BILL NUMBER: AB 7 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 30, 2013
AMENDED IN ASSEMBLY APRIL 8, 2013
INTRODUCED BY Assembly Member Wieckowski
DECEMBER 3, 2012
An act to amend Sections 3203, 3213
3213, and 3215 of, to add Section 3215.5 to, and
to add Article 3 (commencing with Section 3150) to Chapter 1 of
Division 3 of, and to repeal Section 3157 of, the
Public Resources Code, relating to oil and gas.
LEGISLATIVE COUNSEL'S DIGEST
AB 7, as amended, Wieckowski. Oil and gas: hydraulic fracturing.
Under existing law, the Division of Oil, Gas, and Geothermal
Resources, or the division, in the Department of
Conservation , regulates the drilling, operation,
maintenance, and abandonment of oil and gas wells in the state. The
State Oil and Gas Supervisor , or the supervisor,
supervises the drilling, operation, maintenance, and abandonment of
wells and the operation, maintenance, and removal or abandonment of
tanks and facilities related to oil and gas production within an oil
and gas field regarding safety and environmental damage. Existing law
requires an operator of a well, before commencing the work of
drilling the well, to obtain approval from the State Oil and
Gas Supervisor or a district deputy file with the
supervisor or the district deputy a written notice of intention to
commence drilling, and prohibits the commencement of drilling until
approval is given by the supervisor or the district deputy .
Existing law requires the operator of a well to keep, or cause to be
kept, a careful and accurate log, core record, and history of the
drilling of the well. Within 60 days after the date of cessation of
drilling, rework, or abandonment operations, the owner or operator is
required to file with the district deputy certain information,
including the history of work performed.
This bill would revise that procedure to instead require the
operator to file an application before commencing drilling and would
require, on and after January 1, 2014, additional information to be
included in the application, including information regarding the
chemicals, if any, to be injected into a well.
This bill would define, among other things, hydraulic fracturing
and hydraulic fracturing fluid. The bill would require the owner or
operator of a well to provide to the supervisor, or to arrange with
the supplier to provide to the supervisor, specific information
relating to hydraulic fracturing as a part of the history of the
drilling of the well. The bill would provide that the owner
or operator of a well may request in writing that the information
required relating to hydraulic fracturing be considered confidential
information under specific provisions. The bill would,
on or before January 1, 2015, require the division, in consultation
with the Office of Environmental Health Hazard Assessment and the
Department of Toxic Substances Control, to establish a process
through which all chemicals used in hydraulic fracturing treatments
may be studied or reviewed. The bill would also
provide that the owner, operator, or supplier who provides
information to the supervisor relating to hydraulic fracturing may,
at the time of submission, submit to the supervisor a claim in
writing that some or all of the information is protected trade secret
information, as specified. The bill would permit the supervisor,
upon his or her own initiative, to make an initial determination as
to whether the information claimed as trade secret has been properly
claimed as trade secret information. The bill would require the
supervisor to make an initial determination upon receipt of a request
for public information, as specified. The bill would require the
supervisor, within 45 days, to provide written notification of the
initial determination to the person who provided the information and
claims trade secret protection. The bill would provide specific
processes for the person claiming trade secret protection to
challenge the supervisor's initial determination within 30 days from
the date of receipt of the initial determination by providing the
supervisor with additional written justification for the trade secret
claim. The bill would further require the supervisor, after making a
final determination within 45 days of the date of receipt of the
additional written justification that the information is not a trade
secret, to make the information available to the public not sooner
than 30 days from the date of the mailing of a copy of the final
determination to the person who provided the additional written
justification. The bill would also require the supervisor to send a
notice of the final determination to the person who provided the
additional written justification, if the information is determined to
be a trade secret. The bill would provide that a person claiming
trade secret protection is deemed to have waived his or her claim for
trade secret if, on the date when the final determination requires
that the information be made available to the public, he or she has
not filed an action in a court of competent jurisdiction for a
declaratory judgment or injunction prohibiting disclosure of the
information by the supervisor. The bill would permit the supervisor
to disclose information claimed to be a trade secret to specific
government employees with a clear need for the information for an
enforcement action or emergency response, as specified. The bill
would require the operator, within 60 days of the cessation of
hydraulic fracturing treatment, to post or cause to have posted on an
Internet Web site accessible to the public specified information on
hydraulic fracturing, as specified. The bill would further prohibit
those with access to the trade secret from disclosing it, and would
make a person who violates this prohibition guilty of a misdemeanor.
