New Activities at EMNRD Related to the Oil and Gas Industry in New Mexico

Transcription

1 New Activities at EMNRD Related to the Oil and Gas Industry in New Mexico David Martin, Cabinet Secretary NM Energy, Minerals, and Natural Resources Department (EMNRD) IPANM Annual Meeting Albuquerque, NM August 7, 2015

2 Outline Oil Conservation Division (OCD) Personnel Produced Water Recycling Modification of Rule 34 Impact of Proposed BLM Hydraulic Fracturing Rule Subsequent Plans Changes in a rule for surface waste management facilities (Rule 36) State of New Mexico Energy Policy Educational Outreach and Initiatives In-State Nationally 2

3 OCD Personnel New OCD Director, David Catanach Additional Position in the Engineering and Geology Bureau Nine New FTEs Three in the Hobbs District Office Two in the Artesia District Office Three in the Aztec District Office One in the Santa Fe Office 3

4 NM Crude Oil & Produced Water Volumes (Oil Wells) Oil, million bbls Water Oil Ratio (SE) = 8.5 Water, million bbls SE NW Total SE NW Total * * 2014 SE Water Oil Ratio (WOR) = *Total oil, including gas wells: million bbls *Total produced water, including gas wells: million bbls Source: OCD

5 2014 Frac Fluid Volumes County Wells Fluid, bbls Acre Ft bbls/well Eddy ,425,133 4,566 45,185 Lea ,050,969 3,616 55,767 San Juan 68 1,294, ,039 Sandoval , ,752 Rio Arriba , ,505 Other* , ,571 TOTAL 66,580,202 8,582 * Other includes Chaves, Roosevelt and Harding Counties 5

6 Produced Water Reuse Produced Water Historically Regulated as a Waste Commonly disposed by reinjection in deep wells Need to convert this waste into an asset Can be reused for unconventional production Can replace use of fresh water in production operations Can provide a consistent, stable water resource Need Policy that Encourages Recycling and Reuse of Oilfield Produced Water, especially in Hydraulic Fracturing Treatment costs now on a par with disposal costs New produced water recycling rule effective

7 Rule 17: the Pit Rule Only an operator may apply for a division-issued permit: C-144 Only for non-freshwater pits Temporary Pits A drilling or workover pit Must be closed within 6 months of release of rig Multiwell Fluid Management Pits may remain in use until all wells with approved application for permit to drill that are identified in the pit permit are completed Permanent Pits Shall not exceed 10 acre-feet, including freeboard Used for collection, retention or storage of produced water or brine that is constructed with the conditions and for the duration provided in its permit 7

8 Rule 36 Disposal of Oilfield Waste and the Construction, Operation and Closure of Surface Waste Management Facilities Permit Required Application on Form C-137 to the Environmental Bureau in OCD s Santa Fe office. A description of the surface waste management facility Engineering designs, certified by a registered professional engineer An inspection and maintenance plan A closure and post closure plan Financial assurance is required Simplification of rule is planned 8

9 Revision of Rule 34 Encourage recycling and reuse of produced water Reduce fresh water consumption Refine procedures for transport and disposal of produced water, drilling fluids, and other liquid oilfield waste Provide reasonable protection of fresh water, public health, and the environment Defines a recycling facility and a recycling containment (means of water storage) Quantify volumes of produced water recycled and reused 9

10 Recycling Facility A stationary or portable facility used exclusively for the treatment, reuse or recycling of produced water Recycling facilities used for drilling, completion, producing, or plugging of wells can be registered with an OCD District Office on Form C-147 Monthly records of water received and water leaving the facility Facility can be located onsite or offsite and can serve a number of wells 10

11 Recycling Containment Used solely with a recycling facility for the storage, treatment or recycling of produced water for drilling, completion, production, or plugging of wells Water storage using synthetic double liners with leak detection Registered on Form C-147 for a 5-year period Permit by rule Requirements for siting, design and construction, and operations Closure and site reclamation requirements Type of Financial Assurance required and when released 11

12 Produced Water Recycling Options Recycling storage facility and recycling containment registered under Rule 34 A facility permit under another applicable rule Rule 17 ( the Pit Rule ): permanent pits or multiwell fluid management pits Rule 36: a surface waste management facility, most likely the avenue for commercial facilities 12

13 Rule 17: The Pit Rule 13

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15 Resolving Issues with the BLM Frac Rule Regarding PW Recycling Proposed Rule will Discourage the State s Desire to Recycle and Reuse Oilfield Produced Water Requirement for Flowback Water to go to 500 barrel Steel Tanks Impractical Variance Provisions will not Overcome this Requirement Pits on Federal Lands Discouraged Onshore Order No. 7 Considered by BLM an Alternative Allow Produced Water from BLM or Tribal Lands to go to a State Permitted or Registered Containment Facility Two Options for Submittal to BLM (tanks not required) o APD w frac plan, surface use plan, recycle and disposal plans (OCD), NEPA o APD, NEPA, sundry frac plan, surface, recycle and disposal plans, NEPA 15

16 Energy Policy & Implementation Plan Last Official Energy Policy (1991) New Focus: State Revenue & Private Sector Jobs Access to Federal Lands State Collaboration with Federal Agencies Streamline Regulatory Requirements Infrastructure Needs Energy Education (Oil and Gas) Energy and Water Nexus 16

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18 Energy Education Outreach OCD Website: Link to Oil and Gas Education Ongoing access to data and information for the public Legislative Committees Water and Natural Resources Committee Legislative Education Study Committee Associations New Mexico Association of Counties New Mexico Rural Water Association 18

19 New Energy Education Initiatives State Alliances With Universities With NM Tech, offer expert technical assistance and provide neutral science and technology information to the New Mexico Association of Counties. Inform decision making and avoid costly and divisive policymaking on oil and gas industry development. National Academies Roundtable Participate in a new diverse group assembled by the National Academies on unconventional hydrocarbon production. Communicate facts and data, especially related to horizontal drilling and hydraulic fracturing. 19

20 Thank You 20