BILL ANALYSIS �
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| SENATE COMMITTEE ON NATURAL RESOURCES AND WATER |
| Senator Fran Pavley, Chair |
| 2013-2014 Regular Session |
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BILL NO: SB 1281 HEARING DATE: April 29, 2014
AUTHOR: Pavley URGENCY: No
VERSION: April 21, 2014 CONSULTANT: Katharine Moore
DUAL REFERRAL: No FISCAL: Yes
SUBJECT: Oil and gas production: water use reporting.
BACKGROUND AND EXISTING LAW
1.Existing law states that the highest use of water is for
domestic purposes and the next highest use is for irrigation
(Water Code (WAT) �106).
2.Subject to certain conditions (i.e. not wasted), industrial
use of water is a beneficial use of water.
3.The Water Recycling Law (WAT �13500 et seq.) establishes state
policy to promote the use of recycled water (defined as "water
which, as a result of treatment of waste, is suitable for a
direct beneficial use" (WAT �13050)) where available.
4.There are significant amounts of water co-located with the
state's oil and gas fields. The quality of this water can
vary considerably from potentially suitable for irrigation to
extremely salty.
5.The oil and gas industry has a ready supply of water generated
by oil and gas production. On average state-wide, roughly 8
barrels of "produced water" of varying quality are produced
for every barrel of crude oil. Produced water or treated
produced water may be used in lieu of fresh water for at least
some oil and gas field processes. These include enhanced oil
recovery operations such as waterflooding where Class II
injection wells are used to inject water into the subsurface
formation.
6.Existing technology is generally capable of treating produced
water, when needed, to make it suitable for use in oil and gas
field operations.
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7.Current required water use reporting to the Division of Oil,
Gas and Geothermal Resources from oil production (Public
Resources Code (PRC) �3227), while useful, does not provide
sufficient information to understand the sources and uses of
water in the oil and gas fields.
8.Existing state law requires that re-pressurizing depleted oil
and gas-bearing formations is sometimes necessary to prevent
subsidence (PRC �3315 et seq.). Produced water can be used
for these repressurizing activities.
9.Existing state law requires that the amount, source and
disposition of all water used in well stimulation activities
be reported (PRC �3160).
PROPOSED LAW
This bill would reiterate and revise state policy on water use
in the oil and gas fields and expand upon monthly reporting
requirements. Specifically this bill would:
Reiterate state policy regarding the use of recycled
water where feasible.
Establish state policy in oil and gas field exploration,
development and production that:
o produced water should be used or treated and
used where feasible.
o the use and reuse of water initially of poorer
quality is encouraged.
Expand existing monthly oil and gas field production
reporting by requiring additional information be provided
in order to provide a more complete accounting of water
use. This includes water source, water treatment and the
use or reuse of treated and recycled water, and the
disposition of the water used.
ARGUMENTS IN SUPPORT
According to the author, "California is suffering from one of
the worst droughts since it became a state. Last year, 2014,
was the driest year in terms of rainfall since 1850. Water
scarcity is not unusual here, and is a matter of considerable
public concern."
"The amount of water used in oil and gas field exploration,
development and production is also of continuing and significant
public concern. Much of California's oil and gas production is
located in arid parts of the Central Valley and where existing
groundwater - particularly good quality groundwater - may be
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depleted or under threat of depletion."
"Earlier this year, I asked the Senate Office of Research to
find out how much water is used in oil and gas activities in
California. While some information is routinely provided to
regulators, SOR could only provide very rough estimates. The
current reporting requirements are inadequate. The data
reported don't add up."
"SB 1281 is designed to address the public's concerns in two
ways. First, it establishes state policy to promote the use and
treatment and use of produced water and recycled water for oil
and gas field operations. Second, it enhances existing water
reporting requirements. Implementation of SB 1281 will provide
public transparency and adequate recordkeeping on water use in
the oil and gas industry."
ARGUMENTS IN OPPOSITION
None received.
COMMENTS
This bill is a work-in-progress . There are continuing
stakeholder discussions underway to ensure that the concerns
raised are addressed by the bill. This includes water use
during droughts. Additionally, the bill may be usefully
clarified by adding or referring to definitions of certain
terms.
Enhanced Oil Recovery operations . Oil and gas production from
any reservoir tends to decline over time as oil and gas are
removed and the reservoir pressure declines. Enhanced oil
recovery operations (also often called secondary or tertiary
recovery) are efforts to improve oil and gas recovery by
injecting other fluids - such as water or steam - into the
reservoir to, at least generally speaking, boost reservoir
pressure and/or change the properties of the oil and gas. The
use of enhanced oil recovery operations - for example, injection
well projects - are widespread in California. At least some of
the water used in certain enhanced oil recovery operations is
likely to return to the surface as produced water.
As noted above, this bill extends the water use reporting
requirements for well stimulation activities to other oil and
gas field operations not already required to do so.
SUPPORT
Clean Water Action
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Citizens for Responsible Oil and Gas (CFROG)
Earthworks
Environmental Working Group
Los Padres ForestWatch
Mount Shasta Bioregional Ecology Center
Natural Resources Defense Council
South Monterey County Citizen Planning Alliance
Southern Monterey County Rural Coalition
OPPOSITION
None Received
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