Bill Text: CA SB248 | 2015-2016 | Regular Session | Amended
Bill Title: Oil and gas.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Failed) 2016-11-30 - From Assembly without further action. [SB248 Detail]
Download: California-2015-SB248-Amended.html
BILL NUMBER: SB 248 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY AUGUST 17, 2015
AMENDED IN ASSEMBLY JULY 16, 2015
AMENDED IN ASSEMBLY JULY 1, 2015
AMENDED IN SENATE JUNE 1, 2015
AMENDED IN SENATE MAY 5, 2015
AMENDED IN SENATE APRIL 6, 2015
INTRODUCED BY Senator Pavley
FEBRUARY 18, 2015
An act to amend Sections 3108, 3213, and 3227
3227, and 3780 of, to add Sections 3011, 3106.3, 3113,
3114, 3165, 3213.5, 3221, 3227.2, and
3227.2 3786 to, and to add Article 2.7
(commencing with Section 3140) to Chapter 1 of Division 3 of, the
Public Resources Code, relating to oil and gas.
LEGISLATIVE COUNSEL'S DIGEST
SB 248, as amended, Pavley. Oil and gas.
(1) Existing law requires the Division of Oil, Gas, and Geothermal
Resources in the Department of Conservation to regulate the
drilling, operation, maintenance, and abandonment of wells and the
operation, maintenance, and removal or abandonment of tanks and
facilities attendant to oil and gas production. Existing law requires
the State Oil and Gas Supervisor, on or before the first day of
October of each year, to make public a report on specified
information.
This bill would require the supervisor to establish an inspection
program for all activities regulated pursuant to these provisions and
would require the total number of inspections and results of the
inspections to be included in the above-referenced report. The bill
would require the division's regulations, field rules, notices,
manuals, and other requirements to be reviewed and revised, as
needed, through a public process at least once every 10 years.
The bill would require the division, as part of the Oil and Gas
Data Management System developed pursuant to the Budget Act of 2015,
to ensure that required well data and well-related submissions are
retained and readily available to the public and that publicly
available data are machine readable. Unless otherwise incorporated in
the Oil and Gas Data Management System, the bill would require the
division to post certain information that it receives on its Internet
Web site.
The bill would define "enhanced oil recovery" for purposes of
provisions relating to the regulation of oil and gas.
The bill would require the division, by July 1, 2017, to develop
and implement additional safeguards, as needed, to protect
groundwater where a well stimulation treatment is proposed for a
shallow well or at a shallow depth in a well, as specified.
(2) Existing law requires an owner or operator of a well to keep,
or cause to be kept, and requires the operator to file with the
district deputy at specified times, a careful and accurate log, core
record, and history of the drilling of the well. Existing law
requires the well history to show the location and amount of
sidetracked casings, tools, or other material, the depth and quantity
of cement in cement plugs, the shots of dynamite or other
explosives, acid treatment data, the results of production and other
tests during drilling operations, and all data on well stimulation
treatments. Existing law requires the owner of any well to file with
the supervisor a monthly statement that provides certain information
relating to the well, including the amount of water produced from
each well. Existing law provides that a person who fails to comply
with specific laws relating to the regulation of oil or gas
operations, including failing to furnish a report or record, is
guilty of a misdemeanor.
This bill would, in addition, require all operations on or in the
well of any form to be systematically, completely, and accurately
described and recorded in the well history. The bill would require
any fluid injected or emplaced in the well to be fully characterized
and reported as part of the history. history,
as specified. The bill would require the monthly statement to
the supervisor to include the full characterization of the chemical
composition of water produced from each well. The bill would also
require the operator of a waste disposal well to provide to the
supervisor each quarter certain information regarding waste disposal
injections. The bill would prohibit, commencing July 1, 2017, a
chemical from being injected or emplaced in a well unless the
division has in its possession specified information developed
through established techniques about its physical, chemical, and
biological properties in order to permit assessment of its toxicity,
persistence, and mobility in the surrounding environment. The bill
would require the division to post a list of chemicals and the
measured parameters that meet this criteria on its Internet Web site.
