Senate BillNo. 4


Introduced by Senator Pavley

December 3, 2012


An act to amend Section 3213 of, and to add Article 3 (commencing with Section 3150) to Chapter 1 of Division 3 of, the Public Resources Code, relating to oil and gas.

LEGISLATIVE COUNSEL’S DIGEST

SB 4, as introduced, Pavley. Oil and gas: hydraulic fracturing.

Under existing law, the Division of Oil, Gas, and Geothermal Resources (DOGGR) 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 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. 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 define, among other things, hydraulic fracturing and hydraulic fracturing fluid. The bill requires an operator of a well to record and include all data on hydraulic fracturing treatment, including names and locations of all known seismic faults, as a part of the history of the drilling of the well. The bill would require DOGGR, in consultation with the Department of Toxic Substances Control, the State Air Resources Board, and the State Water Resources Control Board, on or before January 1, 2015, to adopt rules and regulations specific to hydraulic fracturing, including governing the construction of wells and well casings and full disclosure of the composition and disposition of hydraulic fracturing. The bill would require an operator to file with the supervisor or a district deputy, at least 30 days prior to the commencement of a hydraulic fracturing treatment, a notice of intention to commence hydraulic fracturing treatment containing specified information. The bill would require the hydraulic fracturing to be completed within one year of the filing of the notice of intention. The bill would require DOGGR, within 10 days of the receipt of the notice of intention, to make the notice publicly available, to post it on the division’s Internet Web site, and to notify the appropriate regional water quality control board. The bill would require the supplier, as defined, of the hydraulic fracturing treatment to provide to the operator, within 30 days following the conclusion of the hydraulic fracturing, certain information regarding the hydraulic fracturing fluid. 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 the fracturing and fluid, as specified. The bill would require a supplier claiming trade secret protection for the chemical composition of additives used in the hydraulic treatment to disclose the composition to DOGGR, but would, except as specified, prohibit those with access to the trade secret to disclose it, and a person who violates this prohibition would be 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, 2016, and annually thereafter, to transmit to the Legislature and make available publicly a comprehensive report on hydraulic fracturing in the exploration and production of oil and gas resources in the state.

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:

P3    1

SECTION 1.  

Article 3 (commencing with Section 3150) is
2added to Chapter 1 of Division 3 of the Public Resources Code,
3to read:

4 

5Article 3.  Hydraulic Fracturing
6

 

7

3150.  

“Additive” means a substance or combination of
8substances added to a base fluid for purposes of preparing a
9hydraulic fracturing fluid. An additive may, but is not required to,
10serve additional purposes beyond the transmission of hydraulic
11pressure to the geologic formation. An additive may be of any
12phase and includes proppants.

13

3151.  

“Base fluid” means the continuous phase fluid used in
14the makeup of a hydraulic fracturing fluid. The continuous phase
15fluid may include, but is not limited to, water, and may be a liquid
16or a gas.

17

3152.  

“Carrier fluid” means a base fluid into which additives
18are mixed to form a hydraulic fracturing fluid.

19

3153.  

“Hydraulic fracturing” means a treatment used in
20stimulating a well that involves the pressurized injection of
21hydraulic fracturing fluid and proppant into an underground
22geologic formation in order to fracture the formation, thereby
23causing or enhancing, for the purposes of this division, the
24production of oil or gas from a well.

25

3154.  

“Hydraulic fracturing fluid” means a carrier fluid mixed
26with physical and chemical additives for the purpose of hydraulic
27fracturing. A hydraulic fracturing treatment may include more than
28one hydraulic fracturing fluid.

29

3155.  

“Proppants” means materials inserted or injected into
30the underground geologic formation that are intended to prevent
31fractures from closing.

32

3156.  

“Supplier” means an entity performing hydraulic
33fracturing or an entity supplying an additive or proppant directly
34to the operator for use in hydraulic fracturing.

35

3157.  

(a) The Legislature finds and declares that hydraulic
36fracturing of oil and gas wells in combination with technological
37advances in oil and gas well drilling are spurring oil and gas
38extraction, as well as oil and gas exploration, in California.

