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FAQ: Methane Emissions Reduction Program (MERP)

FAQ: Methane Emissions Reduction Program (MERP)

This FAQ answers common questions about MERP funding, eligibility, nomination and ranking of wells, grant types, reporting requirements, and other key details to help operators navigate the plugging program.

  • EGLE was awarded a federal grant from the U.S. Department of Energy (DOE) through the Inflation Reduction Act of 2022 for the Methane Emissions Reduction Program (MERP). The federal grant includes approximately $3.6M allocated for plugging eligible operator nominated wells.

  • All that is required is for the operator or owner to complete the MERP Well Nomination Form (EQP-7006) and submit one form per well during the open nomination period, which ends on November 12, 2025. Eligible wells will be added to the nominated well list.

  • Wells that meet the DOE’s definition of a Marginal Conventional Well (MCW), which is a well that produces less than 15 BOED and is either vertical or not highly deviated, will be added to the nominated well list. Only oil and gas production wells that meet the MCW criteria are eligible. Class II injection wells are not included in the MERP plugging program. (Note: 1 BOE=6 Mcf)

  • No, the program is completely voluntary. Unless the well is already part of a separate compliance agreement or process, there is no requirement for a nominated well to be plugged. If a well is selected for a plugging award, an operator can choose not to accept the award if they no longer wish to have the well plugged.

  • All nominated wells will be ranked according to established prioritization factors, which are listed in the Request for Well Nominations. These criteria were chosen to best align with the goals of the MERP program, both at the Federal and State level. Weighting factors have been established to prioritize plugging of the highest risk wells first, while also trying to get a good distribution of awards throughout the state and between commercial and domestic well owners. The webpage will be updated with information on the process and status of identification and prioritization of MCWs to be plugged.

  • The Methane Emissions Reduction Program (MERP) plugging program will offer Operator Plugging Grants and State Managed Plugging Grants.

    • Operator Plugging Grants will be the primary award type for commercial well operators. The operator will receive up to $100k for the plugging project and will be responsible for hiring plugging contractors and for MERP reporting requirements.
    • The State Managed Plugging Grants will be limited to companies who don’t have the capital for the upfront costs or domestic well owners without the experience or connections to properly and safely plug the well. With this type of award, the State will be responsible for the hiring of plugging contractors and all MERP reporting requirements.

  • Operator Plugging Grants will provide for reimbursement of plugging related expenses up to $100K. The final value of the award may be less than $100K, depending on the actual cost to plug the well. Only expenses directly related to plugging are eligible for reimbursement. Expenses related to decommissioning of facilities or flowlines, environmental cleanups, or site restoration are not covered under the MERP plugging program.

    For select wells that qualify for State Managed Plugging Grants, the grant will cover the full cost of plugging related expenses.  Expenses related to decommissioning of facilities or flowlines, environmental cleanups, or site restoration are not covered under the MERP plugging program.

  • Yes, Davis Bacon applies for the duration of any well plugging project that uses the grant money.

  • No, the grant money can be applied to well plugging only.  Operators and Owners are still responsible under Part 615 rules to decommission facilities and flowlines as well as any necessary site cleanup and restoration.
  • There is no established limit on how many grants could be awarded to a company/operator. However, some of the prioritization factors used in ranking are designed to provide a good distribution of awards among participating companies/owners and across the State.  Operators submitting multiple wells may have lower-ranked nominations deferred after receiving an initial $100K Operator Plugging Grant.

  • Yes. If an operator has several wells that could each be plugged for $100,000 or less, they may be able to include those wells under one grant agreement. Bundled wells would be reviewed and ranked together as a single nomination.

    Once a company receives one Operator Plugging Grant, their remaining nominated wells will generally be ranked lower to comparable wells, to help ensure a good distribution of grant funds among commercial operators and domestic well owners and throughout the state.

    After all nominations are received and plugging costs are reviewed, GRMD staff will contact operators who may want to bundle their wells. Please note that operators choosing to bundle are responsible for plugging all wells in the agreement and must continue paying Davis-Bacon prevailing wages until all wells are plugged, even if the cost exceeds $100K.

  • The Federal grant agreement with DOE requires that the MERP funds must be spent by September 30, 2028.
  • Well Nomination forms will be reviewed by GRMD staff and ranked according to the prioritization factors listed in the Request for Well Nominations document. GRMD will utilize PRIMO, a web-based application developed by the DOE for MERP, to assist in ranking nominated wells.
  • The operator will submit Davis-Bacon compliance documentation, along with other plugging expense records to GRMD for review and processing of reimbursement payments. GRMD will withhold the final 30% of the grant reimbursement until the plugging has been completed and all the Davis-Bacon reporting and other contract requirements have been fulfilled. Reimbursement payments will be processed through the State’s SIGMA VSS system, and each award recipient will be required to register as a vendor prior to payment.
  • There is a public facing MERP website that will include a list of nominated wells, basic well details, the final ranking of the wells, how wells were ranked, total cost of plugging each well, cumulative total spent on plugging, amount of methane emissions mitigated per well and aggregate amount mitigated, as well program information about Davis Bacon compliance, Sigma VSS, methane emissions measurements, and other MERP details.

  • Yes, a list of contractors who have been previously approved to bid on Orphan Well projects is available upon request.

  • There may be a second/future round of well nominations if funds remain from initial projects that come in under the $100K grant limit. However, there are no guarantees, so operators interested in the MERP plugging program should get their well nominations submitted for the initial round, before the November 12th deadline.

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