Oil and gas companies must permanently plug thousands of Gulf of Mexico wells idle for five years or more under a federal order issued Wednesday.
The mandate could cost well owners billions of dollars. The U.S. Interior Department and its offshore-drilling oversight agency said companies must cement 3,500 wells that aren't producing oil or gas. Another 650 oil and gas platforms must be dismantled if they are no longer being used, the government said. The mandate becomes effective Oct. 15.
Companies will have 120 days to submit plans to decommission production facilities and wells. Under the regulation, any well that has not been used during the past five years for exploration or production must be plugged. Production platforms and pipelines must be decommissioned if no longer in use.
Owners of such wells would have to pay for the permanent sealing of the wells and abandon the opportunity of reopening them for production.
This is insane. Just because Obama was humiliated by being shown to be incompetent in dealing with an oil well leak, he is going to destroy an entire industry. Next time the price of foreign oil skyrockets, this will mean we will be helpless to do anything about it. |