Staff will monitor Bills as the move through the legislative process

Transcription

1 May 2, 2013

2 There are a number of legislative proposals concerning Hydraulic Fracturing: AB 288 (Levine) AB 7 (Wieckowski) AB 982 (Williams) AB 669 (Stone) SB 4 (Pavley) SB 395 (Jackson) SB 665 (Wolk) Staff will monitor Bills as the move through the legislative process

3 High pressure, high volume injection of fracking fluids Fluid fractures oilbearing rock strata Proppants (sand) prop open fractures, allowing flow of oil Illustration: API, Hydraulic Fracturing; Unlocking America s Natural Gas Resources July 19, 2010

4 Diesel-powered Equipment Drilling rigs, pumps Dust from sand and mixing operations Toxic air contaminants from fracking fluids Pre-injection storage and handling Initial flowback VOC from produced fluids and gas Initial flowback Long-term production operations

5 Permits Required (Rule 2010) New Source Review (Rule 2201) Best controls required, mitigation Some temporary equipment exempt Tanks capturing flowback Portable engines Portable Equipment Registration State requires reduced emissions from fleet California has cleanest portable engine fleet

6 Rule 4401 VOC controls on oil wells Rule 4402 VOC control on first-line tanks and sumps Rule 4409 Fugitive VOC control from valves, flanges, etc, light oil and gas ops. Rule 4623 VOC controls on oil tanks US EPA 40 CFR 60 Subpart OOOO Performance standards for oil and gas prod Newly modified: control of emissions from hydraulic fracking for natural gas production

7 Water Quality Fracturing extending into water table Intrusion of methane, fracking chemicals Induced Seismicity (Earthquakes) Theory: added pressure and lubrication to already-stressed geologic faults Increased GHG Emissions Portable, diesel-powered equipment Fugitive methane emissions

8 WSPA Presentation Here Catherine Reheis-Boyd President Western States Petroleum Association

9 District currently has a number of regulations pertaining to fracking activities/emissions More reporting and monitoring warranted State (DOGGR) should be the lead Multimedia regulatory authority DOGGR already has extensive authority over oil exploration Duplication at local level not effective or efficient District will continue to work with DOGGR to assure air quality issues are properly addressed Address workload issues in a timely fashion 80% of Monterey Shale in San Joaquin Valley Significant increase in permitting and compliance workload

10 Monterey Shale & Hydraulic Fracturing Catherine Reheis-Boyd Western States Petroleum Association May 2, 2013

11 Hydraulic Fracturing Safety: Myths and Facts If fracking is not immediately stopped, the water table will become so highly toxic and unusable that all of Culver City and surrounding cities will all become a desolate, (un)inhabitable wasteland. Plants, trees and all living species will cease to exist here. I m not an alarmist, but... Culver City Resident, Culver City Patch, May 16,

12 Hydraulic Fracturing Safety: Myths and Facts In no case have we made a definitive determination that the fracking process has caused chemicals to enter groundwater. U.S. Environmental Protection Agency Administrator Lisa Jackson, April 30, 2012 I m not aware of any proven case where the fracking process itself has affected water. U.S. Environmental Protection Agency Administrator Lisa Jackson, May 24, 2011 My point of view, based on my own study of hydraulic fracking, is that it can be done safely and has been done safely hundreds of thousands of times. Former Secretary of the Interior Ken Salazar, February 15, 2012 The Water Boards generally consider hydraulic fracturing a low threat to groundwater... State Water Resources Control Board, Executive Director, Thomas Howard, February 8,

13 Hydraulic Fracturing Safety: Myths and Facts Myth: There is a lack of science-based information about hydraulic fracturing in California Fact: In October, 2012, an exhaustive yearlong study at Inglewood Oil Field in Los Angeles looked at 14 environmental issues, including public health, groundwater, air quality, seismic, noise, vibration All fractures separated from fresh water by at least 7,700 feet (1.5 miles) or more No impacts to any of the 14 areas studies October 10,

14 Hydraulic Fracturing Safety: Myths and Facts Myth: Hydraulic fracturing is destructive and unregulated Fact: Hydraulic fracturing in California has been used for 60 plus years; it is not destructive, has never been linked to any environmental harm in California and has been closely regulated The primary regulations that protect groundwater are the state's well construction and testing standards, which are among the strictest in the United States Source: FracFocus, Courtesy of Texas Oil and Gas Association 5

15 Hydraulic Fracturing Safety: Myths and Facts Myth: Hydraulic fracturing uses millions of gallons of water Fact: In 2012, the average amount of water used during hydraulic fracturing operations was 116,000 gallons of water The total amount of water used in the 528 wells that were hydraulically fractured in 2012 was 202 acre feet The average water used on golf courses is 312,000 gallons every day Farming in California 2012 uses approximately 34 million acre feet of water annually 6 Source: FracFocus; California Department of Water Resources

16 Hydraulic Fracturing Safety: Myths and Facts Myth: Hydraulic fracturing causes felt earthquakes Fact: A recent study by the National Academy of Sciences concluded, The process of hydraulic fracturing a well as presently implemented for shale gas recovery does not pose a high risk for inducing felt seismic events. The NAS study and other research has concluded the energy deployed in hydraulic fracturing is miniscule compared to the energy required to trigger a felt earthquake Seismic events associated with wastewater injection wells in other states are not relevant to California; for many decades, thousands of wastewater injection wells have been strictly permitted and used in California without any link to seismic activity 7 Source: National Academy of Sciences, Hydraulic Fracturing Poses Low Risk for Causing Earthquakes, But Risks Higher for Wastewater Injection Wells, June 15, 2012