P4    1(b) (1) On or before January 1, 2015, the division, in
2consultation with the Department of Toxic Substances Control,
3the State Air Resources Board, and the State Water Resources
4Control Board, shall adopt rules and regulations specific to
5hydraulic fracturing. The rules and regulations shall include, but
6are not limited to, revisions, as needed, to the rules and regulations
7governing construction of wells and well casings to ensure integrity
8of wells, well casings, and the geologic and hydrologic isolation
9of the oil and gas formation during and following hydraulic
10fracturing, and full disclosure of the composition and disposition
11of hydraulic fracturing fluids.

12(2) Full disclosure of the composition and disposition of
13hydraulic fracturing fluids shall, at a minimum, include:

14(A) The date of the hydraulic fracturing.

15(B) A complete list of the names, Chemical Abstract Service
16(CAS) numbers, and maximum concentration, in percent by mass,
17of each and every chemical constituent of the hydraulic fracturing
18fluids used. If a CAS number does not exist for a chemical
19constituent, the well owner or operator may provide another unique
20identifier, if available. Chemical information claimed as a trade
21secret, pursuant to subdivision (h), shall be identified as such and
22reported as described in subdivision (h).

23(C) The trade name, the supplier, and a brief description of the
24intended purpose of each additive contained in the hydraulic
25fracturing fluid.

26(D) The total volume of carrier fluid used during hydraulic
27fracturing, and the identification of whether the carrier fluid is
28water suitable for irrigation or domestic purposes, water not
29suitable for irrigation or domestic purposes, or a fluid other than
30water.

31(E) The total volume of base fluid, if not reported as a carrier
32fluid, used during hydraulic fracturing, and the identification of
33whether the base fluid is water suitable for irrigation or domestic
34purposes, water not suitable for irrigation or domestic purposes,
35or a fluid other than water.

36(F) The source, volume, and disposition of all water, including,
37but not limited to, all water used as base and carrier fluids, used
38during hydraulic fracturing and recovered from the well following
39hydraulic fracturing that is not otherwise reported as produced
40water pursuant to Section 3227.

P5    1(G) The disposition of all hydraulic fracturing fluids other than
2water.

3(H) Any radiological components or tracers injected into the
4well as part of the hydraulic fracturing process, a description of
5the recovery method, if any, for those components or tracers, the
6recovery rate, and the disposal method for recovered components
7or tracers.

8(I) The radioactivity of the recovered hydraulic fracturing fluids.

9(J) The location of the portion of the well subject to the hydraulic
10fracturing treatment and the extent of the fracturing surrounding
11the well induced by the treatment.

12(c) (1) Notwithstanding any other law or regulation, at least 30
13days prior to commencing a hydraulic fracturing treatment on a
14well, the operator shall file a written notice of intention to
15commence the hydraulic fracturing treatment with the supervisor
16or district deputy. The notice shall contain the pertinent data the
17supervisor requires on printed forms supplied by the division or
18on other forms acceptable to the supervisor. The hydraulic
19fracturing treatment shall be completed within one year of filing
20the notice of intention. The information provided in the notice
21shall include, but is not limited to, the following:

22(A) The well identification number and location.

23(B) The time period during which the hydraulic fracturing
24treatment is planned to occur.

25(2) Within 10 days of receipt of the notice of intention, the
26division shall make the notice of intention publicly available, post
27it on the publicly accessible portion of the division’s Internet Web
28site, and notify the appropriate regional water quality control board
29or boards as determined by where the well, including its subsurface
30portion, is located.

31(3) The operator shall provide notice to the division 72 hours
32prior to the actual start of the hydraulic fracturing treatment in
33order for the division to witness the treatment.

34(d) If hydraulic fracturing is performed on a well, a supplier
35that performs any part of hydraulic fracturing or provides additives
36directly to the operator for hydraulic fracturing shall furnish the
37operator with information needed for the operator to comply with
38 subdivision (e). If a supplier claims trade secret protection pursuant
39to subdivision (h), the supplier shall notify the operator and provide
40to the operator substitute information, as described in subdivision
P6    1(h), suitable for public disclosure. This information shall be
2provided as soon as possible but no later than 30 days following
3the conclusion of the hydraulic fracturing.

4(e) (1) Within 60 days following cessation of hydraulic
5fracturing on a well, the operator shall post or cause to have posted
6to an Internet Web site designated or maintained by the division
7and accessible to the public, all of the hydraulic fracturing fluid
8composition and disposition information required to be collected
9pursuant to rules and regulations adopted under subdivision (b),
10including well identification number and location.

