California Senate Committee Stands up to Big Oil, Passes SB 1017

 The California State Senate Committee on Education stood up to the big money of Big Oil and took a step forward in the fight to end California’s status as the only oil and gas producing state in the nation to not tax the extraction of energy resources. SB 1017 could raise more than 2 billion dollars for California’s underfunded public universities and community colleges, devastated health and human services programs, and state parks.

Check out www.BigOilBeacon.com to see how Big Oil tries to buy big influence in Sacramento. Let’s end Big Oil’s free ride by passing SB 1017!

via: http://www.california-partnership.org/2014/04/24/california-senate-committee-stands-up-to-big-oil-passes-sb-1017/

California releases proposed fracking regulations

California got its first glimpse Friday morning of proposed hydraulic fracturing regulations that will likely be heavily debated over the coming year.

In a conference call with reporters, California Department of Conservation Director Mark Nechodom heralded a proposal he said would strike a balance between strong safeguards and ensuring that California's oil and gas industry can "remain productive and competitive."

The release of the draft rules kicks off a yearlong process, with the goal of having final regulations in place by Jan. 1, 2015. Nechodom said he anticipates "a very active public regulation" process that could yield "substantial changes" to the current proposed language.
Hydraulic fracturing, commonly known as fracking, involves blasting a pressurized cocktail of chemicals and water underground to dislodge the gas trapped in rock formations. While many have praised fracking as a way to wean America off of foreign oil, environmentalists warn that fracking represents a public health hazard.

Pointing to fracking booms in other parts of the country and warning of a potential explosion of activity above California's Monterey Shale, several lawmakers introduced fracking bills in 2013. Of those, only Sen. Fran Pavley's bill received the governor's signature, with more stringent measures that included statewide moratoriums falling by the wayside.

The Pavley law will now guide the regulatory process. The draft rules released on Friday will require well operators to notify people living near new wells, create a groundwater monitoring regime, spur a statewide scientific review of fracking and mandate disclosure of the types and concentrations of chemicals used in fracking.

Despite the chemical disclosure requirement, the new law allows companies to invoke trade secret protections in some cases. Nechodom said it remains unclear how broadly that exemption will be used.

"It's hard to tell at this point how many trade secret claims may be made," Nechodom said. "There may be few or there may be many."

In the intervening year before final regulations take effect, well operators will need to certify to regulators in advance that they are in compliance. Starting in 2015, they will need to go through a specific permitting process that could trigger environmental review.

Nechodom tried to rebuff concerns that well operators will have free reign in the gap year, saying that operators will still have to win California Environmental Quality Act approval via county-level applications for conditional use permits.

"That has been a misperception, that CEQA does not apply in 2014," Nechodom said, adding that "by the time we get to 2015 that permitting event will essentially require some CEQA review."

In the final days of the 2013 legislative session, environmental groups abandoned Pavley's bill en masse, with many saying that a provision of the bill allowing for broad reviews that cover multiple wells would weaken oversight. Regulations governing the grouping of permits were not released Friday.

But Tim Kustic, state oil and gas supervisor for the Division of Oil, Gas, and Geothermal Resources, said during Friday's conference call that the division already has to be selective in the reviews it conducts.

"We have to prioritize," Kustic said, adding that "fields that have extensive hydraulic fracturing and they're doing, say, the 3,000th in the field" will be a lower priority than an initial exploratory well.

"It's unrealistic to think the division will be out there for every well stimulation," Kustic said.

PHOTO: In this March 29, 2013 file photo, workers tend to a well head during a hydraulic fracturing operation at an Encana Oil & Gas (USA) Inc. gas well outside Rifle, in western Colorado. AP/ Brennan Linsley.

via http://blogs.sacbee.com/capitolalertlatest/2013/11/california-fracking-regulations.html

The Solution To California's Problems Is Beneath Its Feet — But Rich Environmentalists Are Having None Of It

SHALE exploitation in North Dakota has lifted incomes and brought unemployment down to 3.2% of the workforce, the lowest level in the country.