17 Hydraulic Fracturing: How Much, Where Myth: We don t know how much or where hydraulic fracturing is occurring Fact: 568 wells fractured in 2012 according to FracFocus 2,705 well permits issued in ,970 wells currently producing oil and/or gas in CA 97 percent of hydraulic fracturing operations were in 2012 were in Kern County 8 Source: WSPA survey of FracFocus website 2012 data

18 Voluntary Disclosure Source: FracFocus website, California well reports posted as of November 6, 2012

19 Hydraulic Fracturing Regulations California Division of Oil, Gas & Geothermal Resources (DOGGR) proposed regulations Draft regulations require: Advance notice to DOGGR before a well is fractured Enhanced testing and monitoring of fractured wells Safe storage and handling requirements of fracturing fluids Disclosure of chemicals used on FracFocus website Provides protection of trade secrets 10

20 Legislation SB 395 (Jackson): Any produce water from an oil well is deemed a hazardous waste regulated by DTSC. AB 288 (Levine): Deletes existing policy section PRC which outlines DOGGR s authority to facilitate oil production in California; requires permit for any well stimulation treatment AB 7 (Wieckowski): Requires information related to the hydraulic fracturing be given to DOGGR; requires disclosure and addresses trade secrets SB 4 (Pavley): Imposes a moratorium on hydraulic fracturing unless a study is conducted by 2015; requires a permit from DOGGR and pre-notification to land owners AB 669 (Stone) : Requires regional water quality board to approve the method and location of wastewater disposal; requires disclosure of the origin and volume of freshwater used AB 982 (Williams): Requires operators to submit ground water monitoring plan to DOGGR and regional water boards SB 665 (Wolk): Indemnity bond amounts for oil and gas wells in statute blank now. AB 649 (Nazarian): Moratorium on hydraulic fracturing on any well located near an aquifer. AB 1301(Bloom): Moratorium on hydraulic fracturing 11 AB 1323 (Mitchell): Moratorium on hydraulic fracturing

21 WSPA s Position Allow DOGGR s rulemaking to be completed Then address any perceived gaps in statutes or regulations I support our Division of Oil and Gas. They are excellent people and I look for them to navigate the issues as we go forward. The fossil fuel deposits in California are incredible. California Governor Jerry Brown 12

22 Potential Economic Benefits of Shale Production Creation of 512,000 to 2,815,800 new jobs, depending on the year State per-capita gross domestic product growth by $1,600 to $11,000, or by 2.6% to 14.3% Personal income growth by $40.6 billion to $222.3 billion, or by 2.1% to 10.0% Increase in state and local government revenues (tax collections) of $4.5 billion to $24.6 billion, or by 2.1% to 10.0% 13 Source: The Monterey Shale & California s Economic Future, University of Southern California, March 2013

23 Monterey 15.4 Billion Barrels 63% of US Shale Oil Shale Oil Plays in the U.S. Bakken 4 Billion Barrels 17% of US Shale Oil Avalon/Bone Springs 2 Billion Barrels 8% of US Shale Oil Eagle Ford 3 Billion Barrels 12% of US Shale Oil 14

24 Sources of Oil for California Refineries 15 Source: U,S, Energy Information Administration; California Energy Commission

25 January 2012 WESTERN STATES PETROLEUM ASSOCIATION Petroleum is a fuel of the future 16 Source: U.S. Energy Information Administration

26 Hydraulic Fracturing and Air Quality Emissions from oil and gas operations - including hydraulic fracturing - are currently regulated under arguably the most robust body of rules in the nation All oil & gas production operations require extensive permitting by local air districts Portable equipment used in the fracturing process is regulated under CARB s Portable Equipment Registration Program (PERP) Many operations fall under California s cap-and-trade program and must receive federal Title V permits; therefore, greenhouse gas emissions are quantified and must be mitigated 17

27 Hydraulic Fracturing and Air Quality What s not happening Unpermitted/uncontrolled venting of natural gas is not allowed Unpermitted/uncontrolled flaring of gas is not allowed Fracturing contracting companies do not store or transport chemicals without permits from the appropriate federal, state and local agencies 18

28 SJVAPCD Air Quality Regulations Emissions from hydraulic fracturing have been and continue to be part of the San Joaquin Valley Air Pollution Control Agency (SJVAPCD) permitting and reporting process for drilling activities. SJVAPCD Rule 2201 is the new and modified stationary source review rule. It requires that new or modified emission sources apply Best Available Control Technology (BACT), obtain emission offsets, and permit application approval of the Air Pollution Control Officer. SJVAPCD Rule 2540 is an administrative mechanism for incorporating requirements authorized by SJVAPCD Rule 2201 permits into a Federal Part 70 Operating Permit (i.e., demonstrating compliance with the requirements of 40 CFR 70.6, 70.7 and 70.8). SJVAPCD Rule 4401 requires the capture and control or of emissions from existing and new enhanced crude oil production wells. SJVAPCD Rule 4402 requires the capture and control or replacement with tanks of sumps associated with crude oil production wells. SJVAPCD Rule 4409 limits emissions from leaking oil field components including valves, threaded connections, flanges, pumps, compressors, pressure relief values, and polished rod stuffing boxes. SJVAPCD Rule 4623 governs crude oil and petroleum distillate storage tanks. This rule requires controls on tank emissions that include highly-effective vapor recovery system. SJVAPCD Rule 4311 limits the emissions from the operation of flares. Specifically, this rule contains stringent emission standards for ground-level enclosed flares as well as conditions for other types of flares.

29 Follow Us on 20