SB 380: Natural gas storage: moratorium.
- Session Year: 2015-2016
- House: Senate
- Latest Version Date: 2016-05-10
(1)Under existing law, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation regulates the drilling, operation, maintenance, and abandonment of oil and gas wells in the state. Existing law requires the State Oil and Gas Supervisor to supervise the drilling, operation, maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of tanks and facilities related to oil and gas production within an oil and gas field, so as to prevent damage to life, health, property, and natural resources, as provided; to permit owners and operators of wells to utilize all known methods and practices to increase the ultimate recovery of hydrocarbons; and to perform the supervisors duties in a manner that encourages the wise development of oil and gas resources to best meet oil and gas needs in this state. Under existing law, a person who fails to comply with certain requirements relating to the regulation of oil or gas operations is guilty of a misdemeanor.
This bill would require the supervisor to continue the prohibition against Southern California Gas Company injecting any natural gas into the Aliso Canyon natural gas storage facility located in the County of Los Angeles until a comprehensive review of the safety of the gas storage wells at the facility is completed, as specified, the supervisor determines that well integrity has been ensured by the review, the risks of failures identified in the review have been addressed, the supervisors duty to prevent damage to life, health, property, and natural resources, and other requirements is satisfied, and the Executive Director of the Public Utilities Commission has concurred via letter with the supervisor regarding his or her determination of safety. The bill would require the supervisor to determine criteria for the gas storage well comprehensive safety review with input from independent experts and would require the criteria to include, but not be limited to, specified tests and inspections. The bill would require the supervisor to direct the contracted independent experts to provide a methodology to be used in assessing the tests and inspections specified in the criteria. The bill would require the division to post the methodology on a public portion of its Internet Web site. The bill would require the operator of the facility to provide the division with the proposed maximum reservoir pressure and to include data and calculations supporting the basis for the pressure limit. The bill would authorize the supervisor to allow injections of natural gas into the facility once the gas storage well comprehensive safety review is complete, the division holds a duly noticed public hearing in the affected community to provide the public an opportunity to comment on the safety review findings and the proposed pressure limit, and the supervisor has approved the maximum and minimum reservoir pressure at the facility. The bill would also require that, before the completion of the gas storage well comprehensive safety review, the production of natural gas from gas storage wells at the facility be limited to gas storage wells that have satisfactorily completed the testing and remediation required under the review, except as specified. The bill would require the supervisor to direct the operator of the facility to provide a plan to ensure, at the earliest possible time, the availability of sufficient gas production capacity using gas storage wells that have satisfactorily completed the testing and remediation required under the review. The bill would require all gas storage wells returning to service under these provisions to inject or produce gas only through the interior metal tubing, and would require the operator to conduct ongoing pressure monitoring and comply with any other requirements specified by the supervisor. The bill would require the gas storage wells at the facility that are plugged and abandoned pursuant to these provisions to be periodically inspected by the operator for leaks using effective gas leak detection techniques. The bill would require the division, with respect to the review and in a timely manner, to post all testing, inspection and monitoring results, and other safety review-related materials to a public portion of the divisions Internet Web site. Because a violation of certain of these requirements would be a crime, the bill would impose a state-mandated local program. The bill would repeal these provisions on January 1, 2021.
(2)Under existing law, the Public Utilities Commission is authorized to supervise and regulate every public utility in the state. Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.
This bill would require the commission, no later than July 1, 2017, to open a proceeding to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy and electric reliability for the region, and to consult with specified entities in making its determination. The bill would require the commission, in consultation with specified entities, to determine the range of working gas necessary to ensure safety and reliability for the region and just and reasonable rates in California, and to direct the operator of the facility to provide all information the commission deems necessary to make that determination. The bill would require the commission, within 30 days of the effective date of this act, to publish a report, including specified information regarding gas production at the facility. The bill would require the commission to make the report available on its Internet Web site, and to seek public comments on the report, as specified. The bill would require the executive director of the commission, in consultation with the supervisor, to direct the operator of the facility to maintain the specified range of working gas after certain conditions have occurred. Certain provisions of this bill would be part of the act and an order or other action of the commission would be required to implement certain of the provisions. Because a violation of the bills provisions or of an order or decision of the commission would be a crime, this bill would impose a state-mandated local program by creating new crimes. The bill would repeal these provisions on January 1, 2021.
(3)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.
(4)This bill would declare that it is to take effect immediately as an urgency statute.
(1)Under existing law, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation regulates the drilling, operation, maintenance, and abandonment of oil and gas wells in the state. Existing law requires the State Oil and Gas Supervisor to supervise the drilling, operation, maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of tanks and facilities related to oil and gas production within an oil and gas field, so as to prevent damage to life, health, property, and natural resources, as provided; to permit owners and operators of wells to utilize all known methods and practices to increase the ultimate recovery of hydrocarbons; and to perform the supervisors duties in a manner that encourages the wise development of oil and gas resources to best meet oil and gas needs in this state. Under existing law, a person who fails to comply with certain requirements relating to the regulation of oil or gas operations is guilty of a misdemeanor.
This bill would require the supervisor to continue the prohibition against Southern California Gas Company injecting any natural gas into the Aliso Canyon natural gas storage facility located in the County of Los Angeles until a comprehensive review of the safety of the gas storage wells at the facility is completed, as specified, the supervisor determines that well integrity has been ensured by the review, the risks of failures identified in the review have been addressed, the supervisors duty to prevent damage to life, health, property, and natural resources, and other requirements is satisfied, and the Executive Director of the Public Utilities Commission has concurred via letter with the supervisor regarding his or her determination of safety. The bill would require the supervisor to determine criteria for the gas storage well comprehensive safety review with input from independent experts and would require the criteria to include, but not be limited to, specified tests and inspections. The bill would require the supervisor to direct the contracted independent experts to provide a methodology to be used in assessing the tests and inspections specified in the criteria. The bill would require the division to post the methodology on a public portion of its Internet Web site. The bill would require the operator of the facility to provide the division with the proposed maximum reservoir pressure and to include data and calculations supporting the basis for the pressure limit. The bill would authorize the supervisor to allow injections of natural gas into the facility once the gas storage well comprehensive safety review is complete, the division holds a duly noticed public hearing in the affected community to provide the public an opportunity to comment on the safety review findings and the proposed pressure limit, and the supervisor has approved the maximum and minimum reservoir pressure at the facility. The bill would also require that, before the completion of the gas storage well comprehensive safety review, the production of natural gas from gas storage wells at the facility be limited to gas storage wells that have satisfactorily completed the testing and remediation required under the review, except as specified. The bill would require the supervisor to direct the operator of the facility to provide a plan to ensure, at the earliest possible time, the availability of sufficient gas production capacity using gas storage wells that have satisfactorily completed the testing and remediation required under the review. The bill would require all gas storage wells returning to service under these provisions to inject or produce gas only through the interior metal tubing, and would require the operator to conduct ongoing pressure monitoring and comply with any other requirements specified by the supervisor. The bill would require the gas storage wells at the facility that are plugged and abandoned pursuant to these provisions to be periodically inspected by the operator for leaks using effective gas leak detection techniques. The bill would require the division, with respect to the review and in a timely manner, to post all testing, inspection and monitoring results, and other safety review-related materials to a public portion of the divisions Internet Web site. Because a violation of certain of these requirements would be a crime, the bill would impose a state-mandated local program. The bill would repeal these provisions on January 1, 2021.
