BILL NUMBER: SB 887 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY AUGUST 17, 2016
AMENDED IN ASSEMBLY JUNE 30, 2016
AMENDED IN SENATE MAY 31, 2016
AMENDED IN SENATE APRIL 26, 2016
AMENDED IN SENATE MARCH 28, 2016
INTRODUCED BY Senator Pavley
(Coauthors: Senators Allen and De León)
(Coauthor: Assembly Member Wilk)
JANUARY 20, 2016
An act to add Chapter 6 (commencing with Section 42710) to Part 4
of Division 26 of the Health and Safety Code, and
to amend Section 3236.5 3403.5 of, and
to add Sections 3133, 3134, 3135, 3136, 3137, 3138, 3139,
3140, 3141, 3142, 3143, 3144, 3145, and 3146 to,
Article 3.5 (commencing with Section 3180) to Chapter 1 of Division 3
of, the Public Resources Code, and to add Section 1103
to the Public Utilities Code, relating to natural gas.
LEGISLATIVE COUNSEL'S DIGEST
SB 887, as amended, Pavley. Natural gas storage wells.
Under
(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 provides
that a person who fails to comply with specific laws relating to the
regulation of oil or gas operations is guilty of a misdemeanor.
This bill would require the operator of a
natural gas storage well, before January 1, 2018,
and annually thereafter, to be tested across its entire length for a
loss of integrity resulting in a leak and to have those results
reported to the division, and would prescribe standards for a natural
gas storage well, including among other things, required baseline
and follow-on proactive evaluations. This bill would require, on or
before July 1, 2018, all natural gas storage wells, except low-risk
natural gas storage wells, as defined, to be equipped with an
automatic downhole shutoff system and to conduct natural gas
injection and production through tubing only and be isolated from
contact with the well casing. The bill would require low-risk natural
gas storage wells to comply with those requirements on or before
July 1, 2019, except as provided. This bill would require all newly
constructed natural gas storage wells to have a cement barrier, as
determined by the supervisor. This bill would require, in the event
of a loss of the integrity of a natural gas storage well, well
casing, or cementing resulting in a large ongoing leak of natural gas
and associated gases and materials that pose a significant present
or potential hazard to public health and safety, property, or to the
environment, that preparations for the drilling of a relief well
begin within 24 hours of the discovery of the leak. This
to have commenced a mechanical integrity testing regime
specified by the division and would require the division to
promulgate regulations that establish standards for all gas storage
wells, as specified. This bill would require the division to
determine by regulation what constitutes a reportable leak from a gas
storage well and the timeframe for reporting those leaks, as
specified. Until the regulations are in effect, this bill would
require the operator, in the event of
operator to notify the division immediately of a leak of any
size from a natural gas storage well, to
notify the division immediately and well. This bill
would require the division to post information about
the a reported leak that cannot be
controlled within 48 hours on its Internet Web site, as
prescribed. This bill would require the supervisor, within 72
hours of being notified of a reportable leak, to determine if a
relief well is necessary. If the supervisor makes that determination,
whether within the first 72 hours or after, the bill would require
the operator to immediately begin preparation for, and commence the
drilling of, a relief well. This bill would require an operator
of a natural gas storage well to develop and
maintain a comprehensive gas storage well training and mentoring
program for those employees whose job duties involve the safety of
operations and maintenance of natural gas storage
wells and associated equipment, as specified. This bill
would require the division to convene an independent panel of
recognized experts to develop best practices for natural gas storage
facilities and to review and incorporate the best practices developed
by the panel into its regulations for natural gas storage wells, if
appropriate, and to the extent those practices are applicable, for
other wells under the division's jurisdiction. The bill would require
the division to periodically, and whenever necessary, review
advances in relevant technologies and best practices for natural gas
storage facilities and, if appropriate, to incorporate changes in
best practices into its regulations for natural gas storage wells
and, to the extent those practices are applicable, for other wells
under the division's jurisdiction. This bill would
require certain materials, relating to wells serving or located in a
natural gas storage facility, including, among others, a
site-specific r isk management plan, to be submitted by
the operator and approved at the supervisor's discretion .
This bill would require the division to, as feasible,
incorporate federal regulations applicable to natural gas storage
facilities, including, into the division's gas storage well
regulations, and to perform unannounced random onsite
inspections of some natural gas storage wells
annually. This bill would require the Office of
Environmental Health Hazard Assessment and the State Department of
Public Health, in consultation with the division, to perform a risk
assessment of natural gas storage wells to determine, among other
things, appropriate setback distances for natural gas storage wells
and to report the findings of the risk assessment to the Legislature.
This bill would require the State Air Resources Board, in
consultation with any local air district and the division, to develop
guidelines for a monitoring program that includes continuous
monitoring of the ambient concentration of natural gas at sufficient
locations throughout a natural gas storage facility or planned
natural gas storage facility to identify natural gas leaks and the
presence of natural gas emissions in the atmosphere. The bill would
require an operator of a natural gas storage facility to develop and
submit to the state board a facility monitoring plan that satisfies
the program requirements, and would require the state board to review
the plan and to either approve or disapprove the plan. This bill
would require an operator of a natural gas storage facility to
provide the monitoring data to be provided to
the state board. This bill would require the
division state board or the division, as applicable,
to post and make available on its respective
Internet Web site all materials that are provided to the state board
or division division, as applicable, in
order to comply with the provisions added by this act. Because a
violation of these requirements would be a crime, the bill would
impose a state-mandated local program.