The bill would require the division to consult with the Office of
Environmental Health Hazard Assessment in establishing the
acceptable techniques and the list of measured parameters.
Because a violation of these requirements would be a crime, the bill
would impose a state-mandated local program.
(3) The federal Safe Drinking Water Act regulates certain wells as
Class II wells. Under existing federal law, the authority to
regulate Class II wells in California is delegated to the Division of
Oil, Gas, and Geothermal Resources. Under existing regulations, a
well operator is required to obtain approval from the supervisor or a
district deputy for a subsurface injection or disposal project,
including Class II wells, or any change in a project, as provided.
This bill would require the division, on or before January 1,
2018, to update and revise these regulations, except as specified,
according to specified criteria and would require the division to
consult with independent experts and stakeholders in the development
and review of the regulations. The bill would require the regulations
to include certain requirements, including reporting requirements.
The bill would require injection wells and well projects existing as
of December 31, 2017, to be brought into compliance with these
regulations on or before January 1, 2020. The bill would require
these provisions to be liberally construed in order to meet specified
requirements and to provide public transparency. The bill would
provide that where the division shares jurisdiction over an injection
well with a federal entity, the division's rules and regulations are
to apply in addition to all applicable federal laws and regulations.
The bill would require an injection well subject to specified
emergency regulations, or any successor regulations, of the division
regarding aquifer exemptions to immediately cease injection
operations, other than those required for plugging and abandonment
operations, if the well is not in compliance with those regulations
by the applicable regulatory deadline. Because a violation of these
requirements would be a crime, the bill would impose a state-mandated
local program.
(4) Existing law requires the Department of Fish and Wildlife,
whenever it determines that an oil sump, as defined, is hazardous to
wildlife or constitutes an immediate and grave danger to wildlife, to
notify the State Oil and Gas Supervisor of the condition so that the
supervisor may take action to have the condition cleaned up or
abated. Under existing law, the Legislature finds and declares that
it is essential in order to protect the wildlife resources of
California that all hazardous exposed oil sumps in this state be
either screened or eliminated.
This bill would revise the definition of an oil sump and provide
that, in order to protect groundwater, surface water, air quality,
and wildlife resources, commencing July 1, 2017, no oil sumps shall
be used for the disposal of waters or waste waters attendant to oil
and gas field exploration, development, and production.
(4)
(5) The California Constitution requires the state to
reimburse local agencies and school districts for certain costs
mandated by the state. Statutory provisions establish procedures for
making that reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) A 2011 audit of the Division of Oil, Gas, and Geothermal
Resources' injection well program commissioned by the United States
Environmental Protection Agency highlighted numerous problems with
the program.
(b) The division has repeatedly acknowledged that it has failed to
follow applicable regulations in permitting injection wells and that
its injection well regulations are out of date. Among other reasons,
the division has cited antiquated data management practices.
(c) The 2015 independent science study on well stimulation
treatments in the state provides well-researched and documented
findings including the identification of data gaps and poor well
stimulation treatment-related practices that place the state, its
people, and natural resources at unnecessary and unknown risk.
(c)
(d) The division's ability to regulate depends upon
full understanding and knowledge of practices occurring under its
jurisdiction.
(d)
(e) Public transparency and regulatory accountability
are necessary to restore the public's confidence in the division.
SEC. 2. Section 3011 is added to the Public Resources Code, to
read:
3011. "Enhanced oil recovery" means any process to enhance the
displacement of oil or other hydrocarbons from a reservoir,
including, but not limited to, the injection or subsurface
emplacement of fluids or other materials into the productive strata,
the application of pressure, heat, or other means for the reduction
of viscosity of the hydrocarbons, and the supplying of additional
motive force.
SEC. 3. Section 3106.3 is added to the Public Resources Code, to
read:
3106.3. (a) The supervisor shall establish an inspection program
for all activities regulated pursuant to Section 3106.
(b) In establishing the inspection program, the supervisor shall
do, but is not limited to doing, all of the following:
(1) Identify activities subject to inspection.
