Picture a situation where 'City Water' has been brought into a House (copper line) and the old Well piping disconnected, but the Ground Wire has not been moved from it's original location. What are the issues, what should be done and why?

One suggestion — Although the wellhead seal looks decidedly nonmetallic, there may be one good reason for connections to both the casing and new municipally-connected feed—a metal well casing often makes an outstanding grounding electrode. The old 6-inch casing at my rural house measured <2&#8486; with a three-point test, and that is often considered “utility-substation grade.” {The equally-old ‘driven’ ¾-inch-pipe electrode was 65&#937;.}

Remember now that the interior metal water piping is no longer connected to this well piping. What problems/issues does that present?

Bill

Assuming there is no interconection between the old well head and the new city water a new bond needs to be added to the new water system.

I would add a new grounding electrode conductor (GEC)to the new water utility entry piping. I would leave the present GEC in place. This would bond both systems to the main bonding conductor.
--
Tom

Thanks,

What hazards, if any, exist with the way it is now? What would you tell the owner of this house?

Bill

that the interior plumbing may be able to be energized due to a rusty bond...

not as prevelant in this particular pix, the white powdery buidlup we sometimes see , similar to battery connections is explained by Mark Ode in an article Here