BILL ANALYSIS                                                                                                                                                                                                    Ó



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          Date of Hearing:  April 28, 2015  


           ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS


                                  Luis Alejo, Chair


          AB 1420  
          (Salas) - As Amended April 21, 2015


          SUBJECT:  Oil and gas:  pipelines


          SUMMARY:  Establishes a process for assessing the risk of leaks  
          in gas pipelines and for providing notification and assistance  
          to residents affected by a leak.   Specifically, this bill:  


          1)Requires, if the local health officer or his or her designee  
            is notified of a leak in a pipeline that is regulated by the  
            Division of Oil, Gas, and Geothermal Resources (DOGGR), and  
            the local health officer determines that the leak poses a risk  
            to public health or safety and the response to the leak has  
            been inadequate to protect the public health or safety, the  
            local health officer to:



               a.     Work collaboratively with DOGGR and the owner or  
                 operator of the pipeline;



               b.     Direct the responsible party to test, to the  
                 satisfaction of the agency overseeing the testing, the  
                 soil, air, and water in the affected area for  








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                 contamination caused by the leak and disclose the results  
                 of the tests to the public;



               c.     Make a determination, based on the result of the  
                 tests, on whether the leak poses a serious threat to the  
                 public health and safety of residents affected by the  
                 leak;



               d.     Provide, based on the determination, assistance to  
                 affected residents; and,



               e.     Direct, based on the determination, the responsible  
                 party to notify all residents affected by the leak.


          2)Requires DOGGR to prioritize the identification and testing of  
            all pipelines under its jurisdiction that are near sensitive  
            areas such as residences and schools.


          3)Requires the operator of the pipeline, upon the discovery of a  
            leak from a pipeline under the jurisdiction of DOGGR, to  
            promptly notify DOGGR and the local health officer of the  
            jurisdiction in which the leak is located.


          EXISTING LAW:  


          Under the California Health and Safety Code (HSC):


             1)   Requires each board of supervisors to appoint a health  








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               officer who is a county officer, and requires the local  
               health officer to enforce local orders and ordinances and  
               state statues relating to public health. (HSC § 101000, et.  
               seq) 



             2)   Authorizes the local health officer to take any  
               preventive measure that may be necessary to protect and  
               preserve the public health from any public health hazard  
               during any "local emergency" within his or her  
               jurisdiction. (HSC § 101040(a))



          Under the California Public Resources Code (PRC):





             1)   Requires the State Oil & 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, including pipelines, as specified,  
               that are within an oil and gas field, so as to prevent  
               damage to life, health, property, and natural resources.  
               (PRC § 3106. (a))


          Under the California Code of Regulations (CCR):


             1)   Requires the operator for a facility or group of related  
               facilities to develop a spill contingency plan.  (CCR,  
               Title 14, § 1722(b))

             2)   Requires blowouts, fires, serious accidents, and  








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               significant gas or water leaks resulting from or associated  
               with an oil or gas drilling or producing operation, or  
               related facility, to  be promptly reported to the  
               appropriate DOGGR district office.  (CCR, Title 14,  
               §1722(i))



             3)   Requires pipeline operators to visually inspect all  
               aboveground pipelines for leaks and corrosion at least once  
               a year (CCR, Title 14, § 1774.1. (a))



             4)   Authorizes the Supervisor to order such tests or  
               inspections deemed necessary to establish the reliability  
               of any pipeline system.  (CCR, Title 14, § 1774.1. (b))



             5)   Requires a mechanical integrity test to be performed on  
               all active environmentally sensitive pipelines (generally  
               within 300 feet of a building) that are gathering lines,  
               and all urban pipelines over 4" in diameter, every two  
               years.  Exempts pipelines less than 10 years old are exempt  
               this testing requirement.  (CCR, Title 14, § 1774.1. (e))



             6)   Authorizes a county board of Supervisors, a city  
               council, or another state agency to petition the Supervisor  
               to include other pipelines within their jurisdiction as  
               environmentally sensitive.  (CCR, Title 14, § 1774.1. (f)) 



             7)   Requires operators to prepare a pipeline management plan  
               for all pipelines and submit the plan to the Supervisor  
               upon request. (CCR, Title 14, § 1774.2. (a))








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          FISCAL EFFECT:  Unknown.





          COMMENTS:  


          Need for the bill: According to the author, "As the [oil and  
          gas] industry continues to be a fixture in California, the  
          safety of workers, communities and the environment should remain  
          a top priority.  Despite precautions taken, incidents occur in  
          which immediate action is needed to protect the health, safety,  
          and environment of nearby communities? 

          "In early 2014, a gas leak was detected beneath the community of  
          Arvin, California.  A total of 8 families were evacuated from  
          their homes and unable to return for several months. Affected  
          residents claimed to have smelled gas, and complained of  
          nosebleeds, headaches, coughing and dizziness. Once the leak was  
          detected, affected residents were unclear where to get resources  
          and information. This incident demonstrated a lack of clarity in  
          the law regarding the role of all involved entities? AB 1420  
          will ensure that clear guidelines exist should another similar  
          incident occur."



          The gas leak in Arvin:  According to articles in The Bakersfield  
          Californian, on March 11, 2014, Southern California Gas Co.  
          (SCG) was performing routine checks for leaks on its natural gas  
          pipelines in Arvin, California, when its instruments detected a  
          gas leak.  SCG workers realized the next day that the leak  
          wasn't from their own pipelines and notified the city of Arvin,  
          which in turn alerted DOGGR both that it was working with SCG to  








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          determine the source of the gas and that residents of Nelson  
          Court in Arvin had been reporting gas odors.  


