BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                            



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                                 UNFINISHED BUSINESS


          Bill No:  SB 4
          Author:   Pavley (D), et al.
          Amended:  9/6/13
          Vote:     21

           
           SENATE NATURAL RESOURCES AND WATER COMMITTEE  :  6-2, 4/9/13
          AYES:  Pavley, Evans, Hueso, Jackson, Monning, Wolk
          NOES:  Cannella, Fuller
          NO VOTE RECORDED:  Lara

           SENATE ENVIRONMENTAL QUALITY COMMITTEE  :  6-2, 5/1/13
          AYES:  Hill, Corbett, Hancock, Jackson, Leno, Pavley
          NOES:  Gaines, Fuller
          NO VOTE RECORDED:  Calderon

           SENATE APPROPRIATIONS COMMITTEE  :  5-2, 5/23/13
          AYES:  De León, Hill, Lara, Padilla, Steinberg
          NOES:  Walters, Gaines

           SENATE FLOOR  :  28-11, 5/29/13
          AYES:  Beall, Block, Calderon, Corbett, Correa, De León,  
            DeSaulnier, Evans, Galgiani, Hancock, Hernandez, Hill, Hueso,  
            Jackson, Lara, Leno, Lieu, Liu, Monning, Padilla, Pavley,  
            Price, Roth, Steinberg, Torres, Wolk, Wright, Yee
          NOES:  Anderson, Berryhill, Cannella, Emmerson, Fuller, Gaines,  
            Huff, Knight, Nielsen, Walters, Wyland
          NO VOTE RECORDED:  Vacancy

           ASSEMBLY FLOOR  :  Not available


           SUBJECT  :    Oil and gas:  well stimulation
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           SOURCE  :     Author


           DIGEST  :    This bill establishes a comprehensive regulatory  
          program for oil and gas well stimulation treatments (e.g.,  
          hydraulic fracturing, acid well stimulation), which includes,  
          among other things, a study, the development of regulations, a  
          permitting process, and public notification and disclosure.

           Assembly Amendments  make numerous substantive and clarifying  
          changes including (1) removal the fracking permit moratorium  
          tied to when the independent scientific study is completed; (2)  
          revise the scope of this bill to include both hydraulic  
          fracturing and acid well stimulation treatments ("acidizing");  
          (3) require the Division of Oil, Gas and Geothermal Resources  
          (DOGGR) to establish "threshold values" through its rulemaking  
          process to identify acid matrix stimulation treatments subject  
          to the bill's permitting requirements; (4) revise the "savings"  
          clause; (5) offer a variety of other regulatory tools to all  
          applicable regulatory entities beyond this bill; (6) add  
          regional groundwater monitoring in the vicinity of oil and gas  
          fields; (7) require the State Water Resources Control Board  
          (SWRCB) to develop model criteria with input from experts and  
          stakeholders; (8) require the SWRCB to perform the monitoring in  
          high priority areas (9) add groundwater monitoring to the well  
          stimulation treatment permit requirement; (10) require the state  
          to complete a statewide environmental impact report (EIR); (11)  
          require that the ingredient list of trade secret chemical  
          additives be disclosed; and (12) shift the advance neighbor  
          notification requirement to a third party from the well owner,  
          and require that tenants be notified. 

           ANALYSIS  :    Existing law: 

          1. Requires the 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  

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             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.  Prohibits the commencement  
             of drilling 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, requires that failure  
             to be considered an approval of the notice.

          This bill:

           1. Defines "well stimulation treatment" as any treatment of a  
             well designed to enhance oil and gas production or recovery  
             by increasing the permeability of the formation.  Specifies  
             that hydraulic fracturing and acid well stimulation are well  
             stimulation treatments.  Specifies that steam flooding, water  
             flooding, cyclic steaming, routine removal of formation  
             damage due to drilling, routine well cleanout work, routine  
             well maintenance, bottom hole pressure surveys, and routine  
             activities that do not affect the integrity of the well or  
             the formation are not well stimulation treatments. 

