LONDON (Alliance News) - Diversified Gas & Oil PLC said Tuesday it signed a 15-year well decommissioning agreement with West Virginia Department of Environmental Protection.
Under the agreement, the company - which owns and operates around 17,000 wells in the US state of West Virginia - will complete an assessment of its gas and oil wells in state by June 30, 2019, with primary analysis of non-producing wells across the state.
Diversified Gas & Oil will plug 30 wells during 2019. From 2020 through 2034, the company will plug, return to production, or otherwise dispose of not less than 50 wells per annum, of which it will plug at least 20 non-productive wells.
The company has posted a USD3.0 million bond to the benefit of the state of West Virginia, which the will be released following fulfilment of the agreement's terms.
Diversified Gas said it remains in talks with the US states of Pennsylvania and Kentucky to complete similar long-term well decommissioning agreements. To date, the company has completed decommissioning of approximately 41 wells at an average cost of USD23,800 per well.
Shares in the company were trading 1.7% higher at 118.00 pence each on Tuesday.
