BILL ANALYSIS Ó
AB 356
Page 1
ASSEMBLY THIRD READING
AB
356 (Williams)
As Amended June 1, 2015
Majority vote
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|Committee |Votes |Ayes |Noes |
| | | | |
| | | | |
|----------------+------+--------------------+----------------------|
|Natural |6-2 |Williams, Cristina |Dahle, Harper |
|Resources | |Garcia, McCarty, | |
| | |Rendon, | |
| | | | |
| | | | |
| | |Mark Stone, Wood | |
| | | | |
|----------------+------+--------------------+----------------------|
|Appropriations |11-6 |Gomez, Bonta, |Bigelow, Chang, Daly, |
| | |Calderon, Eggman, |Gallagher, Jones, |
| | |Eduardo Garcia, |Wagner |
| | |Gordon, Holden, | |
| | |Quirk, Rendon, | |
| | |Weber, Wood | |
| | | | |
| | | | |
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SUMMARY: Requires, prior to submitting a proposal to exempt an
aquifer to the United States Environmental Protection Agency (U.S.
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EPA), that the Division of Oil, Gas and Geothermal Resources
(DOGGR) hold a public hearing and gain concurrence from the State
Water Resources Control Board (SWRCB) on the proposal. Requires
groundwater monitoring plans for underground injection projects
(projects) as part of an application for approval of the project
or for the annual review of the project.
EXISTING LAW:
1)Pursuant to the Federal Safe Drinking Water Act (SDWA):
a) Prohibits certain well activities that affect underground
sources of drinking water unless those sources are located in
an exempt aquifer.
b) Declares that the Underground Injection Control (UIC)
program for class II wells in the State of California, except
those on Indian lands, is administered by the DOGGR approved
by U.S. EPA pursuant to SDWA Section 1425.
c) Allows DOGGR to propose and the regional administrator of
U.S. EPA to approve an exemption of an aquifer or its portion
that meets the criteria in the definition of "underground
source of drinking water" after considering its current and
potential future use as drinking water.
2)Requires the state's Oil and Gas Supervisor (Supervisor) 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.
3)Authorizes the Supervisor to implement a monitoring program,
designed to detect releases to the soil and water for
aboveground oil production tanks and facilities.
4)Requires groundwater monitoring in the vicinity of a well
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subject to a well stimulation treatment.
This Bill:
1)Requires, prior to submitting a proposal to exempt an aquifer to
U.S. EPA, that DOGGR hold a public hearing and gain concurrence
from the SWRCB on the proposal.
2)Authorizes SWRCB to concur with the proposal if the following
conditions are met:
a) The proposed aquifer cannot now, or will not in the
future, serve as a source of drinking water or for other
beneficial uses.
b) Injection into the proposed aquifer will stay in the
proposed area and will not impact the ability of nearby
nonexempt aquifers to be a source of drinking water or for
other beneficial uses.
3)Requires, by July 1, 2018, and annually thereafter, DOGGR to
review all projects for compliance with applicable law.
4)Requires, by July 1, 2018, operators for all projects to submit
to SWRCB or appropriate regional water quality control board
(RWQCB) for review and concurrence a groundwater monitoring plan
that provides various information including data from monitoring
wells that demonstrate that the injection fluid is confined to
the intended injection zone or zones of injection.
5)Clarifies that each project is only required to have one
monitoring plan for the life of the project.
6)Authorizes SRWCB or appropriate RWQCB to revise monitoring plans
to avoid duplication and assist with regional monitoring plans
associated with oil and gas activities.
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7)Authorizes SRWCB or appropriate RWQCB to authorize a well
operator to rely on a regional monitoring plan instead of their
own monitoring sites.
8)Authorizes, subject to appropriation by the Legislature, DOGGR's
fee authority to be used to fund a public entity's costs
associated with implementing this article.
FISCAL EFFECT: According to the Assembly Appropriations
Committee:
1)Increased administrative costs for Department of
Conservation/DOGGR in the $10 million range (special fund/fee
authority).
2)Increased costs for SWRCB in the $2 million to $2.5 million
range (special fund/fee authority).
3)Potential revenue delay or loss associated from the state's
share of oil extraction on lands regulated by the State Lands
Commission. The state's share is several million dollars per
year, depending on the price of oil.