           2. Requires, on or before January 1, 2015, the Secretary of the  
             Natural Resources Agency to complete a comprehensive  
             independent scientific study on well stimulation treatments.   
             Requires the scientific study to evaluate the hazards and  
             risks that well stimulation treatments pose to natural  
             resources and public, occupational, and environmental health  
             and safety. 

           3. Requires, on or before January 1, 2015, DOGGR, in  
             consultation with the Department of Toxic Substances Control  
             (DTSC), the State Air Resources Board (ARB), the SWRCB, the  
             Department of Resources Recycling and Recovery (CalRecycle),  
             and any local air districts and regional water quality  
             control boards in areas where well stimulation treatments may  
             occur, to adopt rules and regulations specific to well  
             stimulation treatments.  Requires these regulations to  
             include the following:  (a) revisions to the rules and  
             regulations governing construction of wells and well casings  
             to ensure the integrity of wells, well casings, and the  

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             geologic and hydrologic isolation of the oil and gas  
             formation during and following well stimulation treatments,  
             (b) full disclosure of the composition and disposition of  
             well stimulation fluids, (c) a provision for the well  
             operator to provide for baseline and followup water testing  
             upon request by a nearby property owner; and (d) threshold  
             values for acid matrix stimulation treatments, as specified. 

           4. Requires, while regulations are being developed, DOGGR to  
             allow all well stimulation treatment activities, provided  
             that various conditions are met, including the following: 

              A.    The owner or operator of the well certifies compliance  
                with the disclosure and notification requirements in the  
                bill; 

              B.    The owner or operator provides to DOGGR on or before  
                March 1, 2015 a complete well history incorporating the  
                disclosure information required in the bill; and 

              C.    DOGGR conducts an EIR (to be completed by July 1,  
                2015) to provide the public with detailed information  
                regarding any potential environmental impacts of well  
                stimulation in the state. 

           1. Requires, on or before January 1, 2015, DOGGR to enter into  
             formal agreements with DTSC, ARB, SWRCB, CalRecycle, and any  
             local air districts and regional water quality control boards  
             in areas where well stimulation treatments may occur, that  
             clearly delineate respective authority, responsibility, and  
             notification and reporting requirements associated with well  
             stimulation treatments and well stimulation treatment-related  
             activities, including air and water quality monitoring, in  
             order to promote regulatory transparency and accountability. 

           2. Requires the operator of an oil and gas well who wishes to  
             perform well stimulation treatments to first apply for a  
             permit with DOGGR to conduct such treatments.  Requires the  
             permit to include the well identification number and  
             location; the time period during which the treatment is  
             planned to occur; a water management plan regarding water  
             quantity, source, and disposal; specific information related  
             to the chemicals used in the treatment; the planned location  
             of the treatment on the well bore; the estimated length,  

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             height, and direction of the induced fractures; the location  
             of existing wells, including plugged and abandoned wells,  
             that may be impacted; a ground water monitoring plan; and the  
             estimated amount of treatment-generated waste material and an  
             identified disposal method for the waste materials.  Requires  
             the permit to expire one year from the date of issuance. 

           3. Provides for the pre-Well Stimulation Treatment  
             Notification:

              A.    Within five business days of issuing a permit to  
                perform a well stimulation treatment, requires DOGGR to  
                provide a copy of the permit to the appropriate regional  
                water quality control board(s) and to the local planning  
                entity where the well, including the subsurface portion,  
                is located. 

              B.    Within five business days of issuing a permit to  
                perform a well stimulation treatment, requires DOGGR to  
                post the permit on a publicly accessible portion of its  
                Internet Web site. 

              C.    Requires that a copy of the approved well stimulation  
                permit and information on the available water sampling and  
                testing, as described, be provided to every tenant of the  
                surface property and every surface property owner whose  
                property line location is within a 1,500 foot radius of  
                the wellhead or within 500 feet from the horizontal  
                projection of all subsurface portions of the designated  
                well to the surface.  Allows well stimulation treatment to  
                commence 30 days after the permit copies are provided to  
                the appropriate surface property tenants and owners. 

