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SB-467 Oil and gas: hydraulic fracturing, acid well stimulation treatments, steam flooding, water flooding, or cyclic steaming: prohibition: job relocation.(2021-2022)

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Date Published: 03/22/2021 02:00 PM
SB467:v98#DOCUMENT

Amended  IN  Senate  March 22, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill
No. 467


Introduced by Senators Wiener and Limón
(Coauthor: Senator Allen)
(Coauthors: Assembly Members Kalra and Stone Kalra, Stone, Ward, and Wicks)

February 16, 2021


An act to amend Section 3157 of, to amend, repeal, and add Sections 3213 and 3215 of, to add Sections 3151.5, 3162, 3162.5, and 3163 3163, and 3203.5 to, to add Chapter 8 (commencing with Section 3870) to Division 3 of, and to repeal and add Article 3 (commencing with Section 3150) of Chapter 1 of Division 3 of, the Public Resources Code, relating to oil and gas.


LEGISLATIVE COUNSEL'S DIGEST


SB 467, as amended, Wiener. Oil and gas: hydraulic fracturing, acid well stimulation treatments, steam flooding, water flooding, or cyclic steaming: prohibition: job relocation.
Existing law authorizes the Geologic Energy Management Division in the Department of Conservation to regulate the drilling, operation, maintenance, and abandonment of oil and gas wells in the state. Existing law requires an operator proposing to perform a well stimulation treatment to apply to the State Oil and Gas Supervisor or a district deputy for a permit to perform the well stimulation treatment and imposes other requirements and conditions on the use of well stimulation treatments. Under existing law, a person who fails to comply with this and other requirements relating to the regulation of oil or gas operations is guilty of a misdemeanor.
This bill would revise the definition of “well stimulation treatment” to include steam flooding and water flooding. The bill would prohibit the issuance or renewal of a permit to conduct hydraulic fracturing, acid well stimulation treatment, steam flooding, water flooding, or cyclic steaming for the extraction of oil and gas beginning January 1, 2022, and would prohibit new or repeated hydraulic fracturing, acid well stimulation treatments, steam flooding, water flooding, or cyclic steaming, except as conducted pursuant to a permit lawfully issued before that date. The bill would prohibit all hydraulic fracturing, acid well stimulation treatments, steam flooding, water flooding, cyclic steaming, or other well stimulation treatments beginning January 1, 2027. Because a violation of the prohibition on conducting hydraulic fracturing, acid well stimulation treatments, steam flooding, water flooding, cyclic steaming, or other well stimulation treatments, except pursuant to a permit issued before January 1, 2022, would be a crime, the bill would impose a state-mandated local program by creating a new crime. This The bill would, until January 1, 2027, authorize a local government to prohibit well stimulation treatments within its jurisdiction. The bill would also make conforming changes.
This bill would, on and after January 1, 2023, prohibit the issuance of a new or modified permit related to oil and gas wells or production facilities within a health protection zone, as defined, except for certain activities. The bill would authorize the issuance of a variance, as provided, from the prohibition if a court determines that the prohibition would result in a taking of private property of an operator of an oil or gas well or production facility. The bill would provide that the above provisions become operative on July 1, 2022, if, by that date, the division has not promulgated a final rule that would create a health protection zone and prohibit the issuance of any new or modified permit related to oil and gas wells or production facilities within the health protection zone except for certain activities.
This bill would require the division to develop and administer a program to identify workers in downstream, midstream, and upstream oil and gas operations who have lost their jobs and to provide incentives to oil and gas well remediation companies to hire those identified workers.
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   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 The Legislature finds and declares all of the following:
(a) In the 15 years since the enactment of the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code), California still does not have a strategy for addressing the ongoing emissions of greenhouse gases and negative health impacts of oil and gas extraction.
(b) Chapter 249 of the Statutes of 2016 requires California to reduce emissions of greenhouse gases to 40 percent below 1990 levels by 2030. However, current emissions trends show that California is not on track to meet that legislative mandate. This is, in large part, due to the continued emissions of greenhouse gases from extraction, production, and use of oil and gas in California.

