On June 13, 2014, the Department of Conservation (“Department”) issued a public notice and posted the latest version of the proposed regulations for the use of well stimulation in oil and gas production (“Revised Proposed Regulations”). These are revisions to the permanent regulations that will go into effect on January 1, 2015. The Revised Proposed Regulations include the following, significant changes:
- The exemption for acid matrix stimulations containing acid concentrations of 7% or less has been eliminated and replaced with a new standard for determining when the use of acid constitutes a regulated well stimulation treatment. (§1780(a); (§1761(a).)
- Regulations are declared to govern well stimulation treatments both “onshore and offshore.” (§1780(a).)
- Well stimulations must comply with all applicable requirements of the following Board, Districts and Agencies: Regional Water Board, Department of Toxic Substances Control, Air Resources Board, Air Quality Management District or Air Pollution Control District, Certified Unified Program Agency, and any other local agencies with jurisdiction over the well. (§1782(a)(9).)
- If any of the operational requirements contained in §1782(a) are not met at any time during the well stimulation treatment, the operator must terminate the operation as soon as it is safe to do so. (§1782(c).)
- New inter-agency sharing of information: “Upon receipt of a complete application for a permit to conduct well stimulation treatment, the Division will provide a copy of the permit application, including information in the application designated as trade secret or confidential, to the Regional Water Board, the Department of Toxic Substance Control, the Air Resources Board, and the local air district where the well stimulation treatment may occur, provided that the manner and timing of providing copies of permit applications has been specified in a written agreement between the Division and the receiving agency.” (§1783(c).)
- The process for hiring an independent, third-party to locate neighboring surface owners and provide notifications to such owners has been revised and more comprehensively addressed. Notification must be made using the approved Department form. (§ 1783.2.)
- Revised and more detailed requirements for water testing protocols have been added. (§1783.3.)
- A permit application must include a reference to all documents prepared pursuant to CEQA for the proposed activity. (§1783.1(a)(30)).
- New section is added: Cement Evaluation Prior to Well Stimulation Treatment. (§1784.2).
- New section is added: Monitoring and Evaluation of Seismic Activity in the Vicinity of Hydraulic Fracturing. (§1785.1.)
- New required public disclosures are added, primarily relating to water use and testing. (1788(a).)
Most of the changes appear to be designed to address criticisms from environmental and other groups opposed to hydraulic fracturing and well stimulation, such as the seismicity study requirement and applying the regulations to offshore well stimulation treatments. Other changes appear to be designed to correct ambiguities in the original draft regulations concerning the mechanics of compliance, especially with regard to the surface neighbor notification requirements. A 45-day public comment period on the Revised Proposed Regulations began June 13, 2014. Interested parties may submit comments via email to the Division of Oil, Gas and Geothermal resources (“DOGGR”) by July 28, 2014.
Additionally, DOGGR will host multiple public hearings across the state over the next 45 days. See the full list here.