              D.    Requires the operator of the oil and gas well to  
                provide DOGGR at least 72 hours' notice prior to the  
                actual start of the well stimulation treatment in order  
                for DOGGR to witness the treatment. 

           1. Allows a property owner who receives a well stimulation  
             treatment notice to request water quality sampling and  
             testing from a qualified contractor designated by the  
             regional water quality control board.  Requires the well  
             owner or operator to pay for this sampling and testing. 


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           2. Requires, within 60 days after the cessation of well  
             stimulation treatment, the operator of the oil and gas well  
             to post to an Internet Web site designated or maintained by  
             DOGGR and accessible to the public, all of the well  
             stimulation fluid composition and disposition information  
             required to be collected, including well identification  
             number, well location, and collected water quality data.   
             Requires DOGGR to have its Internet Web site operational on  
             or before January 1, 2016.  Requires DOGGR's Internet Web  
             site to organize the reported information in a format, such  
             as a spreadsheet, that allows the public to easily search and  
             aggregate each type of information required.  Authorizes  
             DOGGR to direct reporting to fracfocus.org in the interim.   
             Requires DOGGR to allow the public to search and sort the  
             well stimulation and related information by at least the  
             following criteria:  (a) geographic area; (b) additive; (c)  
             chemical constituent; (d) Chemical Abstract Service number;  
             (e) time period; and (f) operator. 

           3. Allows a supplier of well stimulation chemicals to claim  
             trade secret protections for the chemical composition of  
             additives; however, the supplier must still provide the trade  
             secret information to DOGGR.  Requires a supplier to  
             substantiate a trade secret claim, which is reviewed by  
             DOGGR.  If the supplier legitimately claims a trade secret,  
             requires the supplier to publicly disclose where trade secret  
             information has been withheld and provide substitute  
             information as specified. 

           4. Requires, if DOGGR receives a request for release of the  
             trade secret information to the public, DOGGR to notify the  
             supplier of the request and give the supplier at least 60  
             days to commence a court action to prohibit the release of  
             information. 

           5. Allows disclosure of trade secret information to a  
             government officer or employee in connection with his/her  
             official duties or to a contractor with a government entity  
             if, in the opinion of DOGGR, disclosure is necessary and  
             required for satisfactory performance of a contract or to  
             protect health and safety. 

           6. Authorizes disclosure of trade secret information to a  
             health professional in the event of an emergency or to  

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             diagnose or treat a patient. 

           7. Requires, to protect public health, a supplier to provide  
             trade secret information to a health professional,  
             toxicologist, or epidemiologist who is employed in the field  
             of public health and who provides a written statement of  
             need.  Requires the written statement of need to include the  
             public health purpose and reason the disclosure of the  
             specific chemical and its concentration is required. 

           8. Prohibits the following information from be protected as  
             trade secret:  the identities of the chemical constituents of  
             additives; the concentration of the additives in the well  
             stimulation treatment fluids; any air or other pollution  
             monitoring data; health and safety data associated with well  
             stimulation treatment fluids; and the chemical composition of  
             the flowback fluid. 

           9. Requires annual public reports from DOGGR containing data  
             and information on well stimulation as specified. 

           10.Authorizes a civil penalty between $10,000 to $25,000 per  
             day against a person who violates the well stimulation  
             requirements in this bill. 

           11.Authorizes, subject to appropriation by the Legislature,  
             DOGGR's fee authority to be used to fund a public entity's  
             costs associated with well stimulation treatments including  
             rulemaking and scientific studies required to evaluate the  
             treatment, inspections, and any air and water quality  
             sampling, monitoring, and testing performed by public  
             entities and the costs of SWRCB and the regional water  
             quality control boards for its groundwater monitoring  
             program.

           12.Requires, on or before July 1, 2015, SWRCB to develop model  
             groundwater monitoring criteria to be implemented either on a  
             well-by-well basis for a well subject to well stimulation  
             treatment, or on a regional scale.  Requires, on or before  
             January 1, 2016, SWRCB or appropriate regional water quality  
             control board to begin implementation of the regional  
             groundwater monitoring programs. Where there is no regional  
             groundwater monitoring plan approved by SWRCB or regional  
             water quality control board, requires the use of the  

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             well-by-well groundwater monitoring plan.