(a)

(c) Hydraulic fracturing, cyclic steaming, steam flooding, and water flooding present a current and immediate threat to the environment as well as to public health, safety, and welfare, and even more so than conventional oil production. These unconventional extraction practices degrade surface and groundwater quality; require large amounts of freshwater, especially for drilling; contribute significantly to global climate change; add to air pollution from drilling, extraction, processing, trucking, and other activities; inevitably cause spills of oil, produced water, or other hazardous materials; and destroy wildlife, habitat, and other sensitive lands. Drilling, fracking, and steaming also produce large quantities of toxic wastes that must be disposed of, presenting additional environmental and public safety concerns. These environmental harms predominantly and disproportionately harm vulnerable California communities, including low-income communities and communities of color.

(b)

(d) Hydraulic fracturing requires the injection of largely unknown, yet highly toxic, chemicals that risk contamination of the state’s freshwater aquifers relied upon by communities for drinking water or by businesses for agricultural operations.

(c)

(e) Cyclic steam injection and steam flooding are enhanced oil recovery (EOR) practices used in tar sands and other heavy oil deposits. These EOR techniques employ a highly energy-intensive method of oil extraction that results in significant increases in air emissions and contributes to global climate change. The continuous injection of steam underground to extract the oil requires the constant use of steam generators, which emit high levels of greenhouse gases and other air pollutants hazardous to health. These EOR techniques also generate a substantial volume of wastewater that must be re-injected into underground aquifers, increasing the potential for seismic activity or the migration of contamination into underground sources of drinking water. In certain formations, cyclic steaming has also proven to cause surface seeps that foul surface waters and harm wildlife.

(d)

(f) Water flooding, like hydraulic fracturing, cyclic steam injection, and steam flooding, generates large volumes of produced water, which must be disposed of after treatment. The sheer volume of produced water generated by this practice increases the risks to surface water quality especially. This practice has also been linked to sinkhole formation.
(g) In addition to increasing impacts of climate change, a growing body of research shows direct health impacts from oil extraction as far as two kilometers away from a well.
(h) These impacts are disproportionately impacting Black, indigenous, and people of color in California, who are most likely to live in close proximity to oil extraction activities and who are the most vulnerable to the negative impacts of climate change.

(e)

(i) Proximity to oil and gas extraction sites pose significant health risks, especially due to increased air pollution and threats to quality drinking water. Fine particulate matter (PM), like PM2.5, is produced during combustion, and can deeply penetrate the respiratory system. A recent study found that even a small increase in long-term exposure to PM2.5 leads to a large increase in the COVID-19 death rate, heightening the public health risks for people that live close to oil fields.
(j) Workers who are also affected by health impacts have been subject to the economic impacts of an increasingly volatile global market for oil, leading to layoffs and low prices that threaten high-wage jobs critical to regions like the County of Kern.
(k) For all of these reasons, protective actions to phase out extreme and dangerous drilling techniques, while mitigating any potential impacts to workers, is a critical legislative issue.

(f)

(l) Further assistance must be provided to frontline and vulnerable communities that have been most polluted by the fossil fuel industry by cleaning up pollution, remediating negative health impacts, and building resilient infrastructure to prepare for the unavoidable impacts of climate change.

(g)

(m) California must provide fossil fuel workers, and the communities in which they live, with a just and equitable transition away from the fossil fuel industry, including, but not limited to, training opportunities, health care coverage, secured pensions of affected workers, and the creation of new, unionized, green jobs, with family-sustaining wages, alongside investing in economic development and infrastructure in communities currently supported by fossil fuels.

SEC. 2.

 Section 3151.5 is added to the Public Resources Code, to read:

3151.5.
 (a) “Cyclic steaming” means the alternating injection of steam under pressure, followed by production of oil or gas with condensed steam.
(b) “Steam flooding” means a method of thermal recovery in which steam is injected into a reservoir through an injection well and heats up the crude oil to reduce its viscosity and the oil is extracted through a production well.
(c) “Water flooding” means the pumping of water into the ground around an oil production well to loosen and force out additional oil.

SEC. 3.

 Section 3157 of the Public Resources Code is amended to read:

3157.
 (a) For purposes of this article, “well stimulation treatment” means any treatment of a well designed to enhance oil and gas production or recovery. Well stimulation treatments include, but are not limited to, hydraulic fracturing treatments, acid well stimulation treatments, steam flooding, water flooding, and cyclic steaming.
(b) Well stimulation treatments do not include routine well cleanout work, routine well maintenance, routine removal of formation damage due to drilling, bottom hole pressure surveys, or routine activities that do not affect the integrity of the well or the formation.

