Methodology

When the RRC’s Wellbore Inventory appears to contain duplicate entries (such as multiple completions in the same wellbore or formatting errors), we combine these into a single line for each wellhead location, so our estimates do not count a single well location multiple times. 

We match the wellbores based on a combination of API + Lease Number + Well Number.

For the most recent RRC Wellbore Inventory report, our process removed roughly 470,000 duplicate entries.

When a well depth is not available directly from the RRC data, we estimate the depth by analogy using 1 of 3 methods in the following order of priority:

1) The average depth of the wells on the same lease by Lease Number and District Number
2) The average depth of the wells in the same County and Field Number
3) If both previous methods are not available, then we apply the statewide average of 6,700 ft 

Depth data for unplugged wells:
Available from RRC - 82%
Estimated - 18% 

The RRC reports its average plugging cost per foot of depth by RRC District each year. The most recent available is 2025, and we note large reductions in the average cost in some districts (Districts 8, 6, 4, 3) compared to previous years.

We apply the reported RRC District average cost per foot to the well depth (reported or estimated, as described above) to determine the estimated plugging cost. Example: RRC District 2 Average = $9.16/foot of well depth x 6,700’ well depth = $61,372 plugging estimate

For site remediation, the RRC does not report a metric which we can apply directly to a wellsite. Instead, it reports the number of operations and the total cost.  We estimate an average uplift by district over the RRC reported costs of plugging from the fiscal years 2022 to 2025.

Example: RRC District 2 Average for site remediation = 8% x $61,372 (from 3 above) = $4,909 site remediation estimate.

Specifically, Districts 8 and 10 are 7%, Districts 1 and 2 are 8%, District 4 is 17%, Districts 7B and 7C are 20% and 21%, District 9 is 33%, District 3 is 50%, District 8A is 104%, and Districts 5, 6 and 6E are 134%.

Plugging & site remediation involves several steps in the field: plugging of the wellbore below the surface, removal of surface equipment, flowlines and materials, remediation of surface pollution, and sometimes restoration of the surface. 

The RRC reports its out-of-pocket costs paid to contractors in two parts: “plugging” which includes downhole operations plus some surface clean-up, and “site remediation” for more extensive work at the surface. In its annual reports, the RRC also reports its internal costs of executing the program.

We relied upon the RRC’s annual accounting of its internal costs from 2019 to 2025  to estimate that its future administrative costs will be 18% of its out-of-pocket costs paid to contractors for plugging and surface clean-up.

Formula: (Plugging cost estimate + site remediation estimate) x 18% administration estimate = total estimated cost

Example: $61,372 (from 3 above) + $4,909(from 4 above) + $11,046 (18% administration) = $77,327 total estimated cost

We determine the number of “active” wells by counting the wells (in the normalized Wellbore Inventory) then subtracting the number of plugged wells (with a reported plug date in the normalized Wellbore Inventory), the number of orphaned wells (from the Orphaned Wells list), and the number of other inactive wells (from the Inactive Wells list).  

However, production data is not reported by individual well but by Lease ID. Oil leases can contain multiple wells. Our calculation of lease production includes service wells like injectors, so the average production available to pay for clean-up is spread across the wells actively involved in creating that production.  Due to evident inconsistencies in separate reports from the RRC, we set the minimum number of wells to one. 

To calculate the production, we use the number of days in the year so the figure represents the average rate actually achieved over the year, including downtime, rather than what the lease may be capable of producing. 

Production of oil and gas are combined by revenue equivalence into “barrels of oil equivalent” (BOE) using 6 Mcf (thousand cubic feet) of natural gas equivalent to 1 barrel of oil. 

The rule affects only wells meeting both of two criteria: shut-in more than 15 years ago AND completed more than 25 years ago.

We determine whether or not a well is affected by the current rulemaking using completion and shut-in dates reported on the RRC Inactive Well Aging Report. We do not attempt to estimate dates for the minority of wells not already evaluated by the RRC.

When both dates are available we calculate the difference between the date of our calculation and the reported dates and divide by 365.24 days in a year. If only the shut-in date is available, then wells shut in for more than 25 years are deemed affected. Other wells shut-in from 15 to 25 years do not have enough information to evaluate.