Existing
(2) Existing law requires the
operator of a well to file a written notice of intention to commence
drilling with, and prohibits any drilling until approval is given by,
the supervisor or district deputy. Under existing law, the notice is
deemed approved if the supervisor or district deputy fails to
respond to the notice in writing within 10 working days from receipt
and is deemed canceled if operations have not commenced within one
year of receipt. Existing law provides that these provisions also
apply to the deepening or redrilling of the well, any operation
involving the plugging of the well, or any operations permanently
altering in any manner the casing of the well.
This bill would require certain materials, relating to
wells serving or located in a natural gas storage facility, to be
submitted by the operator and approved at the supervisor's discretion
before approval of the notice. This bill would provide that the
public has a right to review the locations of all new natural gas
storage wells or existing wells converting to natural gas storage
wells before the approval of the notice. the division,
on a weekly basis, to post on its Internet Web site a list of the
notices of intention received by the division, and to provide copies
of those notices to the public upon request.
Existing law requires the owner or operator of any well to keep,
or cause to be kept, a careful and accurate log, core record, and
history of the drilling of the well.
This bill would require the well history to include all
operations, injection, production, and emplacement of any materials
into a natural gas storage well, and to be disclosed to the division
by the operator, as specified.
Under existing law, a person who violates certain statutes or
regulations relating to oil and gas well operations is subject to a
civil penalty not to exceed $25,000 for each violation. Existing law
provides that the unreasonable waste of natural gas by act, omission,
sufferance, or insistence is opposed to the public interest and is
unlawful.
This bill would provide that a violation of the prohibition
against the unreasonable waste of natural gas is subject to the civil
penalty not to exceed $25,000 for each violation.
(3) Under existing law, the supervisor is required to impose an
annual charge computed at a uniform rate based on the number of wells
used to inject and withdraw gas from an underground storage facility
during the preceding calendar year. Existing law requires the charge
to defray the costs incurred by the state in maintaining
surveillance over those facilities.
This bill would instead require that annual charge to be the
proportionate share of the total regulatory costs projected for each
fiscal year based on the field capacity and number of wells of each
underground gas storage facility. The bill would require an
additional charge to be imposed on an operator, if an uncontrolled
leak or release of gas occurs at the operator's underground gas
storage facility, to defray the costs of the response effort of the
division, as specified.
(4) The Administrative Procedure Act governs the procedure for the
adoption, amendment, or repeal of regulations by state agencies and
for the review of those regulatory actions by the Office of
Administrative Law. Existing law provides that, if a state agency
makes a finding that the adoption of a regulation or order of repeal
is necessary for the immediate preservation of the public peace,
health and safety, or general welfare, the regulation or order of
repeal may be adopted as an emergency regulation or order of repeal.
Under existing law, a regulation, amendment, or order of repeal
adopted as an emergency regulation remains in effect no more than 180
days unless the adopting agency and the Office of Administrative Law
comply with certain requirements.
Until January 1, 2019, this bill would instead require that
emergency regulations adopted by the division effective February 5,
2016, continue in effect until the adoption, amendment, or repeal of
the regulation is promulgated by the division pursuant to the act.
(5) Under existing law, the Public Utilities Commission has
regulatory authority over public utilities, including gas
corporations. The Public Utilities Act prohibits any gas corporation
from beginning the construction of, among other things, a line,
plant, or system, or of any extension thereof, without having first
obtained from the commission a certificate that the present or future
public convenience and necessity require or will require that
construction.
This bill, if a new underground gas storage facility is proposed,
would require the commission to ensure that a risk assessment
evaluating the potential impact of a leak from the facility on public
and environmental health, safety, and welfare is conducted by the
project proponent, as specified. This bill would require that the
findings of any risk assessment conducted pursuant to these
provisions be subjected to peer review by independent experts and
reported to the Legislature, as specified.
The
(6) 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.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares as follows:
(a) Public transparency regarding risks, the regulations designed
to mitigate those risks, and regulatory activity are essential to
protect public health and welfare and natural resources.
(b) Public disclosure and safe operation of gas storage wells and
associated piping and equipment are essential in order to provide for
public, environmental, and occupational health and welfare,
including a proactive approach to potential problems.
(c) On October 23, 2015, a significant, uncontrolled leak from a
natural gas storage well that was originally drilled over 60 years
ago was discovered in the Aliso Canyon natural gas storage facility
located in the County of Los Angeles. Initial efforts to stop the
leak failed.
(d) The Division of Oil, Gas, and Geothermal Resources in the
Department of Conservation responded swiftly to the leak, including
by issuing two orders that, among other things, require the use of
relief wells. The division worked around the clock overseeing efforts
to stop the leak.