SEC. 4.

 Section 3162 is added to the Public Resources Code, to read:

3162.
 (a) Notwithstanding Sections 3160 and 3161, no a permit to conduct hydraulic fracturing, acid well stimulation treatment, steam flooding, water flooding, or cyclic steaming may shall not be issued, and no a then-existing permit may shall not be renewed, including permits to redrill or rework, beginning January 1, 2022. Any A permit issued to the operator of a well beginning January 1, 2022, to conduct hydraulic fracturing, acid well stimulation treatment, steam flooding, water flooding, or cyclic steaming is void.
(b) Hydraulic fracturing, acid well stimulation treatments, steam flooding, water flooding, and cyclic steaming are prohibited for the extraction or recovery of oil and gas and no new or repeated hydraulic fracturing, acid well stimulation treatments, steam flooding, water flooding, or cyclic steaming may shall not be conducted beginning January 1, 2022, except pursuant to a permit lawfully issued pursuant to this article before that date and in compliance with the requirements of Sections 3160 and 3161.

SEC. 5.

 Section 3162.5 is added to the Public Resources Code, to read:

3162.5.
 Notwithstanding any other law, a local government may prohibit the use of well stimulation treatment in an area within the jurisdiction of the local government.

SEC. 6.

 Section 3163 is added to the Public Resources Code, to read:

3163.
 This article shall remain in effect only until January 1, 2027, and as of that date is repealed.

SEC. 7.

 Article 3 (commencing with Section 3150) is added to Chapter 1 of Division 3 of the Public Resources Code, to read:
Article  3. Well Stimulation

3150.
 For purposes of this article, the following definitions apply:
(a) “Acid well stimulation treatment” means a well stimulation treatment that uses, in whole or in part, the application of one or more acids to the well or underground geologic formation. The acid well stimulation treatment may be at any applied pressure and may be used in combination with hydraulic fracturing treatments or other well stimulation treatments. Acid well stimulation treatments include acid matrix stimulation treatments and acid fracturing treatments. Acid matrix stimulation treatments are acid treatments conducted at pressures lower than the applied pressure necessary to fracture the underground geologic formation.
(b) “Cyclic steaming” means the alternating injection of steam under pressure, followed by production of oil or gas with condensed steam, as well as other fluids and materials.
(c) “Hydraulic fracturing” means a well stimulation treatment that, in whole or in part, includes the pressurized injection of hydraulic fracturing fluid or fluids into an underground geologic formation in order to fracture or with the intent to fracture the formation, thereby causing or enhancing, for the purposes of this division, the production of oil or gas from a well.
(d) “Steam flooding” means a method of thermal recovery in which steam is injected into a reservoir through an injection well and heats up the crude oil to reduce its viscosity and the oil is extracted through a production well.
(e) “Water flooding” means the pumping of water into the ground around an oil production well to loosen and force out additional oil.
(f) (1) “Well stimulation treatment” means any treatment of a well designed to enhance oil and gas production or recovery. Well stimulation treatments include, but are not limited to, hydraulic fracturing treatments, acid well stimulation treatments, steam flooding, water flooding, and cyclic steaming.
(2) Well stimulation treatments do not include routine well cleanout work, routine well maintenance, routine removal of formation damage due to drilling, bottom hole pressure surveys, or routine activities that do not affect the integrity of the well or the formation.

3151.
 (a) Hydraulic fracturing, acid well stimulation treatments, steam flooding, water flooding, cyclic steaming, or other well stimulation treatments are prohibited for the extraction or recovery of oil and gas.
(b) The division shall monitor oil and gas fields for well stimulation treatment activities.

3152.
 This article shall become operative on January 1, 2027.

SEC. 8.

