crown land with work underway focused on updating the orphan wells database to enable informed future decisions." - Megan Woods
The Government reconfirmed its commitment to a reactive, ad hoc response to private claims in April last year.
Taranaki Energy Watch spokesperson Sarah Roberts said it was disappointing and wrong the Government's planned work was focused only on its own backyard.
“We believe it is wrong for them to take an ad hoc approach to orphaned wells on private land. It should not be a landowners issue.
“The Government has placed oil and gas permits over hundreds of square kilometres of onshore land in Taranaki. They own the oil and gas. The Crown contracts the Companies to drill for the oil and gas on their behalf.
“For decades the Crown Mineral Act has potentially forced families into providing access to their land by the oil and gas companies without being legally informed of the possibility for serious harmful effects from the petroleum activities.”
Energy Minister Megan Woods stood by the plan.
“The Government is focused on improving the quality of information we have on the location and status of petroleum wells in New Zealand. Our first priority is ensuring the accuracy of information related to wells on Crown land with work underway focused on updating the orphan wells database to enable informed future decisions.
“No final decisions have yet been made to plug and abandon any wells.
“Property owners may also find information on wells drilled after 1991 as part of LIM reports held by local authorities.”