COMMENTS:
1)UIC Program. In 1974, the SDWA gave the U.S. EPA the authority
and responsibility to control underground injection to protect
underground drinking water sources. In 1982, a primacy
agreement was signed that allowed DOGGR to implement the U.S.
EPA's UIC program for oil and gas wells in California. It has
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recently been discovered that there were two versions of this
agreement, one allowing exemptions for 11 aquifers with high
water quality and another denying those exemptions and requiring
all existing injection wells into those aquifers be phased out
over 18 months. The aquifers were non-hydrocarbon-producing and
all had a total dissolved solids (TDS) concentration below 3,000
mg/l. The SDWA is supposed to protect underground sources of
water with TDS concentrations below 10,000 milligram/liter.
DOGGR's UIC permitting decisions have been based on the
assumption that these exemptions were granted for the 11
aquifers in question.
A 2011 U.S. EPA audit of DOGGR's UIC program implementation
concluded that DOGGR was misclassifying underground sources of
drinking water and doing an insufficient job monitoring the UIC
program. In June 2014, it was discovered that DOGGR was
approving injection wells in nonexempt aquifers. This included
injections into the 11 aquifers that were not properly exempted,
but also included injections into aquifers that were never
exempt. California Environmental Protection Agency's (CALEPA)
review found that DOGGR's district offices were approving
projects without review from DOGGR and were making errors
identifying the injectable zone of exempt aquifers. This
included misidentifying the borders and depth of the aquifer and
allowing expansion of productive limits over time beyond
boundaries established in the Primacy Application. Initially
there were 2,553 injection wells operating in non-exempt
aquifers; after a review, 76 wells were removed from that list.
The wells represented both disposal wells and enhanced oil
recovery wells. To date, the state has shut down 23 injection
wells, because they were injecting into aquifers that could be
suitable for drinking water. In addition, these wells could
potentially have had an impact on nearby water supply wells.
While no contamination of water supply wells has been found yet,
it is clear that aquifers that could have been a source of
underground drinking water have been contaminated with injection
fluid.
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2)Aquifer exemptions. Any aquifer less than 10,000
milligram/liter TDS must be exempted by U.S. EPA to be injected
into. The state can decide which aquifers to propose to U.S.
EPA. In response to U.S. EPA's audit and concerns over aquifers
that were not properly exempted, DOGGR will now require SWRCB
concurrence on any aquifer exemption proposal. In addition, the
operator will be required to demonstrate that the aquifer cannot
now, and will not in the future, serve as a source of drinking
water or for other beneficial uses. This bill codifies this new
procedure to ensure that aquifer exemptions will be thoroughly
vetted by DOGGR and SWRCB with public input. As California
deals with the fourth year of drought conditions, protecting
groundwater has become more important than ever. Past actions
by DOGGR harmed aquifers that could have been used for a
beneficial use. Thorough vetting of aquifers will help prevent
that from happening again.
3)Groundwater monitoring. California's 515 alluvial (loose)
groundwater basins and sub-basins provide close to 40% of the
state's water supply in an average year. In dry or drought
years, groundwater accounts for as much as 60% of the state's
water supply. Many disadvantaged communities rely on
groundwater for 100% of their water supply. There are
approximately 42,000 oil and gas injection wells in California;
however, those wells are grouped together as injection projects.
According to DOGGR, there are 897 active injection projects and
2,146 total projects in DOGGR's database. DOGGR estimates that
these projects inject into 350 aquifers, but does not
definitively know the number of aquifers being injected into.
Injection projects can also be into sand or rock that are not
aquifers. When wastewater and other fluids associated with the
extraction of oil or gas are injected into an aquifer, they can
change the chemistry of and contaminate that aquifer. In
addition, there is concern that injection fluids may not stay in
the aquifer they are injected into. Zonal isolation is
important to protect other nearby aquifers. There have been
examples in other states, such as Pennsylvania, where drinking
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water has been contaminated by nearby oil and gas activities.
According to USGS, chemical additives used in well stimulation
are also used in enhanced oil recovery and chemicals are mixed
into the produced wastewater stream. SB 4 (Pavley), Chapter 313,
Statutes of 2013, requires groundwater monitoring for wells that
have been stimulated. SWRCB released its Draft Model Criteria
on April 29, 2015, to govern the groundwater monitoring plans
required by SB 4.
Analysis Prepared by:
Michael Jarred / NAT. RES. / (916) 319-2092 FN:
0000839