 Section 3203.5 is added to the Public Resources Code, to read:

3203.5.
 (a) For purposes of this section, the following definitions apply:
(1) “Health protection zone” means the area within 2,500 feet of a sensitive receptor, or a greater distance set by a city, a county, or the division.
(2) “Sensitive receptor” means any of the following:
(A) A residence, including a private home, condominium, apartment, and living quarter.
(B) An education resource, including a preschool, school maintaining kindergarten or any of grades 1 to 12, inclusive, daycare center, park, and playground.
(C) A community resource center, including a youth center.
(D) A health care facility, including a hospital, retirement home, and nursing home.
(E) Live-in housing, including a long-term care hospital, hospice, prison, detention center, and dormitory.
(F) Any other location determined to be a sensitive receptor by an air pollution control district or an air quality management district or the State Air Resources Board pursuant to Section 42705.5 of the Health and Safety Code.
(b) Except as provided in subdivision (c), and notwithstanding any other law, commencing January 1, 2023, the division shall not issue any new or modified permit related to oil and gas wells or production facilities within a health protection zone except for repairs, integrity testing, monitoring activities, plugging and abandoning wells, and maintenance activities necessary to prevent an emergency.
(c) (1) If a court determines that the application of subdivision (b) results in a taking of private property of an operator of an oil or gas well or a production facility, the supervisor may grant a variance to the operator after a 30-day public comment period and a public hearing to determine appropriate conditions of the variance.
(2) (A) A variance shall be limited to the minimum reduction in the health protection zone, the minimum amount of time, and the minimum oil and gas development or enhancement activity necessary to avoid an unconstitutional taking of private property.
(B) If a variance is granted under this subdivision, the operator of the oil or gas well or production facility shall do all of the following:
(i) Have safety devices, as described in Section 1724.3 of Title 14 of the California Code of Regulations, installed and maintained in operating condition.
(ii) Demonstrate to the applicable air pollution control district or air quality management district that any air quality and odor impacts associated with oil and gas development have been mitigated to the extent technologically feasible. To the extent technologically feasible, mitigation shall occur onsite.
(iii) Provide an individual indemnity bond sufficient to pay the full cost of properly plugging and abandoning the operator’s well or wells, and decommissioning any attendant production facilities, within the variance. The division shall determine the amount of the individual indemnity bond in accordance with, and to the maximum extent authorized in, Section 3205.3. The operator’s blanket indemnity bond authorized pursuant to Section 3205 shall not be used to satisfy this clause.
(d) The division may prescribe, adopt, and enforce any emergency regulations as necessary to implement, administer, and enforce its duties under this section. Any emergency regulation prescribed, adopted, or enforced pursuant to this section shall be adopted in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, and, for purposes of that chapter, including Section 11349.6 of the Government Code, the adoption of the regulation is an emergency and shall be considered by the Office of Administrative Law as necessary for the immediate preservation of the public peace, health and safety, and general welfare. Notwithstanding any other law, the emergency regulations adopted by the division may remain in effect for two years from adoption, unless amended by the division.
(e) This section does not prohibit a city or county from adopting a larger health protection zone or otherwise regulating, limiting, or prohibiting oil and gas development. If a city or county adopts an ordinance increasing the distance of a health protection zone, an operator of an oil or gas well or a production facility seeking a variance pursuant to subdivision (c) shall obtain applicable variances from both the division and the city or county.
(f) This section does not diminish the authority of the supervisor to establish a health protection zone larger than 2,500 feet.
(g) This section shall not apply to permits, approvals, or authorizations lawfully issued by the division before January 1, 2023, and that are in compliance with all local laws and applicable requirements for the duration of the permit, approval, or authorization. This section does not diminish or alter the authority of the supervisor to deny, revoke, or suspend permits to meet the division’s duty to protect public health and safety and environmental quality, including reduction and mitigation of greenhouse gas emissions, or to prevent, as far as possible, damage to life, health, property, natural resources, or underground and surface waters suitable for irrigation or domestic purposes.
(h) This section shall become operative on July 1, 2022, only if by that date the division has not promulgated a final rule that creates a health protection zone of at least 2,500 feet and the division shall not issue any new or modified permit related to oil and gas wells or production facilities within the health protection zone except for repairs, integrity testing, monitoring activities, plugging and abandoning wells, and maintenance activities necessary to prevent an emergency.

SEC. 8.SEC. 9.

 Section 3213 of the Public Resources Code is amended to read:

3213.
 (a) The history shall show the location and amount of sidetracked casings, tools, or other material, the depth and quantity of cement in cement plugs, the shots of dynamite or other explosives, acid treatment data, and the results of production and other tests during drilling operations. All data on well stimulation treatments pursuant to Section 3160 shall be recorded in the history.
(b) This section shall remain in effect only until January 1, 2027, and as of that date is repealed.

SEC. 9.SEC. 10.