(2)Under existing law, the Public Utilities Commission is authorized to supervise and regulate every public utility in the state. Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.
This bill would require the commission, no later than July 1, 2017, to open a proceeding to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy and electric reliability for the region, and to consult with specified entities in making its determination. The bill would require the commission, in consultation with specified entities, to determine the range of working gas necessary to ensure safety and reliability for the region and just and reasonable rates in California, and to direct the operator of the facility to provide all information the commission deems necessary to make that determination. The bill would require the commission, within 30 days of the effective date of this act, to publish a report, including specified information regarding gas production at the facility. The bill would require the commission to make the report available on its Internet Web site, and to seek public comments on the report, as specified. The bill would require the executive director of the commission, in consultation with the supervisor, to direct the operator of the facility to maintain the specified range of working gas after certain conditions have occurred. Certain provisions of this bill would be part of the act and an order or other action of the commission would be required to implement certain of the provisions. Because a violation of the bills provisions or of an order or decision of the commission would be a crime, this bill would impose a state-mandated local program by creating new crimes. The bill would repeal these provisions on January 1, 2021.
(3)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.
(4)This bill would declare that it is to take effect immediately as an urgency statute.
(1)Under existing law, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation regulates the drilling, operation, maintenance, and abandonment of oil and gas wells in the state. Existing law requires the State Oil and Gas Supervisor to supervise the drilling, operation, maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of tanks and facilities related to oil and gas production within an oil and gas field, so as to prevent damage to life, health, property, and natural resources, as provided; to permit owners and operators of wells to utilize all known methods and practices to increase the ultimate recovery of hydrocarbons; and to perform the supervisors duties in a manner that encourages the wise development of oil and gas resources to best meet oil and gas needs in this state. Under existing law, a person who fails to comply with certain requirements relating to the regulation of oil or gas operations is guilty of a misdemeanor.
This bill would require the supervisor to continue the prohibition against Southern California Gas Company injecting any natural gas into the Aliso Canyon natural gas storage facility located in the County of Los Angeles until a comprehensive review of the safety of the gas storage wells at the facility is completed, as specified, the supervisor determines that well integrity has been ensured by the review, the risks of failures identified in the review have been addressed, the supervisors duty to prevent damage to life, health, property, and natural resources, and other requirements is satisfied, and the Executive Director of the Public Utilities Commission has concurred via letter with the supervisor regarding his or her determination of safety. The bill would require the supervisor to determine criteria for the gas storage well comprehensive safety review with input from independent experts and would require the criteria to include, but not be limited to, specified tests and inspections. The bill would require the division to hold at least one public meeting to provide the public an opportunity to comment on the criteria. The bill would require the supervisor to direct the contracted independent experts to provide a methodology to be used in assessing the tests and inspections specified in the criteria. The bill would require the division to post the methodology on a public portion of its Internet Web site. The bill would require the operator of the facility to provide the division with the proposed maximum reservoir pressure and to include data and calculations supporting the basis for the pressure limit. The bill would authorize the supervisor to allow injections of natural gas into the facility once the gas storage well comprehensive safety review is complete complete, the division holds a duly noticed public hearing in the affected community to provide the public an opportunity to comment on the safety review findings and the proposed pressure limit, and the supervisor has approved the maximum and minimum reservoir pressure at the facility. The bill would also require that, before the completion of the gas storage well comprehensive safety review, the production of natural gas from gas storage wells at the facility be limited to gas storage wells that have satisfactorily completed the testing and remediation required under the review, except as specified. The bill would require the supervisor to direct the operator of the facility to provide a plan to ensure, at the earliest possible time, the availability of sufficient gas production capacity using gas storage wells that have satisfactorily completed the testing and remediation required under the review. The bill would require all gas storage wells returning to service under these provisions to inject or produce gas only through the interior metal tubing, and would require the operator to conduct ongoing pressure monitoring and comply with any other requirements specified by the supervisor. The bill would require the gas storage wells at the facility that are plugged and abandoned pursuant to these provisions to be periodically inspected by the operator for leaks using effective gas leak detection techniques. The bill would require the division, with respect to the review and in a timely manner, to post all testing, inspection and monitoring results, and other safety review-related materials to a public portion of the divisions Internet Web site. Because a violation of certain of these requirements would be a crime, the bill would impose a state-mandated local program. The bill would repeal these provisions on January 1, 2021.
(2)Under existing law, the Public Utilities Commission is authorized to supervise and regulate every public utility in the state. Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.
This bill would require the commission, no later than July 1, 2017, to open a proceeding to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy and electric reliability for the region, and to consult with specified entities in making its determination. The bill would require the commission, in consultation with specified entities, to determine the range of working gas necessary to ensure safety and reliability for the region and just and reasonable rates in California, and to direct the operator of the facility to provide all information the commission deems necessary to make that determination. The bill would require the commission, within 30 days of the effective date of this act, to publish a report, including specified information regarding gas production at the facility. The bill would require the commission to make the report available on its Internet Web site, and to seek public comments on the report, as specified. The bill would require the executive director of the commission, in consultation with the supervisor, to direct the operator of the facility to maintain the specified range of working gas after certain conditions have occurred. Certain provisions of this bill would be part of the act and an order or other action of the commission would be required to implement certain of the provisions. Because a violation of the bills provisions or of an order or decision of the commission would be a crime, this bill would impose a state-mandated local program by creating new crimes. The bill would repeal these provisions on January 1, 2021.
(3)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.
(4)This bill would declare that it is to take effect immediately as an urgency statute.
(1)Under existing law, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation regulates the drilling, operation, maintenance, and abandonment of oil and gas wells in the state. Existing law requires the State Oil and Gas Supervisor to supervise the drilling, operation, maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of tanks and facilities related to oil and gas production within an oil and gas field, so as to prevent damage to life, health, property, and natural resources, as provided; to permit owners and operators of wells to utilize all known methods and practices to increase the ultimate recovery of hydrocarbons; and to perform the supervisors duties in a manner that encourages the wise development of oil and gas resources to best meet oil and gas needs in this state. Under existing law, a person who fails to comply with certain requirements relating to the regulation of oil or gas operations is guilty of a misdemeanor.