11(2) The division may designate a publicly accessible Internet
12Web site, developed by the Ground Water Protection Council and
13the Interstate Oil and Gas Compact Commission for the posting
14of the data pursuant to paragraph (1), if all of the following
15requirements are met:

16(A) The information is organized on that Internet Web site in a
17format such as a spreadsheet that allows the public to easily search
18and aggregate, to the extent practicable, each type of information
19required to be collected pursuant to subdivision (b) using search
20functions on that Internet Web site.

21(B) The Internet Web site permits any person to export, copy,
22or otherwise obtain in electronic format the data submitted pursuant
23to subdivision (b) from that Internet Web site. Once obtained, there
24shall be no restrictions on the possession or further distribution,
25modification, transmission, or reproduction of any information
26submitted pursuant to this section in any form and by any means
27and no prior authorization shall be required.

28(3) If an Internet Web site is not designated by the division
29pursuant to paragraph (2), the division shall maintain a publicly
30accessible Internet Web site, in compliance with subparagraphs
31(A) and (B) of paragraph (2), for the posting of the data required
32pursuant to paragraph (1).

33(f) The operator is responsible for compliance with this section.

34(g) The names and locations of all known seismic faults within
35a distance from the well bore in any direction equal to five times
36the fracture zone length and the names and locations of seismic
37faults whose movement is reasonably anticipated to impact the
38integrity of the well, well casing, and oil and gas formation shall
39be added to the well history. The fracture zone length is defined
P7    1as the distance from the well bore to the maximum extent of any
2induced fracture.

3(h) (1) The supplier may claim trade secret protection for the
4chemical composition of additives pursuant to Section 1060 of the
5Evidence Code, or the Uniform Trade Secrets Act (Title 5
6(commencing with Section 3426) of Part 1 of Division 4 of the
7Civil Code).

8(2) If a supplier believes that information regarding a chemical
9constituent of a hydraulic fracturing fluid is a trade secret, the
10supplier shall nevertheless disclose the information to the division
11within 30 days following cessation of hydraulic fracturing on a
12well, and shall notify the division in writing of that belief.

13(3) The supplier is not required to disclose trade secret
14information to the operator.

15(4) This subdivision does not permit a supplier to refuse to
16disclose the information required pursuant to this section to the
17division.

18(5) To comply with the public disclosure requirements of this
19section, the supplier shall indicate where trade secret information
20has been withheld and the specific name of a chemical constituent
21shall be replaced with the chemical family name or similar
22descriptor associated with the trade secret chemical information.

23(6) Except as provided in subparagraph (B) of paragraph (8),
24the division shall protect from disclosure any trade secret
25designated as such by the supplier, if that trade secret is not a public
26record.

27(7) The supplier shall notify the division in writing within 30
28days of any changes to information provided to the division to
29support a trade secret claim.

30(8) Upon receipt of a request for the release of information to
31the public, which includes information the supplier has notified
32the division is a trade secret and is not a public record, the
33following procedure applies:

34(A) The division shall notify the supplier of the request in
35writing by certified mail, return receipt requested.

36(B) The division shall release the information to the public, but
37not earlier than 60 days after the date of mailing the notice of the
38request for information, unless, prior to the expiration of the 60-day
39period, the supplier obtains an action in an appropriate court for a
40declaratory judgment that the information is subject to protection
P8    1or for a preliminary injunction prohibiting disclosure of the
2information to the public and provides notice to the division of
3that action.

4(9) Except as provided in subparagraph (B) of paragraph (8),
5trade secret information is not a public record and shall not be
6disclosed to anyone except to an officer or employee of the
7division, the state, or the United States, in connection with the
8official duties of that officer or employee, to a health professional,
9under any law for the protection of health, or to contractors with
10the division or the state and its employees if, in the opinion of the
11division, disclosure is necessary and required for the satisfactory
12performance of a contract, for performance of work, or to protect
13health and safety.

14(10) Except as provided in subparagraph (B) of paragraph (8),
15an officer or employee of the division or former officer or employee
16who, by virtue of that employment or official position, has
17possession of, or has access to, any trade secret subject to this
18section, and who, knowing that disclosure of the information to
19the general public is prohibited by this section, knowingly and
20willfully discloses the information in any manner to any person
21not entitled to receive it, is guilty of a misdemeanor. A contractor
22of the division and any employee of the contractor who has been
23furnished information as authorized by this section shall be
24considered an employee of the division for purposes of this section.

