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California Fracking Rules Are Broadened, Regulator Says

A California oil and gas regulator on Tuesday characterized the state's latest revised draft hydraulic fracturing (fracking) rules as going beyond any other state’s since the law mandating them (SB 4) applies to all well stimulation activity, fracking just being part of what the recently revised rules cover.

While many other states supposedly have focused on the integrity of wells, making sure they are constructed and maintained properly, in setting fracking rules, California understands the premise of trusting the wells' integrity, but also requires that all of this be verified. "Let's make sure we have groundwater monitoring in place and that we have baseline where you have protected water," said Jason Marshall, chief deputy director at the Department of Conversation.

Following more than 150,000 comments from an initial public input period that closed in January, the conservation department's Division of Oil, Gas and Geothermal Resources (DOGGR) has clarified issues and broadened some of the requirements for oil and natural gas operators, Marshall told a conference call for news media.

There is an attempt to more clearly distinguish between well stimulation work and well maintenance work, such as well cleanouts. In that regard the reporting requirements on the use of acid in well stimulation work have changed from a concentration threshold to a volumetric measurement. This change came not from public comments, but from discussions with the state lawmakers who authorized California's law (SB 4) mandating separate rules for well stimulation work (see Shale DailySept. 13, 2013).

Marshall said the latest revisions (see Shale DailyJune 16) do not change the basic requirements for groundwater testing for operators. There are provisions allowing for neighboring landowners to be able to force the operators to provide groundwater testing before and after well stimulation work, and there is also a provision, aside from whatever neighbors do, that requires operators to develop groundwater monitoring plans.

Separately, by July 1, 2015, a separate panel convened by state water regulators will develop criteria for what will be required in water monitoring plans, Marshall said in response to a news reporter's question. "Those criteria will become the baseline for what operators must do," he said.

There are monitoring requirements in effect now as part of interim, emergency rules that California put in effect Jan. 1 to cover the period while the permanent rules are hammered out. "When the permanent rules are effective next year, they will supercede the existing requirements," said Marshall, noting he did not want to speculate on what will be in the final criteria.

In response to another question about how surrounding landowners can be assured that reports of groundwater contamination will be dealt with swiftly, Marshall said the reporting from oil/gas operators will go directly to state and regional water quality control agencies. "That's their responsibility, and that is why they are included among the agencies designated to see all water quality monitoring results," he said.

Another change drawing questions is the move by DOGGR to essentially double the per-barrel fee it will charge oil and gas operators to help pay for enforcing the new well stimulation rules. Marshall said fee revenues will allow DOGGR to greatly expand its staff by 20%, or 65 positions, and will also help support air and water quality agencies' enforcement of those rules.

In the state's ongoing budget process for the next fiscal year, all the state agencies involved made estimates of the costs they envision from the implementation of SB 4 requirements. "Those costs were placed in addition to [budgeted items] because SB 4 required the oil and gas operators to pay for the regulation," said Marshall, adding those fee-based costs were added to the DOGGR budget.

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