           Background
           
           Background on well stimulation  .  According to the Western States  
          Petroleum Association (WSPA), hydraulic fracturing (also known  
          as fracking) is a form of well stimulation 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. 

          Another form of well stimulation is called acid matrix  
          stimulation, which involves the injection of acid-such as  
          hydrochloric or hydrofluoric-into an oil and gas well to create  
          or enhance channels for the oil and gas.  Unlike hydraulic  
          fracturing, acid matrix stimulation injection pressures are not  
          high enough to fracture the formation. 

          In 2005, Congress enacted what is colloquially referred to as  
          the "Halliburton Loophole," which exempts hydraulic fracturing  
          (except when involving the injection of diesel fuels) from the  
          federal Safe Drinking Water Act (SDWA).  As a result of this  
          action, the U.S. Environmental Protection Agency (US EPA) lacks  
          the authority to regulate hydraulic fracturing activities that  
          do not use diesel fuel as an additive. 

          Around the same time that Congress exempted hydraulic fracturing  
          from SDWA, the country experienced a boom in the production of  
          shale oil and gas.  From 2007 to 2011, shale oil production  

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          increased more than fivefold, from approximately 39 million  
          barrels to about 217 million barrels, and shale gas production  
          increased approximately fourfold, from 1.6 trillion cubic feet  
          to 7.2 trillion cubic feet.  This increase in production was  
          driven primarily by technological advances in horizontal  
          drilling and hydraulic fracturing that made more shale oil and  
          gas development economically viable. 

          But with this boom comes various issues with regard to  
          environmental health and safety, which has caused enormous  
          public anxiety.  Cases of environmental contamination attributed  
          to hydraulic fracturing have been reported in Wyoming, Texas,  
          Colorado, West Virginia, and Pennsylvania.  Consequently,  
          governments at all levels across the country are looking to  
          regulate the practice and address these concerns. 

           The risks associated with shale oil and gas development  .   
          According to a recent report from the U.S. Government  
          Accountability Office (GAO), which is an independent,  
          nonpartisan agency that works for Congress, "[d]eveloping oil  
          and gas resources?poses inherent environmental and public health  
          risks, but the extent of risks associated with shale oil and gas  
          development is unknown, in part, because the studies we reviewed  
          do not generally take into account potential long-term,  
          cumulative effects."  The GAO's report categorizes the  
          environmental risks into the four major categories: air quality,  
          water quantity, water quality, and land and wildlife. 

          With regard to air quality, the risks are "generally the result  
          of engine exhaust from increased truck traffic, emissions from  
          diesel-powered pumps used to power equipment, intentional  
          flaring or venting of gas for operational reasons, and  
          unintentional emissions of pollutants from faulty equipment."   
          The GAO report also explains how silica sand, a proppant  
          commonly used in hydraulic fracturing, and storing fracturing  
          fluids and produced waters in impoundments can cause air quality  
          issues.  Silica sand, if not properly handled, can become  
          airborne, lodge into a person's lungs, and cause silicosis,  
          which is an incurable lung disease.  Impoundments (i.e., ponds)  
          containing fracturing fluids and produced waters (i.e., the  
          water produced when oil and gas are extracted from the ground)  
          pose a risk because the evaporation of the fluids has the  
          potential to release contaminants into the atmosphere. 


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          With regard to water quantity, water is used for well drilling  
          operations to make drilling mud as well as to cool and lubricate  
          the drill bits.  Water is also the primary component of  
          hydraulic fracturing fluids.  According to the GAO, "the amount  
          of water used for shale gas development is small in comparison  
          to other water uses, such as agriculture and other industrial  
          purposes.  However, the cumulative effects of using surface  
          water or ground water at multiple oil and gas development sites  
          can be significant at the local level, particularly in areas  
          experiencing drought conditions."  It should be noted that the  
          oil and gas industry and DOGGR both assert that the amount of  
          water used for hydraulic fracturing in California is a fraction  
          of what is used in other states.  This assertion is based on  
          information voluntarily provided by oil and gas operators.  It  
          is not clear whether this information is representative of all  
                                                                hydraulic fracturing in the state.  Additionally, with the  
          potential for an oil boom in the Monterey Shale (which is  
          explained in more detail below), it is too speculative to  
          determine the type and amount of well stimulation that will take  
          place in the future and how much water will be needed. 