(2) Create forms or checklists associated with each type of
inspection.
(3) Establish the time or time period in which each inspection
shall be performed.
(4) Establish procedures for how an inspection shall be conducted.
(c) The inspection program shall be available to the public on the
division's Internet Web site.
SEC. 4. Section 3108 of the Public Resources Code is amended to
read:
3108. (a) On or before the first day of October of each year the
supervisor shall make public, for the benefit of all interested
persons, a report in writing containing all of the following:
(1) The total amounts of oil and gas produced in each county in
the state during the previous calendar year.
(2) The total cost of the division for the previous fiscal year.
(3) The total amount delinquent and uncollected from any
assessments or charges levied pursuant to this chapter.
(4) The total number of inspections and the results of the
inspections.
(b) The report shall also include other information as the
supervisor deems advisable.
SEC. 5. Section 3113 is added to the Public Resources Code, to
read:
3113. (a) It is the policy of the state that the division
regularly review and update its regulations, field rules, notices,
manuals, and other requirements to ensure that technological advances
and other changes in the exploration, development, and production of
oil and gas are incorporated to ensure that life, health, property,
and natural resources are protected pursuant to Section 3106.
(b) The division's regulations, field rules, notices, manuals, and
other requirements shall be reviewed and revised, as needed, through
a public process. The regulations, field rules, notices, manuals,
and other requirements need not be reviewed all at once, but each of
them shall be reviewed at least once every 10 years. A revision is
not required pursuant to this section if the supervisor makes a
public written finding indicating that the existing regulation, field
rule, manual, or other requirement is appropriate and reflects best
management practices.
(c) The supervisor shall prepare and transmit reports to the
Legislature describing the results of the reviews required by this
section and any revisions made or planned to the division's
regulations, field rules, notices, manuals, and other requirements. A
report required by this subdivision shall be submitted in compliance
with Section 9795 of the Government Code.
(d) The division shall develop and disseminate in a timely manner
training materials related to any revisions made pursuant to this
section.
SEC. 6. Section 3114 is added to the Public Resources Code, to
read:
3114. (a) The division shall, as part of the Oil and Gas Data
Management System developed pursuant to the Budget Act of 2015
(Chapter 10 of the Statutes of (Ch. 10,
Stats. 2015), ensure that required well data and well-related
submissions are retained and readily available to the public and that
publicly available data are machine readable. Unless otherwise
incorporated in the Oil and Gas Data Management System, the division
shall make available to the public on its Internet Web site at least
all of the following:
(1) Any notice received pursuant to Section 3203 within five days
of receipt.
(2) Any changes in status of any notice received pursuant to
Section 3203 within five days of the change.
(3) The log, history, and core record of a well within 10 days of
receipt.
(b) The division shall consult with local, state, and federal
regulators in the development of the Oil and Gas Data Management
System to facilitate timely sharing of data.
SEC. 7. Article 2.7 (commencing with Section 3140) is added to
Chapter 1 of Division 3 of the Public Resources Code, to read:
Article 2.7. Injection Wells
3140. (a) (1) On or before January 1, 2018, the division shall
update and revise its regulations for all injection wells and well
projects for which the division has received primacy from the United
States Environmental Protection Agency pursuant to Section 1425 of
the federal Safe Drinking Water Act (42 U.S.C. Sec. 300h-4).
(2) Injection well and well project regulations that the division
is in the process of adopting as of January 1, 2016, and that address
issues identified in subdivision (c), shall not be subject to update
and revision pursuant to this section.
(b) In adopting regulations pursuant to this section, the division
shall, in consultation with independent experts and stakeholders
through a public process, do all of the following:
(1) Develop best management practices for injection wells and well
projects.
(2) Review cement and cementing requirements, including factors
influencing the aging of cement.