This bill would require the supervisor to immediately institute a moratorium on injections of natural gas into any gas storage wells located within and serving continue the prohibition against Southern California Gas Company injecting any natural gas into the Aliso Canyon natural gas storage facility located in the County of Los Angeles until specified conditions are met, including that the integrity of each gas storage well has been quantitatively and objectively evaluated using state-of-the-art technology, as determined by the supervisor with input from independent experts, and the risks posed by gas storage well failure have been evaluated. a comprehensive review of the safety of the gas storage wells at the facility is completed, as specified, the supervisor determines that well integrity has been ensured by the review, the risks of failures identified in the review have been addressed, the supervisors duty to prevent damage to life, health, property, and natural resources, and other requirements is satisfied, and the Executive Director of the Public Utilities Commission has concurred via letter with the supervisor regarding his or her determination of safety. The bill would require the supervisor to determine criteria for the gas storage well comprehensive safety review with input from independent experts and would require the criteria to include, but not be limited to, specified tests and inspections. The bill would require the division to hold at least one public meeting concerning the technical methods and equipment to be used to evaluate gas storage well integrity and the risks posed by gas storage well failure, request the independent experts to also develop objective criteria to assess the overall risk of the Aliso Canyon natural gas storage facility, and make that objective criteria available to the public. to provide the public an opportunity to comment on the criteria. The bill would require the supervisor to direct the contracted independent experts to provide a methodology to be used in assessing the tests and inspections specified in the criteria. The bill would require the division to post the methodology on a public portion of its Internet Web site. The bill would require the operator of the facility to provide the division with the proposed maximum reservoir pressure and to include data and calculations supporting the basis for the pressure limit. The bill would authorize the supervisor to allow injections of natural gas into the facility once the gas storage well comprehensive safety review is complete and the supervisor has approved the maximum and minimum reservoir pressure at the facility. The bill would also require the supervisor to prohibit that, before the completion of the gas storage well comprehensive safety review, the production of natural gas by any gas storage well originally drilled earlier than 1954 from gas storage wells at the Aliso Canyon natural gas storage facility located in the County of Los Angeles until specified conditions are met, except as specified. be limited to gas storage wells that have satisfactorily completed the testing and remediation required under the review, except as specified. The bill would require the supervisor to direct the operator of the facility to provide a plan to ensure, at the earliest possible time, the availability of sufficient gas production capacity using gas storage wells that have satisfactorily completed the testing and remediation required under the review. The bill would require all gas storage wells returning to service under these provisions to inject or produce gas only through the interior metal tubing, and would require the operator to conduct ongoing pressure monitoring and comply with any other requirements specified by the supervisor. The bill would require the gas storage wells at the facility that are plugged and abandoned pursuant to these provisions to be periodically inspected by the operator for leaks using effective gas leak detection techniques. The bill would require the division, with respect to the review and in a timely manner, to post all testing, inspection and monitoring results, and other safety review-related materials to a public portion of the divisions Internet Web site. Because a violation of certain of these requirements would be a crime, the bill would impose a state-mandated local program. The bill would repeal these provisions on January 1, 2021.
(2)Under existing law, the Public Utilities Commission is authorized to supervise and regulate every public utility in the state. Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.
This bill would require the commission, no later than July 1, 2017, to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy and electric reliability for the region, and to consult with specified entities in making its determination. The bill would require the commission, in consultation with specified entities, to determine the range of working gas necessary to ensure safety and reliability for the region and just and reasonable rates in California, and to direct the operator of the facility to provide all information the commission deems necessary to make that determination. The bill would require the commission, within 30 days of the effective date of this act, to publish a report, including specified information regarding gas production at the facility. The bill would require the commission to make the report available on its Internet Web site, and to seek public comments on the report, as specified. The bill would require the executive director of the commission, in consultation with the supervisor, to direct the operator of the facility to maintain the specified range of working gas after certain conditions have occurred. Certain provisions of this bill would be part of the act and an order or other action of the commission would be required to implement certain of the provisions. Because a violation of the bills provisions or of an order or decision of the commission would be a crime, this bill would impose a state-mandated local program by creating new crimes. The bill would repeal these provisions on January 1, 2021.
(3)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.
(4)This bill would declare that it is to take effect immediately as an urgency statute.
(1)Under existing law, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation regulates the drilling, operation, maintenance, and abandonment of oil and gas wells in the state. Existing law requires the State Oil and Gas Supervisor to supervise the drilling, operation, maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of tanks and facilities related to oil and gas production within an oil and gas field, so as to prevent damage to life, health, property, and natural resources, as provided; to permit owners and operators of wells to utilize all known methods and practices to increase the ultimate recovery of hydrocarbons; and to perform the supervisors duties in a manner that encourages the wise development of oil and gas resources to best meet oil and gas needs in this state. Under existing law, a person who fails to comply with certain requirements relating to the regulation of oil or gas operations is guilty of a misdemeanor.
This bill would require the supervisor to immediately institute a moratorium on injections of natural gas into any gas storage wells located within and serving the Aliso Canyon natural gas storage facility located in the County of Los Angeles until specified conditions are met, including that the integrity of each gas storage well has been quantitatively and objectively evaluated using state-of-the-art technology, as determined by the supervisor with input from independent experts, and the risks posed by gas storage well failure have been evaluated. The bill would require the division to hold at least one public meeting concerning the technical methods and equipment to be used to evaluate gas storage well integrity and the risks posed by gas storage well failure, request the independent experts to also develop objective criteria to assess the overall risk of the Aliso Canyon natural gas storage facility, and make that objective criteria available to the public. The bill would also require the supervisor to prohibit the production of natural gas by any gas storage well originally drilled earlier than 1954 at the Aliso Canyon natural gas storage facility located in the County of Los Angeles until specified conditions are met, except as specified. Because a violation of these requirements would be a crime, the bill would impose a state-mandated local program. The bill would repeal these provisions on January 1, 2021.
(2)Under existing law, the Public Utilities Commission is authorized to supervise and regulate every public utility in the state.
This bill would require the commission commission, no later than July 1, 2017, to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy reliability for the region, and to consult with specified entities in making its determination.
(3)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.
(4)This bill would declare that it is to take effect immediately as an urgency statute.
(1)Under existing law, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation regulates the drilling, operation, maintenance, and abandonment of oil and gas wells in the state. Existing law requires the State Oil and Gas Supervisor to supervise the drilling, operation, maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of tanks and facilities related to oil and gas production within an oil and gas field, so as to prevent damage to life, health, property, and natural resources, as provided; to permit owners and operators of wells to utilize all known methods and practices to increase the ultimate recovery of hydrocarbons; and to perform the supervisors duties in a manner that encourages the wise development of oil and gas resources to best meet oil and gas needs in this state. Under existing law, a person who fails to comply with certain requirements relating to the regulation of oil or gas operations is guilty of a misdemeanor.
This bill would require the supervisor to immediately institute a moratorium on injections of natural gas into any wells located within and serving the Aliso Canyon storage facility located in the County of Los Angeles until specified conditions are met. met, including that the integrity of each well has been quantitatively and objectively evaluated using state-of-the-art technology, as determined by the supervisor with input from independent experts, and the risks posed by well failure have been evaluated. The bill would require the division to hold at least one public meeting concerning the technical methods and equipment to be used to evaluate well integrity and the risks posed by well failure, request the independent experts to also develop objective criteria to assess the overall risk of the facility, and make that objective criteria available to the public. The bill would also require the supervisor to prohibit the production of natural gas by any well originally drilled earlier than 1954 at the Aliso Canyon storage facility located in the County of Los Angeles until specified conditions are met, except as specified. Because a violation of these requirements would be a crime, the bill would impose a state-mandated local program.
(2)Under existing law, the Public Utilities Commission is authorized to supervise and regulate every public utility in the state.
This bill would require the commission to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy reliability for the region, and to consult with specified entities in making its determination.
(3)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.
(4)This bill would declare that it is to take effect immediately as an urgency statute.
(1)Under existing law, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation regulates the drilling, operation, maintenance, and abandonment of oil and gas wells in the state. Existing law requires the State Oil and Gas Supervisor to supervise the drilling, operation, maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of tanks and facilities related to oil and gas production within an oil and gas field, so as to prevent damage to life, health, property, and natural resources, as provided; to permit owners and operators of wells to utilize all known methods and practices to increase the ultimate recovery of hydrocarbons; and to perform the supervisors duties in a manner that encourages the wise development of oil and gas resources to best meet oil and gas needs in this state. Under existing law, a person who fails to comply with certain requirements relating to the regulation of oil or gas operations is guilty of a misdemeanor.