(e) It was several days before the community was notified of the
leak, although numerous residents started reporting odor concerns
almost immediately. The leaking well is up the hill and approximately
one and one-quarter miles away from the nearest home. Other natural
gas storage wells serving this facility are located closer to homes
and businesses.
(f) The operator of the leaking well had removed a subsurface
safety valve decades earlier and had not replaced it. Regulations in
effect at that time did not require approval or replacement of the
valve. There was no automatic downhole shutoff system installed in
the event of a leak. In 2014, the operator acknowledged publicly in a
filing to the Public Utilities Commission that many of its wells
needed additional assessment and repair. There was no requirement to
disclose to potential homebuyers and business owners the existence of
the Aliso Canyon natural gas storage facility and its attendant
risks.
(g) The Governor declared a state of emergency on January 6, 2016,
in order to facilitate the ongoing state response and efforts to
stop the leak.
(h) On February 18, 2016, the Division of Oil, Gas, and Geothermal
Resources in the Department of Conservation certified that the Aliso
Canyon leak had been stopped. Reports estimate almost 100,000 metric
tons of the potent greenhouse gas methane were emitted to the
atmosphere. Community In addition to climate
risks, community health concerns continue postleak with
hundreds of complaints reported to the County of Los Angeles along
with widespread concern about the short- and long-term impacts of the
leak on public health and economic welfare in the area.
(i) The standards for natural gas storage wells need to be
improved in order to reflect 21st century technology, disclose and
mitigate any risks associated with those wells, recognize that these
facilities may be in locations near population centers, and ensure a
disaster like the Aliso Canyon leak does not happen again.
SEC. 2. Chapter 6 (commencing with Section 42710) is added to Part
4 of Division 26 of the Health and Safety Code, to read:
CHAPTER 6. NATURAL GAS STORAGE FACILITY MONITORING
42710. (a) The state board, in consultation with any local air
district and the Division of Oil, Gas, and Geothermal Resources in
the Department of Conservation, shall develop a natural gas storage
facility monitoring program that includes continuous monitoring of
the ambient concentration of natural gas at sufficient locations
throughout a natural gas storage facility or planned natural gas
storage facility to identify natural gas leaks and the presence of
natural gas emissions in the atmosphere. The continuous monitoring
program may be supplemented by daily leak detection measurements.
(b) (1) The program shall include guidelines
for the continuous monitoring which shall include, at minimum,
optical gas imaging imaging, where
applicable, and accurate quantitative monitoring of natural gas
concentrations. The program shall include protocols for both
stationary and mobile monitoring, as well as fixed and temporary
monitoring locations.
(2) The program shall require optical gas imaging when a large,
ongoing leak occurs.
(c) An operator of a natural gas storage facility shall develop
and submit to the state board a facility monitoring plan that
satisfies program requirements pursuant to subdivision (a).
subdivisions (a) and (b). The state board shall
review the plan and may approve or disapprove the plan.
(d) An operator of a natural gas storage facility shall conduct
monitoring in accordance with the facility monitoring plan approved
by the state board pursuant to subdivision (c).
(d) Monitoring data shall be provided
(e) An operator of a natural gas
storage facility shall provide monitoring data to the state
board. All materials provided to comply with this section shall be
posted and available to the public on the Internet Web site of the
Division of Oil, Gas, and Geothermal Resources.
state board.
SEC. 3. Section 3133 is added to the Public
Resources Code, to read:
3133. (a) (1) As used in this article, "natural gas storage well"
means an active or idle well used solely to inject gas into or
withdraw gas from an underground gas storage facility.
(2) (A) For purposes of this section, a "low-risk natural gas
storage well" means a natural gas storage well that meets all of the
following:
(i) The well is not subject to Section 3217.
(ii) The well is located in a nonurban area.
(iii) The well meets or exceeds current well construction
standards for gas storage wells.
(iv) The well was constructed specifically for natural gas storage
and was constructed after January 1, 1997.
(v) The well has a consistent and demonstrated record of
mechanical integrity, as determined by the supervisor.
(vi) The well is in compliance with all other applicable
requirements imposed by this article and the division's regulations.
(B) (1) The division may deem any natural gas storage well as
ineligible for classification as a low-risk natural gas storage well
to protect public safety and natural resources.
(2) If the division exercises the authority provided in paragraph
(1), the division shall make a written finding of that decision.
(b) Before January 1, 2018, and annually thereafter, all natural
gas storage wells shall be tested across their entire length for a
loss of integrity resulting in a leak and the results of the testing
shall be reported to the division.
(c) (1) Except as provided in paragraph (2), all natural gas
storage wells shall, on or before July 1, 2018, comply with both of
the following:
(A) Have an automatic downhole shutoff system, including, but not
limited to, surface-controlled subsurface safety valves, deployed in
order to limit leaks associated with a loss of the integrity of a
well, well casing, or cementing. The shutoff system shall be tested
and the results of the test shall be reported to the division no less
than semiannually.
(B) Conduct natural gas injection and production through tubing
only and be isolated from contact with the well casing.
