BILL ANALYSIS Ó SENATE COMMITTEE ON ENVIRONMENTAL QUALITY Senator Wieckowski, Chair 2015 - 2016 Regular Bill No: AB 1420 ----------------------------------------------------------------- |Author: |Salas | ----------------------------------------------------------------- |-----------+-----------------------+-------------+----------------| |Version: |7/06/2015 |Hearing |7/15/2015 | | | |Date: | | |-----------+-----------------------+-------------+----------------| |Urgency: |No |Fiscal: |Yes | ------------------------------------------------------------------ ----------------------------------------------------------------- |Consultant:|Rachel Machi Wagoner | | | | ----------------------------------------------------------------- SUBJECT: Oil and gas: pipelines. ANALYSIS: Existing law: 1) Requires the Division of Oil, Gas, and Geothermal Resources (DOGGR) to prescribe minimum facility maintenance standards for oil and gas production facilities, including pipelines that are not under the jurisdiction of the State Fire Marshal. Under the division's regulations, an owner or operator of an active environmentally sensitive gas pipeline that is a gathering line is required to perform a mechanical integrity test on the pipeline, unless it is less than 10 years old. 2) Establishes local health departments, under the purview of the local health officer and prescribes various duties for those local health departments, including supervising remediation when hazardous waste is released and enforcing statutes relating to public health. This bill: 1) Requires a mechanical integrity test every 2 years for all active gas pipelines of any diameter that are identified as in sensitive areas and requires DOGGR, by January 1, 2018, to identify all gas pipelines that are within sensitive areas. AB 1420 (Salas) Page 2 of ? 2) Requires a local health officer or his or her designee, if he or she is notified of an active leak in a pipeline that is within a sensitive area and makes certain determinations, to take certain actions related to the leak, working collaboratively with DOGGR and the owner or operator of that pipeline. 3) Requires the local public health officer or his or her designee to direct the responsible party (RP) to notify residents affected by the leak if he or she determines that the leak poses a serious threat to public health and safety. 4) Requires owners or operators of pipelines under DOGGR's jurisdiction, upon discovery of a leak from the pipeline, to notify DOGGR and the appropriate local health officer or his or her designee of the leak. 5) For purposes of this section, defines "sensitive area" as: a) An area containing a building intended for human occupancy, such as a residence, school, hospital, or business that is located within 300 feet of an active gas pipeline and that is not necessary to the operation of the pipeline. b) An area determined by the supervisor to present significant potential threat to life, health, property, or natural resources in the event of a leak from an active gas pipeline. c) An area determined by the supervisor to have an active gas pipeline that has a history of chronic leaks. 6) Specifies that the responsible party shall be liable for the costs incurred by the local health officer or his or her AB 1420 (Salas) Page 3 of ? designee pursuant to this section. Background 1) 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 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. PCR 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, 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 PCR 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 AB 1420 (Salas) Page 4 of ? months and remain concerned about the safety of living in their own homes. 2) DOGGR's jurisdiction over pipelines: DOGGR oversees the 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. 3) 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 areas, such as residential areas and schools. AB 1420 (Salas) Page 5 of ? Comments Purpose of Bill. According to the author, "[a]s the [oil] 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." "Assembly Bill 1420 would require operators of a leak[ing] pipeline to notify local health officials. If it is determined that the leak poses a risk to public health and safety then the local health official will be required to work collaboratively with [the division] and the owner and/or operator the pipeline. [?] The bill will also require [the division] to prioritize the identification and testing of pipelines in their jurisdiction that are near sensitive areas, such as residential neighborhoods and schools." What is the Responsibility of the Responsible Party? The bill specifies that the local health officer shall work in collaboration with DOGGR and RP to provide information and assistance to affected residents and requires that the RP reimburse the costs incurred by the local health officer, including, but not limited to, relocation of residents. It is more appropriate that RP incur the cost to residents, including relocation. An amendment is needed to specify that the RP will pay for relocation and other costs to residents. Additionally, while nothing in this legislation relieves an RP from civil/tort liability, an amendment should be taken to clearly state that the RP shall not condition any assistance provided pursuant to this bill to any waiver of the recipient of the assistance. AB 1420 (Salas) Page 6 of ? DOUBLE REFERRAL: This measure was heard in Senate Natural Resources and Water Committee on June 23, 2015, and passed out of committee with a vote of 9-0. The provisions of the bill pertaining to DOGGR's responsibilities and jurisdiction were heard by that committee. The role of local health officers, disclosure of environmental testing results, processes and procedures in the event of a local health emergency, and resident notification is under the Senate Environmental Quality Committee's jurisdiction. SOURCE: Author SUPPORT: Center on Race, Poverty & the Environment City of Arvin Sierra Club OPPOSITION: None received ARGUMENTS IN SUPPORT: The Center on Race, Poverty & the Environment wrote, "[t]hough residents took their own air samples, the results of the "official" air testing were never disclosed to residents. The evacuated residents are now back home, but the leak and the subsequent eight-month forced relocation has taken a heavy financial, emotional, and health toll on the families." The Center continues, "AB 1420 will provide local agencies with the authority they need to quickly respond to leaks in order to protect residents' health, ensures that residents are informed about the risks they face if a leak occurs nearby, and provides for reimbursements to residents for costs associated with a pipeline leak, including relocation costs." -- END -- AB 1420 (Salas) Page 7 of ?