This bill would require the supervisor to immediately institute a moratorium on injections of natural gas into any wells located within and serving the Aliso Canyon storage facility located in the County of Los Angeles until specified conditions are met. The bill would also require the supervisor to prohibit the production of natural gas by any well originally drilled earlier than 1954 at the Aliso Canyon storage facility located in the County of Los Angeles until specified conditions are met, except as specified. Because a violation of these requirements would be a crime, the bill would impose a state-mandated local program.
(2)Under existing law, the Public Utilities Commission is authorized to supervise and regulate every public utility in the state.
This bill would require the commission to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy reliability for the region, and to consult with specified entities in making its determination.
(3)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.
(4)This bill would declare that it is to take effect immediately as an urgency statute.
Existing law establishes the Student Aid Commission as the state agency charged with the responsibility of administering student financial aid programs, including the Ortiz-Pacheco-Poochigian-Vasconcellos Cal Grant Program, the Assumption Program of Loans for Education, the State Nursing Assumption Program of Loans for Education, the Graduate Assumption Program of Loans for Education, and the Middle Class Scholarship Program, among other programs.
This bill would express the intent of the Legislature to enact legislation to establish the Topline Teacher Recruitment and Retention Program, under the administration of the Student Aid Commission, which would make funds available to students at public postsecondary educational institutions who have graduated in the top 5% of their secondary school classes and have committed to teaching in public secondary schools for a specified number of years.
Existing law establishes the Student Aid Commission as the state agency charged with the responsibility of administering student financial aid programs, including the Ortiz-Pacheco-Poochigian-Vasconcellos Cal Grant Program, the Assumption Program of Loans for Education, the State Nursing Assumption Program of Loans for Education, the Graduate Assumption Program of Loans for Education, and the Middle Class Scholarship Program, among other programs.
This bill would express the intent of the Legislature to enact legislation to establish the Topline Teacher Recruitment and Retention Program, under the administration of the Student Aid Commission, which would make funds available to students at public postsecondary educational institutions who have graduated in the top 5% of their secondary school classes and have committed to teaching in public secondary schools for a specified number of years.
(a)(1)The supervisor shall continue the prohibition against Southern California Gas Company injecting any natural gas into the Aliso Canyon natural gas storage facility located in the County of Los Angeles until a comprehensive review of the safety of the gas storage wells at the facility is completed and the supervisor determines that well integrity has been ensured by the review, the risks of failures identified in the review have been addressed, and the supervisors duty to prevent damage to life, health, property, and natural resources, and other requirements, as specified in Section 3106, is satisfied. The supervisor may not lift the prohibition on injection until the Executive Director of the Public Utilities Commission has concurred via letter with the supervisor regarding his or her determination of safety.
(2)For purposes of this section, facility means the Aliso Canyon natural gas storage facility located in the County of Los Angeles operated by Southern California Gas Company.
(b)(1)The criteria for the gas storage well comprehensive safety review shall be determined by the supervisor with input from contracted independent experts and shall include the steps in subdivision (c).
(2)The supervisor shall direct the contracted independent experts to provide a methodology to be used in assessing the tests and inspections specified in the criteria. This requirement may be satisfied by the independent experts reviewing and, if necessary, revising the divisions written methodology for assessing the tests and inspections specified in the criteria. The methodology shall include all tests and inspections required by the criteria. The division shall post the methodology online on a public portion of its Internet Web site.
(c)The gas storage well comprehensive safety review shall include the following steps to ensure external and internal well mechanical integrity:
(1)All gas storage wells shall be tested and inspected from the surface to the packer or to any wellbore restriction near the top of the geologic formation being used for gas storage, whichever is higher in elevation, to detect existing leaks using temperature and noise logs.
(2)Any leaks shall be stopped and remediated to the satisfaction of the supervisor.
(3)Following remediation, leak detection tests shall be repeated and results reviewed by the supervisor.
(4)(A)Unless a well has been fully plugged and abandoned to the supervisors satisfaction and in accordance with Section 3208, the well shall be evaluated and remediated in accordance with subparagraph (B) or plugged in accordance with subparagraph (C).
(B)If a gas storage well is intended to return to service for the purposes of resuming injections to the facility, it shall be tested and inspected from the surface to the packer or to any wellbore restriction near the top of the geologic formation being used for gas storage, whichever is higher in elevation, to ensure mechanical integrity. As identified in the divisions criteria, these tests and inspections shall include the measurement of casing thickness and integrity, an evaluation of the cement bond on the casing, the determination as to whether any deformities in the well casing exist, and an evaluation of the wells ability to withstand pressures that exceed maximum allowable injection and production pressures, with a reasonable margin for safety, at the facility in accordance with the criteria determined by the supervisor with input from independent experts pursuant to subdivision (b). If the tests reveal that a well poses a risk of failure, the supervisor shall require remediation and repeat tests as necessary to demonstrate to the satisfaction of the supervisor that remediation has mitigated any potential identified risks. If the operator cannot remediate the well to mitigate the identified risks to the satisfaction of the supervisor, the well shall be plugged and abandoned in accordance with Section 3208.
(C)(i)If a well is to be taken out of service before resumption of gas injections at the facility, it shall be removed from operation and isolated from the gas storage reservoir through plugging according to the divisions criteria, including, but not limited to, the demonstration of sufficient cement to prevent migrations between the reservoir and other zones, placement of a mechanical plug at the bottom of the well, and subsequent filling of the well with fluid, and to specifications approved by the supervisor. All gas storage wells that are taken out of service under this subparagraph shall be subjected to ongoing testing and monitoring requirements identified in the criteria determined by the supervisor with input from independent experts. The monitoring shall include, but not be limited to, real-time and daily pressure monitoring, as applicable. A gas storage well shall not be returned to service unless the testing and remediation required under subparagraph (B) has been completed.
(ii)A gas storage well, within one year of being plugged and isolated from the gas storage reservoir pursuant to clause (i), shall either be returned to service by satisfactorily completing the testing and remediation required under subparagraph (B) or be permanently plugged and abandoned to the supervisors satisfaction in accordance with Section 3208.
(D)The supervisor shall make a written finding for each gas storage well that has satisfactorily completed the testing and remediation required under subparagraph (B).
(5)The gas storage well comprehensive safety review is not complete until every gas storage well at the facility has completed the testing and remediation required under subparagraph (B) of paragraph (4), been temporarily abandoned and isolated from the reservoir as required under clause (i) of subparagraph (C) of paragraph (4), or been fully plugged and abandoned to the supervisors satisfaction in accordance with Section 3208.
(d)Upon completion of the gas storage well comprehensive safety review but before authorizing the commencement of injections at the facility, the division shall hold at least one duly noticed public meeting in the affected community to provide the public an opportunity to comment on the safety review findings and on the proposed pressure limit as provided in subdivision (e).
(e)(1)Before commencing injections at the facility, the operator of the facility shall provide the division with the proposed maximum reservoir pressure and include data and calculations supporting the basis for the pressure limit. The pressure limit shall account for the pressure required to inject intended gas volumes at all proposed inventory levels and the pressure limit shall not exceed the design pressure limits of the reservoir, wells, wellheads, piping, or associated facilities with an appropriate margin for safety.
