When an oil and gas well stops producing, someone has to pay to plug it and restore the site. Bonding requirements exist to make sure companies set aside enough money to cover the cost, but Utah’s rules, until this month, hadn’t been updated in over two decades.
As a Salt Lake County Council member who cares about protecting my taxpaying constituents, I’m glad to see the state act on this problem. On June 24, the Board of Oil, Gas and Mining finalized a modern, risk-based rule that ties bonding requirements to an operator’s revenues and potential liabilities. That updates a system where blanket bonds remained at $120,000 for over 20 years, which is nowhere near enough to address the hundreds or even thousands of wells some operators hold under a single bond.
This is a statewide issue that affects all Utahns. When an oil and gas well’s productive life ends, the liability doesn’t stay in the county or jurisdiction where the well sits. Cleanup funds are shared resources, so an abandoned well in one corner of Utah is a cost we all carry. And any local elected official knows: there are dozens of priorities competing for local government dollars. When state and federal cleanup funds are depleted, that’s money diverted from our schools, roads and essential services.
Utah’s energy sector is part of our economy, and strong bonding requirements are not a burden on responsible operators. They’re just good governance and a basic condition of doing business. With this rule now finalized, the companies that develop Utah’s resources, not my constituents, will bear the cost of restoring our state’s landscapes and protecting our groundwater and air quality for future generations.
Suzanne Harrison, Salt Lake County Council member (at-large)