(2) All low-risk natural gas storage wells shall comply with
subparagraphs (A) and (B) of paragraph (1) on or before July 1, 2019.
(d) The division shall review and update practices for the use of
subsurface safety valves in natural gas storage wells to reflect the
best practices established by independent experts pursuant to Section
3140.
(e) All newly constructed natural gas storage wells shall have a
cement barrier, as determined by the supervisor.
(f) (1) The division may modify the requirements of subdivision
(c) for low-risk natural gas storage wells to protect public safety
and natural resources.
(2) If the division exercises the authority provided in paragraph
(1), the division shall make a written finding of that decision.
(g) Nothing in this section shall be construed as limiting the
supervisor's authority to take action to respond to a hazard.
SEC. 4. Section 3134 is added to the Public
Resources Code, to read:
3134. A natural gas storage well shall meet all of the following
requirements:
(a) (1) Baseline and follow-on proactive evaluations of the
integrity of the well, well casing, and cementing across the entire
length of the well shall be conducted to thoroughly, quantitatively,
and accurately assess their condition. These assessments shall be
performed using the best available technology. Based upon these
assessments, the risks posed by erosion, corrosion, material
deterioration, scaling, cracking, and any other process that may
produce natural gas leaks shall be determined.
(2) By January 1, 2018, the division shall develop a schedule for
the completion of baseline proactive evaluations for all natural gas
storage wells.
(3) The division shall also develop a schedule for performing
follow-on proactive evaluations for all natural gas storage wells in
order to measure any changes in well condition after the baseline
proactive evaluations are completed. The schedule shall be determined
based upon an assessment of risk. The natural gas storage wells at
lowest risk of a loss of integrity shall be reevaluated pursuant to
this paragraph at least once every four years and natural gas storage
wells at high risk of a loss of integrity shall be reevaluated
pursuant to this paragraph at least annually.
(4) A natural gas storage well that has lost integrity or that is
at risk of an imminent loss of integrity shall be immediately
repaired before returning to service.
(b) Annular pressure and production or injection flow rate shall
be continuously monitored.
SEC. 5. Section 3135 is added to the Public
Resources Code, to read:
3135. (a) For the purposes of this section, "sensitive receptor"
means any living quarters, including private homes, condominiums,
apartments, retirement homes, prisons, dormitories, or other housing;
education resources, including preschools and schools operating
kindergarten or any of grades 1 to 12, inclusive; daycare centers;
and health care facilities, including hospitals, nursing homes, and
long-term care and hospice facilities.
(b) The Office of Environmental Health Hazard Assessment and the
State Department of Public Health, in consultation with the division,
shall perform a science-based risk assessment of natural gas storage
wells. The goal of the risk assessment shall be to determine
appropriate setback distances for natural gas storage wells from
different locations, activities, and receptors. The risk assessment
shall include, but is not limited to, all of the following
information:
(1) The construction, service history, and operating conditions of
a well.
(2) The potential impact of a leak on public and environmental
health, safety, and welfare. Both acute and chronic exposures for a
range of expected emissions and emissions rates shall be considered.
(3) The factors relevant to determining setback distances
including, but not limited to, population density, sensitive
receptors, environmentally sensitive areas, emergency response times,
evacuation times, leak duration, chemical species emitted, and local
meteorology.
(4) The data necessary to determine appropriate setback distances.
(c) The risk assessment conducted pursuant to subdivision (b)
shall be subjected to peer review by independent experts.
(d) The findings of the risk assessment required by subdivision
(b) shall be reported to the Legislature in accordance with Section
9795 of the Government Code.
(e) Upon completion of the risk assessment required by subdivision
(b), the division shall review and, as appropriate, revise its
regulations.
SEC. 6. Section 3136 is added to the Public
Resources Code, to read:
3136. (a) The operator of a natural gas storage well shall submit
for the supervisor's approval the following materials:
(1) A regular maintenance program for the well and the portion of
the facility within the division's jurisdiction. The maintenance
program shall include training for site personnel and proactive
replacement of equipment at risk of failure to ensure safe operation.
(2) Design and operating conditions and parameters for the well
and the portion of the facility within the division's jurisdiction.
(3) An inspection, leak detection, and monitoring program for the
well and the portion of the facility within the division's
jurisdiction that includes monitoring of natural gas concentrations
pursuant to Chapter 6 (commencing with Section 42710) of Part 4 of
Division 26 of the Health and Safety Code. Ambient natural gas
monitoring sufficient to include monitoring of a new or reworked well
shall be in operation before a new well is drilled or a well is
reworked.
(4) A site-specific risk management plan to identify and plan for
mitigation of all threats and hazards and potential threats and
hazards associated with natural gas storage well operation in order
to ensure internal and external mechanical integrity of a well. The
risk management plan shall provide for regular review and revision,
as needed, to ensure the plan appropriately reflects current
conditions. The risk management plan shall include, but is not
limited to, all of the following:
(A) A natural gas leak prevention and response program that
addresses the full range of natural gas leaks possible at the
facility with specific response plans that provide for immediate
control of the leak. The prevention and response program shall
include, but is not limited to, all of the following:
(i) A protocol for public notice of the leak to the community by
the operator.