Because this bill would create a new crime, it would impose a
state-mandated local program.
This bill would require the supervisor, on or before January 1,
2014, and annually thereafter, to transmit to the Legislature a
comprehensive report on hydraulic fracturing in the exploration and
production of oil and gas resources in the state, as specified.
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) Hydraulic fracturing has been used in California for several
decades to extract oil and gas and is likely to be used more
extensively as the industry seeks to develop additional oil-bearing
and gas-bearing formations.
(b) The Division of Oil, Gas, and Geothermal Resources in the
Department of Conservation, which has the obligation to protect
public health and the natural resources of the state, including
groundwater resources, has the authority to regulate all oil and
natural gas drilling in the state, but currently does not require the
disclosure of pertinent information regarding hydraulic fracturing
or ascertain all specific types of production and exploration taking
place at permitted wells.
(c) Given California's geologic, seismic complexity, and its
finite and significantly compromised water resources, it is important
to collect basic information about natural resource production
processes. The state and the public should know when and where
hydraulic fracturing is occurring and what chemicals are being used
in the process.
SEC. 2. Section 3203 of the Public
Resources Code is amended to read:
3203. (a) The operator of any well, before commencing the work of
drilling the well, shall file with the supervisor or the district
deputy a written notice of intention an
application to commence drilling. Drilling shall not commence
until approval of the application is given by the
supervisor or the district deputy. If the supervisor or the district
deputy fails to give the operator a written response to
the notice application within 10
working days from the date of receipt, that failure shall be
considered as an approval of the notice
application and the notice, application,
for the purposes and intents of this chapter, shall be deemed
a written report of the supervisor. If operations have not commenced
within one year of receipt of the notice,
application, the notice application
shall be deemed canceled. The notice
application shall contain the pertinent data the supervisor
requires on printed forms supplied by the division or on other forms
acceptable to the supervisor. The supervisor may require other
pertinent information to supplement the notice
application .
(b) (1) On and after January 1, 2014, in addition to the
information required in the application under subdivision (a), the
application shall additionally include all of the following
information:
(A) The type of exploration and production techniques that the
operator will use at the well or wells.
(B) A complete list of the chemicals, if any, that will be
injected into the well for hydraulic fracturing or other production
enhancement methods in the exploration or production process or
processes. This list of chemicals shall include all of the following
information:
(i) The name of the chemical.
(ii) The purpose of the chemical in the production or exploration
process.
(iii) The Chemical Abstract Service numbers for the chemical.
(iv) The estimated total amount of the chemical used.
(2) If any of the information required pursuant to paragraph (1)
changes over the course of the exploration and production process,
the operator shall immediately notify the supervisor.
(b)
(c) After the completion of any well, this section also
applies as far as may be, to the deepening or redrilling of the
well, any an operation involving the
plugging of the well, or any operations permanently altering in any
manner the casing of the well. The number or designation of
any a well, and the number or designation
specified for any a well in a
notice an application filed as required by this
section, shall not be changed without first obtaining a written
consent of the supervisor.
(c)
(d) If an operator has failed
fails to comply with an order of the supervisor, the supervisor
may deny approval of proposed well operations until the operator
brings its existing well operations into compliance with the order.
If an operator has failed fails to pay
a civil penalty, remedy a violation that it is required to remedy to
the satisfaction of the supervisor pursuant to an order issued under
Section 3236.5, or to pay any charges assessed under Article 7
(commencing with Section 3400), the supervisor may deny approval to
the operator's proposed well operations until the operator pays the
civil penalty, remedies the violation to the satisfaction of the
supervisor, or pays the charges assessed under Article 7 (commencing
with Section 3400).
SEC. 2. SEC. 3. Section 3213 of the
Public Resources Code is amended to read:
3213. 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, the results of production and other tests during drilling
operations, and the information required pursuant to Section 3156.
SEC. 3. SEC. 4. Article 3
(commencing with Section 3150) is added to Chapter 1 of Division 3 of
the Public Resources Code, to read:
Article 3. Hydraulic Fracturing
3150. "Chemical Abstracts Service" means the division of the
American Chemical Society that is the globally recognized authority
for information on chemical substances.
