(1)Existing law authorizes the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation to regulate the drilling, operation, maintenance, and abandonment of oil and gas wells in the state as well as the operation, maintenance, and removal or abandonment of tanks and facilities attendant to oil and gas production. Existing law generally vests the State Air Resources Board with the primary responsibility for the control of vehicular air pollution, and air pollution control and air quality management districts with the primary responsibility for the control of air pollution from all sources other than vehicular sources.

This bill would require an air district to establish an emission standard for methane from a well stimulation treatment, as defined, or a production facility, as defined, and to issue a permit or other regulatory document to an owner or operator to enforce that standard. The bill also would require the emission standard to include requirements on the owner or operator to monitor the well stimulation treatment for methane leaks. specified components. By adding to the duties of air districts, this bill would impose a state-mandated local program.

This bill would require the state board or an air district, as appropriate, to install monitoring stations near any site approved by the division for a well stimulation treatment or a production facility, as specified. By adding to the duties of air districts, this bill would impose a state-mandated local program.

(2)Existing law makes a violation of any rule, regulation, or order of the state board or an air district a misdemeanor. By expanding the scope of a crime, this bill would impose a state-mandated local program.

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.

(1)Existing law authorizes the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation to regulate the drilling, operation, maintenance, and abandonment of oil and gas wells in the state. Existing law generally vests the State Air Resources Board with the primary responsibility for the control of vehicular air pollution, and air pollution control and air quality management districts with the primary responsibility for the control of air pollution from all sources other than vehicular sources.

This bill would require an air district to establish an emission standard for methane from a well stimulation treatment, as defined, and to issue a permit to an owner or operator to enforce that standard. The bill also would require the emission standard to include requirements on the owner or operator to monitor the well stimulation treatment for methane leaks. By adding to the duties of air districts, this bill would impose a state-mandated local program.

This bill would require the state board or an air district, as appropriate, to install monitoring stations near any site approved by the division for a well stimulation treatment, as specified. By adding to the duties of air districts, this bill would impose a state-mandated local program.

(2)Existing law makes a violation of any rule, regulation, or order of the state board or an air district a misdemeanor. By expanding the scope of a crime, this bill would impose a state-mandated local program.

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.

Date of Hearing: April 27, 2015

ASSEMBLY COMMITTEE ON NATURAL RESOURCES

Das Williams, Chair

ABPCA Bill Id:AB 1501

Author:(Rendon) – As Amended Ver:April 21, 2015

SUBJECT: Well stimulation treatments: emissions

SUMMARY: Requires air districts to establish an emission standard for methane from well stimulation treatments and other petroleum extraction facilities. Requires the emission standard to include a permit requirement and consideration of the effect production facilities have on adjacent vulnerable populations. Requires the Air Resources Board (ARB) or a local air district to install monitoring stations near any approved well stimulation site and other petroleum extraction facilities to monitor for 12 different chemicals.

EXISTING LAW:

1. Requires the Department of Conservation’s Division of Oil, Gas, and Geothermal Resources (DOGGR) to regulate oil and gas wells, tanks, and facilities attendant to oil and gas production.

2. Establishes, pursuant to SB 4 (Pavley, Chapter 313, Statutes of 2013), a comprehensive, multi-agency regulatory program for oil and gas well stimulation treatments (e.g., hydraulic fracturing, acid matrix stimulation). Establishes DOGGR as the lead agency for the multi-agency regulatory program.

3. Requires, on or before January 1, 2015, the Secretary of the Natural Resources Agency to conduct and complete an independent scientific study on well stimulation treatments, including, but not limited to, hydraulic fracturing and acid well stimulation treatments.

4. Requires the scientific study to evaluate the hazards and risks and potential hazards and risks that well stimulation treatments pose to natural resources and public, occupational, and environmental health and safety, including potential degradation of air quality.

5. Requires, on or before January 1, 2015, DOGGR, in consultation with the Department of Toxic Substances Control, ARB, the State Water Resources Control Board (SWRCB), the Department of Resources Recycling and Recovery, and any local air districts and regional water quality control boards in areas where well stimulation treatments, including acid well stimulation treatments and hydraulic fracturing treatments, may occur, to adopt rules and regulations specific to well stimulation treatments.

6. Provides ARB with the primary responsibility for the control of vehicular air pollution, and air pollution control and air quality management districts with the primary responsibility for the control of air pollution from all sources other than vehicular sources.

7. Requires the Public Utilities Commission (PUC) to open a proceeding to adopt rules and procedures that minimize methane leaks from PUC-regulated gas pipeline facilities, with the goal of reducing Greenhouse Gas (GHG) emissions.

THIS BILL:

1. Requires air districts to establish an emission standard for methane from well stimulation treatment and other petroleum extraction facilities.

2. Requires air districts to issue permits or another regulatory document to an owner or operator to enforce the emission standard created pursuant to this bill.

