The Nickel Report

This article follows up on two prior articles published by Hunton Andrews Kurth LLP attorneys focusing on the Department of the Interior’s (“DOI”) funding of state orphaned well programs[1] and the Biden Administration’s promise of a greater emphasis on consulting with indigenous people and acknowledging their communities’ cultures, customs, sacred sites, and historical knowledge in the contexts of environmental planning, sustainability, and justice, and in ongoing and forthcoming federal decision making and regulatory rulemaking.[2]

On November 23, 2022, the DOI announced final guidance for Tribes wanting to apply for the first $50 million in funding available under the Infrastructure Investment and Jobs Act (“IIJA”).[3] The IIJA is expected to provide for a total of $150 million to Tribal communities over the next five (5) years.[4]

In deciding whether to approve grant applications, due by January 20, 2023, the DOI Secretary will take into account: (i) the unemployment rate of the Tribe on the date the application is submitted; (ii) the estimated number of orphaned wells on the applicant Tribe’s land; and (iii) the extent to which the proposed work will eliminate human health and safety risks, restore habitat, and employ community members and Tribally-owned businesses.[5]

In accordance with the guidance, Tribes can use the funds to: (i) plug, remediate, or reclaim an orphaned well; (ii) remediate soil and restore habitat degraded by an orphaned well or associated pipelines, facilities, or infrastructure; (iii) remediate Tribal land adjacent to orphaned wells and decommission or remove associated pipelines, facilities, and infrastructure; (iv) provide an accounting of the cost of plugging, remediation, and reclamation for each orphaned well site; (v) identify and characterize undocumented orphaned wells; and (vi) develop or administer a Tribal program to carry out any activities described in items (i) through (v) above.[6] In lieu of funding for these activities, Tribes can request that DOI administer and carry out the activities on the Tribe’s behalf.[7] In a given year, Tribes may either apply for a grant or exercise the in-lieu-of option. Unless the DOI has granted an extension, Tribes must obligate granted funds within five (5) years from the date of receipt.[8] Tribes hoping to receive these funds will be subject to certain requirements, including: (i) reporting of pre- and post-plugging air and water pollution measurements; (ii) well plugging and site remediation standards; and (iii) financial and performance reporting. [9]

[1] https://www.huntonak.com/images/content/8/6/v2/86051/dept-of-the-interior-funding-for-state-orphaned-well-programs.pdf.

[2] https://www.huntonnickelreportblog.com/2022/01/2022-promises-greater-focus-on-tribal-consultation-and-incorporation-of-indigenous-traditional-ecological-knowledge-in-the-permitting-process/.

[3] https://www.doi.gov/pressreleases/biden-harris-administration-makes-50-million-available-clean-orphaned-oil-and-gas.

[4] Infrastructure Investment and Jobs Act, Pub. L. No. 117-58, §40601(d), 135 STAT. 1088 (2021).

[5] Id. at §40601(d)(3).

[6] Id. at §40601(d)(2)(A).

[7] Id. at §§40601(d)(1)(B) and 40601(d)(B)(7).

[8] Id. at §40601(d)(6).

[9] https://www.doi.gov/sites/doi.gov/files/fy23-tribal-grant-guidance-revised-final.pdf.