Louisiana Senate Bill SB377

Louisiana 2018 Regular Session

• Introduced: 3/2/18
• Refer: 3/2/18
• Refer: 3/12/18
• Report Pass: 3/26/18
• Engrossed: 4/10/18
• Refer: 4/11/18

Caption

Establishes procedures for review of future utility of well sites that have been inactive for more than ten years. (8/1/18) (RE INCREASE SD EX See Note)

Impact

This legislation impacts the management of oil and gas resources by formally regulating the review process for inactive wells. It aims to minimize the number of wells that may become orphaned—an issue that arises when well operators fail to plug and abandon these sites responsibly. The bill introduces procedures that require operators to justify the continued classification of wells as having potential future utility, which could help to ensure that abandoned wells are managed appropriately and do not pose environmental hazards.

Summary

Senate Bill 377 establishes a new framework for determining the future utility of inactive oil and gas wells in Louisiana. Specifically, it targets wells that have been classified as inactive for ten years or more and lays out a process for owners to request a review of these wells by the office of conservation. If an inactive well is neither set for plugging nor covered by an approved production plan, the owner can prompt the office to assess the well's potential future utility, setting in motion a mandated timeline for operator justifications and office determinations.

Sentiment

The sentiment around SB 377 appears to be generally positive among those who favor stricter regulatory oversight of inactive wells. Supporters argue that the bill represents a necessary step towards responsible resource management and environmental protection. However, there may be opposition from certain operators who could view the regulation as an undue burden requiring justification for wells that they may intend to reactivate or maintain for economic reasons.

Contention

Notable points of contention within the discussions surrounding this bill include concerns about the regulatory burden it places on operators as well as the potential financial implications of the necessary investments to monitor and manage these inactive sites. While proponents advocate for environmental safeguards, there is apprehension that the administrative measures could complicate operations for smaller companies that might struggle with added costs or the logistics of meeting the new requirements set forth by the bill.