(ii) Prepositioning, as feasible, and identification of materials
and personnel necessary to respond to leaks. This shall include
materials and equipment to respond to and stop the leak itself as
well as to protect public health.
(iii) A training program to ensure site personnel are prepared to
respond to a leak, consistent with the requirements of Section 3144.
(B) A plan for corrosion monitoring and evaluation.
(C) A schedule for regular well and reservoir integrity
assessments.
(D) An assessment of the risks associated with the natural gas
storage well and its operation.
(E) Planned risk mitigation efforts.
(b) All of the materials described in subdivision (a) shall be
approved by the supervisor, at his or her discretion, and in the
possession of the division before the supervisor or district deputy
approves a notice required pursuant to Section 3203.
(c) All of the materials described in subdivision (a) shall be
reported to the division annually. The operator shall not deviate
from the programs, plans, and other conditions and protocols
contained in the materials without prior written approval by the
supervisor.
SEC. 7. Section 3137 is added to the Public
Resources Code, to read:
3137. The public has a right to review the location of a natural
gas storage well or conversion of an existing well to a natural gas
storage well before the approval of any notice required pursuant to
Section 3203.
SEC. 8. Section 3138 is added to the Public
Resources Code, to read:
3138. In the event of a loss of the integrity of a natural gas
storage well, well casing, or cementing resulting in a large ongoing
leak of natural gas and associated gases and materials that pose a
significant present or potential hazard to public health and safety,
property, or to the environment, preparations for the drilling of a
relief well shall begin within 24 hours of the discovery of the leak
regardless of any other activities undertaken to stop the leak.
SEC. 9. Section 3139 is added to the Public
Resources Code, to read:
3139. In the event of a leak of any size from a natural gas
storage well, the operator shall notify the division immediately.
Within 24 hours of notification, the division shall post information
about the leak on its Internet Web site and provide regular updates
to the public until the leak is stopped.
SEC. 10. Section 3140 is added to the Public
Resources Code, to read:
3140. (a) The division shall convene an independent panel of
recognized experts to develop best practices for natural gas storage
facilities. The panel shall consider at least all of the following:
(1) The proximity of a natural gas storage facility and wells to
populations of people.
(2) The conditions at which a well should be plugged and
abandoned, and what standards the plugging and abandonment should
meet.
(3) The range of proactive methods to assess the integrity of a
well, well casing, and cementing, and identifying the best available
technology for these assessments.
(4) A thorough analysis of the risks associated with the
conversion of a well for use as a natural gas storage well.
(5) Natural gas storage well design, operating, maintenance, and
monitoring standards, including, but not limited to, placement of
observation wells, soil monitoring, training, and well monitoring
after plugging and abandonment.
(6) Risk assessment and management tools for all threats and
hazards and potential threats and hazards associated with natural gas
storage wells, including identifying data requirements for those
tools, with the goal of providing for a standardized and comparable
approach to evaluate natural gas storage wells statewide.
(7) Automatic shutoff systems including the location and placement
of subsurface and surface safety valves, shutoff control systems,
reliability, and appropriate use.
(b) Upon completion of the panel's work pursuant to subdivision
(a), the division shall review and incorporate best practices
developed by the panel into its regulations for natural gas storage
wells, if appropriate, and, to the extent those practices are
applicable, for other wells under the division's jurisdiction.
(c) The division shall periodically, and whenever necessary,
review advances in relevant technologies and best practices for
natural gas storage facilities and, if appropriate, shall incorporate
changes in best practices into its regulations for natural gas
storage wells and, to the extent those practices are applicable, for
other wells under the division's jurisdiction.
SEC. 11. Section 3141 is added to the Public
Resources Code, to read:
3141. In order to facilitate consistency, standardization, and
training, the division shall, as feasible, incorporate federal
regulations applicable to natural gas storage facilities, including,
but not limited to, Parts 190 to 199, inclusive, of Title 49 of the
Code of Federal Regulations into the division's natural gas storage
well regulations.
SEC. 12. Section 3142 is added to the Public
Resources Code, to read:
3142. To ensure that the division has all the records it needs to
evaluate natural gas storage wells, the well history maintained
pursuant to Section 3213 shall include all operations, injection,
production, and emplacement of any materials into the well. The
operator shall disclose the well history to the division for each
operation, injection, production, and emplacement of any material
into the well.
SEC. 13. Section 3143 is added to the Public
Resources Code, to read:
3143. The division shall perform unannounced random onsite
inspections of some natural gas storage wells annually. The results
shall be posted and available to the public on the division's
Internet Web site.
SEC. 14. Section 3144 is added to the Public
Resources Code, to read:
3144. An operator of a natural gas storage well shall develop and
maintain a comprehensive gas storage well training and mentoring
program for those employees whose job duties involve the safety of
operations and maintenance of natural gas storage wells and
associated equipment. The training program shall include, but is not
limited to, gas storage well operations, including best practices to
prevent leaks, maintenance and testing, gas storage well safety
regulations, emergency response, and incident reporting. If employees
are represented by a labor union, the operator shall consult with
the union on safety issues and, when requested, establish a framework
to provide training through a joint labor-management training
program.