3151. "Chemical Abstracts Service (CAS) number" means the unique
identification number assigned to a chemical by the Chemical
Abstracts Service.
3152. "Hydraulic fracturing" is a well stimulation treatment that
may include the application of hydraulic fracturing fluids into an
underground geologic formation in order to create fractures in the
formation, thereby causing or improving the production of oil or gas
from a well.
3153. "Hydraulic fracturing fluid" includes water or other
carrier fluids that may be mixed with physical and chemical additives
for the purpose of hydraulic fracturing. The additives may, but are
not required to, serve additional purposes beyond the transmission of
hydraulic pressure to the geologic formation. Additives may be of
any phase and may include proppants.
3154. "Proppants" are materials inserted or injected into the
formation that are intended to prevent newly created or enhanced
fractures from closing.
3155. "Supplier" means an entity performing hydraulic fracturing
or a person supplying an additive or proppant directly to the
operator for use in hydraulic fracturing a well.
3156. If hydraulic fracturing is performed on a well, the owner
or operator of the well shall provide to the supervisor, or shall
arrange with the supplier to provide to the supervisor, and shall
include in the well history maintained pursuant to Section 3213, all
of the following information, except for information claimed as a
trade secret pursuant to Section 3158:
(a) A complete list of the chemical constituents formulated for
use in the hydraulic fracturing fluid that is injected into the well
and each chemical's associated CAS numbers. Where the CAS number does
not exist, the operator or supplier may provide another unique
identifier where available.
(b) The purpose of each additive contained in the hydraulic
fracturing fluid.
(c) The estimated total amount of the additives in the hydraulic
fracturing fluid.
(d) The estimated maximum concentration of each chemical
constituent in the additive as disclosed on a material safety data
sheet in the hydraulic fracturing fluid expressed as a percentage by
mass.
(e) The estimated maximum concentration of each chemical
constituent disclosed on a material safety data sheet in the
hydraulic fracturing fluid, expressed as a percentage by mass.
(f) The amount and source of any water suitable for irrigation or
domestic purposes used to conduct the hydraulic fracturing treatment
of the well.
(g) The amount and disposition of water and hydraulic fracturing
fluid recovered from each well where hydraulic fracturing occurred
prior to the reporting of the water produced pursuant to Section
3227.
(h) Any radiological components or tracers injected into the well
as part of the hydraulic fracturing process and a description of the
recovery method, if any, for those components or tracers, the
recovery rate, and the disposal method for recovered components or
tracers.
3157. (a) The owner or operator of a well may request in writing
that the information required by Section 3156 be considered
confidential information pursuant to Section 3234.
(b) For nonexploratory wells where hydraulic fracturing is used to
complete or rework a well, the owner or operator may request in
writing that the information required by Section 3156 be considered
confidential information pursuant to Section 3234.
(c) This section shall become inoperative on January 1, 2017, and,
as of that date, is repealed, unless a later enacted statute, that
becomes operative on or before January 1, 2017, deletes or extends
the date on which it becomes inoperative and is repealed.
3157.5. (a) The owner or operator, of a well may request in
writing that the information required by Section 3156 be considered
confidential information pursuant to Section 3234.
(b) This section shall become operative on January 1, 2017.
3157. On or before January 1, 2015, the division, in consultation
with the Office of Environmental Health Hazard Assessment and the
Department of Toxic Substances Control, shall establish a process
through which all chemicals used in hydraulic fracturing treatments
may be studied or reviewed, a list containing any restricted or
prohibited toxic chemicals, and a list containing any restricted or
prohibited locations deemed extremely vulnerable to a spill or
release of chemicals.
3158. (a) The owner, operator, or supplier who provides
information to the supervisor in accordance with Section 3156 may, at
the time of submission, submit to the supervisor a claim in writing
that some or all of the information is protected trade secret
information as defined in the Uniform Trade Secrets Act (Title 5
(commencing with Section 3426) of Part 1 of Division 4 of the Civil
Code).
(b) The written claim submitted to the supervisor under paragraph
(a) shall state the reasons for the trade secret information and
provide specific supporting documentation.
3159. (a) The owner, operator, or supplier who provides
information to the supervisor and who claims trade secret protection
shall submit two versions of the information required under Section
3156 as follows:
(1) The first version shall be labeled "Confidential Information -
Do Not Disclose" and shall include all the information required
under Section 3156.