3. Specifies that the emission standard shall include requirements on the owner or operator to monitor the well stimulation treatment for methane leaks.

4. Requires air districts, when adopting the emission standard, to consider the effects of production facilities on adjacent vulnerable populations, including but not limited, to school-age children and the elderly.

5. Requires ARB or local air districts to install monitoring stations near any approved well stimulation site and other petroleum extraction facilities to monitor for 12 specified chemicals.

FISCAL EFFECT: Unknown

COMMENTS:

1. Author’s statement.

Oil and gas extraction activities, including fracking activities, emit air pollutants. This problem has been identified from a number of sources – a recent Clean Water Action report and developing DOGGR regulations. But the problem does not appear to be receiving the urgent attention it needs. The fracking regulations, for example, just suggest that the extraction operation obtain a permit if the local air district requires one. The Southern California Air Quality Management District (AQMD) does some monitoring of fracking, but neither AQMD nor other air districts set emissions standards or require permits for oil and gas extraction. DOGGR and the air districts are doing little to address this problem.

2. Methane regulation. Methane is a potent contributor to climate change that produces 34 times the warming impact than the same amount of carbon dioxide. As stated above, DOGGR’s regulation requires compliance with all applicable requirements by ARB or a local air district. ARB is in the initial stages of drafting regulations to control methane at new and existing oil and natural gas facilities. These statewide standards will apply to all of California’s air districts and will encompass well stimulation, while achieving co-benefits that protect public health from toxic emissions from well stimulation or other sector sources. AB 1501 would inform that process by requiring the standard to meet certain criteria. This is similar to SB 1371 (Leno), Chapter 525, Statutes of 2014, which put requirements on the PUC for reducing methane emissions from the natural gas industry. SB 1371 is currently being implemented at the PUC. On March 18, 2015, the PUC released a staff report that identifies best practices and new technologies in natural gas leak detection.

3. Schools and oil production. In November of 2014, a nonprofit environmental organization called FracTracker reported that more than 350,000 California children go to schools within a mile of an oil or gas well. They also stated that the top 11 school districts with the most wells are in the San Joaquin Valley, with 10 of those in Kern County. In Kern County, the Taft High School District has more than 33,000 wells in their jurisdiction, and Kern Union High School District has more than 19,000 wells in their jurisdiction. The report stated that students attending school within 1 mile of oil and gas wells are predominantly non-white (79.6%), and 60.3% are Hispanic. In response to the report the Western States Petroleum Association stated, “Hydraulic fracturing and other well stimulation techniques are of little to no concern to public health.” AB 1501 requires the new emission standard to consider the effects of production facilities on adjacent vulnerable populations, including but not limited to school-age children and the elderly.

4. Related legislation.

SB 454 (Allen) prohibits DOGGR from submitting a proposal for an aquifer exemption to the U.S. Environmental Protection Agency (U.S. EPA) unless DOGGR and SWRCB concur in writing that the aquifer meets specified conditions. This bill is awaiting a hearing in the Senate Natural Resources and Water Committee on April 28.

SB 545 (Jackson) revises and updates DOGGR’s authority and permitting practices and reforms the handling of confidential wells. This bill is awaiting a hearing in the Senate Natural Resources and Water Committee on April 28.

SB 248 (Pavley) requires DOGGR to review and update its regulations, data management practices, and enhance required reporting. This bill is awaiting a hearing in the Senate Appropriations Committee.

AB 1490 (Rendon) prohibits well stimulation, and in some cases, wastewater disposal in areas that are seismically active or have recently had an earthquake. This bill will also be heard by this committee on April 27.

AB 1420 (Salas) requires a local health officer, if notified of a leak in a pipeline regulated by DOGGR, to direct the responsible party to test soil, air, and water and based on the test results make an assessment of the risk to the public. If the leak poses a risk to the public, requires the local health officer to notify residents affected by the leak of the threat and provide assistance to the public. This bill will also be heard by this committee on April 27.

AB 356 (Williams) requires, prior to submitting a proposal to exempt an aquifer to U.S. EPA, that DOGGR hold a public hearing and gain concurrence from SWRCB on the proposal. This bill also requires groundwater monitoring plans for underground injection projects as part of an application for approval of the project or for the annual review of the project. This bill will also be heard by this committee on April 27.

REGISTERED SUPPORT / OPPOSITION:

Support

Association of Irritated Residents

California Communities Against Toxics

California League of Conservation Voters

Center on Race, Poverty & The Environment

Citizens Coalition for a Safe Community

Clean Water Action

Clean Water and Air Matter

Coalition for Clean Air

Earthworks

Environmental Working Group

Environment California

Fresnans Against Fracking

Mainstreet Moms

National Parks Conservation Association

Save the Sespe

Sierra Club California

Opposition

California Independent Petroleum Association

Western States Petroleum Association

Analysis Prepared by: Michael Jarred / NAT. RES. / (916) 319-2092