SEC. 15. Section 3145 is added to the Public
Resources Code, to read:
3145. All materials provided to the division to comply with
Section 3133 to 3143, inclusive, shall be posted and available to the
public on the Internet Web site of the division.
SEC. 16. Section 3146 is added to the Public
Resources Code, to read:
3146. A member of the public may bring suit for writ of mandate
against the division for failure to enforce Sections 3133 to 3145,
inclusive.
SEC. 17. Section 3236.5 of the Public Resources
Code is amended to read:
3236.5. (a) A person who violates this chapter or a regulation
implementing this chapter is subject to a civil penalty not to exceed
twenty-five thousand dollars ($25,000) for each violation. A person
who commits a violation of Article 3 (commencing with Section 3150)
or Section 3300 is subject to a civil penalty of not less than ten
thousand dollars ($10,000) and not to exceed twenty-five thousand
dollars ($25,000) per day per violation. An act of God and an act of
vandalism beyond the reasonable control of the operator shall not be
considered a violation. The civil penalty shall be imposed by an
order of the supervisor pursuant to Section 3225 upon a determination
that a violation has been committed by the person charged. The
imposition of a civil penalty under this section shall be in addition
to any other penalty provided by law for the violation. When
establishing the amount of the civil penalty pursuant to this
section, the supervisor shall consider, in addition to other relevant
circumstances, all of the following:
(1) The extent of harm caused by the violation.
(2) The persistence of the violation.
(3) The pervasiveness of the violation.
(4) The number of prior violations by the same violator.
(b) An order of the supervisor imposing a civil penalty shall be
reviewable pursuant to Article 6 (commencing with Section 3350). When
the order of the supervisor has become final and the penalty has not
been paid, the supervisor may apply to the appropriate superior
court for an order directing payment of the civil penalty. The
supervisor may also seek from the court an order directing that
production from the well or use of the production facility that is
the subject of the civil penalty order be discontinued until the
violation has been remedied to the satisfaction of the supervisor and
the civil penalty has been paid.
(c) Any amount collected under this section shall be deposited in
the Oil, Gas, and Geothermal Administrative Fund.
SEC. 3. Article 3.5 (commencing with Section 3180)
is added to Chapter 1 of Division 3 of the Public
Resources Code , to read:
Article 3.5. Natural Gas Storage Wells
3180. (a) As used in this article, "gas storage well" means an
active or idle well used primarily to inject natural gas into or
withdraw natural gas from an underground natural gas storage
facility.
(b) On or before January 1, 2018, the operators of all gas storage
wells shall have commenced a mechanical integrity testing regime
specified by the division. The testing regime shall include all of
the following:
(1) Regular leak testing.
(2) Casing wall thickness inspection.
(3) Pressure test of the production casing.
(4) Any additional testing deemed necessary by the division to
demonstrate the integrity of the well.
(c) All
anomalies identified in the testing shall be immediately reported to
the appropriate district office and explained to the supervisor's
satisfaction.
(d) (1) The division shall promulgate regulations that establish
standards for the design, construction, and maintenance of all gas
storage wells to ensure that integrity concerns with a gas storage
well are identified and addressed before they can become a threat to
life, health, property, the climate, or natural resources.
(2) The regulations shall require that gas storage wells be
designed, constructed, and maintained to ensure that a single point
of failure does not pose an immediate threat of loss of control of
fluids, as determined by the supervisor.
(3) In developing the regulations, the division shall consider
enhanced design, construction, and maintenance measures that could
meet the standard in paragraph (2), including any of the following:
(A) Primary and secondary mechanical well barriers to isolate the
storage gas within the storage reservoir and transfer storage gas
from the surface into and out of the storage reservoir.
(B) Production casing to the surface with the required integrity
to contain reservoir pressure.
(C) Tubing and packer and production tree with the required
integrity to contain reservoir pressure.
(D) Surface controlled subsurface safety valves or Christmas tree
valves with the required integrity to contain reservoir pressure that
halt flow through the well.
(E) Secondary barrier with overlapping cement casing between two
concentric casings with good quality cement bond.
(F) Wellhead with annular valves and seals and the required
integrity to contain reservoir pressure.
(G) Casing with a hanger and seal assembly.
(H) Any other well construction requirements the supervisor
determines would improve the protection of public health, safety, the
environment, and natural resources.
(4) In developing the regulations, the division shall develop a
schedule for ongoing mechanical integrity testing.
(e) In order to facilitate consistency, standardization, and
training for site inspection and maintenance, to the extent that the
regulations promulgated by the division pursuant to subdivision (d)
address surface equipment associated with an underground gas storage
facility, the division shall ensure that those regulations are
consistent with comparable requirements in Parts 190 to 199,
inclusive, of Title 49 of the Code of Federal Regulations.
