It could cost close to half a billion dollars for an oil field to be decommissioned, and taxpayers are footing the bill.
What's happening?
The Tui oil field in New Zealand was abandoned by Tamarind Taranaki in 2019, and now that the offshore wells have been plugged, Kiwis are getting a look at the bill: 443.4 million New Zealand dollars.
It's almost three times that of a 2015 estimate, though the figure is just an allocation and the actual toll may be much lower, Radio New Zealand reported in March.
The Malaysian company went bankrupt because of an unsuccessful drilling operation, the New Zealand Herald reported at the time, and the Ministry of Business, Innovation and Employment has been working on a safe decommissioning plan since 2020, according to RNZ.
The last of the field's subsea infrastructure was removed in late February, completing the project aside from environmental surveys and regulatory reporting, according to the MBIE.
"The government has always been playing down the real costs of the extractive industries environmentally," Climate Justice Taranaki researcher Catherine Cheung told RNZ. "They make a mess and then they walk away."
Why is oil field decommissioning important?
Just like in the United States, oil and gas companies in other nations can walk away from their responsibilities with little to no accountability.
This is concerning because of what happens when wells are abandoned, or "orphaned." These "zombie wells" leak petroleum, wastewater, and even deadly gas, polluting groundwater and the air as well as causing sinkholes.
Residents in Colorado have sued one company, which was reportedly "designed for bankruptcy." In Texas, another company is focusing on plugging wells in underrepresented communities, who disproportionately suffer the negative effects of our reliance on dirty energy, including "the Wilmington cough."
The industry may be fighting the green transition, but there is hope that won't go on forever, as workers are finding new opportunities on wind farms and similar renewable energy projects.
What's being done about abandoned wells?
In New Zealand, lawmakers amended the Crown Minerals Act 1991 after Tamarind Taranaki became insolvent. Now, petroleum permit and license holders must decommission their own wells and infrastructure. If they sell their rights and the new owner cannot fund plugging operations, the previous owner is "next in line," RNZ reported.
Cheung told the outlet that we must go further to protect ourselves and the planet as temperatures rapidly rise because of fossil-fuel burning, calling for a ban on new oil, gas, coal, and seabed mining permits.
"It's irresponsible; we can't keep doing it for economic growth," Cheung said. "Making money off nature, off the environment, is economically suicidal."
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