One out of every six barrels of crude oil produced in the United States comes from a marginal well - a well whose production has slowed to 10 barrels a day or less. Over 85 percent of the total number of U.S. oil wells are now classified as marginal wells. There are over 420,000 of these wells in the United States, and together they produce more than 915,000 barrels of oil per day, or 18 percent of U.S. production.  Stripper wells are more common in older oil and gas producing regions, most notably in Appalachia, Texas and Oklahoma.  

Many of these wells are marginally economic and at risk of being prematurely abandoned, leaving significant quantities of oil remaining behind. A common misperception is that oil left behind remains readily available for production when oil prices rise again. In most instances, this is not the case, leaving our nation more dependent on foreign oil imports.

When marginal fields are abandoned, the surface infrastructure - the pumps, piping, storage vessels, and other processing equipment - is removed and the lease forfeited. Since much of this equipment was probably installed over many years, replacing it over a short period is enormously expensive. Oil prices would have to stay at today's elevated record levels for many years before there would be sufficient economic justification to bring many marginal fields back into production.  As a result, once a marginal field is abandoned, the oil that remains behind is often lost forever. The costs of re-drilling a plugged well may be as much as or more than drilling a new well. 

From 1994 through 2006, on average each year over 3 percent of marginal wells were plugged and abandoned. In total, this is more than 177, 000 marginal wells, representing a number equal to 42 percent of all operating wells in 2006.

Although the situation is less severe for natural gas, there is nonetheless a growing concern about the premature abandonment of gas stripper wells. Currently, there are more than 296,000 natural gas stripper wells in the lower 48 states. Together they account for over 1.7 trillion cubic feet of natural gas production annually, or over 9 percent of the natural gas produced in the lower 48 states. (A "stripper" gas well is defined by the Interstate Oil and Gas Compact Commission, which represents the governors of oil and natural gas producing states, as one that produces 60 thousand cubic feet or less of gas per day; the Internal Revenue Service, for tax purposes, uses a threshold of 75 thousand cubic feet per day.)

DOE strategies to curtail premature abandonment have focused on supporting an industry-driven Stripper Well Consortium (SWC). One consortium project by Vortex Flow LLC has developed downhole tools that reduce pressure drop thereby reducing the gas flow needed to lift liquids up the wellbore. This novel technology received the Platts 2004 Newcomer of the Year Award, one of the most prestigious award programs in the industry.

Another recent success includes the documentary video, "Independent Oil: Rediscovering America's Forgotten Wells," which was awarded a bronze award at the 28th Annual Telly Awards for 2007.  The video was funded by the SWC, DOE's National Energy Technology Laboratory, and the New York State Energy Research and Development Authority. The Telly Awards honor the best local, regional, and cable television commercials and programs, as well as video and film productions. The 28th Annual Telly Awards received over 14,000 entries from all 50 states and 5 continents. Copies of this video are available by contacting the SWC (swc@ems.psu.edu).

In addition, the SWC funded a project to use cost-effective technology for converting brine produced from oil and gas fields into a new source of fresh water for farmers, ranchers and communities near oil and gas producing wells.  The third phase of this SWC-funded project is for a pilot desalination unit to convert water from brackish aquifers into purified water for community use, with the concentrated brine solution used in a nearby oilfield water flood process to increase oil production.  This project has been approved by the Texas Commission on Environmental Quality in Andrews, Texas, and is the very first authorization of this type in the nation.

The Department of Energy helped organize the SWC in collaboration with Pennsylvania State University to assist small and independent operators who own the vast majority of the nation's stripper wells in the development, demonstration, and commercialization of technologies to improve production performance from stripper wells. The SWC coordinates research projects in three broad areas: reservoir remediation, wellbore clean-up, and surface system optimization.

Specific research proposals are developed by SWC members, and there must be a minimum of 30 percent cost share from project participants. The SWC currently has about 78 members.  The membership includes companies/organizations from 20 states, plus the District of Columbia and Canada, with operations in many other states. An Executive Council, appointed by the SWC's membership, selects proposed research projects that will lead to improving natural gas and petroleum production from stripper wells. The process of having industry develop, review, and select projects for funding will ensure that the SWC conducts research that is relevant and timely to the natural gas and petroleum industry. From 2001 through April 2008, the SWC committed $9.26 million to co-fund 89 projects. In April 2006, the SWC committed $1.24 million to co-fund 9 projects. In May 2007, the SWC committed $1.16 million to co-fund 10 projects. In April 2008, the SWC committed $0.84 million to co-fund 8 projects. The DOE's Office of Fossil Energy, through the NETL Strategic Center for Natural Gas and Oil, and the New York State Energy Research and Development Authority provide base funding and guidance to the consortium. By pooling financial and human resources, the SWC membership can economically develop technologies that will extend the life and production of the nation's stripper wells.

MORE INFO 01.19.05 Techline: Ultra-low Cost Well Monitoring Could Save Thousands of Marginal Oil Wells

Related DOE efforts entail supporting "reservoir life extension" technology development and technology transfer activities and providing sound science and analyses to support more informed regulatory and policy decisions. For example, a DOE-funded project in California has successfully tested a new, ultra-low cost method for monitoring marginal oil wells. The Marginal Expense Oilwell Wireless Surveillance (MEOWS) monitoring system allows daily remote monitoring of wells in real-time, providing information to the operator that helps improve efficiency of timer-controlled rod pumps. This novel, inexpensive monitoring system can help prevent the early abandonment of thousands of U.S. wells.