3181. (a) The operator of a gas storage well shall submit for the
supervisor's approval the following materials:
(1) Data describing the gas storage project and gas storage wells
that demonstrate that stored gas will be confined to the approved
zone or zones. Updated data shall be provided to the division if
conditions change or if more accurate data become available.
(2) A site-specific risk management plan to identify and plan for
mitigation of all threats and hazards and potential threats and
hazards associated with gas storage well operation in order to ensure
internal and external mechanical integrity of a well. The risk
management plan shall provide for regular review and revision, as
needed, to ensure the plan appropriately reflects current conditions.
The operator shall consult with local emergency response entities on
the risk management plan. The risk management plan shall include,
but is not limited to, all of the following:
(A) A natural gas leak prevention and response program that
addresses the full range of natural gas leaks possible at the
facility with specific response plans that provide for immediate
control of the leak. The prevention and response program shall
include, but is not limited to, all of the following:
(i) A protocol for public notice of a large, uncontrollable leak
to any community within two miles of the leak if the leak cannot be
controlled within 48 hours of discovery by the operator.
(ii) Prepositioning, as feasible, and identification of materials
and personnel necessary to respond to leaks. This shall include
materials and equipment to respond to and stop the leak itself as
well as to protect public health.
(iii) The identification of personnel responsible for notifying
regulatory authorities with jurisdiction over the range of leaks
possible.
(B) A plan for corrosion monitoring and evaluation.
(C) A schedule for regular well and reservoir integrity
assessments.
(D) An assessment of the risks associated with the gas storage
well and its operation.
(E) Planned risk mitigation efforts.
(F) A regular maintenance program for the well and the portion of
the facility within the division's jurisdiction. The maintenance
program shall include training for site personnel and proactive
replacement of equipment at risk of failure to ensure safe operation.
(3) In addition to other factors deemed relevant by the
supervisor, the risk management plan required in paragraph (2) shall
consider all of the following:
(A) The facility's distance from dwellings, other buildings
intended for human occupancy, or other well-defined outside areas
where people may assemble such as campgrounds, recreational areas, or
playgrounds.
(B) The risks to and from the well related to roadways, rights of
way, railways, airports, and industrial facilities.
(C) Proximity to environmentally or culturally sensitive areas.
(D) The risks of well sabotage.
(E) The current and predicted development of the surrounding area.
(F) Topography and local wind patterns.
(b) All of the materials described in subdivision (a) shall be
reported to the division according to a schedule approved by the
supervisor. The operator shall not deviate from the programs, plans,
and other conditions and protocols contained in the materials without
prior written approval by the supervisor.
3182. On a weekly basis, the division shall post a list of
notices received pursuant to Section 3203 on the division's Internet
Web site. Copies of any notice shall be provided to members of the
public upon request.
3183. (a) The division, in consultation with the State Air
Resources Board, shall determine and adopt by regulation what
constitutes a reportable leak from a gas storage well and the
timeframe for reporting that leak. The regulations shall require an
operator to immediately report to the division a leak that poses a
significant present or potential hazard to public health and safety,
property, or to the environment.
(b) Until the regulations pursuant to subdivision (a) are in
effect, a leak of any size from a gas storage well shall be deemed a
reportable leak, and the operator shall notify the division
immediately.
(c) If a leak from a gas storage well that is reported to the
division pursuant to subdivision (a) or (b), as applicable, cannot be
controlled within 48 hours, the division shall post information
about the leak on its Internet Web site and provide regular updates
to the public until the leak is stopped.
3184. (a) Within 72 hours of being notified of a reportable leak,
pursuant to Section 3183, the supervisor shall determine if the
reportable leak poses a significant present or potential hazard to
public health and safety, property, or to the environment such that a
relief well is necessary. If the supervisor makes that
determination, the operator shall immediately begin preparation for,
and commence the drilling of, a relief well.
(b) Nothing in subdivision (a) shall prevent the supervisor from
making a determination after the initial 72-hour period that a
reportable leak poses a significant hazard to public health and
safety, property, or to the environment and that a relief well is
necessary. If the supervisor makes that determination, the operator
shall immediately begin preparation for, and commence the drilling
of, a relief well.
(c) If the operator is required to drill a relief well under
subdivision (a) or (b), the operator's efforts to drill the relief
well shall continue until the reportable leak has been stopped and
the cause of the reportable leak has been fully addressed or the
supervisor determines that other means of controlling the reportable
leak are appropriate.
3185. The division shall perform unannounced random onsite
inspections of some gas storage wells annually. The results shall be
posted and available to the public on the division's Internet Web
site.
3186. An operator of a gas storage well shall develop and
maintain a comprehensive gas storage well training and mentoring
program for those employees whose job duties involve the safety of
operations and maintenance of gas storage wells and associated
equipment. The training program shall include, but is not limited to,
gas storage well operations, including best practices to prevent
leaks, maintenance and testing, gas storage well safety regulations,
emergency response, and incident reporting. If storage field
employees are represented by a labor union, the operator shall
consult with the relevant union local on safety issues and, when
requested, establish a framework to provide training through a joint
labor-management training program.
