The Orphaned Well Mitigation Enterprise (OWME) Board and the Colorado Energy and Carbon Management Commission (ECMC) are excited to announce new funding for Enterprise Marginal Well Plugging (EMWP).
Established in 2022, the OWME Board formed to impose and collect orphan well mitigation fees from oil and gas operators to fund the plugging, reclaiming, and remediating of orphaned wells. Orphaned wells are inactive, unplugged oil, gas or injection wells with no active owner or operator. Most orphaned wells are the result of ECMC bond claims, and ECMC’s Orphaned Well Program is responsible for addressing orphaned wells using bond claims, OWME orphan well mitigation fees, and federal funding from the Infrastructure Investment and Jobs Act, a.k.a, the Bipartisan Infrastructure Law.
In 2024, through enactment of Senate Bill 24-229, the OWME Board expanded its powers and duties to include collecting an additional marginal well fee from operators to fund plugging, reclaiming, and remediating qualifying marginal wells and eliminating the risk of such qualifying marginal wells from becoming orphaned wells.
On March 31, 2025, the OWME Board adopted ECMC Staff’s recommended Program Parameters for EMWP Operator Eligibility Criteria and EMWP Well Eligibility Criteria.
- To be eligible for EMWP funding, an operator must have a Form 3B Financial Assurance Plan Option 3 or Option 4.
- The following operators are not eligible for funding:
- Operators with wells that have an AP (active permit) status are not eligible.
- Operators with wells that have a DG (drilling) or WO (waiting-on-completion) status are not eligible.
- Operators without wells are not eligible (only built locations where a well was not drilled).
- To be eligible for EMWP funding, a marginal well produces less than the Colorado Stripper Well thresholds of 15 bbls oil per day and 90 mcf gas per day, averaged during the prior 12 months.
- The following types of wells are not eligible for funding:
- Wells with a status of IJ (injection wells), AC (gas storage wells), or AC (monitoring wells) are not eligible
- Wells designated as out-of-service wells and wells classified as stratigraphic are not eligible.
- Wells with federal or tribal minerals are not eligible.
- Orphaned wells are not marginal wells and therefore, are not eligible for EMWP funding
- The Grant Application will open on April 4, 2025 and close on May 20, 2025. Complete applications will be prioritized.
- The Grant Application and guidance are available on the Marginal Wells page.
- To ensure your application is complete, refer to the Marginal Well Application Guidance.
- The guidance will include a template for Applicants to list the wells and facilities proposed for cost reimbursement.
- The OWME Board will consider ECMC Staff’s Proposed Program Parameters for Enterprise Marginal Well Plugging during the board meeting on March 31, 2025, including selection criteria.
- Applications for eligible projects will be evaluated and scored in accordance with the selection criteria.
- ECMC will retain a contractor to measure methane concentrations and flow rates at the well before and after the Operator’s well plugging activities. ECMC or its contractor will notify the Operator prior to the work to provide the Operator an opportunity to be on location during the work. ECMC or its contractor will also provide notice to the surface owner prior to performing methane measurements.
- ECMC’s contractor will perform methane measurements in accordance with DOE NETL METHANE MEASUREMENT GUIDELINES FOR MARGINAL CONVENTIONAL WELLS.
- EMWP funding will cover the methane measurements at no cost to the Operator.
- SB24-229 expanded the scope of the Orphaned Wells Mitigation Enterprise (OWME) to help finance the plugging, reclamation, and remediation of marginal wells in or near Disproportionately-Impacted Communities and populated areas that are a high risk of becoming orphaned.
- ECMC will report EMWP plugging progress annually during the regular OWME Board meeting in the fall or winter of each year.
For more information, please reach out via email to dnr_marginalwellplugging@state.co.us.