Stripper wells produce natural gas or oil at very low rates: less than 10 barrels of oil per day or less than 60 thousand cubic feet of gas per day. Despite their small output, stripper oil and gas wells make a significant contribution to the nation’s energy supply; they are the lifeblood of thousands of small, independent oil and gas operating companies.
About 80 percent of the roughly 500,000 producing oil wells in the United States are classified as stripper wells. Despite their small volumes, they add up. The stripper oil wells in the United States produce, in aggregate, nearly 1 million barrels per day of oil, which represents almost 19% of domestic oil production.
When marginal wells are prematurely abandoned, significant quantities of oil remain behind. In some cases, as much as two-thirds of the oil remains in the reservoir. A common misconception is that oil left behind remains readily available for production when oil prices rise again. In most instances, this is not the case. Research that produces technology to help operators revive America’s declining oilfields also helps bolster the nation’s energy security by making it less 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. Because much of this equipment was likely installed over many years, replacing it over a short period when oil prices rise, is enormously expensive. Oil prices would have to surpass their historic highs, and stay at elevated levels for years, before economic justification would be sufficient 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 to 2003, about 143,000 marginal oil wells were plugged and abandoned in the United States, representing over 110 million barrels of crude oil that was still in the ground.
In 2002, the number of domestic stripper gas wells in the United States grew for the eighth straight year, to nearly 246,000. These wells account for 1.4 trillion cubic feet of natural gas production per year, or roughly 10 percent of all onshore production in the lower 48 states. Overall, stripper wells are quickly becoming a critical element in meeting near-term increases in gas demand: increased stripper well production accounted for 43 percent of the overall rise in domestic production during 2001-2002.
Given their low production rates, stripper wells typically are marginally economic properties. And with each passing year, the economics continue to degrade. In particular, proper disposal of increasing volumes of produced water adds significant cost burdens to the well. Eventually, the well ceases to be profitable and is plugged and abandoned. In 2002, operators abandoned 3,870 gas wells, even though most of these wells were still producing some gas.
Although stripper well status is the necessary end-stage of all producing oil and gas wells, many wells decline to stripper production levels prematurely and unnaturally, often due to avoidable and repairable wellbore damage. NETL’s stripper well technology research will help determine ways to identify premature stripper wells and to develop effective remediative technologies that can result in higher production volumes, longer well life, and more efficient recovery of the available oil and gas resources.
To assist the small and independent operators that own the vast majority of the nation’s stripper wells, NETL has organized a Stripper Well Consortium in association with Pennsylvania State University. The consortium allows operators to leverage their resources and experiences with federal assistance, to analyze the causes of premature well declines, and to apply the latest technologies to correct them. A list of NETL's final project reports on Stripper Well Consortium collaborations are available from 2001-2006.