3187. All materials provided to the division and approved by the
supervisor to comply with Sections 3181, 3184, and 3185 shall be
posted and available to the public on the Internet Web site of the
division in a timely manner.
SEC. 4. Section 3403.5 of the Public
Resources Code is amended to read:
3403.5. (a) The Legislature finds that there are underground
storage facilities for gas that utilize depleted or partially
depleted oil or gas reservoirs. Purchased gas, usually from out of
state, is injected for storage and withdrawn during peak load
periods. The supervisor is required to maintain surveillance over
these facilities to insure ensure that
the original reserves are not lost, that drilling of new wells is
conducted properly, and that no damage occurs to the environment by
reason of injection and withdrawal of gas.
(b) In order to help support the regulatory effort of the
supervisor, there shall be imposed an annual charge computed
at a uniform rate based on the number of wells used to inject and
withdraw gas from an underground storage facility during the
preceding calendar year. The charge shall defray the costs incurred
by the state in conducting the activities described in this section.
on operators of underground gas storage facilities to
defray the regulatory costs incurred by the state in conducting the
activities described in subdivision (a). Each underground gas sto
rage facility operator shall pay a proportionate share of
the total regulatory costs projected for each fiscal year based on
the field capacity and number of wells for each underground gas
storage facility. For each underground gas storage facility, the
portion owed by the operator shall be computed by
multiplying the operator's field capacity by the number of the
operator's wells, and dividing that product by the product of the
field capacity of all underground gas storage facilities statewide
multiplied by the number of wells for all underground gas storage
facilities statewide.
(c) In order to defray the costs of the response effort of the
division in the event of a large, uncontrolled release of gas from an
underground storage facility that poses a significant present or
potential hazard to public health and safety, property, or to the
environment, there shall be an additional charge imposed entirely on
the operator of the underground storage facility at which the
uncontrolled leak or release of gas occurred. The charge shall be in
the amount of the total directly associated costs incurred by the
division in the previous calendar year in the course of responding to
the release, including personnel hours, travel expenses, contracting
costs, and any other directly associated costs incurred by the
division.
(d) For purposes of this section, the following terms have the
following meanings:
(1) "Field capacity" means the gas storage capacity of an
underground gas storage facility, in cubic feet.
(2) "Wells" means all wells associated with an underground gas
storage facility except those that have been plugged and abandoned
pursuant to Section 3208 before the preceding calendar year.
SEC. 5. Section 1103 is added to the
Public Utilities Code , to read:
1103. (a) If a new underground gas storage facility is proposed,
the commission shall ensure that a risk assessment evaluating the
potential impact of a leak from the facility on public and
environmental health, safety, and welfare is conducted by the project
proponent. Both acute and chronic exposures from a range of expected
emissions and emissions rates shall be evaluated. The evaluation
shall include consideration of population density in proximal
communities, environmentally sensitive areas, emergency response
times, evacuation times, possible leak duration, possible chemical
species emitted, and local meteorology.
(b) In evaluating the potential risks and impacts of acute and
chronic exposures from emissions from a proposed new gas storage
facility, the project proponent shall assess or cause to be assessed
risks associated with the proposed facility's proximity to any living
quarters, including private homes, condominiums, apartments,
retirement homes, prisons, dormitories, or other housing; education
resources, including preschools and schools operating kindergarten or
any of grades 1 to 12, inclusive; day care centers; and health care
facilities, including hospitals, nursing homes, and long-term care
and hospice facilities. Based on the risk analysis, appropriate
setbacks to the listed structure types shall be determined by the
commission.
(c) The risk assessment conducted pursuant to this section shall
be subjected to peer review by independent experts whose demonstrated
expertise includes, but is not limited to, the fields of public
health, epidemiology, and toxicology.
(d) The findings of any risk assessment required by this section
shall be reported to the Legislature in accordance with Section 9795
of the Government Code.
SEC. 6. (a) Notwithstanding
Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3
of Title 2 of the Government Code, including subdivisions (e) and (h)
of Section 11346.1 of the Government Code, the emergency regulations
amending Section 1724.9 of T itle 14 of the California
Code of Regulations adopted by the Division of Oil, Gas, and
Geothermal Resources in the Department of Conservation effective
February 5, 2016, shall continue in effect until the
adoption, amendment, or repeal of the regulations is
promulgated by the division pursuant to Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code.
(b) This section shall remain in effect only until January 1,
2019, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2019, deletes or extends
that date.
SEC. 7. This act shall neither impair nor diminish
requirements imposed by Chapter 14 of the Statutes of 2016 related
to the Aliso Canyon natural gas storage facility located in the
County of Los Angeles.
SEC. 18. SEC. 8. No reimbursement is
required by this act pursuant to Section 6 of Article XIII B of the
California Constitution because the only costs that may be incurred
by a local agency or school district will be incurred because this
act creates a new crime or infraction, eliminates a crime or
infraction, or changes the penalty for a crime or infraction, within
the meaning of Section 17556 of the Government Code, or changes the
definition of a crime within the meaning of Section 6 of Article XIII
B of the California Constitution.