          According to the Department of Conservation (DOC), under which  
          DOGGR operates, DOGGR staff immediately met with Petro Capitol  
          Resources (PCR), which operates the three oil and gas leases  
          about 200 feet east of the homes on Nelson Court, to review  
          existing lease maps of the operation.  They found that the  
          existing maps were faulty, and that the pipelines were actually  
          adjacent to the homes on Nelson Court that had been reporting  
          the odor.  PRC shut down its pipeline on March 13th, and  
          affected residents were evacuated.  On the 17 and 18th the  
          actual leak was detected in a 3" gas flare pipe, and Kern County  
          tested for flammable gases, finding high levels of flammable  
          gases outside the homes and levels at half of the lower  
          explosive levels were inside eight homes on Nelson Court.   
          Further, Kern County and DOGGR found that the soil was so  
          saturated with natural gas that remediation required application  
          of a vapor extraction system.  The Bakersfield Californian  
          reported that some residents said they had smelled the gas for  
          as long as two years, and complained of nosebleeds, headaches,  
          coughing and dizziness.


          According to news articles, letters submitted to the Governor,  
          and communication with the author and this Committee, before and  
          after the leak was detected, residents were confused about where  
          to seek resources and information and felt the response to the  
          leak was inadequate.  Additionally, even though PRC performed  
          initial toxicity testing of the houses on Nelson Court,  
          residents were distrustful of the results, and the County  
          performed another set of tests, for which it is still trying to  
          recoup costs.  Residents remained evacuated for over 7 months  
          and remain concerned about the safety of living in their own  
          homes.  


          DOGGR's jurisdiction over pipelines: DOGGR oversees the  








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          drilling, operation, maintenance, and plugging and abandonment  
          of oil, natural gas, and geothermal wells.  DOGGR has  
          jurisdiction over tanks and facilities that are "attendant to"  
          oil and gas production, including pipelines located within oil  
          and gas fields and not subject to regulation by the California  
          Department of Forestry and Fire Protection-Office of State Fire  
          Marshal.  Tanks and pipelines that are located within the lease  
          areas of oil and gas fields, and are integrally associated with  
          oil and gas production, are generally "attendant to" oil and gas  
          production and therefore under DOGGR's jurisdiction.  In the  
          Arvin case, according to the DOC, DOGGR is responsible for the  
          oversight of the pipes that leaked.





          DOGGR's process for identifying and inspecting pipelines:   
          DOGGR's regulations require pipeline operators to visually  
          inspect all above ground pipelines at least once per year and  
          authorize the Supervisor to order tests or inspections as needed  
          to establish the reliability of any pipeline system.   
          Additionally, regulations require a mechanical integrity test to  
          be performed on all active environmentally sensitive pipelines  
          that are used to transport crude oil or natural gas from the  
          production site to a central collection point, and all urban  
          pipelines over 4" in diameter, every two years.  Regulation  
          exempts pipelines less than 10 years old from the two year  
          testing requirement. 


          In Arvin, even though DOGGR is responsible for the oversight of  
          the pipeline that failed, the pipeline is not subject to the  
          periodic testing required of other, larger capacity (over 4" in  
          diameter) lines, or lines that carry hydrocarbons.  DOGGR  
          records showed that the pipeline was last inspected on August 8,  
          2011.  This bill requires DOGGR to prioritize the identification  
          and testing of all pipelines under its jurisdiction, regardless  
          of size or what it carries, for leaks that are near sensitive  








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          areas, such as residential areas and schools.   


          Leak reporting requirements:  Statute and regulation have  
          various requirements for reporting leaks of hazardous substances  
          and the subsequent response.  For example, for oil discharges to  
          land greater than or equal to a barrel, the facility owner or  
          operator must report to the Governor's Office of Emergency  
          Services (CalOES) (PRC § 3233); for a release or threatened  
          release of hazardous materials that may pose a significant  
          threat to human health and safety, property or the environment,  
          the handler must report to CalOES, the local unified program  
          agencies (CUPAs) and/ or 911 (HSC § 25510); for illegal  
          discharges or threatened discharges of hazardous waste, the  
          designated government employee must report to the local health  
          officer or local board of supervisors (HSC § 25180.7(b)); and,  
          significant gas or water leaks resulting from or associated with  
          an oil or gas drilling or producing operation, or related  
          facility, must be promptly reported to the appropriate DOGGR  
          district office (CCR, Title 14, §1722(i)).


          This bill clarifies the reporting process by requiring that the  
          operator of a pipeline under DOGGR's jurisdiction must promptly  
          notify the local health officer and DOGGR when he or she detects  
          a leak.


          Leak response requirements: The Arvin incident illustrates the  
          complexity of local and state response to leaks, and delegated  
          authority for response to leaks varies throughout the state.   
          While state agencies often work directly with local agencies to  
          respond to and remediate leaks, there is often not a requirement  
          for state agencies to provide resources to the local responding  
          agency.  AB 1173 requires the local health officer or designee  
          to work in collaboration with DOGGR to respond to leaks, thus  
          bringing state resources to local efforts.  Further, this bill  
          requires the party responsible for the leak to, under the  
          direction on the locale health officer, test the soil, water and  








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          air for contamination and, if the local health officer  
          determines that the threat poses a serious threat, to notify all  
          residents affected by the leak.  These provisions require the  
          responsible party to pay for testing and notification in  
          response to a leak and serve to legitimize testing and response  
          by requiring the local health officer to oversee the testing  
          process. 


          Double referral:  This bill was double referred to the Assembly  
          Natural Resources Committee, in which it is set for a hearing  
          April 27, 2015.   


          REGISTERED SUPPORT / OPPOSITION:




          Support


          None on file.




          Opposition


          None on file.  




          Analysis Prepared by:Shannon McKinney / E.S. & T.M. / (916)  
          319-3965










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