          With regard to water quality, the GAO explains that shale oil  
          and gas development pose risks from contamination of surface  
          water and ground water as a result of spills and releases of  
          hydraulic fracturing chemicals, produced water, and drill  
          cuttings.  Spills and releases of these materials can occur as a  
          result of tank ruptures, blowouts, equipment or impoundment  
          failures, overfills, vandalism, accidents, ground fires, or  
          operational errors. 

          The potential for the spill and release of chemicals involved in  
          hydraulic fracturing has received a great amount of public  
          attention.  According to a recent congressional report, between  
          2005 and 2009, oil and gas companies throughout the U.S. used  
          hydraulic fracturing products containing 29 chemicals that are  
          known or possible human carcinogens; regulated under the SDWA  
          for their risk to human health; or listed as hazardous air  
          pollutants under the Clean Air Act.  As for produced water, it  
          can carry a range of contaminants, including hydraulic  
          fracturing chemicals, salts, metals, oil, grease, dissolved  
          organics, and naturally occurring radioactive materials.  Drill  
          cuttings (i.e., the broken bits of solid material removed from  
          drilling) may contain naturally occurring radioactive materials,  
          as well. 

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          The potential for underground migration is also a potential risk  
          to water quality.  The GAO explains that "[u]nderground  
          migration can occur as a result of improper casing and cementing  
          of the wellbore as well as the intersection of induced fractures  
          with natural fractures, faults, or improperly plugged dry or  
          abandoned wells.  There are also concerns that induced fractures  
          can grow over time and intersect with drinking water aquifers."   
          It should be noted that the oil and gas industry has provided  
          information claiming that hydraulic fracturing typically occurs  
          thousands of feet below the earth's surface and that the well  
          casing for these wells extends below an impervious layer of rock  
          "that would prevent any migration of fluids up into the drinking  
          water supply."  Assuming that the industry is correct, there is  
          still the problem with well casing failures.  A 2000 Society of  
          Petroleum Engineers article regarding an oil field in Kern  
          County explained that "the well failure rate, although lower  
          than that experienced in the 1980s, is still economically  
          significant at 2 to 6% of active wells per year."  In  
          Pennsylvania, poor cementing around a well casing allowed  
          methane to contaminate the water wells of 19 families.   
          Moreover, little data exists on fracture growth in shale  
          formations following multistage hydraulic fracturing over an  
          extended time period; the frequency with which refracturing of  
          horizontal wells may occur; the effect of refracturing on  
          fracture growth over time; and the likelihood of adverse effects  
          on drinking water aquifers from a large number of hydraulically  
          fractured wells in close proximity to each other. 

          With regard to land and wildlife, the GAO explains that  
          "clearing land of vegetation and leveling the site to allow  
          access to the resource, as well as construction of roads,  
          pipelines, storage tanks, and other infrastructure needed to  
          extract and transport the resource can fragment habitats?[which]  
          increases disturbances?, provides pathways for predators, and  
          helps spread nonnative plant species."  Noise, the presence of  
          new infrastructure, and spills of oil, gas, or other toxic  
          chemicals are other risks that can negatively affect wildlife  
          and habitat.  There is also the issue of earthquakes and  
          hydraulic fracturing.  According to the GAO report, well  
          injections, especially the injection of produced water, have  
          been connected to seismicity. 

          Ideally, the environmental risks referenced above would be  

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          analyzed by the lead agency under CEQA.  However, according to a  
          complaint in a recent lawsuit filed against DOGGR by a number of  
          environmental groups, the agency has been "approving permits for  
          oil and gas wells after exempting such projects from  
          environmental review or? issuing boilerplate negative  
          declarations finding no significant impacts from these  
          activities." 

