WORKWEEK

One fun thing about swimming in climate tech circles is exposing yourself so some of the more niche topics that are of interest to different people. 

Take wells, for example. Carbon removal companies are keenly interested in accessing Class VI wells to inject and sequester CO2 underground. Other folks train their eyes on old oil and gas wells because they leak harmful methane gas. One company even wants to use old oil and gas wells for energy storage.  

While the Class VI well conversation is a fascinating one we’ll table for another day, it’s been a while since we lambasted oil and gas companies here. Let’s turn our attention there. 

The EPA estimates there are more than 2 million inactive, unplugged wells in the U.S., most of which stem from oil and gas operations. While not the largest source of methane emissions by any means (estimates range from 10-20 million metric tons of CO2-e per year), these wells are frustrating, especially because oil and gas companies should plug them once they’re out of use. Suffice to say that doesn’t always happen. 

In particular, there’s a sizable number of ‘orphan’ wells for whom there’s no solvent owner (i.e., the past owner went bankrupt, no longer exists, etc.) These sit in a no man’s land of responsibility and continue to emit methane, pollute groundwater, and degrade air quality in other ways.

Not plug and play

Even when oil and gas companies want to do the responsible thing and plug wells, it’s not as simple as putting a cork in ’em. Plugging wells is challenging for several reasons:

1. Complexity of the wellbore: Wells aren’t just a straight shot down. They consist of a complex network of pipes and casings that extend deep into the ground. Depth makes access for maintenance and plugging difficult. Over time, wells and their pipes also corrode and degrade, making sealing them up nigh impossible in some cases.
2. Pressure and fluid dynamics: In operation, there’s usually enough pressure in a well to ensure fluids and gasses stay contained. Once a well is out of operation however, pressure changes, making it harder to control the containment of fluids and gasses throughout.
3. Cost: The cost of plugging a well can be high, especially if the well is deep, complex, or in a difficult-to-access location. Regulatory requirements governing safely also add additional costs. 

Even when wells are plugged (typically with cement), the seal sometimes fails, often due to pressure build up over time. All of this begs for a better solution.

This week, BioSqueeze, a Butte, Montana-based firm, raised $7.4M in Series A funding to commercialize its biomineralization well-plugging technique. Biomineralization is a process in which mineral crystals are deposited in living organisms that can ‘grow’ them into complex, more dynamic structures.

Specifically, BioSqueeze uses soil bacteria and other non-toxic chemicals to form minerals in wells. Instead of using cement, they pump a fluid mineralizing solution deep into the wellbore, where it can ‘squeeze’ into spaces other products can’t. The technique was developed over ten years with the DOE.

The pitch here is to compete both on cost and, more importantly, on the success of the well-plugging process. The worst case scenario when plugging a well is investing in the process only for the seal to fail down the road. In that case, you’ve wasted time, money, and accomplished next to nothing. Even in scenarios where costs are higher, if their long-run success rate is high, BioSqueeze should have no problem attracting clientele.

In terms of their clients, BioSqueeze primarily works with oil and gas companies. That’s one challenge here. Those are the only people with real money for plugging wells; oil and gas companies have regulatory responsibilities and, ESG naysayers be damned, do care about the optics of abandoning unplugged wells.

What happens with orphan wells, for whom there’s no solvent owner? While there’s some federal funding available to plug orphan wells it’s not always enough to cover costs. BioSqueeze has noted it will “devote a portion of its new capacity to assisting state and federal efforts” in this effort. Which is great, but also sounds more like charity to me than a growth area for the business.

The net-net

BioSqueeze’s technology stands out to me because while it seems like a niche application, I bet it will find use elsewhere. Plugging wells alone will become more critical in the next decade. And not just to mitigate methane emissions; as carbon removal companies start storing CO2 underground in wells, they’ll need to make damn sure they’re air-tight. Beyond that, in the same way gels from spacecraft are making their way into home energy efficiency, there’ll be other applications for BioSqueeze’s biomineralization I can’t think of right now. 

That said, thinking and reading about BioSqueeze also brought something else home for me. The financial incentive to scale their tech across different applications isn’t always readily apparent. Orphan wells are one example: For many of these across the country and world, there’s insufficient economic incentive to plug the well. To be sure, there are massive climate and ecosystem benefits in favor of plugging. But they’re not always easy to monetize. 

In time there will be new systems that help bridge the gap. Carbon credits come to mind. But even if you could get credited for preventing methane emissions by plugging a well, the value of those avoided emissions might not cover the (up to six-figure) cost of plugging. 

The tech innovation is essential and exciting, as always. And at the same time, there’s a lot more thinking needed on how to scale technologies whose principal ‘product’ is the avoidance of something society hasn’t properly priced.