25(11) In the event of exposure to hydraulic fracturing fluids
26necessitating medical care, the person receiving the care shall have
27the right to petition the division to disclose relevant trade secret
28information in order to receive appropriate medical care.

29(i) This section does not apply to routine tests to monitor the
30integrity of wells and well casings.

31(j) A well granted confidential status pursuant to Section 3234
32shall comply with this section, with the exception of the disclosure
33of hydraulic fracturing fluids pursuant to subdivision (e) which
34shall not be required until the confidential status of the well ceases.

35

3158.  

(a) Within 60 days after the date of cessation of
36hydraulic fracturing, the operator shall file with the district deputy,
37in a form approved by the supervisor, true copies of the log, core
38record, and history of work performed, and, if made, true and
39reproducible copies of all electrical, physical, or chemical logs,
40tests, or surveys. Upon a showing of hardship, the supervisor may
P9    1extend the time within which to comply with this section for a
2period not to exceed 60 additional days.

3(b) The supervisor shall include information provided pursuant
4to subdivision (e) of Section 3157 on existing publicly accessible
5maps on the division’s Internet Web site, and make the information
6available such that hydraulic fracturing and related information
7are associated with each specific well. If data are reported on an
8Internet Web site not maintained by the division pursuant to
9paragraph (2) of subdivision (e) of Section 3157, the division shall
10provide electronic links to that Internet Web site. The public shall
11be able to search and sort the hydraulic fracturing and related
12information by at least the following criteria:

13(1) Geographic area.

14(2) Additive.

15(3) Chemical constituent.

16(4) Chemical Abstract Service number.

17(5) Time period.

18(6) Operator.

19(c) Notwithstanding Section 10231.5 of the Government Code,
20on or before January 1, 2016, and annually thereafter, the
21supervisor shall, in compliance with Section 9795 of the
22Government Code, prepare and transmit to the Legislature a
23comprehensive report on hydraulic fracturing in the exploration
24and production of oil and gas resources in California. The report
25shall include aggregated data of all of the information required to
26be reported pursuant to Section 3157 reported by district, county,
27and operator. The report also shall include relevant additional
28information, as necessary, including, but not limited to, all the
29following:

30(1) Aggregated data detailing the disposition of any produced
31water from wells that have undergone hydraulic fracturing.

32(2) Aggregated data detailing the names and locations of seismic
33faults within a distance from the well bore in any direction equal
34to five times the fracture zone length and the names and locations
35of seismic faults whose movement is reasonably anticipated to
36impact the integrity of the well, well casing, and oil and gas
37formation.

38(3) The number of emergency responses to a spill or release.

P10   1(4) Aggregated data detailing the number of times trade secret
2information was not provided to the public, by county and by each
3company, in the preceding year.

4(5) Data detailing the loss of well and well casing integrity in
5the preceding year for wells that have undergone hydraulic
6fracturing treatment. For comparative purposes, data detailing the
7loss of well and well casing integrity in the preceding year for all
8wells shall also be provided. The cause of each well and well casing
9failure, if known, shall also be provided.

10(d) The report shall be made publicly available and an electronic
11version shall be available on the division’s Internet Web site.

12

SEC. 2.  

Section 3213 of the Public Resources Code is amended
13to read:

14

3213.  

The history shall show the location and amount of
15sidetracked casings, tools, or other material, the depth and quantity
16of cement in cement plugs, the shots of dynamite or other
17explosives, and the results of production and other tests during
18drilling operations.begin insert All data on hydraulic fracturing treatments end insert
19begin insertpursuant to Section 3157 shall be recorded in the history.end insert

20

SEC. 3.  

No reimbursement is required by this act pursuant to
21Section 6 of Article XIII B of the California Constitution because
22the only costs that may be incurred by a local agency or school
23district will be incurred because this act creates a new crime or
24infraction, eliminates a crime or infraction, or changes the penalty
25for a crime or infraction, within the meaning of Section 17556 of
26the Government Code, or changes the definition of a crime within
27the meaning of Section 6 of Article XIII B of the California
28Constitution.



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