Oklahoma lawmakers passed the Well Repurposing Act in March, opening the door for companies to buy over 20,000 abandoned oil and gas wells and convert them into geothermal energy plants. The move follows similar legislation in New Mexico and Alabama, as states seek to turn environmental liabilities into clean power assets. Gradient Energy CEO Benjamin Burke called the shift a chance to turn orphaned wells from "environmental liabilities into community assets."
The Oklahoma bill addresses a backlog. State regulators say plugging those 20,000-plus wells using conventional techniques would take 235 years and cost hundreds of millions of dollars, according to OilPrice. That timeline is not theoretical.
Many of these wells are already leaking methane, a potent greenhouse gas. Companies walked away from them for a reason. Some went bankrupt.
Other operators were too small to track. The result is a sprawling network of "orphan wells" across the United States, a legacy of over a century of oil production. The federal government is spending millions plugging them, money that could otherwise fund new energy projects. "This study represents an important step in turning orphaned wells from environmental liabilities into community assets," Burke said in March, when his company Gradient Energy announced it would support a technical study in Colorado.
The study will evaluate the potential to repurpose orphaned wells for geothermal production and assess synergies with carbon capture and sequestration. Colorado is not alone. New Mexico passed its own law in 2025 to address more than 2,000 orphan wells.
Alabama followed in April with legislation that lets the state approve and regulate the conversion of oil and gas wells for other energy purposes, including geothermal. North Dakota established a bill in 2025 requiring its legislative council to study the feasibility of using abandoned wells for geothermal production. The policy says one thing.
The reality says another. Converting an oil well into a geothermal well is not a simple swap. Emily Pope, a geologist who authored a recent study on next-generation geothermal power, told OilPrice the opportunity is "enormous" but the technology is "pretty far away technologically from being a reality." She cited immense hurdles that still require significant research and development.
The basic concept is straightforward. Geothermal energy taps heat from the Earth's core, which reaches roughly 5,200°C. Rock and water in the crust can hit 370°C.
Operators drill a few miles down to access thermal energy in rocks and warm water deposits, using the heat to power turbines for carbon-free electricity. The wells are already drilled. Enhanced geothermal drilling borrowed fracking techniques from the oil industry.
The United States is well-suited to fracking, which made the shale boom possible. Now those same techniques could unlock a different kind of energy. The Department of Energy launched its Wells of Opportunity (WOO) Initiative in 2021 to explore retrofitting and co-producing oil and gas wells for geothermal use.
What this actually means for your family is a potential new source of reliable, low-emission power. Unlike solar and wind, geothermal runs around the clock. It does not depend on the sun shining or the wind blowing.
For communities near abandoned wells, repurposing them could mean local jobs, reduced methane leaks, and a steady supply of electricity. Burke emphasized that point. "Repurposing existing infrastructure for geothermal energy can reduce methane emissions, create local jobs, and deliver reliable, low-emission power to Colorado communities," he said. The political landscape gives geothermal an unusual advantage.
President Donald Trump has attacked solar and wind power repeatedly since taking office last year. He has called the Inflation Reduction Act, the most far-reaching US climate policy to date, the "green new scam." His administration has restricted new renewable energy projects while making it easier to expand fossil fuel production. Geothermal has escaped that assault.
The president has not targeted it. That silence has encouraged states to explore the clean energy source, particularly as they look to diversify their energy mix for security reasons. For Republican-led states with deep oil and gas histories, geothermal offers a politically palatable path toward cleaner energy.
Both sides claim victory. Here are the numbers. Oklahoma alone has over 20,000 abandoned wells.
The US Government Accountability Office has identified hundreds of thousands of orphan wells nationwide. Plugging them all would cost billions. Repurposing even a fraction could turn a liability into a revenue stream.
The economic logic is compelling. Selling abandoned wells to geothermal companies generates income for states. It shifts cleanup costs from taxpayers to private firms.
It creates jobs in drilling, construction, and plant operation. And it produces electricity that can be sold to the grid. The technical challenges remain significant.
Not every abandoned well is suitable for geothermal production. The depth, temperature, and geological conditions vary widely. Some wells are too shallow.
Others are too degraded. Researchers are still determining which wells can be converted and what modifications are needed. Pope's study highlighted the gap between potential and practice.
The R&D required is substantial. But she argued it is worth pursuing. The Department of Energy's WOO initiative is funding some of that research, but the program is still in its early stages.
States are moving faster than the federal government. Oklahoma's Well Repurposing Act follows the blueprint of New Mexico's 2025 law. Alabama's April legislation gives state regulators authority to approve conversions.
North Dakota's study requirement could lead to its own bill. Colorado's technical study, backed by Gradient Energy, will produce data that other states can use. The patchwork of state laws creates a natural experiment.
If Oklahoma and New Mexico succeed, other states with large orphan well inventories—Texas, Pennsylvania, California—may follow. If the technical hurdles prove too high, the momentum could stall. OilPrice reported that the US geothermal potential is vast.
A recent breakthrough could unlock a 150-gigawatt energy revolution. Converting abandoned wells is one piece of that puzzle. Enhanced geothermal systems, which create artificial reservoirs by fracturing hot rock, represent another.
Both approaches rely on technology developed for oil and gas extraction. The irony is hard to miss. Techniques that drove the shale boom and increased US oil production are now being used to develop clean energy.
The same companies that drilled the wells could be the ones to repurpose them. The workforce that lost jobs when wells were abandoned could find new work in geothermal. Key Takeaways: - Oklahoma passed a law in March allowing companies to buy and repurpose over 20,000 abandoned oil and gas wells for geothermal energy production. - Similar laws have passed in New Mexico and Alabama, while Colorado and North Dakota are conducting feasibility studies. - The technology to convert oil wells into geothermal wells is not yet mature, with significant R&D hurdles remaining, according to geologist Emily Pope.
Why It Matters: Converting abandoned oil wells into geothermal plants could solve two problems at once: the multibillion-dollar backlog of orphan wells leaking methane across the US, and the need for reliable, around-the-clock clean power. For states like Oklahoma and New Mexico, the policy offers a rare convergence of environmental cleanup, job creation, and energy security that appeals to both parties. If the technical challenges are solved, the model could spread to hundreds of thousands of wells nationwide, reshaping the energy landscape in communities long dependent on fossil fuels.
The next 18 months will be critical. North Dakota's legislative council study could lead to a bill in the next session. The Department of Energy's WOO initiative will continue funding research into well conversion and co-production.
The private sector is watching. Geothermal startups and established energy companies are assessing whether well conversion can be profitable at scale. The first successful commercial project could trigger a wave of investment.
The first high-profile failure could scare off capital. Pope's caution is worth heeding. The technology is not ready for prime time.
But the direction is clear. States are not waiting for a federal mandate. They are writing their own laws, funding their own studies, and betting that yesterday's oil wells can become tomorrow's power plants.
Key Takeaways
— - Oklahoma's Well Repurposing Act lets companies buy abandoned oil wells for geothermal conversion, addressing a 20,000-well backlog.
— - New Mexico, Alabama, Colorado, and North Dakota are pursuing similar policies, creating a state-led push for geothermal energy.
— - Geologist Emily Pope warns the technology is 'pretty far away' from being viable, requiring significant R&D investment.
— - Geothermal has avoided Trump-era attacks on renewables, giving it bipartisan appeal in oil-producing states.
Source: OilPrice
