Texas Opens $134.1M Marginal Well Plugging Program, Applications Due Nov. 9
Permian Basin Oil & Gas Magazine reports that TCEQ is accepting applications through Nov. 9 for a $134.1 million federal program to plug marginal conventional wells in Texas.
Market Impact
The Texas Commission on Environmental Quality runs the new Texas Voluntary Marginal Conventional Well Plugging Program, known as TxMCW. It will permanently plug and abandon eligible wells. Applications close Monday, Nov. 9.
Eligible wells must meet several criteria, according to the report:
- Onshore on non-federal Texas land
- Production of no more than 15 boed or 90,000 cfd in a year
- Vertical
- A known owner or operator
- Not previously plugged
TCEQ said plugging cuts methane emissions, local air pollution, groundwater hazards and fire hazards.
For scale, the Railroad Commission of Texas counts 432,634 oil and gas wells in the state. Of those, 277,016 are active and 155,618 are inactive. The total includes 156,120 producing oil wells, 84,661 producing gas wells and 36,235 service wells. The report does not say how many wells TxMCW will plug or how many meet the production cutoff.
Three public meetings will explain the program:
- Friday, Oct. 9, 9 a.m., Carrasco Room, Midland College
- Tuesday, Oct. 13, 1:30 p.m., Prothro Great Hall, SMU, 5901 Bishop Blvd., Dallas
- Tuesday, Oct. 20, 1:30 p.m., Luling Oil and Gas Museum
The report does not cover contractor eligibility, prequalification, how work will be packaged, payment mechanics, per-well funding caps or when awards will be made. Those details are the open questions for field service companies.
What It Means for Subcontractors
- Attend the Oct. 9 Midland meeting first. It is the earliest session and the closest to Permian crews. Ask TCEQ how plugging work will be procured, whether contractors need to be prequalified or registered, and how and when contractors are paid. The Dallas (Oct. 13) and Luling (Oct. 20) sessions are the follow-ups.
- Know who is applying. The source requires a known owner or operator for each well, which suggests operators, not contractors, file the applications. That is our inference, not a stated rule. If it holds, pulling-unit, cementing and well-service companies should get quotes to operators with marginal wells before the Nov. 9 deadline.
- Scope the work as vertical wells only. Horizontal wells are out. Price crews and cement programs for vertical wellbores, and expect operators to need production figures that show 15 boed or 90,000 cfd or less.
- Ask about site restoration. The source says plugging reduces local air, groundwater and fire hazards but does not say whether surface cleanup is funded. Ask TCEQ whether restoration is covered, so civil and dirt crews can decide whether to bid.
- Hold off on committing capacity. No award schedule or per-well cap is stated, so crew and equipment commitments cannot be timed yet. Wait for TCEQ’s answers at the meetings before booking crews against this money.