Californians are rarely found looking longingly towards the Midwest. But the revelation that their state, with unemployment at 9.8% and America’s highest poverty rate, may be sitting on the largest deposit of shale oil in the continental United States has led some to wonder if their salvation lies 10,000 feet (3,000 metres) beneath them.

California has been an oil state since 1865. Thanks largely to reserves that can still be tapped by conventional means, it remains the third-largest producer in the country. Output has lately been declining by 2-3% a year, according to the state’s Energy Commission. But in 2011 the federal Energy Information Administration declared that the Monterey shale formation, which spans 1,750 square miles (450,000 hectares) in southern and central California, held 15.42 billion barrels of recoverable oil, 64% of the total estimated to be in the 48 contiguous states.

That should be an attractive prospect for a state with a history of unemployment and fiscal woe. But environmental scruples have long been as characteristic of California as budgetary mismanagement, and a battle is brewing. Opponents of the hydraulic fracturing ("fracking") technique often used to extract oil and gas from shale rock in "unconventional" drilling say regulations proposed by the state in December do not adequately protect against groundwater contamination or air pollution. Some mutter about earthquakes. Such concerns find receptive ears in a seismically active state with a large farm sector.

The oilmen reply that fracking has been conducted in California for years without trouble. Moreover, they add, surely the environmentally concerned should want as much Californian oil as possible produced under the state’s tight regulations, rather than imported from places with looser regimes. Some see an emerging split between inland counties, which tend to have higher unemployment and more conservative politics, and the conservationists along the coast. The row will rumble on, with revised rules expected later this year.

For some, the complex geology of the Monterey shale opens up alternative means of extraction. Santa Maria Energy, a small producer in Santa Barbara County, about 150 miles (240 km) north-west of Los Angeles, extracts 200 barrels of crude a day from the shale at depths of around 2,500 feet by exploiting natural fractures in the rock. Although the firm has no plans to begin fracking, David Pratt, its president, likes to say that the Monterey is California’s way out of the "fiscal toilet".

Some of the "Saudi America" talk is overdone. And even if California does begin exploiting the Monterey aggressively, an economic miracle is unlikely. California’s population is over 50 times bigger than North Dakota’s, and, as Kevin Klowden of the Milken Institute, a think-tank, points out, the opportunity costs of giving over land to drilling may be far higher in California than in some other states.

No producer has yet found a way to begin large-scale extraction from the Monterey. But despite the geological and regulatory uncertainties, several firms have placed large bets on its future. And other states in the region sitting on shale reserves are forging merrily ahead. At a Senate hearing on February 12th John Hickenlooper, Colorado’s Democratic governor, staked out his position by announcing that he had once drunk a glass of fracking fluid.

Meanwhile, the technology that kick-started the revolution marches on. Some speak excitedly of fracking that uses saline rather than fresh water, or no water at all. The industry has moved so quickly in recent years, says Dan Kirschner of the Northwest Gas Association, a trade body, that it is starting to seem odd to call shale resources "unconventional".

via Business Insider

California Fracking Disclosure Rules Leave Some Environmentalists Unsatisfied

 Underneath much of Central and southern California sits the single largest deposit of shale oil in the United States, boasting a motherlode of some 15 billion barrels of oil.

While the Monterey Shale's unique geology has prevented energy companies from unleashing a new West Coast energy boom, California regulators have begun to take the first steps in regulating hydraulic fracturing (or "fracking"), a controversial practice decried by environmentalists and the most promising solution for retrieving said oil.

The process of injecting a mixture of water, sand and other chemicals into a well in order to stimulate the flow of oil or natural gas, fracking is especially helpful in accessing energy deposits in shale formations that would otherwise be out of reach using traditional methods.

Kassie Siegel of the nonprofit Center for Biological Diversity, which is in the process of suing the state for doing what it calls an insufficient job of regulating fracking, argues that the practice has the potential to do irreparable harm to the environment. She notes that a quarter of all the chemicals used in fracking are known carcinogens, and some people living near fracked wells have reported health ailments like vomiting, nausea and seizures.