(2) (A) The second version shall be labeled "Public Information -
This Information shall be Disclosed to the Public," provide an
explanation of the basis for the claim of trade secrecy, and include
all of the information required under Section 3156, except that the
specific name of any constituent that is claimed as trade secret
information shall be replaced with the chemical family associated
with the trade secret constituent, the corresponding CAS number shall
be replaced with the phrase "Trade Secret Information," and all
other trade secret information shall be redacted.
(B) The information contained in the version pursuant to paragraph
(2) shall be made available to the public in accordance with Section
3215 or upon request by a member of the public pursuant to Chapter
3.5 (commencing with Section 6250) of Division 7 of Title 1 of the
Government Code.
(b) The supervisor shall keep the version under paragraph (1) of
subdivision (a) confidential until the person claiming trade secret
protection waives its claim pursuant to subdivision (d) of Section
3161 or the claim of trade secret protection is determined to be
invalid by a court of competent jurisdiction.
3160. If the person claiming trade secret protection pursuant to
Section 3158 is a supplier, the supplier shall only provide the well
owner or operator with the version pursuant to paragraph (2) of
subdivision (a) of Section 3159 so the owner or operator may include
the information required in the history of the drilling of the well
pursuant to Section 3213.
3161. (a) (1) The supervisor, upon his or her own initiative, may
determine whether any or all of the information claimed as a trade
secret pursuant to Section 3158 has been properly claimed as trade
secret information. If the supervisor determines that the information
is not trade secret, the supervisor shall provide written
notification of the determination to the person who furnished the
information within 45 days. The written notification shall be sent by
certified mail.
(2) Upon receipt of a request for public information pursuant to
Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1
of the Government Code, the supervisor shall determine whether any or
all of the information claimed as a trade secret pursuant Section
3158 has been properly claimed as trade secret information. If the
supervisor determines that the information is not trade secret, the
supervisor shall provide written notification of the determination to
the person who furnished the information within 45 days. The written
notification shall be sent by certified mail.
(b) (1) The person who provided the trade secret information under
Section 3159 shall have 30 days from the date of receipt of a
written notification of the determination under subdivision (a) to
provide the supervisor with additional written justification of the
grounds on which trade secret protection is claimed. The additional
written justification shall be submitted by certified mail.
(2) The additional written justification is not a public record
under subdivision (e) of Section 6252 of the Government Code, and
shall be disclosed by the supervisor only to state employees with a
clear need to know the information to reassess the trade secrecy
determination.
(c) (1) The supervisor shall make a final determination on whether
the additional written justification under subdivision (b) satisfies
a claim for trade secret protection, within 45 days of the date of
receipt of the additional written justification.
(A) If the supervisor makes a final determination that the
information is not protected as a trade secret, the supervisor,
within 45 days, shall send a copy of the final determination to the
person who provided the additional written justification, specifying
a date, not sooner than 30 days from the date of the mailing of the
final determination, when the information claimed to be trade secret
information shall be made available to the public. The notice of the
final determination shall be sent by certified mail.
(2) If the supervisor makes a final determination that the
information is protected as a trade secret, the supervisor, within 45
days, shall send a copy of the final determination, including
information stating that the determination may be challenged in
court, to the person who provided the additional written
justification and to any person who requested the information
pursuant to Chapter 3.5 (commencing with Section 6250) of Division 7
of Title 1 of the Government Code. The notice of the final
determination shall be sent by certified mail.
(d) (1) A person claiming trade secret protection shall be deemed
to have waived his or her claim for trade secret protection if, on
the date when the final notice states that the information shall be
made available to the public pursuant to subparagraph (A) of
paragraph (1) of subdivision (c), he or she has not filed an action
in a court of competent jurisdiction for a declaratory judgment or
injunction prohibiting disclosure of the information by the
supervisor after a final determination under subdivision (c).
(2) A person claiming trade secret protection may, at any time,
waive a claim of trade secret protection by submitting a voluntary
waiver of the claim to the supervisor in writing.
3162. (a) The supervisor may disclose information claimed as
trade secret information to an officer or employee of the county,
city, state, or federal government who has a clear need for the trade
secret information for an enforcement action or emergency response.
