Senate BillNo. 886


Introduced by Senator Pavley

(Principal coauthors: Senators De León and Huff)

(Coauthor: Senator Allen)

(Coauthor: Assembly Member Wilk)

January 20, 2016


An act to add Section 3217 to the Public Resources Code, and to add Section 713 to the Public Utilities Code, relating to natural gas, and declaring the urgency thereof, to take effect immediately.

LEGISLATIVE COUNSEL’S DIGEST

SB 886, as introduced, Pavley. Natural gas storage: moratorium.

(1) Under existing law, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation regulates the drilling, operation, maintenance, and abandonment of oil and gas wells in the state. Existing law requires the State Oil and Gas Supervisor to supervise the drilling, operation, maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of tanks and facilities related to oil and gas production within an oil and gas field, so as to prevent damage to life, health, property, and natural resources, as provided; to permit owners and operators of wells to utilize all known methods and practices to increase the ultimate recovery of hydrocarbons; and to perform the supervisor’s duties in a manner that encourages the wise development of oil and gas resources to best meet oil and gas needs in this state. Under existing law, a person who fails to comply with certain requirements relating to the regulation of oil or gas operations is guilty of a misdemeanor.

This bill would require the supervisor to immediately institute a moratorium on injections of natural gas into any wells located within and serving the Aliso Canyon storage facility located in the County of Los Angeles until specified conditions are met. The bill would also require the supervisor to prohibit the production of natural gas by any well originally drilled earlier than 1954 at the Aliso Canyon storage facility located in the County of Los Angeles until specified conditions are met, except as specified. Because a violation of these requirements would be a crime, the bill would impose a state-mandated local program.

(2) Under existing law, the Public Utilities Commission is authorized to supervise and regulate every public utility in the state.

This bill would require the commission to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy reliability for the region, and to consult with specified entities in making its determination.

(3) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(4) This bill would declare that it is to take effect immediately as an urgency statute.

Vote: 23. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

P2    1

SECTION 1.  

Section 3217 is added to the Public Resources
2Code
, to read:

3

3217.  

(a) The supervisor shall immediately institute a
4moratorium on injections of natural gas into any wells located
5within and serving the Aliso Canyon storage facility located in the
6County of Los Angeles until all of the following conditions are
7met:

8(1) The integrity of each well has been quantitatively and
9objectively evaluated using state-of-art technology and the risks
10posed by well failure have been evaluated.

11(A) The age, history, and condition of each well shall be
12specifically addressed, with particular emphasis on wells drilled
13prior to 2006.

14(B) The technical methods and equipment used to evaluate well
15integrity and the risks posed by well failure shall be determined
P3    1by the supervisor with input from independent experts and the
2public through a public process.

3(2) Any well posing an enhanced risk of failure has been
4repaired to mitigate the enhanced risk or plugged and abandoned.

5(3) The supervisor determines that the overall risk from well
6failure satisfies the supervisor’s duty pursuant to Section 3106 to
7prevent damage to life, health, property, and natural resources and
8other requirements.

9(4) The Public Utilities Commission and the State Energy
10Resources Conservation and Development Commission concur
11with the supervisor’s determination in paragraph (3).

12(b) The supervisor shall prohibit the production of natural gas
13by any well originally drilled earlier than 1954 at the Aliso Canyon
14storage facility located in the County of Los Angeles until after
15the integrity of and the risks associated with any of these wells
16have been evaluated and determinations by the supervisor, with
17the concurrence of the commissions, have been made pursuant to
18the process described in subdivision (a), except when necessary
19to do either of the following:

20(1) Respond to the uncontrolled leak of natural gas from the
21“Standard Sesnon 25” well (American Petroleum Institute
22identification number 03700776).

23(2) Maintain regional energy reliability, at the written direction
24of the commissions.

25

SEC. 2.  

Section 713 is added to the Public Utilities Code, to
26read:

27

713.  

The commission shall determine the feasibility of
28minimizing or eliminating use of the Aliso Canyon natural gas
29storage facility located in the County of Los Angeles while still
30maintaining energy reliability for the region. The commission shall
31consult with the State Energy Resources Conservation and
32Development Commission, the Independent System Operator, the
33Division of Oil, Gas, and Geothermal Resources in the Department
34of Conservation, and other relevant government entities, in making
35its determination.

36

SEC. 3.  

No reimbursement is required by this act pursuant to
37Section 6 of Article XIII B of the California Constitution because
38the only costs that may be incurred by a local agency or school
39district will be incurred because this act creates a new crime or
40infraction, eliminates a crime or infraction, or changes the penalty
P4    1for a crime or infraction, within the meaning of Section 17556 of
2the Government Code, or changes the definition of a crime within
3the meaning of Section 6 of Article XIII B of the California
4Constitution.

5

SEC. 4.  

This act is an urgency statute necessary for the
6immediate preservation of the public peace, health, or safety within
7the meaning of Article IV of the Constitution and shall go into
8immediate effect. The facts constituting the necessity are:

9In order to mitigate, at the earliest possible time, ongoing harm
10from the gas leak at the Aliso Canyon storage facility, and to
11evaluate the integrity of and the risks associated with older wells
12at that facility, it is necessary that this act take effect immediately.



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