(3) Identify the impacts and potential impacts of injection on the
geologic formations in which injection wells are located to ensure
that well and formation integrity is maintained and groundwater with
a beneficial use is protected, consider the range of injection
practices for different purposes, including, but not limited to,
waste disposal, cyclic steam injection, steam flooding, and water
flooding, and clearly identify when fracturing of the formation is
deemed to occur or is likely to occur that may result in surface
movement, including, the development of sinkholes and the loss of
well and formation integrity.
(c) Injection well and well project regulations adopted pursuant
to this section may do one or more of the following:
(1) Clarify standards for ensuring zonal isolation of injection
projects.
(2) Expressly define the quality of water to be protected when
constructing wells.
(3) Codify best practices for well construction.
(4) Establish permitting and regulatory requirements specific to
cyclic steam operations.
(5) Establish requirements specific to cyclic steam in diatomite,
including a regulatory framework for responding to surface
expressions and provide clarification regarding injection above
fracture gradient.
(6) Clarify the process and standards for establishing maximum
allowable surface pressure for injection operations.
3141. The regulations adopted pursuant to Section 3140 shall
ensure that the integrity of the well, wellbore, and formation are
maintained. In order to accomplish this requirement, the regulations
shall do both of the following:
(a) Be specific to each type of injection well and well project
used for any purpose, including, but not limited to, enhanced oil
recovery and waste disposal.
(b) Include any operation, treatment, process, and activity
performed to enhance oil recovery on, in, or in the vicinity of, any
well, wellbore, or hydrocarbon-bearing formation.
3142. (a) It is the intent of this section to provide specific
direction to the division to include certain components in the
development of the regulations required by this article in order to
promote public transparency and regulatory accountability, and
address public concerns about potential seismicity, surface
instability, and the fracturing of the formation induced by injection
wells and their operation. Additional state and federal law and
regulations apply.
(b) The regulations adopted pursuant to Section 3140 shall
include, but are not limited to, the following:
(1) An opportunity for public participation in the well and well
project review process, if not otherwise provided through local land
use planning and zoning requirements.
(2) Full and complete geologic and hydrologic characterization and
reporting of the formation surrounding the well, including the
fracture pressure. This characterization shall include determination
of the area of review pursuant to Section 146.6 of Title 40 of the
Code of Federal Regulations, and the performance of a step-rate test
or tests to evaluate fracture pressure or pressures.
(3) Full and complete characterization and reporting of all well
operations with appropriate monitoring of surface movement such as
the development of sinkholes or seismic activity. To the extent
practicable, monitoring requirements shall be standardized and
explicit in the regulations.
(4) Establishment of limits on operations, and procedures to
follow in the event of surface movement, including, but not limited
to, the development of sinkholes and seismic activity.
3143. Injection wells and well projects existing as of December
31, 2017, shall be brought into compliance with the regulations
adopted pursuant to Section 3140 on or before January 1, 2020.
3144. This article shall be liberally construed pursuant to
Section 3013 in order to meet the requirements of Section 3106 and to
provide public transparency.
3145. Where the division shares jurisdiction over an injection
well with a federal entity, the division's rules and regulations
shall apply in addition to all applicable federal laws and
regulations.
3146. An injection well subject to the division's emergency
regulations regarding aquifer exemptions (Sections 1760.1 and 1779.1
of Title 14 of the California Code of Regulations, effective on April
20, 2015), or any successor regulations, shall immediately cease
injection operations other than those required for plugging or
abandonment operations if the well is not in compliance with those
regulations by the applicable regulatory deadline.
SEC. 8. Section 3165 is added to the
Public Resources Code , to read:
3165. (a) By July 1, 2017, the division shall develop and
implement additional safeguards, as needed, to protect groundwater
where a well stimulation treatment is proposed for a shallow well or
at a shallow depth in a well.
(b) The division shall consider at least the following in
developing the safeguards pursuant to subdivision (a):
(1) Whether guidance specific to a field or pool based on geology
and hydrology is needed.
(2) Whether additional fracturing design controls, monitoring,
operational controls, and reporting are needed in order to assess
whether the actual length and orientation of induced fractures place
groundwater at risk.
(c) For the purposes of this section, "shallow" means 2000 feet or
less in depth.
