BILL ANALYSIS �
SB 395
SENATE COMMITTEE ON ENVIRONMENTAL QUALITY
Senator Jerry Hill, Chair
2013-2014 Regular Session
BILL NO: SB 395
AUTHOR: Jackson
AMENDED: April 4, 2013
FISCAL: Yes HEARING DATE: May 1, 2013
URGENCY: No CONSULTANT: Laura Feinstein
and Rachel Machi Wagoner
SUBJECT : HAZARDOUS SUBSTANCES: PRODUCED WATER
SUMMARY :
Existing federal law :
1)Under the Safe Drinking Water Act (SDWA), regulates the
nation's public drinking water supply. The SDWA delegates
authority to the United States Environmental Protection
Agency (US EPA) to regulate Underground Injection Control
(UIC) wells in order to protect drinking water (42 United
States Code �300f et seq.). The UIC program defines Class II
wells as those that:
a) Inject fluids which are brought to the surface in
connection with conventional oil or natural gas
production, known as produced water. Injected produced
water may be commingled with wastes from production
operations.
b) Used for enhanced recovery of oil or natural gas.
c) Used for storage of hydrocarbons which are liquid at
standard temperature and pressure (Code of Federal
Regulations Title 40 �144.6).
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2)Under the Resource Conservation and Recovery Act (RCRA):
a) Requires that wastes are managed in an environmentally
sound manner (42 USC �6901 et seq.).
b) Defines hazardous waste as "waste that is dangerous or
potentially harmful to our health or the environment.
Hazardous wastes can be liquids, solids, gases, or
sludges. They can be discarded commercial products, like
cleaning fluids or pesticides, or the by-products of
manufacturing processes." Hazardous waste are divided
into listed wastes, characteristic wastes, universal
wastes, and mixed wastes. Specific procedures determine
how waste is identified, classified, listed, and delisted.
Existing state law :
1)Creates the Division of Oil, Gas and Geothermal Resources
(DOGGR) within the Department of Conservation and entrusts
DOGGR's Supervisor (supervisor) with extensive authority to
regulate activities associated with the production and
removal of hydrocarbons (e.g. oil and gas) from the ground to
prevent damage to life, health, property, natural resources,
and to underground and surface water suitable for irrigation
or domestic purposes (Public Resources Code �3106).
2)Under a Primacy Agreement with the US EPA, grants DOGGR
oversight over Class II underground injection in California.
3)Under the Toxic Well Injection Control Act (TWICA) of 1985
prohibits a person from discharging hazardous waste into an
injection well unless certain conditions are met (Health and
Safety Code �25159.10 et seq.).
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4)Exempts from the TWICA wells that are regulated by DOGGR (HSC
�25159.12(l)(2)). Therefore, fluids associated with oil and
gas production are injected down Class II wells without
oversight from the Department of Toxic Substances Control
(DTSC) and regardless of whether or not they are hazardous.
5)Under Chapter 6.5 of the Health and Safety Code, entrusts DTSC
with regulating the safe handling and disposal of hazardous
waste (HSC �25100 et seq.).
6)Requires generators of hazardous waste to identify waste that
is hazardous by (California Code of Regulations Title 22
�66262.11):
a) applying knowledge of the waste based on materials or
processes used, or
b) testing a sample of the waste.
c) Defines hazardous waste as any waste that is toxic,
reactive, ignitable, corrosive, and/or listed in Article 4
or Appendix X of Chapter 11 of Division 4.5 of CCR Title
22 (22 CCR �66262.11.).
7)Exempts certain types of oil and gas field Exploration and
Production (E&P) wastes from hazardous waste law. E&P wastes
that meet criteria for hazardous waste based solely on
federal standards for toxicity are excluded from
classification as hazardous waste (22 CCR �66261.24(a)(1)).
This bill :
1)Removes the hazardous waste law exemption in the TWICA for
wells regulated by DOGGR (HSC �25159.12(l)(2)).
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2)Specifies that oilfield wastewater for the purpose of
disposal in a Class II well does not include hazardous waste,
as defined.
3)Authorizes DTSC to regulate fluids injected into Class II
wells.
4)Prohibits the injection of state defined hazardous waste into
Class II wells.