 Section 3213 is added to the Public Resources Code, to read:

3213.
 (a)  The history shall show the location and amount of sidetracked casings, tools, or other material, the depth and quantity of cement in cement plugs, the shots of dynamite or other explosives, acid treatment data, and the results of production and other tests during drilling operations.
(b) This section becomes operative on January 1, 2027.

SEC. 10.SEC. 11.

 Section 3215 of the Public Resources Code is amended to read:

3215.
 (a) Within 60 days after the date of cessation of drilling, rework, well stimulation treatment, or abandonment operations, or the date of suspension of operations, the operator shall file with the district deputy, in a form approved by the supervisor, true copies of the log, core record, and history of work performed, and, if made, true and reproducible copies of all electrical, physical, or chemical logs, tests, or surveys. Upon a showing of hardship, the supervisor may extend the time within which to comply with this section for a period not to exceed 60 additional days.
(b) The supervisor shall include information or electronic links to information provided pursuant to subdivision (g) of Section 3160 on existing publicly accessible maps on the division’s internet website, and make the information available such that well stimulation treatment and related information are associated with each specific well. If data is reported on an internet website not maintained by the division pursuant to paragraph (2) of subdivision (g) of Section 3160, the division shall provide electronic links to that internet website. The public shall be able to search and sort the hydraulic well stimulation and related information by at least the following criteria:
(1) Geographic area.
(2) Additive.
(3) Chemical constituent.
(4) Chemical Abstract Service number.
(5) Time period.
(6) Operator.
(c) Notwithstanding Section 10231.5 of the Government Code, on or before July 30 of each year, the supervisor shall, in compliance with Section 9795 of the Government Code, prepare and transmit to the Legislature a comprehensive report on well stimulation treatments in the exploration and production of oil and gas resources in California. The report shall include aggregated data of all of the information required to be reported pursuant to Section 3160 reported by the district, county, and operator. The report also shall include relevant additional information, as necessary, including, but not limited to, all of the following:
(1) Aggregated data detailing the disposition of any produced water from wells that have undergone well stimulation treatments.
(2) Aggregated data describing the formations where wells have received well stimulation treatments including the range of safety factors used and fracture zone lengths.
(3) The number of emergency responses to a spill or release associated with a well stimulation treatment.
(4) Aggregated data detailing the number of times trade secret information was not provided to the public, by county and by each company, in the preceding year.
(5) Data detailing the loss of well and well casing integrity in the preceding year for wells that have undergone well stimulation treatment. For comparative purposes, data detailing the loss of well and well casing integrity in the preceding year for all wells shall also be provided. The cause of each well and well casing failure, if known, shall also be provided.
(6) The number of spot check inspections conducted pursuant to subdivision (l) of Section 3160, including the number of inspections where the composition of well stimulation fluids were verified and the results of those inspections.
(7) The number of well stimulation treatments witnessed by the division.
(8) The number of enforcement actions associated with well stimulation treatments, including, but not limited to, notices of deficiency, notices of violation, civil or criminal enforcement actions, and any penalties assessed.
(d) The report shall be made publicly available and an electronic version shall be available on the division’s internet website.
(e) This section shall remain in effect only until January 1, 2027, and as of that date is repealed.

SEC. 11.SEC. 12.

 Section 3215 is added to the Public Resources Code, to read:

3215.
 (a) Within 60 days after the date of cessation of drilling, rework, or abandonment operations, or the date of suspension of operations, the operator shall file with the district deputy, in a form approved by the supervisor, true copies of the log, core record, and history of work performed, and, if made, true and reproducible copies of all electrical, physical, or chemical logs, tests, or surveys. Upon a showing of hardship, the supervisor may extend the time within which to comply with this section for a period not to exceed 60 additional days.
(b) This section becomes operative on January 1, 2027.

SEC. 12.SEC. 13.

 Chapter 8 (commencing with Section 3870) is added to Division 3 of the Public Resources Code, to read:
CHAPTER  8. Oil Field Remediation Jobs

3870.
 The division shall develop and administer a program to do both of the following:
(a) Identify workers from downstream, midstream, and upstream oil and gas operations who have lost their jobs in the oil and gas industry.
(b) Provide incentives to oil and gas well remediation companies to hire those workers identified pursuant to subdivision (a).

SEC. 13.SEC. 14.

 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.