BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 395|
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THIRD READING
Bill No: SB 395
Author: Jackson (D)
Amended: 5/28/13
Vote: 21
SENATE ENVIRONMENTAL QUALITY COMMITTEE : 6-3, 5/1/13
AYES: Hill, Corbett, Hancock, Jackson, Leno, Pavley
NOES: Gaines, Calderon, Fuller
SENATE APPROPRIATIONS COMMITTEE : 5-2, 5/23/13
AYES: De Le�n, Hill, Lara, Padilla, Steinberg
NOES: Walters, Gaines
SUBJECT : Hazardous waste: wells
SOURCE : Author
DIGEST : This bill authorizes the Department of Toxic
Substances Control (DTSC) to regulate fluids injected into Class
II wells, and prohibits the injection of state defined hazardous
waste into Class II wells.
ANALYSIS : Existing federal law, 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. The UIC
program defines Class II wells as specified.
Existing state law:
CONTINUED
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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.
2.Under a Primacy Agreement with the U.S. 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.
4.Exempts from the TWICA wells that are regulated by DOGGR.
Therefore, fluids associated with oil and gas production are
injected down Class II wells without oversight from DTSC and
regardless of whether or not they are hazardous.
5.Entrust DTSC with regulating the safe handling and disposal of
hazardous waste.
6.Requires generators of hazardous waste to identify waste that
is hazardous, as specified.
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.
This bill:
1.Specifies that oilfield wastewater for the purpose of disposal
in a Class II well does not include hazardous waste, as
defined.
2.Authorizes DTSC to regulate fluids injected into Class II
wells.
3.Prohibits the injection of state defined hazardous waste into
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Class II wells.
4.Requires a generator of produced water to test the produced
water in order to determine whether it is hazardous waste
within the meaning of specified provisions.
5.Authorizes the generator of the produced water, that meets
specified requirements, may apply knowledge in testing to
determine whether produced water is hazardous waste, if there
has been sufficient prior testing that illustrates that the
produced water is not hazardous and there is a reasonable
expectation that the produced water will continue to have the
same characteristics it had at the time of that prior testing.
These requirements include: 1) the produced water is
produced by a system in which no materials are added before
being disposed or reused, and 2) the produced water is
immediately reinjected back into a well after oil and gas is
removed.
Background
Management of oil and gas exploration and production wastes in
California . 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.
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
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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.
The well operator captures the produced water and separates the
commercially valuable 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.
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.
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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 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.
Class II wells . Class II wells are the type of 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.
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 place that the waste that is
being accepted by these facilities meets the requirements of
governing laws.
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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, as specified.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee, unknown costs
from the Hazardous Waste Control Account (special fund) for
increased workload to DTSC to oversee hazardous waste associated
with oil and gas wells. This increased workload would be offset
by fees from the regulated party.
SUPPORT : (Verified 5/28/13)
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 : (Verified 5/28/13)
Brea Chamber of Commerce
California Business Properties Association
California Chamber of Commerce
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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
ARGUMENTS IN SUPPORT : 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's office, 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.
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.
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 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.
This bill requires 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
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thereby better assuring protection of public health.
ARGUMENTS IN OPPOSITION : Opponents state that as long as
produced water is reinjected into an underground formation in 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.
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.
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. 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.'
RM:nl 6/3/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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