           Well stimulation in California  .  According to the oil and gas  
          industry, hydraulic fracturing has been used in California for  
          decades.  The industry claims that over 90% of hydraulic  
          fracturing occurs in Kern County, in areas with no potable  
          water, no surrounding population, and no other significant  
          business interests.  However, reports from various sources  
          suggest that hydraulic fracturing in California will likely  
          increase significantly in the upcoming years, spreading to areas  
          throughout the state. 

          A recent report from the University of Southern California  
          explains that "California boasts perhaps the largest deep-shale  
          reserves in the world.  Those reserves exist within the Monterey  
          Shale Formation, a 1,750 square mile swath of mostly underground  
          shale rock that runs lengthwise through the center of the state,  
          with the major portion in the San Joaquin Basin."  The U.S.  
          Energy Department estimates that the Monterey Shale contains  
          more than 15 billion barrels of oil, accounting for  
          approximately two-thirds of the shale-oil reserve in the U.S.   
          Additionally, according to a 2008 paper published by the Society  
          of Petroleum Engineers, "it is believed that hydraulic  
          fracturing has a significant potential in many Northern  
          California gas reservoirs." 

          DOGGR, although having statutory authority to regulate well  
          stimulation, has not yet developed regulations to address the  
          activity. As explained below, the agency is currently focused on  
          developing regulations that require oil and gas operators to  
          take certain protective measures and provide information about  
          hydraulic fracturing operations. 

           DOGGR's Draft Regulations  .  On December 28, 2012, DOGGR released  
          a pre-rulemaking discussion draft of regulations on hydraulic  
          fracturing-this draft does not address other forms of well  
          stimulation, such as acid matrix stimulation.  The proposed  
          hydraulic fracturing regulations attempt to impose requirements  

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          on operators aimed to improve transparency and safety.   
          Specifically, the proposed regulations would require an operator  
          to:  (1) submit information to DOGGR at least 10 days prior to  
          beginning hydraulic fracturing operations and notify DOGGR at  
          least 24 hours prior to commencing hydraulic fracturing  
          operations (advance disclosure of hydraulic fracturing chemicals  
          is not required); (2) prior to operations, test the structural  
          integrity of wells and casings to prevent fluid migration; (3)  
          store and handle hydraulic fracturing fluids in a specified  
          manner; (4) monitor a specified set of parameters during  
          hydraulic fracturing operations and, in case a breach occurs,  
          terminate operations and immediately notify DOGGR about the  
          breach; (5) after the conclusion of operations, monitor wells  
          for up to 30 days and maintain data for a period of five years;  
          and (6) disclose data to a Chemical Disclosure Registry (such as  
          fracfocus.org) that is not a trade secret, unless a health  
          professional submits a written statement of need stating that  
          the trade secret information will be used for diagnosis or  
          treatment of an individual exposed to hazardous hydraulic  
          fracturing chemicals and the health professional also executes a  
          confidentiality agreement.
           
          CEQA review of oil and gas wells  .  DOGGR regularly approves oil  
          and gas development proposals under the CEQA categorical  
          exemptions for minor alterations to land or existing facilities,  
          or by way of negative or mitigated negative declarations.  As a  
          result, oil and gas permits are rarely reviewed in EIRs that  
          would evaluate the potential risks associated with hydraulic  
          fracturing.

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    
          Local:  Yes

          According to the Assembly Appropriations Committee: 

           1. One-time costs of $2 million for DOGGR's initial activities  
             including rulemaking.  Ongoing costs of approximately $2  
             million for DOGGR to provide regulatory oversight. 

           2. Unknown Increased initial and ongoing costs to the SWRCB and  
             regional boards to provide groundwater monitoring depending  
             on well activity. 

           3. Unknown significant costs to the Natural Resources Agency,  

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             potentially in the hundreds of thousands of dollars to  
             conduct an independent scientific study. 

           4. Ongoing costs of approximately $2 million for the ARB to  
             update their regulations and provide associated monitoring. 