SEC. 8. SEC. 9. Section 3213 of the
Public Resources Code is amended to read:
3213. (a) The history shall show the location and amount of
sidetracked casings, tools, or other material, the depth and quantity
of cement in cement plugs, the shots of dynamite or other
explosives, all acid treatment data of any amount and concentration,
and the results of production and other tests during drilling
operations. All operations on or in the well of any form, including,
but not limited to, the injection or emplacement of any material in
the well for any purpose during the drilling, operation, maintenance,
or abandonment of the well shall be systematically, completely, and
accurately described and recorded in the history. All data on well
stimulation treatments pursuant to Section 3160 shall be recorded in
the history.
(b) The well history reporting requirements shall not be waived.
SEC. 9. SEC. 10. Section 3213.5 is
added to the Public Resources Code, to read:
3213.5. (a) The chemical composition of any
fluid injected or emplaced in the well shall be fully characterized
and reported as part of the history. The chemical composition shall
include any phase present as part of, or suspended in, the fluid. The
analytical method used in the determination shall also be reported.
Analytical methods established by the United States Environmental
Protection Agency to determine chemical composition shall be used
where applicable. For purposes of this section, fluid means a liquid
or gas of any chemical composition. Subdivision (j) of Section 3160
shall apply to any claim of trade secret protection for information
described in this section.
(b) Where produced water from the same source receiving identical
treatment is repeatedly injected into a well, the chemical
composition of a single representative sample per month meets the
well history reporting requirement.
SEC. 11. Section 3221 is added to the
Public Resources Code , to read:
3221. (a) Commencing July 1, 2017, no chemical shall be injected
or emplaced in a well unless the division has in its possession
information developed through established techniques about its
physical, chemical, and biological properties in order to permit
assessment of its toxicity, persistence, and mobility in the
surrounding environment. This information shall include parameters to
assess the solubility, volatility, partitioning, susceptibility to
hydrolysis, biodegradability, and bioaccumulation potential. At a
minimum, the octanol-water partitioning coefficient, the vapor
pressure, Henry's constant, soil organic carbon-water partitioning
coefficient, acid dissociation coefficient, and acute and chronic
toxicity for oral, dermal, and inhalation routes of exposure shall be
provided.
(b) The division shall post a list of chemicals and the measured
parameters that meet the criteria pursuant to subdivision (a) on its
Internet Web site.
(c) The division shall consult with the Office of Environmental
Health Hazard Assessment in establishing the acceptable techniques
and the list of measured parameters for the implementation of
subdivision (a).
SEC. 10. SEC. 12. Section 3227 of the
Public Resources Code is amended to read:
3227. (a) The owner of any well shall file with the supervisor,
on or before the last day of each month, for the last preceding
calendar month, a statement, in the form designated by the
supervisor, showing all of the following:
(1) (A) The amount of oil and gas produced from each well during
the period indicated, together with the gravity of the oil, the
amount of water produced from each well, estimated in accordance with
methods approved by the supervisor, and the number of days during
which fluid was produced from each well.
(B) The full characterization of the chemical composition of water
produced from each well, based on a representative sample, which
shall include any phase present as part of, or suspended in, the
water, and the analytical method used in making the characterization.
Analytical methods established by the United States Environmental
Protection Agency to determine chemical composition shall be used
where applicable.
(2) The number of wells drilling, producing, injecting, or idle,
that are owned or operated by the person.
(3) What disposition was made of the gas produced from each field,
including the names of persons, if any, to whom the gas was
delivered, and any other information regarding the gas and its
disposition that the supervisor may require.
(4) What disposition was made of water produced from each field
and the amount of fluid or gas injected into each well used for
enhanced recovery, underground storage of hydrocarbons, or wastewater
disposal, and any other information regarding those wells that the
supervisor may require.
(5) The source of water, and volume of any water, reported in
paragraph (4), including the water used to generate or make up the
composition of any injected fluid or gas. Water volumes shall be
reported by water source if more than one water source is used. The
volume of untreated water suitable for domestic or irrigation
purposes shall be reported. Commingled water shall be proportionally
assigned to individual wells, as appropriate.