(2)The operators proposed maximum reservoir pressure shall be subject to review and approval by the supervisor, and the supervisor shall consult with independent experts regarding the appropriate maximum and minimum reservoir pressure at the facility.
(f)Once the gas storage well comprehensive safety review is complete pursuant to paragraph (5) of subdivision (c), the supervisor has approved the maximum and minimum reservoir pressure pursuant to paragraph (2) of subdivision (e), and the public hearing is held pursuant to subdivision (d), the supervisor may allow injections of natural gas at the facility.
(g)All gas storage wells returning to service pursuant to subdivision (f) shall only inject or produce gas through the interior metal tubing and not through the annulus between the tubing and the well casing. The operator shall also conduct ongoing pressure monitoring and comply with any other requirements specified by the supervisor.
(h)The gas storage wells at the facility that are plugged and abandoned in accordance with Section 3208 pursuant to this section shall be periodically inspected by the operator for leaks using effective gas leak detection techniques such as optical gas imaging.
(i)(1)Before the completion of the gas storage well comprehensive safety review, production of natural gas from gas storage wells at the facility shall be limited to gas storage wells that have satisfactorily completed the testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c) unless insufficient production capacity is available. Only if production capacity supplied by the tested and remediated wells is demonstrably insufficient may the supervisor allow other gas storage wells to be used.
(2)The supervisor shall direct the operator of the facility to provide a plan to ensure, at the earliest possible time, the availability of sufficient gas production capacity using gas storage wells that have satisfactorily completed the testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c).
(j)With respect to the gas storage well comprehensive safety review at the facility, all testing, inspection and monitoring results reported to the division, gas storage well compliance status, any required remediation steps, and other safety review-related materials shall be posted in a timely manner by the division online on a public portion of its Internet Web site.
(k)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 2.Section 714 is added to the Public Utilities Code, to read:714.(a)The commission, no later than July 1, 2017, shall open a proceeding to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy and electric reliability for the region. This determination shall be consistent with the Clean Energy and Pollution Reduction Act of 2015 (Ch. 547, Stats. 2015) and Executive Order B-30-2015. The commission shall consult with the State Energy Resources Conservation and Development Commission, the Independent System Operator, the local publicly owned utilities that rely on natural gas for electricity generation, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation, affected balancing authorities, and other relevant government entities, in making its determination.
(b)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 3.Section 715 is added to the Public Utilities Code, to read:715.(a)The commission shall direct the operator of the Aliso Canyon natural gas storage facility located in the County of Los Angeles to provide all information the commission deems necessary for the commission to determine, in consultation with the State Energy Resources Conservation and Development Commission, the Independent System Operator, and affected publicly owned utilities, the range of working gas necessary to ensure safety and reliability for the region and just and reasonable rates in California. The determination shall be based on best available data, and shall incorporate data from recent and ongoing studies being conducted to determine energy and gas use in the region by the commission, the State Energy Resources Conservation and Development Commission, the Independent System Operator, and affected publicly owned utilities.
(b)Within 30 days of the effective date of the act adding this section, the commission shall publish a report that includes, but is not limited to, all of the following:
(1)The range of working gas necessary at the facility to ensure safety and reliability and just and reasonable rates in California determined pursuant to subdivision (a).
(2)The amount of natural gas production at the facility needed to meet safety and reliability requirements.
(3)The number of wells and associated injection and production capacity required.
(4)The availability of sufficient natural gas production using gas storage wells that have satisfactorily completed testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c) of Section 3217 of the Public Resources Code.
(c)The commission shall make the report required under subdivision (b) available on its Internet Web site and seek, either through written comments or a workshop, public comments on the report.
(d)The executive director of the commission, in consultation with the State Oil and Gas Supervisor, shall direct the operator to maintain the specified range of working gas, determined pursuant to subdivision (a), at the facility to ensure reliability and just and reasonable rates in California, after all of the following occur:
(1)The gas storage well comprehensive safety review is complete pursuant to paragraph (5) of subdivision (c) of Section 3217 of the Public Resources Code.
(2)The State Oil and Gas Supervisor has approved the maximum and minimum reservoir pressure pursuant to subdivision (e) of Section 3217 of the Public Resources Code.
(3)The State Oil and Gas Supervisor has allowed injections of natural gas at the facility, pursuant to subdivision (f) of Section 3217 of the Public Resources Code.
(4)The commission has allowed, and received, public comment on the report pursuant to subdivision (c).
(e)In no case may the volume of working gas set by the executive director of the commission result in reservoir pressures that fall out of the range established pursuant to subdivision (e) of Section 3217 of the Public Resources Code.
(f)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 4.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
SEC. 5.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to mitigate, at the earliest possible time, ongoing harm from the gas leak at the Aliso Canyon natural gas storage facility, and to evaluate the integrity of and the risks associated with gas storage wells at that facility, it is necessary that this act take effect immediately.
(a)(1)The supervisor shall continue the prohibition against Southern California Gas Company injecting any natural gas into the Aliso Canyon natural gas storage facility located in the County of Los Angeles until a comprehensive review of the safety of the gas storage wells at the facility is completed and the supervisor determines that well integrity has been ensured by the review, the risks of failures identified in the review have been addressed, and the supervisors duty to prevent damage to life, health, property, and natural resources, and other requirements, as specified in Section 3106, is satisfied. The supervisor may not lift the prohibition on injection until the Executive Director of the Public Utilities Commission has concurred via letter with the supervisor regarding his or her determination of safety.
(2)For purposes of this section, facility means the Aliso Canyon natural gas storage facility located in the County of Los Angeles operated by Southern California Gas Company.
(b)(1)The criteria for the gas storage well comprehensive safety review shall be determined by the supervisor with input from contracted independent experts and shall include the steps in subdivision (c).
(2)The supervisor shall direct the contracted independent experts to provide a methodology to be used in assessing the tests and inspections specified in the criteria. This requirement may be satisfied by the independent experts reviewing and, if necessary, revising the divisions written methodology for assessing the tests and inspections specified in the criteria. The methodology shall include all tests and inspections required by the criteria. The division shall post the methodology online on a public portion of its Internet Web site.
(c)The gas storage well comprehensive safety review shall include the following steps to ensure external and internal well mechanical integrity:
(1)All gas storage wells shall be tested and inspected from the surface to the packer or to any wellbore restriction near the top of the geologic formation being used for gas storage, whichever is higher in elevation, to detect existing leaks using temperature and noise logs.
(2)Any leaks shall be stopped and remediated to the satisfaction of the supervisor.
(3)Following remediation, leak detection tests shall be repeated and results reviewed by the supervisor.
(4)(A)Unless a well has been fully plugged and abandoned to the supervisors satisfaction and in accordance with Section 3208, the well shall be evaluated and remediated in accordance with subparagraph (B) or plugged in accordance with subparagraph (C).
(B)If a gas storage well is intended to return to service for the purposes of resuming injections to the facility, it shall be tested and inspected from the surface to the packer or to any wellbore restriction near the top of the geologic formation being used for gas storage, whichever is higher in elevation, to ensure mechanical integrity. As identified in the divisions criteria, these tests and inspections shall include the measurement of casing thickness and integrity, an evaluation of the cement bond on the casing, the determination as to whether any deformities in the well casing exist, and an evaluation of the wells ability to withstand pressures that exceed maximum allowable injection and production pressures, with a reasonable margin for safety, at the facility in accordance with the criteria determined by the supervisor with input from independent experts pursuant to subdivision (b). If the tests reveal that a well poses a risk of failure, the supervisor shall require remediation and repeat tests as necessary to demonstrate to the satisfaction of the supervisor that remediation has mitigated any potential identified risks. If the operator cannot remediate the well to mitigate the identified risks to the satisfaction of the supervisor, the well shall be plugged and abandoned in accordance with Section 3208.