COMMENTS :
1)Purpose of bill . The author's intention is for waste from oil
and gas production to be characterized, and if it is
hazardous under state law, for it to be disposed of following
the same rules and regulations as other hazardous wastes in
California.
According to the author, disposal of hazardous waste in Class
II wells is dangerous for environmental and public health.
Class II wells can be drilled through underground drinking
water aquifers, and a failure in the well casing or an
improperly sealed abandoned well located nearby can serve as
conduits for contamination of groundwater.
The author states that Class I wells, which are governed by
the TWICA, are constructed specifically for the purpose of
underground hazardous waste disposal and are subject to
tighter restrictions than Class II wells. Yet, under the
exemption in current law, Class II wells are also
repositories for hazardous waste from oil and gas production.
The author believes that hazardous waste associated with oil
recovery should meet the same protective requirements
developed for every other type of hazardous waste. The
author states that there is no reason that hazardous waste
from oil recovery should have a special exemption.
According to the author, under SB 395, oil and gas field
operators would be required to determine if their wastes are
hazardous. If the wastes are found to be hazardous, the
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operator could pursue three routes for disposal: 1) ship the
waste offsite to a licensed hazardous waste disposal
facility, 2) treat the waste to be non-hazardous and use it
for another purpose, 3) treat the waste to be non-hazardous
and discharge to surface water, or 4) treat the waste to be
non-hazardous and dispose of it down a Class II well.
The author argues the bill would require that hazardous waste
would be treated to be non-hazardous before disposal,
reducing concerns about toxic substances leaking into
groundwater from Class II disposal wells thereby better
assuring protection of public health.
2)Management of oil and gas exploration and production wastes
in California . Exploration and production (E&P) wastes are
wastes associated with the exploration, development, or
production of crude oil or natural gas, including produced
water and drilling fluids.
DOGGR's guiding principle in managing exploration and
production waste is that produced water is most safely
deposited in the underground formation where it originated.
Their strategy to protect environmental and public health is
to regulate well construction and siting to prevent
contamination of underground drinking water. While they do
require a chemical analysis, they do not require that fluids
be characterized as hazardous or non-hazardous before they
are deposited in Class II wells. As a result, hazardous
fluids can be injected into Class II wells without being
tested for hazardous components.
3)Produced water . The vast majority of E&P waste is produced
water. Produced water is any fluid emitted from an oil or gas
production well. Its origin could be: 1) fluids that were
injected at the surface by the well operator for the purpose
of enhanced oil recovery or hydraulic fracturing that return
to the surface, known as flowback, 2) hydrocarbons, or 3)
brine released from the underground production zone, known as
formation water. Formation water can carry trace elements
from the production zone, some of which are hazardous,
including arsenic, mercury, or naturally occurring
radioactive materials (NORM). The well operator captures the
produced water and separates the commercially valuable
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hydrocarbons. The remaining produced water can be reused for
enhanced oil recovery or hydraulic fracturing, or disposed
of, which generally entails injection down a Class II well.
Industry sources state that the majority of produced water is
not hazardous. Hazardous substances may be present, but at a
sufficiently low concentration to fall below regulatory
standards.
The last study conducted on the potentially hazardous nature
of wastes associated with oil and gas production in
California was published by DTSC in 2002, entitled "Oil
Exploration and Production Wastes Initiative May 2002."
Thirty-two samples of produced water were analyzed at eight
production facilities. Produced water did not exceed the
state's regulatory threshold under California hazardous waste
criteria. In some cases, oily sludges collected from the
bottom of production pits and produced water holding tanks
were hazardous.
4)Produced water and hydraulic fracturing . The nature of
produced water and its disposal has attracted increased
attention in recent years due to the growing use of hydraulic
fracturing. Hydraulic fracturing entails injecting large
volumes of water, chemicals and sand into a well to fracture
the rock and stimulate the flow of oil and gas. A single
hydraulic fracturing job can use from tens of thousands to
millions of gallons of fluid. California does not track the
identity of chemicals used in hydraulic fracturing, although
this is the subject of discussion draft regulations by DOGGR
as well as pending legislation. A report entitled Chemicals
Used In Hydraulic Fracturing by the United States House of
Representatives Committee on Energy and Commerce Minority
Staff showed that between 2005 and 2009, the 14 leading
hydraulic fracturing companies in the United States used over
2,500 hydraulic fracturing products containing 750 compounds.
