BILL ANALYSIS Ó
AB 1882
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Date of Hearing: April 4, 2016
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Das Williams, Chair
AB 1882
(Williams) - As Introduced February 11, 2016
SUBJECT: Oil and gas: groundwater monitoring
SUMMARY: Requires the State Water Resources Control Board
(SWRCB) or appropriate regional water quality control board
(RWQCB) to review and concur with any Underground Injection
Control (UIC) project subject to review or approval. Authorizes
SWRCB or appropriate RWQCB to propose additional requirements
for a project, including groundwater monitoring.
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 UIC program for class II wells in the
State of California, except those on tribal lands, is
administered by the Division of Oil, Gas, and Geothermal
Resources (DOGGR) approved by United States Environmental
Protection Agency (US EPA) pursuant to SDWA section 1425.
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c) Allows DOGGR to propose and the regional administrator
of US 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
subject to a well stimulation treatment.
5)Requires DOGGR to consult with SWRCB or the appropriate RWQCB
regarding any proposed aquifer exemption.
6)Requires DOGGR and SWRCB to concur prior to proposing an
aquifer exemption to US EPA.
THIS BILL:
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1)Defines the terms "project" and "regional board" related to
the UIC program.
2)Requires DOGGR to provide an opportunity and the information
necessary for SWRCB or the appropriate RWQCB to review UIC
projects.
3)Requires SWRCB or the appropriate RWQCB to review, comment on,
and propose additional requirements it deems necessary,
including groundwater monitoring, for a new project or a
project under review to ensure that injection of fluids will
not affect the quality of water that is, or may reasonably be,
used for any beneficial use.
4)Prohibits DOGGR from approving a new project, approving any
modification or revision to an existing project, or finalizing
a comprehensive review of an existing project without written
concurrence from SWRCB or the appropriate RWQCB.
5)Requires the written concurrence to specify the rationale for
concurrence and explain why permit conditions, such as
requiring groundwater monitoring, were or were not required
for the project.
FISCAL EFFECT: Unknown
COMMENTS:
1)UIC Program. In 1974, the Safe Drinking Water Act gave the US
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
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implement the US EPA's UIC program for oil and gas wells in
California. In 2014 it was 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 mg/l. DOGGR's UIC permitting
decisions have been based on the assumption that these
exemptions were granted for the 11 aquifers in question.
A 2011 US 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 2,553 injection wells were identified
as operating in non-exempt aquifers. The wells represented
both disposal wells and enhanced oil recovery wells. To date,
the state has shut down 56 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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In addition to the DOGGR and SWRCB review of projects whose
aquifer exemptions are in question, DOGGR has taken other
actions to improve its implementation of the UIC program. In
October 2015, DOGGR released its "Renewal Plan for Oil and Gas
Regulation," which outlines reforms DOGGR will undertake with
the goal of having "an effective regulatory program that
ensures the protection of public health and the environment in
the oil fields of California." Included in the plan is a
review of every project DOGGR has approved and updated
regulations for the UIC program.
2)Aquifer exemptions. Aquifers with less than 10,000 mg/l TDS
must be exempted by US EPA to be injected into. The state can
decide which aquifers to propose to US EPA. In response to US
EPA's audit and concerns over aquifers that were not properly
exempted, DOGGR will now require SWRCB concurrence on any
aquifer exemption proposal. Last year SB 83 (Committee on
Budget and Fiscal Review), Chapter 24, Statutes of 2015,
required DOGGR and SWRCB to concur on all proposed exemptions
of aquifers from the SDWA before they can be submitted to the
US EPA. 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. In its written concurrence for the Arroyo
Grande Aquifer Exemption, SWRCB indicated that "approval of
Class II UIC projects and permits will involve a joint review
by the DOGGR and the Water Boards." It also stated DOGGR and
SWRCB will consider incorporating groundwater monitoring into
projects in the aquifer exempted.
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3)Memorandum of Agreement (MOA). In 1988, DOGGR entered into a
MOA with SWRCB for prescribing permit requirements. The MOA
specifies that SWRCB or appropriate RWQCB may require permit
applicants to submit additional data. The MOA also states
that the appropriate RWQCB may comment on permit requirements
and proposes additional conditions or revisions to proposed
conditions. The MOA states that DOGGR will not issue final
requirements until the appropriate RWQCB concerns have been
satisfied. However, if DOGGR does not receive a response from
the appropriate RWQCB during the public comment period, it is
required to presume the appropriate RWCRB finds the
requirement acceptable. In most instances, since this MOA was
executed, the appropriate RWCRB has not commented on an
application or asked for additional requirements. Now that
SWRCB has new oil and gas responsibilities from SB 83 and SB 4
(Pavley), Chapter 313, Statutes of 2013, it reviews all UIC
applications and asks for additional data from applicants when
necessary. In addition, DOGGR and SWRCB are currently working
on a new MOA to recognize SWRCB's enhanced role in oil and gas
regulation.
