California Resources Bankruptcy Said Unlikely to Impact Abandoned Well Cleanup

California’s oil and natural gas industry is pushing back against a report alleging that the state’s largest exploration operator, now mired in bankruptcy, could leave a billion-dollar abandoned well cleanup problem in its wake.

The Sierra Club in a recent report labeled top producer California Resources Corp. (CRC), now in Chapter 11, as a stripper exploration and production company that is trying to squeeze the last drops of oil from mature locations. It cited concerns that CRC’s approach was “not providing much value” in the wake of expanded unconventional drilling techniques.

Sierra Club claimed that more than half of CRC’s 17,900 wells are idle. If the company “fails to close its wells by becoming terminally insolvent, the obligation and ultimate cost of...