(C)(i)If a well is to be taken out of service before resumption of gas injections at the facility, it shall be removed from operation and isolated from the gas storage reservoir through plugging according to the divisions criteria, including, but not limited to, the demonstration of sufficient cement to prevent migrations between the reservoir and other zones, placement of a mechanical plug at the bottom of the well, and subsequent filling of the well with fluid, and to specifications approved by the supervisor. All gas storage wells that are taken out of service under this subparagraph shall be subjected to ongoing testing and monitoring requirements identified in the criteria determined by the supervisor with input from independent experts. The monitoring shall include, but not be limited to, real-time and daily pressure monitoring, as applicable. A gas storage well shall not be returned to service unless the testing and remediation required under subparagraph (B) has been completed.
(ii)A gas storage well, within one year of being plugged and isolated from the gas storage reservoir pursuant to clause (i), shall either be returned to service by satisfactorily completing the testing and remediation required under subparagraph (B) or be permanently plugged and abandoned to the supervisors satisfaction in accordance with Section 3208.
(D)The supervisor shall make a written finding for each gas storage well that has satisfactorily completed the testing and remediation required under subparagraph (B).
(5)The gas storage well comprehensive safety review is not complete until every gas storage well at the facility has completed the testing and remediation required under subparagraph (B) of paragraph (4), been temporarily abandoned and isolated from the reservoir as required under clause (i) of subparagraph (C) of paragraph (4), or been fully plugged and abandoned to the supervisors satisfaction in accordance with Section 3208.
(d)Upon completion of the gas storage well comprehensive safety review but before authorizing the commencement of injections at the facility, the division shall hold at least one duly noticed public meeting in the affected community to provide the public an opportunity to comment on the safety review findings and on the proposed pressure limit as provided in subdivision (e).
(e)(1)Before commencing injections at the facility, the operator of the facility shall provide the division with the proposed maximum reservoir pressure and include data and calculations supporting the basis for the pressure limit. The pressure limit shall account for the pressure required to inject intended gas volumes at all proposed inventory levels and the pressure limit shall not exceed the design pressure limits of the reservoir, wells, wellheads, piping, or associated facilities with an appropriate margin for safety.
(2)The operators proposed maximum reservoir pressure shall be subject to review and approval by the supervisor, and the supervisor shall consult with independent experts regarding the appropriate maximum and minimum reservoir pressure at the facility.
(f)Once the gas storage well comprehensive safety review is complete pursuant to paragraph (5) of subdivision (c), the supervisor has approved the maximum and minimum reservoir pressure pursuant to paragraph (2) of subdivision (e), and the public hearing is held pursuant to subdivision (d), the supervisor may allow injections of natural gas at the facility.
(g)All gas storage wells returning to service pursuant to subdivision (f) shall only inject or produce gas through the interior metal tubing and not through the annulus between the tubing and the well casing. The operator shall also conduct ongoing pressure monitoring and comply with any other requirements specified by the supervisor.
(h)The gas storage wells at the facility that are plugged and abandoned in accordance with Section 3208 pursuant to this section shall be periodically inspected by the operator for leaks using effective gas leak detection techniques such as optical gas imaging.
(i)(1)Before the completion of the gas storage well comprehensive safety review, production of natural gas from gas storage wells at the facility shall be limited to gas storage wells that have satisfactorily completed the testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c) unless insufficient production capacity is available. Only if production capacity supplied by the tested and remediated wells is demonstrably insufficient may the supervisor allow other gas storage wells to be used.
(2)The supervisor shall direct the operator of the facility to provide a plan to ensure, at the earliest possible time, the availability of sufficient gas production capacity using gas storage wells that have satisfactorily completed the testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c).
(j)With respect to the gas storage well comprehensive safety review at the facility, all testing, inspection and monitoring results reported to the division, gas storage well compliance status, any required remediation steps, and other safety review-related materials shall be posted in a timely manner by the division online on a public portion of its Internet Web site.
(k)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 2.Section 714 is added to the Public Utilities Code, to read:714.(a)The commission, no later than July 1, 2017, shall open a proceeding to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy and electric reliability for the region. This determination shall be consistent with the Clean Energy and Pollution Reduction Act of 2015 (Ch. 547, Stats. 2015) and Executive Order B-30-2015. The commission shall consult with the State Energy Resources Conservation and Development Commission, the Independent System Operator, the local publicly owned utilities that rely on natural gas for electricity generation, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation, affected balancing authorities, and other relevant government entities, in making its determination.
(b)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 3.Section 715 is added to the Public Utilities Code, to read:715.(a)The commission shall direct the operator of the Aliso Canyon natural gas storage facility located in the County of Los Angeles to provide all information the commission deems necessary for the commission to determine, in consultation with the State Energy Resources Conservation and Development Commission, the Independent System Operator, and affected publicly owned utilities, the range of working gas necessary to ensure safety and reliability for the region and just and reasonable rates in California. The determination shall be based on best available data, and shall incorporate data from recent and ongoing studies being conducted to determine energy and gas use in the region by the commission, the State Energy Resources Conservation and Development Commission, the Independent System Operator, and affected publicly owned utilities.
(b)Within 30 days of the effective date of the act adding this section, the commission shall publish a report that includes, but is not limited to, all of the following:
(1)The range of working gas necessary at the facility to ensure safety and reliability and just and reasonable rates in California determined pursuant to subdivision (a).
(2)The amount of natural gas production at the facility needed to meet safety and reliability requirements.
(3)The number of wells and associated injection and production capacity required.
(4)The availability of sufficient natural gas production using gas storage wells that have satisfactorily completed testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c) of Section 3217 of the Public Resources Code.
(c)The commission shall make the report required under subdivision (b) available on its Internet Web site and seek, either through written comments or a workshop, public comments on the report.
(d)The executive director of the commission, in consultation with the State Oil and Gas Supervisor, shall direct the operator to maintain the specified range of working gas, determined pursuant to subdivision (a), at the facility to ensure reliability and just and reasonable rates in California, after all of the following occur:
(1)The gas storage well comprehensive safety review is complete pursuant to paragraph (5) of subdivision (c) of Section 3217 of the Public Resources Code.
(2)The State Oil and Gas Supervisor has approved the maximum and minimum reservoir pressure pursuant to subdivision (e) of Section 3217 of the Public Resources Code.
(3)The State Oil and Gas Supervisor has allowed injections of natural gas at the facility, pursuant to subdivision (f) of Section 3217 of the Public Resources Code.
(4)The commission has allowed, and received, public comment on the report pursuant to subdivision (c).
(e)In no case may the volume of working gas set by the executive director of the commission result in reservoir pressures that fall out of the range established pursuant to subdivision (e) of Section 3217 of the Public Resources Code.
(f)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 4.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
SEC. 5.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to mitigate, at the earliest possible time, ongoing harm from the gas leak at the Aliso Canyon natural gas storage facility, and to evaluate the integrity of and the risks associated with gas storage wells at that facility, it is necessary that this act take effect immediately.