4)Groundwater monitoring. Groundwater provides 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 55,000 oilfield injection wells in California;
however, those wells are grouped together as injection
projects. According to DOGGR, there are 901 active injection
projects and 2,167 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. Wastewater and other fluids associated with
the extraction of oil or gas can change the chemistry of and
contaminate aquifers. There is concern that injection fluids
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may not stay in the aquifer they are injected into. Zonal
isolation is important to protect other nearby aquifers. SB 4
requires groundwater monitoring for wells that have been
stimulated. On July 7, 2015, SWRCB released model criteria to
govern the groundwater monitoring plans required by SB 4. In
SWRCB's model criteria regional monitoring programs are
required to factor in UIC wells, in addition to wells that
have been stimulated. In the Arroyo Grande Aquifer Exemption,
the SWRCB stated that sentry groundwater monitoring wells on
the boundaries of the exempted area could provide assurances
that the injected fluid will remain in the proposed exempted
area.
5)AB 1882. Currently, the SWRCB is reviewing and commenting on
UIC projects. It has requested more data on some projects and
has indicated it will work with DOGGR to incorporate
groundwater monitoring in others. However, it is unclear
whether this will be a permanent arrangement or until US EPA's
concerns with the program have been addressed. SB 83 required
on or before January 1, 2018, the Secretary for Environmental
Protection and the Secretary of the Natural Resources Agency
to appoint an independent review panel to evaluate DOGGR's
administration of the UIC Program and consider whether it
would be beneficial to transfer the program to SWRCB. AB 1882
codifies a joint review of UIC projects that are under
consideration for approval or review, which is an alternative
approach to transferring the UIC program to SWRCB. AB 1882
joint project review is consistent with the aquifer review
process outlined in SB 83.
6)Previous and related legislation.
AB 982 (Williams, 2013) required RWQCBs to approve a proposed
groundwater monitoring plan prior to noticing the intent to
begin any oil or gas drilling. The bill required the notice to
include the source of water used during any hydraulic fracturing
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operations. The bill was held in Assembly Appropriations
Committee.
SB 4 (Pavley), Chapter 313, Statutes of 2013, established a
comprehensive regulatory program for oil and gas well
stimulation treatments, which included, among other things, a
study, the development of regulations, a permitting process, and
public notification and disclosure.
SB 356 (Williams, 2015) required, prior to submitting a proposal
to exempt an aquifer to the US EPA, that DOGGR hold a public
hearing and gain concurrence from SWRCB on the proposal. This
bill would have required groundwater monitoring plans for UIC
projects as part of an application for approval of the project
or for the annual review of the project. This bill failed
passage on the Assembly Floor with a vote of 28-33.
SB 454 (Allen, 2015) prohibited DOGGR from submitting a proposal
for an aquifer exemption to the US EPA unless DOGGR and SWRCB
concur in writing that the aquifer meets specified conditions.
This bill failed passage on the Senate Floor with a vote of
17-17.
SB 545 (Jackson, 2015) revised and updated DOGGR's authority and
permitting practices and reforms the handling of confidential
wells. The bill was held in Senate Appropriations committee.
SB 248 (Pavley, 2015) requires DOGGR to review and update its
regulations, data management practices, and enhance required
reporting. This bill prohibits the use of oil sumps after July
1, 2017. This bill also prohibits injection chemicals, unless
DOGGR has complete information about specified properties and
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potential groundwater impacts. This bill is in the Assembly
Appropriations Committee.
AB 2729 (Williams, 2016) creates disincentives for operators to
maintain large idle well inventories, will ensure that funds are
available to plug and abandon idle wells in the event that they
are deserted, and will help improve public perception of oil and
gas operations. This bill will also be heard by this committee
on April 4, 2016.
AB 2756 (Thurmond, 2016) enhances DOGGR's penalty and
investigative authority and allows penalties to be spent on
environmentally beneficial projects. This bill will also be
heard by this Committee on April 4, 2016.
REGISTERED SUPPORT / OPPOSITION:
Support
Association of California Water Agencies
California League of Conservation Voters
Center for Environmental Health
Citizens Coalition for a Safe Community
Clean Water Action California
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Earthworks
East Bay Municipal Utility District
Environmental Defense Center
Environmental Justice Coalition for Water
Environmental Working Group
Grassroots Coalition
League of Women Voters of California
Mainstreet Moms
Natural Resources Defense Council
Santa Barbara County Board of Supervisors
Save the Sespe
Sierra Club California
The Wildlands Conservancy
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Ventura County Board of Supervisors
Opposition
California Chamber of Commerce
California Independent Petroleum Association
California Manufacturers & Technology Association
Western States Petroleum Association
Analysis Prepared by:Michael Jarred / NAT. RES. / (916) 319-2092