           5. Unknown one-time and ongoing costs for CalRecycle and the  
             DTSC likely in the hundreds of thousands of dollars to  
             consult with DOGGR in regulation development and form  
             multi-agency agreements.

           SUPPORT  :   (Verified  9/11/13)

          Senator Dianne Feinstein
          Alameda County Water District
          American Lung Association in California
          Association of California Water Agencies
          California Association of Environmental Health Administrators
          California Association of Professional Scientists
          California Coastal Protection Network
          California Interfaith Power and Light
          Citizens for Responsible Oil and Gas
          City of Los Angeles Councilmember, Gil Cedillo
          City of Malibu Mayor, Lou LaMonte
          City of Moorpark
          City of Moorpark Councilmember, David Pollock
          City of Oxnard Councilmember, Carmen Ramirez
          City of Ventura Councilmember, Brian Brennan
          Clean Coalition
          Community Alliance with Family Farmers
          County of Ventura Supervisor, Linda Parks
          County of Ventura Supervisor, Steve Bennett
          Earthworks
          Environmental Defense Center
          Los Angeles Community College District
          Los Angeles County Board of Supervisors
          Los Angeles County Democratic Party Central Committee
          Paw PAC
          San Fernando Valley Young Democrats
          San Francisco Baykeeper 
          Santa Cruz County Board of Supervisors
          South Coast Air Quality Management District
          The League of Women Voters
          The Nature Conservancy

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                                                                       SB 4
                                                                     Page  
          15

          Ventura County Board of Supervisors

           OPPOSITION  :    (Verified  9/11/13)

          American Chemistry Council
          California Business Properties Association
          California Chamber of Commerce
          California Environmental Justice Alliance 
          California Independent Petroleum Association
          California Manufacturers and Technology Association
          Center for Biological Diversity 
          Department of Finance 
          Food and Water Watch
          Halliburton Energy Services, Inc.
          Kern County Board of Supervisors
          Physicians for Social Responsibility - Los Angeles 
          Sierra Club California
          Southwest California Legislative Council
          Western States Petroleum Association

           ARGUMENTS IN SUPPORT  :    The Environmental Defense Center  
          states, "while the state of California is widely regarded as the  
          nation's leader on environmental issues, our state lags far  
          behind other major oil and gas producing states in the  
          development of a legal and regulatory framework to address  
          fracking and the significant risks it poses to the public  
          health, safety, and the natural environment?  No one but the oil  
          industry truly knows the location, extent, or frequency of  
          fracking, the source and volume of water used, or what chemicals  
          are being utilized?  SB 4 would remedy this unacceptable status  
          quo."

          Ventura County states the county is "highly dependent on local  
          groundwater resources for potable water, and groundwater is the  
          lifeblood of the County's $1 billion-plus agricultural industry?  
           Ventura County has historically balanced oil and gas production  
          and the jobs it brings with the protection of our natural and  
          agricultural resources.  It is important that this balancing  
          continue to occur."

           ARGUMENTS IN OPPOSITION  :    In a joint letter, the Western  
          States Petroleum Association states that "SB 4 imposes a  
          moratorium on the use of hydraulic fracturing in oil and gas  
          production starting on January 1, 2015, until [the state's]  

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                                                                       SB 4
                                                                     Page  
          16

          regulations are complete.  This would unnecessarily and  
          substantially threaten our supplies of oil and natural gas,  
          raising business costs and harming California's economy."  They  
          continue, "This significant, untimely burden on California's  
          businesses and economy is unnecessary.  Oil and gas production  
          as a whole is heavily regulated and monitored, and hydraulic  
          fracturing has been used for decades with no reported incidents  
          of harm to the environment or public health.  Opponents argue  
          that SB 4 will not provide added public health or environmental  
          protections, but it will increase business costs, hamper  
          California's economic recovery and deprive our state of  
          much-needed fuel, jobs and tax revenues indefinitely."


          RM:k  9/11/13   Senate Floor Analyses 

                           SUPPORT/OPPOSITION:  SEE ABOVE

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