A bill that would ban permits for underground activities near salt domes, caverns or sink holes where moderate or catastrophic disasters have occurred in the past is advancing in the Louisiana State Legislature, despite opposition from the Louisiana Oil and Gas Association (LOGA).

SB 200, sponsored by Sen. Fred Mills (R-Parks), was voted out of the Senate Natural Resources Committee (SNRC) on May 1 and has since been scheduled for a floor vote in the Senate on Monday (May 6).

The bill was drafted in response to last summer’s collapse of a brine cavern on the west side of the Napoleonville Salt Dome in Assumption Parish, LA (see NGI, Aug. 13, 2012). People living near Bayou Corne were evacuated, and nearby natural gas pipeline infrastructure was shut in, after a sinkhole opened in the area (see NGI, Sept. 10, 2012).

Under SB 200, the underground storage of hazardous wastes, liquid hydrocarbons, natural gas, carbon dioxide or Class III brine extractions would be banned from areas near moderate or catastrophic disasters, such as sinkholes and salt dome cavern collapses. Drilling into or through underground caverns, salt domes and underground storage reservoirs would also be banned.

The ban would remain in place until the secretary of the state Department of Natural Resources (DNR) and the industry have sufficient time to review existing state regulations and promulgate new rules if the underground activities are deemed to be safe. Three legislative committees — the SNRC, the House Committee on Natural Resources and Environment and the Senate Committee on Environmental Quality — would ultimately review the new rules and decide whether to lift the ban.

An amendment attached to SB 200 by the SNRC stipulates that the DNR’s commissioner of conservation “shall not authorize or issue any permits for the creation of a solution mined cavern, or to convert a solution mined cavern to storage or waste disposal in any area where the salt stock underlying a state-owned water bottom has structurally failed if that failure was man-made.”

The Louisiana Offshore Terminal Authority and the United States Strategic Petroleum Reserve are exempt from the SB 200 amendment.

LOGA President Don Briggs told NGI that the bill unfairly targeted plans by Jefferson Island Storage & Hub LLC, a subsidiary of AGL Resources Inc., to expand its gas storage capacity below the surface of Lake Peigneur in Iberia Parish, LA (see NGI, Dec. 14, 2009).

“We’re very much against that bill,” Briggs said. “There’s been a lot of hype about the integrity of that [Jefferson Island] salt dome, when in fact it’s a perfectly safe one. A bill like that sets a precedent. They’re using the Bayou Corne thing as a ‘fear factor’ to pass that bill, [but] school is still out as to what the real true cause of that is.”

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