(a)(1)The supervisor shall continue the prohibition against Southern California Gas Company injecting any natural gas into the Aliso Canyon natural gas storage facility located in the County of Los Angeles until a comprehensive review of the safety of the gas storage wells at the facility is completed and the supervisor determines that well integrity has been ensured by the review, the risks of failures identified in the review have been addressed, and the supervisors duty to prevent damage to life, health, property, and natural resources, and other requirements, as specified in Section 3106, is satisfied. The supervisor may not lift the prohibition on injection until the Executive Director of the Public Utilities Commission has concurred via letter with the supervisor regarding his or her determination of safety.
(2)For purposes of this section, facility means the Aliso Canyon natural gas storage facility located in the County of Los Angeles operated by Southern California Gas Company.
(b)(1)The criteria for the gas storage well comprehensive safety review shall be determined by the supervisor with input from contracted independent experts and shall include the steps in subdivision (c). The division shall hold at least one public meeting to provide the public an opportunity to comment on the criteria.
(2)The supervisor shall direct the contracted independent experts to provide a methodology to be used in assessing the tests and inspections specified in the criteria. This requirement may be satisfied by the independent experts reviewing and, if necessary, revising the divisions written methodology for assessing the tests and inspections specified in the criteria. The methodology shall include all tests and inspections required by the criteria. The division shall post the methodology online on a public portion of its Internet Web site.
(c)The gas storage well comprehensive safety review shall include the following steps to ensure external and internal well mechanical integrity:
(1)All gas storage wells shall be tested and inspected from the surface to the packer or to any wellbore restriction near the top of the geologic formation being used for gas storage, whichever is higher in elevation, to detect existing leaks using temperature and noise logs.
(2)Any leaks shall be stopped and remediated to the satisfaction of the supervisor.
(3)Following remediation, leak detection tests shall be repeated and results reviewed by the supervisor.
(4)(A)Unless a well has been fully plugged and abandoned to the supervisors satisfaction and in accordance with Section 3208, the well shall be evaluated and remediated in accordance with subparagraph (B) or plugged in accordance with subparagraph (C).
(B)If a gas storage well is intended to return to service for the purposes of resuming injections to the facility, it shall be tested and inspected from the surface to the packer or to any wellbore restriction near the top of the geologic formation being used for gas storage, whichever is higher in elevation, to ensure mechanical integrity. As identified in the divisions criteria, these tests and inspections shall include the measurement of casing thickness and integrity, an evaluation of the cement bond on the casing, the determination as to whether any deformities in the well casing exist, and an evaluation of the wells ability to withstand pressures that exceed maximum allowable injection and production pressures, with a reasonable margin for safety, at the facility in accordance with the criteria determined by the supervisor with input from independent experts pursuant to subdivision (b). If the tests reveal that a well poses a risk of failure, the supervisor shall require remediation and repeat tests as necessary to demonstrate to the satisfaction of the supervisor that remediation has mitigated any potential identified risks. If the operator cannot remediate the well to mitigate the identified risks to the satisfaction of the supervisor, the well shall be plugged and abandoned in accordance with Section 3208.
(C)(i)If a well is to be taken out of service before resumption of gas injections at the facility, it shall be removed from operation and isolated from the gas storage reservoir through plugging according to the divisions criteria, including, but not limited to, the demonstration of sufficient cement to prevent migrations between the reservoir and other zones, placement of a mechanical plug at the bottom of the well, and subsequent filling of the well with fluid, and to specifications approved by the supervisor. All gas storage wells that are taken out of service under this subparagraph shall be subjected to ongoing testing and monitoring requirements identified in the criteria determined by the supervisor with input from independent experts. The monitoring shall include, but not be limited to, real-time and daily pressure monitoring, as applicable. A gas storage well shall not be returned to service unless the testing and remediation required under subparagraph (B) has been completed.
(ii)A gas storage well, within one year of being plugged and isolated from the gas storage reservoir pursuant to clause (i), shall either be returned to service by satisfactorily completing the testing and remediation required under subparagraph (B) or be permanently plugged and abandoned to the supervisors satisfaction in accordance with Section 3208.
(D)The supervisor shall make a written finding for each gas storage well that has satisfactorily completed the testing and remediation required under subparagraph (B).
(5)The gas storage well comprehensive safety review is not complete until every gas storage well at the facility has completed the testing and remediation required under subparagraph (B) of paragraph (4), been temporarily abandoned and isolated from the reservoir as required under clause (i) of subparagraph (C) of paragraph (4), or been fully plugged and abandoned to the supervisors satisfaction in accordance with Section 3208.
(d)Upon completion of the gas storage well comprehensive safety review but before authorizing the commencement of injections at the facility, the division shall hold at least one duly noticed public meeting in the affected community to provide the public an opportunity to comment on the safety review findings and on the proposed pressure limit as provided in subdivision (e).
(d)
(e)(1)Before commencing injections at the facility, the operator of the facility shall provide the division with the proposed maximum reservoir pressure and include data and calculations supporting the basis for the pressure limit. The pressure limit shall account for the pressure required to inject intended gas volumes at all proposed inventory levels and the pressure limit shall not exceed the design pressure limits of the reservoir, wells, wellheads, piping, or associated facilities with an appropriate margin for safety.
(2)The operators proposed maximum reservoir pressure shall be subject to review and approval by the supervisor, and the supervisor shall consult with independent experts regarding the appropriate maximum and minimum reservoir pressure at the facility.
(e)
(f)Once the gas storage well comprehensive safety review is complete pursuant to paragraph (5) of subdivision (c) and (c), the supervisor has approved the maximum and minimum reservoir pressure pursuant to paragraph (2) of subdivision (d), (e), and the public hearing is held pursuant to subdivision (d), the supervisor may allow injections of natural gas at the facility.
(f)
(g)All gas storage wells returning to service pursuant to subdivision (e) (f) shall only inject or produce gas through the interior metal tubing and not through the annulus between the tubing and the well casing. The operator shall also conduct ongoing pressure monitoring and comply with any other requirements specified by the supervisor.
(g)
(h)The gas storage wells at the facility that are plugged and abandoned in accordance with Section 3208 pursuant to this section shall be periodically inspected by the operator for leaks using effective gas leak detection techniques such as optical gas imaging.
(h)
(i)(1)Before the completion of the gas storage well comprehensive safety review, production of natural gas from gas storage wells at the facility shall be limited to gas storage wells that have satisfactorily completed the testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c) unless insufficient production capacity is available. Only if production capacity supplied by the tested and remediated wells is demonstrably insufficient may the supervisor allow other gas storage wells to be used.
(2)The supervisor shall direct the operator of the facility to provide a plan to ensure, at the earliest possible time, the availability of sufficient gas production capacity using gas storage wells that have satisfactorily completed the testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c).
(i)
(j)With respect to the gas storage well comprehensive safety review at the facility, all testing, inspection and monitoring results reported to the division, gas storage well compliance status, any required remediation steps, and other safety review-related materials shall be posted in a timely manner by the division online on a public portion of its Internet Web site.
