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Hercules Offshore, Inc. (HERO) Message Board

  • KenWeslow KenWeslow Jan 9, 2011 9:36 AM Flag

    PLUG AND ABANDONMENT

    Went through companies last presentation and they are starting to see increased P & A with the new GLA-05 regulation. Think this might be an underappreciated revenue source no one is talking about. Any thought? This is an article from July 2010:

    More than 27,000 abandoned oil and gas wells lurk in the hard rock beneath the Gulf of Mexico, an environmental minefield that has been ignored for decades.
    More than 27,000 abandoned oil and gas wells lurk in the hard rock beneath the Gulf of Mexico, an environmental minefield that has been ignored for decades. No one — not industry, not government — is checking to see if they are leaking, an Associated Press investigation shows.

    The oldest of these wells were abandoned in the late 1940s, raising the prospect that many deteriorating sealing jobs are already failing.

    The AP investigation uncovered particular concern with 3,500 of the neglected wells — those characterized in federal government records as "temporarily abandoned."

    Regulations for temporarily abandoned wells require oil companies to present plans to reuse or permanently plug such wells within a year, but the AP found that the rule is routinely circumvented, and that more than 1,000 wells have lingered in that unfinished condition for more than a decade. About three-quarters of temporarily abandoned wells have been left in that status for more than a year, and many since the 1950s and 1960s — eveb though sealing procedures for temporary abandonment are not as stringent as those for permanent closures.

    As a forceful reminder of the potential harm, the well beneath BP's Deepwater Horizon rig was being sealed with cement for temporary abandonment when it blew April 20, leading to one of the worst environmental disasters in the nation's history. BP alone has abandoned about 600 wells in the Gulf, according to government data.

    There's ample reason for worry about all permanently and temporarily abandoned wells — history shows that at least on land, they often leak. Wells are sealed underwater much as they are on land. And wells on land and in water face similar risk of failure. Plus, records reviewed by the AP show that some offshore wells have failed.

    Experts say such wells can repressurize, much like a dormant volcano can awaken. And years of exposure to sea water and underground pressure can cause cementing and piping to corrode and weaken.

    "You can have changing geological conditions where a well could be repressurized," said Andy Radford, a petroleum engineer for the American Petroleum Institute trade group.

    Whether a well is permanently or temporarily abandoned, improperly applied or aging cement can crack or shrink, independent petroleum engineers say. "It ages, just like it does on buildings and highways," said Roger Anderson, a Columbia University petroleum geophysicist who has conducted research on commercial wells.

    Despite the likelihood of leaks large and small, though, abandoned wells are typically not inspected by industry or government.

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