More than 650 of these products contained chemicals that are
known or possible human carcinogens, regulated under the Safe
Drinking Water Act, or listed as hazardous air pollutants.
According to an article in the National Law Review, it is
estimated that approximately 20 tons of chemicals are added
to each million gallons of water. A typical hydraulic
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fracturing procedure involves 4-7 million gallons of water so
about 80-140 tons of chemicals. Each well requires millions
of gallons of water (which separately is leading to
confrontations over water supply in drought-stricken states).
Some of the water comes back up immediately, along with
additional groundwater. The rest returns over months or
years.
5)Class II wells . Class II wells are the type of Underground
Injection Control (UIC) well that is used to inject fluids
associated with oil and natural gas production. There are
three categories of Class II wells: A) water disposal wells
(also referred to as salt water disposal or simply as
disposal wells), used for injecting fluids associated with
the production of oil and natural gas or natural gas storage
operations; B) enhanced recovery wells, in which fluids are
injected into oil-bearing formations to recover residual oil
and natural gas, and C) hydrocarbon storage wells, which
store hydrocarbons underground.
There were 3,192 water disposal wells, 1,405 of which were
active, listed on DOGGR's Production and Injection database
as of April 12, 2013.
Under the federal SDWA exemption, hydraulically fractured
production wells are not categorized as Class II wells.
However, injection into Class II wells is the main disposal
mechanism for waste from hydraulically fractured production
wells.
6)Commercial Wastewater Disposal Well Facilities . While no
public record has been able to be obtained regarding these
offsite disposal facilities, DOGGR has communicated that
there are approximately eight to ten commercial wastewater
disposal well facilities operating in California. These
facilities operate Class II disposal wells that are regulated
under DOGGR's jurisdiction. They accept wastewater from E&P
activities. DOGGR has noted that these facilities are under
no obligation to verify where the waste comes from or if the
waste is hazardous and if so, allowed to be disposed of in
Class II wells under the current exemption granted for E&P
activities. As stated by DOGGR, there is a "trust" system in
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place that the waste that is being accepted by these
facilities meets the requirements of governing laws.
This bill would require hazardous waste transported to the
facilities be tested, manifested and handled as hazardous
waste.
7)Hazardous waste law, Class I wells, and the Toxic Injection
Well Control Act . Under the Toxic Well Injection Control
Act, Class I wells inject hazardous and non-hazardous wastes
into deep, isolated rock formations that are thousands of
feet below the lowermost underground source of drinking
water. Class I hazardous waste disposal wells are regulated
by DTSC and are classified specifically for the disposal of
hazardous waste. They are subject to a number of
restrictions that do not apply to Class II wells intended to
ensure that hazardous materials do not contaminate
underground drinking water. Requirements applicable to Class
I hazardous waste disposal wells, but not Class II wells,
include the following:
a) No point along the length of the injection well, as
measured either horizontally or vertically, is located
within one-half mile of drinking water.
b) The injection well does not discharge hazardous
waste into or above a formation which contains a source
of drinking water within one-half mile of the well.
c) DTSC inspects annually.
d) Injection fluids sampled and analyzed at least
monthly.
e) Water quality monitoring wells must be installed in
the vicinity of the injection well in accordance with
DTSC approval to determine a number of factors,
including any changes in quality of drinking water
within at least one half-mile of the well (HSC
��25159.15, 25159.17).
8)Arguments in Opposition . Opponents state that as long as
produced water is reinjected into an underground formation in
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a closed-loop system and is not exposed to the environment,
DOGGR properly regulates the handling of those fluids. They
feel that the safest strategy for managing produced water is
to return it to the formation where it originated. Opponents
argue that produced water from oil and gas production is
already highly regulated by the state and regional water
quality control boards.
Opponents are concerned that Class II wells would be subject to
the Toxic Well Injection Control Act. They argue that this
regulatory change would impose an excessive regulatory burden
and cause the cessation of much of the oil production
activity in the state.