On the other hand, industry representatives have pointed to a recent year-long study conducted in Southern California's Ingleside Oil Field that found no negative health, air quality or seismic effects from the fracking occurring there. The study, paid for by Plains Exploration & Production Company as part of a lawsuit against the energy producer, has been criticized by environmentalists for not looking at the long-term heath effects of fracking.

Earlier this month, the California Department of Conservation's Department of Oil, Gas & Geothermal Resources (DOGGR) released a preliminary set of regulatory guidelines for all fracking activities occurring in the state.

During a phone conference with members of the media last week, state regulators noted that many of the rules they're planning to put in place mandate practices already standard across the energy industry. However, one area headed for change is the requirement that companies disclose all the chemicals they use in fracking.

The new rules mandate that all chemicals used in the fracking process be disclosed within 60 days after the completion of fracking and that the state be notified 10 days before fracking occurs.

Presently, energy producers aren't required to tell anyone where or when they're using hydraulic fracturing, although many companies have started to do so on a voluntarily basis through industry-run site FracFocus.org after state regulators asked them to do so earlier this year. Under the new regulatory regime, reporting chemicals on FracFocus would become mandatory.

FracFocus now lists information for just over 600 fracked wells in California. According to Western States Petroleum Association Spokesman Tupper Hull, a recent survey found that of the 47,000 active wells, only 628 utilize hydraulic fracturing.

Some environmentalists have questioned the wisdom of relying on a private, industry-run website to host this information, especially when said site isn't required to comply with Freedom Of Information Act requests. However, on last week's conference call, regulators explained that the state retains the ability to extricate itself from FracFocus at any time and build its own site if they feel FracFocus isn't doing an adequate job. It would likely take California at least three years to get its own version of FracFocus online, whereas the industry site is ready now and has been hosting voluntary disclosures for over a year.

"When the companies voluntarily disclosure info, we're happy," said Scott Anderson, a senior policy advisor at the Environmental Defense Fund. "But voluntary disclosure is insufficient."

Surprisingly, over the past year or so, many of the companies engaging in fracking have come to the same conclusion as Anderson. When Wyoming adopted a mandatory disclosure rule in 2010, the state imposed it over significant industry opposition. However, as Anderson explained, the industry has come to see mandatory disclosure as a way to overcome some of the widespread hostility toward fracking. "There's no reason for people to trust data that's doled out by these companies on a voluntary basis," he explained.

This newfound openness toward letting the whole world know about precisely which chemicals they're pumping into the ground isn't exactly universal--it stops at a line marked "trade secrets."

Firms in states with mandatory disclosure rules, such as the ones proposed in California, are able to avoid releasing information about certain compounds by saying that making this information public would put them at a competitive disadvantage against other drilling firms.

The California rules would allow the state to challenge trade secrets claims and require immediate disclosure if a heath professional declares a medical emergency.

In an editorial published a few days after the release of this new set of regulations, the Sacramento Bee came down strongly in favor of the state demanding the strongest level of disclosure possible:
As valuable as fossil fuels are, California groundwater is a much more treasured resource, and it needs to be protected. We don't allow food companies to withhold the fact they might be adding carcinogenic chemicals to their recipes. Why should we allow oil companies to do the same with fracking?

California must insist on full disclosure on fracking chemicals. If regulators think they lack the authority to order such disclosure, then the Legislature will need to pass legislation to make it the law of the land.

Siegel came out even more forcefully. "These draft regulations would keep California's fracking shrouded in secrecy and do little to contain the many threats posed by fracking," she said in a statement. "These regulations are going to have to be completely rewritten if the goal is to provide real protection for our air, water, and communities."

Formal discussion of the fracking rules will begin early next year. During that process, regulators plan on meeting with both environmentalists and industry representatives and will host a series of town hall discussions with members of public in oil-producing areas across the state.

via Huffington Post