(6) The treatment of water and the use of treated or recycled
water in oil and gas field activities, including, but not limited to,
exploration, development, and production.
(7) (A) The specific disposition of all water used in or generated
by oil and gas field activities, including water produced from each
well reported pursuant to paragraph (1). Water volumes shall be
reported by disposition method if more than one disposition method is
used. Commingled water shall be proportionally assigned to
individual wells, as appropriate.
(B) This information shall also include the temporary onsite
storage of water, as or if appropriate, and the ultimate specific
use, disposal method or method of recycling, or reuse of this water.
(b) Any operator that produces oil by the application of mining or
other unconventional techniques shall file a report with the
supervisor, on or before March 1 of each year, showing the amount of
oil produced by those techniques in the preceding calendar year.
(c) (1) Upon request and making a satisfactory showing therefor, a
longer filing period may be established by the supervisor for any
particular owner or operator.
(2) Notwithstanding subdivision (a), the owner of any well shall
file with the supervisor, on a quarterly basis, a statement
containing the information required to be reported pursuant to
paragraphs (5), (6), and (7) of subdivision (a) in the form
designated by the supervisor.
(d) The division shall use a standardized form or format to
facilitate reporting required pursuant to this section.
(e) The division shall use noncustom software, as feasible, to
implement online reporting by the operator of the information
required pursuant to paragraphs (5), (6), and (7) of subdivision (a).
This information may be reported separately from other information
required to be reported pursuant to this section.
(f) For purposes of this section, the following terms have the
following meanings:
(1) "Source of water" or "water source" means any of the
following:
(A) The well or wells, if commingled, from which the water was
produced or extracted.
(B) The water supplier, if purchased or obtained from a supplier.
(C) The point of diversion of surface water.
(2) "Specific disposition of all water" means the identification
of the ultimate specific use, disposal method or method of recycling,
or reuse of the water. This includes, but is not limited to, the
identification of any treatment or recycling method used, injection
of the water into specific injection or disposal well or wells, if
commingled, discharge of the water to surface water or sumps, and
sale or transfer of the water to a named entity.
SEC. 11. SEC. 13. Section 3227.2 is
added to the Public Resources Code, to read:
3227.2. (a) The operator of a waste disposal well shall provide
to the supervisor each quarter information described in subdivision
(b) from the preceding quarter that is specific to each waste
disposal injection performed at the well and that fully characterizes
each waste disposal injection performed at the well. The information
shall be reported in a machine-readable format.
(b) The information to be provided shall include, but is not
limited to, the date and time of the injection, the duration of the
injection, the volume of material injected, the rate of injection,
and the applied pressure of the injection.
SEC. 14. Section 3780 of the Public
Resources Code is amended to read:
3780. As used in this chapter, an "oil sump" is any open
depression or basin in the ground, whether manmade or natural,
which contains oil or a combination of oil and water.
lined or unlined, serving as a receptacle for
collecting, disposing of, or storing waste fluids, including, but not
limited to, mud, oil, or waters or waste waters attendant to oil and
gas field exploration, development, and production. "Waters or waste
waters attendant to oil and gas field exploration, development, and
production" includes, but is not limited to, waters or waste waters
associated with well drilling, oil production, well completion, and
well stimulation treatments, and may contain oil or other
hydrocarbons and materials and be multiphase.
SEC. 15. Section 3786 is added to the
Public Resources Code , to read:
3786. In order to protect groundwater, surface water, air
quality, and wildlife resources, commencing July 1, 2017, no oil
sumps shall be used for the disposal of waters or waste waters
attendant to oil and gas field exploration, development, and
production.
SEC. 12. SEC. 16. No reimbursement
is required by this act pursuant to Section 6 of Article XIII B of
the California Constitution because the only costs that may be
incurred by a local agency or school district will be incurred
because this act creates a new crime or infraction, eliminates a
crime or infraction, or changes the penalty for a crime or
infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIII B of the California Constitution.
