Texas lawmakers question Railroad Commission over 160,000 inactive oil and gas wells

Texas faces a growing well problem

Texas has nearly 160,000 inactive oil and gas wells. Many are no longer producing, but remain in place. Some could become orphan wells if companies disappear. That could leave Texas responsible for cleanup costs.

The issue is drawing attention from state lawmakers. They want stronger safeguards for aging wells. The goal is limiting future environmental and financial risks. Taxpayers could otherwise face expensive cleanup bills.

Lawmakers will question state regulators

The House Energy Resources Committee examined the Texas Railroad Commission on September 15. The agency oversees oil and gas activity and tracks the state’s inactive well inventory.

The hearing included testimony on implementation of SB 1150, safeguards for inactive wells, and ways to reduce the number that become orphaned. The committee directed its staff to begin preparing the 2026 Energy Resources Interim Committee Report.

Texas has at least 12,000 orphan wells

Texas has at least 12,000 orphan wells today. These wells lack a responsible operator for cleanup. That can leave regulators facing difficult cleanup decisions. Neglected wells can also create environmental problems.

Cleanup costs can reach tens of millions of dollars. That makes preventing orphan wells important for Texas. Inactive wells are not automatically considered orphaned sites. The greater risk comes when operators disappear.

Bankruptcy can raise orphaning risks

A well faces greater risk when its operator disappears. Bankruptcy can also make cleanup responsibility harder to enforce. The risk rises after prolonged bankruptcy proceedings. Regulators must track companies connected to inactive wells.

Financial trouble can make plugging work difficult. It can leave fewer resources available for remediation. Bankruptcy does not automatically orphan every well. However, it can create uncertainty about future cleanup duties.

Operators can delay plugging inactive wells

Texas operators have been able to delay plugging. Extensions can keep inactive wells on the books. Lawmakers are examining how long those delays should last. They also want closer review of extension requests.

The issue involves more than the number of wells. It also involves how long wells stay inactive. SB 1150 keeps several extension options available. Regulators will determine how those options work.

SB 1150 sets new limits for older wells

Texas lawmakers approved Senate Bill 1150 in 2025. State Sen. Mayes Middleton authored the measure. Beginning September 1, 2027, new limits will apply to wells that have been inactive for more than 15 years and were completed more than 25 years before an extension request.

The law still provides several paths for extensions under specified conditions. The Railroad Commission must adopt implementing rules by December 31, 2026, with those rules taking effect September 1, 2027.

Extensions can keep some wells open

SB 1150 allows the Railroad Commission to grant extensions under specific conditions. Regulators can consider an operator’s history of returning inactive wells to operation or documented financial hardship.

Another option allows an approved compliance plan committing an operator to plug a well or return it to an authorized use by September 1, 2042. Operators may also use a well-specific performance bond covering the full calculated plugging cost.

Experts point to room for delays

Some experts say the law leaves room for delays. Nikki Morris raised that concern to The Texas Tribune. Morris is a geologist and energy institute executive. She said operators could keep wells inactive indefinitely.

Her comments focus on the extension provisions. Repeated extensions could postpone plugging for many years. Lawmakers want regulators to explain their review process. The standards could determine how deadlines work.

Financial assurances may fall short

Texas requires financial assurance for cleanup costs. Companies can calculate assurance using well depth. The rate is $2 per foot under one method. Operators can also calculate assurance using well counts.

A company with ten wells may need $25,000. Yet one well’s remediation could cost millions. That creates concern about financial protection levels. Lawmakers want regulators to examine those requirements.

Cleanup costs can reach taxpayers

Plugging inactive wells is not only an industry issue. Failed operators can leave cleanup responsibilities unresolved. Texas already has thousands of orphan wells. Major cleanup projects can cost tens of millions.

Financial assurance is designed to reduce public exposure. Critics question if current amounts provide enough protection. Preventing orphan wells can reduce future cleanup needs. It can also limit potential taxpayer costs.

The rulemaking process is still underway

The Railroad Commission must adopt rules required by SB 1150 by December 31, 2026. Those rules will help determine how extension requests, compliance plans, financial-hardship claims, and other requirements operate.

The House Energy Resources Committee examined implementation of the law during its September 15 hearing. The resulting rules could affect thousands of inactive wells and must take effect September 1, 2027.

Industry wants flexibility for economic wells

Oil and gas producers have weighed in on SB 1150. Ben Sheppard leads the Permian Basin Petroleum Association. He said reducing inactive wells is imperative. He also supports reasonable requirements for operators.

Sheppard wants companies to restart economical wells. That could happen instead of immediate plugging. The industry supports reducing inactive wells over time. Regulators must determine how that flexibility operates.

Interested in another story about the industries that shaped America? Discover the darker history of the Transcontinental Railroad and the story now being told at a Los Angeles museum.

What happens next for Texas wells

The Railroad Commission still faces major implementation work under SB 1150. After lawmakers examined the issue at a September 15 hearing, the House Energy Resources Committee directed staff to begin preparing its 2026 interim report.

The commission must submit its first required inactive-well report by December 1 and adopt implementing rules by December 31, 2026. The new plugging provisions and related rules take effect September 1, 2027.

Want to know more about the agency overseeing Texas oil and gas? Check out how a Texas commission race is putting industry experience and other major issues in the spotlight.

How do you think Texas should handle its growing number of inactive wells? Share your thoughts in the comments and leave a like if this story caught your attention.

This slideshow was made with AI assistance and human editing.

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