(b) The information provided under subdivision (a) shall be
clearly labeled as "Confidential trade secret information."
(c) An officer or employee who receive
receives information under subdivision (a) shall maintain the
confidentiality of the information and shall destroy all copies
received once the need for the information has ended.
3163. Nothing in this article is intended to change or supersede
the disclosure of information pursuant to the California Occupational
Safety and Health Act of 1973 (Part 1 (commencing with Section
6300), 6300) of Division 5,
5 of the Labor Code), the requirements of
Article 1 (commencing with Section 25500) of Chapter 6.95 ,
concerning hazardous material release response plans and
inventories, the Porter-Cologne Water Quality Control Act (Division 7
(commencing with Section 13000), 13000) of
the Water Code), or any other state or federal act allowing the
disclosure of chemical information.
SEC. 4. SEC. 5. Section 3215 of the
Public Resources Code is amended to read:
3215. (a) Within 60 days after the date of cessation of drilling,
rework, hydraulic fracturing, or abandonment operations, or the date
of suspension of operations, the owner or operator shall file with
the district deputy, in a form approved by the supervisor, true
copies of the log, core record, and history of work performed, and,
if made, true and reproducible copies of all electrical, physical, or
chemical logs, tests, or logs and tests
. Upon a showing of hardship, the supervisor may extend the
time within which to comply with this section for a period not to
exceed 60 additional days.
(b) (1) The supervisor shall post the information provided
pursuant to Section 3156 and that is not claimed as a trade secret
pursuant to Section 3158 to existing Internet maps on the division's
Internet Web site, and shall make that information available to the
public in a way that the information is associated with each specific
well where chemicals are injected for purposes of hydraulic
fracturing.
(2) For purposes of complying with the posting requirements of
paragraph (1), the supervisor may use an existing public Internet Web
site administered by the Ground Water Protection Council or the
Interstate Oil and Gas Compact Commission if both
all of the following are met:
(A) The information is transmitted and posted to the public
Internet Web site in a form and manner approved by the supervisor and
includes the information provided to the supervisor pursuant to
Section 3156, except for trade secret information pursuant to Section
3158.
(B) There is an electronic link from the wells represented on the
division's existing internet maps that allows members of the public
to view the information about specific wells based on their location.
(C) On and after January 1, 2014, the Chemical Disclosure Registry
allows for the division staff and the public to aggregate data and
search and sort the registry for information by geographic area,
ingredient, Chemical Abstract Service number, time period, and
operator.
(D) Members of the public are permitted to copy, reproduce,
modify, republish, upload, post, transmit, or distribute the
information without restriction.
SEC. 5. SEC. 6. Section 3215.5 is
added to the Public Resources Code, to read:
3215.5. (a) On Notwithstanding Section
10231.5, on or before January 1, 2014, and annually thereafter,
the supervisor shall prepare and transmit to the Legislature a
comprehensive report regarding hydraulic fracturing in oil and gas
exploration and production in California, using the information
provided pursuant to Section 3156. Where the information involves
trade secret protection, the supervisor shall only use information
provided pursuant to paragraph (2) of subdivision (a) of
Section 3159 to complete the report. The report shall additionally
include, but is not limited to, the following relevant information:
(1) The disposition of water used in the treatments.
(1) Aggregated data detailing the volumes of hydraulic fracturing
fluid used during hydraulic fracturing, identifying whether it is
water suitable for irrigation or domestic purposes, water not
suitable for irrigation or domestic purposes, or something other than
water.
(2) Aggregated data detailing the disposition of hydraulic
fracturing fluid used to conduct hydraulic fracturing.
(2)
(3) Aggregated data detailing the volumes of each
chemical used in hydraulic fracturing treatments in the state, in
each county, and by each company, during the preceding year.
(4) The number of emergency responses to a spill or release.
(5) The number of well failures.
(6) Based on a representative sampling of information submitted to
the division pursuant to subdivision (a) of Section 3159, the
percentage of chemical information withheld within the representative
sample as trade secret information.
(b) A report to the Legislature pursuant to subdivision (a) shall
be submitted in compliance with Section 9795 of the Government Code.
(c)
The requirement for submitting the report pursuant to subdivision
(a) is inoperative seven years after the date the first report is
due, pursuant to Section 10231.5 of the Government Code.
SEC. 6. SEC. 7. 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.