BILL ANALYSIS Ó
AB 1323
Page 1
ASSEMBLY THIRD READING
AB 1323 (Mitchell)
As Amended May 28, 2013
Majority vote
NATURAL RESOURCES 5-3 APPROPRIATIONS 12-5
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|Ayes:|Chesbro, Muratsuchi, |Ayes:|Gatto, Bocanegra, |
| |Skinner, Stone, Williams | |Bradford, |
| | | |Ian Calderon, Campos, |
| | | |Eggman, Gomez, Hall, |
| | | |Ammiano, Pan, Quirk, |
| | | |Weber |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Grove, Bigelow, Patterson |Nays:|Harkey, Bigelow, |
| | | |Donnelly, Linder, Wagner |
| | | | |
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SUMMARY : Prohibits hydraulic fracturing until the date that
regulations adopted by the Division of Oil, Gas, and Geothermal
Resources (DOGGR) regulating hydraulic fracturing take effect.
EXISTING LAW :
1)Requires DOGGR to supervise 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, including certain pipelines that are within an
oil and gas field, so as to prevent, as far as possible, damage to
life, health, property, and natural resources; damage to
underground oil and gas deposits from infiltrating water and other
causes; loss of oil, gas, or reservoir energy, and damage to
underground and surface waters suitable for irrigation or domestic
purposes by the infiltration of, or the addition of, detrimental
substances.
2)Requires the operator of any well, before commencing the work of
drilling the well, to file with DOGGR a written notice of
intention to commence drilling. Drilling shall not commence until
approval is given by DOGGR. If DOGGR fails to give the operator
written response to the notice within 10 working days from the
date of receipt, that failure shall be considered as an approval
AB 1323
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of the notice.
FISCAL EFFECT : According to the Assembly Appropriations Committee,
potential delay in state revenues of up to $9 million due to the
inability to use hydraulic fracturing on tidelands oil wells owned
by the state while the regulations are being developed.
COMMENTS :
Background . Hydraulic fracturing (also known as fracking) is one
energy production technique used to obtain oil and natural gas in
areas where those energy supplies are trapped in rock (i.e., shale)
or sand formations.
Once an oil or natural gas well is drilled and properly lined with
steel casing, fluids are pumped down to an isolated portion of the
well at pressures high enough to cause cracks in shale formations
below the earth's surface. These cracks or fractures allow oil and
natural gas to flow more freely. Often, a propping agent such as
sand is pumped into the well to keep fractures open.
In many instances, the fluids used in hydraulic fracturing are
water-based. There are some formations, however, that are not
fractured effectively by water-based fluids because clay or other
substances in the rock absorb water. For these formations, complex
mixtures with a multitude of chemical additives may be used to
thicken or thin the fluids, improve the flow of the fluid, or even
kill bacteria that can reduce fracturing performance.
Federal Exemption Followed by Fracking Increase . In 2005, Congress
exempted hydraulic fracturing (except when involving the injection
of diesel fuels) from the federal Safe Drinking Water Act. As a
result of this action, the United States (US) Environmental
Protection Agency (US EPA) lacks the authority to regulate hydraulic
fracturing activities that do not use diesel fuel as an additive.
Since 2007, shale oil production has increased from about 39 barrels
to 217 million barrels and shale gas production increased from 1.6
trillion cubic feet to 7.2 trillion cubic feet.
Potential Environmental Risks . The US Government Accountability
Office (GAO) categorizes the potential environmental risks of
fracking into the following categories: a) air quality; b) water
quality and quantity; and c) land and wildlife.
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Air quality risks are generally a result of engine exhaust from
increased traffic and equipment emissions with a risk of
unintentional emissions of pollutants from faulty equipment.
Water quality risks result from spills or releases of fracking
fluids from tank ruptures, or operational errors or underground
migration. Fracturing chemicals may contaminate surface or
groundwater under these conditions. Water is the primary component
of fracking fluids. The cumulative effects of using surface water
or groundwater should be regulated to prevent significant local
effects.
With regard to land and wildlife, the GAO raises concerns about
vegetation clearing, road construction, pipelines and storage tanks,
unintentional oil or toxic chemical spills and the resulting impact
on wildlife and habitat
DOGGR's Fracking Regulations . DOGGR has the statutory responsibility
to regulate fracking, but to date has not done so. In December
2012, DOGGR released a pre-rulemaking discussion draft of fracking
regulations to help inform the next regulatory draft.
Once released, the proposed regulations will be vetted through a
year-long formal rulemaking process. In the meantime, DOGGR is
conducting workshops throughout the state. Numerous groups are
concerned that fracking activity is continuing absent formally
adopted safeguards and regulations.
Others are concerned that DOGGR may not be conducting adequate
environmental review through the California Environmental Quality
Act (CEQA) process to fully determine significant environmental
effects.
Analysis Prepared by : Mario DeBernardo / NAT. RES. / (916)
319-2092
FN: 0001023