$33 million available for Bakken Restart Program

Published: Jun. 25, 2020 at 7:33 PM CDT
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State lawmakers have approved more than $400 million in COVID-19 response funds.

One project already in the works and set to receive more of these funds is the Bakken Restart Program.

In the first round, the commission granted about $30 million to ensure orphaned oil wells could be plugged and reclaimed.

Now, an additional $33 million is being made available.

The program would plug and restore 419 orphaned oil wells and will be funded through the Coronavirus Relief Fund.

"So for the foreseeable future, there is no money other than CARES Act money for these 419," said Department of Mineral Resources Director Lynn Helms.

But drawing the distinction between an orphaned well and an abandoned well took time.

"The only way we could distill it down to a final "what's really orphaned" was to take the abandoned well list, do an economic analysis, then hold a hearing, and then from the testimony at the hearing sort out what's abandoned and what's orphaned," said Helms.

Helms said 70 percent of the orphaned wells are from 1950 to 1985 and none of them are less than 10 years old.

But that raised questions about whether the spending is considered coronavirus-related or not.

"It isn't that I don't know there's a need out there, we know that these wells need to be reclaimed, but when I look at the 1950-1980 well history on these and the dates on them I'm not sure we can say this is COVID-19 related,” said State Sen. Joan Heckaman, D-New Rockford.

In order to receive the funding, the industry has to be struggling because of the pandemic.

Helms said there's proof the oil market downturn and COVID-19 are intertwined.

"Of those 419, none of them were orphaned at the beginning of this year. We're confident that we can meet the test, any test, that the federal auditor's present to us in terms of are the funds necessary," said Helms.

He added that the funding will be necessary for many Bakken workers.

About 9,700 unemployment claims filed in North Dakota derive from the oil and gas sector.

But the Bakken Restart Program would keep about 1,000 oilfield workers working on orphaned wells through the year.