Opponents state that Class II injection wells have an
outstanding record for environmental protection, and DTSC
found in their 2002 report that the majority of E&P waste is
not hazardous. Opponents feel there is a lack of evidence for
widespread pollution incidents caused by produced water under
the existing system.
Opponents add that produced water has beneficial reuses. It can
be used to produce steam for reinjection as part of the
production process, or cleaned and sold for irrigation.
Opponents further state that injecting produced water
prevents land subsidence. If a large proportion of produced
water could no longer be used for injection, they would need
to inject potable water in its place.
Opponents are concerned that hauling hazardous waste for
disposal off-site would cause environmental harm because of
truck emissions, and could potentially overwhelm the state's
licensed hazardous waste disposal facilities.
9) Are Class II wells safe ? In 2012, the journal ProPublica
published an article. They reviewed records of more than
220,000 well inspections submitted to the EPA's underground
injection control program by state officials. ProPublica
found that for California's 29,505 Class II water disposal
wells, there were twelve reported cases of drinking water
contamination from Class II wells. At present DOGGR does
not publish compiled information on well casing failures or
water contamination for its Internet web site or annual
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reports.
10)Amendments needed . As written, the bill requires well
operators to characterize waste as hazardous or
non-hazardous before disposal. Under Title 22 CCR
�66262.11(b)(2), waste characterization can be based on
knowledge or testing. That is, a well operator can rely on
general knowledge of the wastes they generate to infer
whether a particular material is hazardous. A clarifying
amendment is needed to specify that operators are required
to test the exploration and production waste they generate
on a routine basis.
11)Related Legislation .
SB 665 (Wolk) of 2012 would alter the requirements for the
indemnity bonds purchased by operators of commercial water
disposal wells. SB 665 is in the Senate Committee on Natural
Resources and Water.
AB 669 (Stone) of 2012 requires well operators to gain
approval from the State Oil and Gas Supervisor for the
disposal method and location of wastewater disposal for the
well, and requires the Supervisor to include information on
the disposal of wastewater in their annual report. AB 669 is
in the Assembly Committee on Appropriations.
AB 982 (Williams) of 2012 requires extensive groundwater
monitoring in the vicinity of hydraulic fracturing. AB 982 is
in the Assembly Committee on Appropriations.
SB 4 (Pavley) of 2012 provides a comprehensive framework for
hydraulic fracturing regulation. SB 4 is in the Senate
Committee on Environmental Quality.
AB 7 (Wieckowski) of 2012 provides a comprehensive framework
for hydraulic fracturing regulation. AB 7 is in the Assembly
Committee on Natural Resources.
AB 288 (Levine) of 2012 provides general principles to
regulate hydraulic fracturing to protect public health and
safety. AB 288 is in the Assembly Committee on
Appropriations.
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AB 649 (Nazarian) of 2012 directs a panel to investigate
hydraulic fracturing and places a moratorium on fracking that
would be lifted if the panel deems the practice to be safe.
AB 649 bans the use of fresh water in hydraulic fracturing as
well as hydraulic fracturing near an aquifer. AB 649 is in
the Assembly Committee on Natural Resources.
AB 1323 (Mitchell) of 2012 bans hydraulic fracturing until a
study shows how it can be done safely. It provides for an
advisory council and a study with formal public review. AB
1323 is in the Assembly Committee on Natural Resources.
SOURCE : Senator Jackson
SUPPORT : California Coastal Protection Network
Carpinteria Valley Association
Citizens Planning Association of Santa Barbara
County
Clean Water Action
Environmental Defense Center
Environmental Working Group
Forests Forever
Get Oil Out!
Natural Resources Defense Council
Santa Barbara County Action Network
Santa Ynez Valley Alliance
Sierra Club California
Surfrider Foundation, Santa Barbara Chapter
OPPOSITION : Brea Chamber of Commerce
California Business Properties Association
California Chamber of Commerce
California Independent Petroleum Association
California Manufacturers & Technology
Association
Camarillo Chamber of Commerce
City of Long Beach Mayor Bob Foster
Southwest California Legislative Council
Western States Petroleum Association
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