JPMorgan Chase: Balancing environmental, social, and economic needs
Summary
More than half a million people in Los Angeles live less than a quarter mile from an active oil well. Nearly a third of the city’s wells are located near schools, parks, homes, and other residential areas and disproportionately affect communities of color. The Los Angeles neighborhood of Wilmington is home to the third-largest oil field in the continental United States and is now home to ClimateWells’ initiative with JPMorgan Chase to create economic incentives to help oil and gas producers permanently shut down old oil wells and the methane they emit.
Using our science and economics based approach, ClimateWells leveraged the voluntary carbon market and Rocky Mountain Institute’s Oil Climate Index tool to develop verified emission reduction projects that will serve to create jobs, improve health and safety, and further urban renewal in the Wilmington community.
Wilmington crew at work in April 2024
Community
The Wilmington project offers great employment opportunities for skilled workers in the area.
From cementing and welding to regulatory and trucking, each of the plugging projects helped bring local professionals an opportunity to empower the Los Angeles energy transition. In addition to tackling emissions, retiring these wells reduces the health risks caused by nearby industrial pollution.
Member of the Wilmington plugging crew
Wilmington oilfield structure map from 1943
History and Health
The Wilmington Field is a subsection of the historic Los Angeles Oil Basin originally discovered in 1890. Though the field originally contained nearly 3 billion barrels of oil, almost all remaining wells in the area have declined for decades and are currently producing at marginal levels. These wells are an ideal fit for carbon crediting as the oil is heavy, requiring high-emission processing, and the production is low and predictable.
Wilmington is in the top 1% of pollution exposure in the U.S. The 60,000 residents of Wilmington suffer from higher asthma rates and cardiac disease. Pregnant women living near active oil operations in LA have a 40% increased risk of premature birth and 30% increased risk of high-risk pregnancy. Mobilizing capital through voluntary carbon markets can support economic decisions that reduce community exposure to emissions.
Results
When completed, this expedited decommissioning will shut down 2 active flares, gas processing equipment and dozens of aging wellheads and transmission lines.
Project in progress. Expected completion in August 2024.