(j)
(k)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 2.Section 714 is added to the Public Utilities Code, to read:714.(a)The commission, no later than July 1, 2017, shall open a proceeding to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy and electric reliability for the region. This determination shall be consistent with the Clean Energy and Pollution Reduction Act of 2015 (Chapter 547 of the Statutes of 2015) and Executive Order B-30-2015. The commission shall consult with the State Energy Resources Conservation and Development Commission, the Independent System Operator, the local publicly owned utilities that rely on natural gas for electricity generation, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation, affected balancing authorities, and other relevant government entities, in making its determination.
(b)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 3.Section 715 is added to the Public Utilities Code, to read:715.(a)The commission shall direct the operator of the Aliso Canyon natural gas storage facility located in the County of Los Angeles to provide all information the commission deems necessary for the commission to determine, in consultation with the State Energy Resources Conservation and Development Commission, the Independent System Operator, and affected publicly owned utilities, the range of working gas necessary to ensure safety and reliability for the region and just and reasonable rates in California. The determination shall be based on best available data, and shall incorporate data from recent and ongoing studies being conducted to determine energy and gas use in the region by the commission, the State Energy Resources Conservation and Development Commission, the Independent System Operator, and affected publicly owned utilities.
(b)Within 30 days of the effective date of the act adding this section, the commission shall publish a report that includes, but is not limited to, all of the following:
(1)The range of working gas necessary at the facility to ensure safety and reliability and just and reasonable rates in California determined pursuant to subdivision (a).
(2)The amount of natural gas production at the facility needed to meet safety and reliability requirements.
(3)The number of wells and associated injection and production capacity required.
(4)The availability of sufficient natural gas production using gas storage wells that have satisfactorily completed testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c) of Section 3217 of the Public Resources Code.
(c)The commission shall make the report required under subdivision (b) available on its Internet Web site and seek, either through written comments or a workshop, public comments on the report.
(d)The executive director of the commission, in consultation with the State Oil and Gas Supervisor, shall direct the operator to maintain the specified range of working gas, determined pursuant to subdivision (a), at the facility to ensure reliability and just and reasonable rates in California, after all of the following occur:
(1)The gas storage well comprehensive safety review is complete pursuant to paragraph (5) of subdivision (c) of Section 3217 of the Public Resources Code.
(2)The State Oil and Gas Supervisor has approved the maximum and minimum reservoir pressure pursuant to subdivision (d) (e) of Section 3217 of the Public Resources Code.
(3)The State Oil and Gas Supervisor has allowed injections of natural gas at the facility, pursuant to subdivision (e) (f) of Section 3217 of the Public Resources Code.
(4)The commission has allowed, and received, public comment on the report pursuant to subdivision (c).
(e)In no case may the volume of working gas set by the executive director of the commission result in reservoir pressures that fall out of the range established pursuant to subdivision (d) (e) of Section 3217 of the Public Resources Code.
(f)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 4.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
SEC. 5.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to mitigate, at the earliest possible time, ongoing harm from the gas leak at the Aliso Canyon natural gas storage facility, and to evaluate the integrity of and the risks associated with gas storage wells at that facility, it is necessary that this act take effect immediately.
(a)The supervisor shall immediately institute a moratorium on injections of natural gas into any gas storage wells located within and serving the Aliso Canyon natural gas storage facility located in the County of Los Angeles until all of the following conditions are met:
(1)The integrity of each gas storage well has been quantitatively and objectively evaluated using state-of-the-art technology, as determined by the supervisor with input from independent experts, and the risks posed by gas storage well failure have been evaluated.
(A)The age, history, and condition of each gas storage well shall be specifically addressed, with particular emphasis on gas storage wells drilled prior to 2006.
(B)The technical methods and equipment used to evaluate gas storage well integrity and the risks posed by gas storage well failure shall be determined by the supervisor with input from independent experts and the public.
(C)The division shall hold at least one public meeting concerning the technical methods and equipment. The division shall request the independent experts to also develop objective criteria to assess the overall risk of the Aliso Canyon natural gas storage facility. The division shall make the objective criteria available to the public.
(2)Any gas storage well posing an enhanced risk of failure has been repaired to mitigate the enhanced risk or plugged and abandoned.
(3)The supervisor determines that the overall risk from gas storage well failure satisfies the supervisors duty pursuant to Section 3106 to prevent damage to life, health, property, and natural resources, and other requirements, as specified in Section 3106.
(4)The Public Utilities Commission and the State Energy Resources Conservation and Development Commission concur with the supervisors determination in paragraph (3).
(b)The supervisor shall prohibit the production of natural gas by any gas storage well originally drilled earlier than 1954 at the Aliso Canyon natural gas storage facility located in the County of Los Angeles until after the integrity of and the risks associated with any of these gas storage wells have been evaluated and determinations by the supervisor, with the concurrence of the commissions, have been made pursuant to the process described in subdivision (a), except when necessary to do either of the following:
(1)Respond to the uncontrolled leak of natural gas from the Standard Sesnon 25 well (American Petroleum Institute identification number 03700776).
(2)Maintain regional energy reliability, at the written direction of the commissions.
(c)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SECTION 1.Section 3217 is added to the Public Resources Code, to read:3217.(a)(1)The supervisor shall continue the prohibition against Southern California Gas Company injecting any natural gas into the Aliso Canyon natural gas storage facility located in the County of Los Angeles until a comprehensive review of the safety of the gas storage wells at the facility is completed and the supervisor determines that well integrity has been ensured by the review, the risks of failures identified in the review have been addressed, and the supervisors duty to prevent damage to life, health, property, and natural resources, and other requirements, as specified in Section 3106, is satisfied. The supervisor may not lift the prohibition on injection until the Executive Director of the Public Utilities Commission has concurred via letter with the supervisor regarding his or her determination of safety.
(2)For purposes of this section, facility means the Aliso Canyon natural gas storage facility located in the County of Los Angeles operated by Southern California Gas Company.
(b)(1)The criteria for the gas storage well comprehensive safety review shall be determined by the supervisor with input from contracted independent experts and shall include the steps in subdivision (c). The division shall hold at least one public meeting to provide the public an opportunity to comment on the criteria.
(2)The supervisor shall direct the contracted independent experts to provide a methodology to be used in assessing the tests and inspections specified in the criteria. This requirement may be satisfied by the independent experts reviewing and, if necessary, revising the divisions written methodology for assessing the tests and inspections specified in the criteria. The methodology shall include all tests and inspections required by the criteria. The division shall post the methodology online on a public portion of its Internet Web site.
(c)The gas storage well comprehensive safety review shall include the following steps to ensure external and internal well mechanical integrity:
(1)All gas storage wells shall be tested and inspected from the surface to the packer or to any wellbore restriction near the top of the geologic formation being used for gas storage, whichever is higher in elevation, to detect existing leaks using temperature and noise logs.
(2)Any leaks shall be stopped and remediated to the satisfaction of the supervisor.
(3)Following remediation, leak detection tests shall be repeated and results reviewed by the supervisor.
(4)(A)Unless a well has been fully plugged and abandoned to the supervisors satisfaction and in accordance with Section 3208, the well shall be evaluated and remediated in accordance with subparagraph (B) or plugged in accordance with subparagraph (C).
(B)If a gas storage well is intended to return to service for the purposes of resuming injections to the facility, it shall be tested and inspected from the surface to the packer or to any wellbore restriction near the top of the geologic formation being used for gas storage, whichever is higher in elevation, to ensure mechanical integrity. As identified in the divisions criteria, these tests and inspections shall include the measurement of casing thickness and integrity, an evaluation of the cement bond on the casing, the determination as to whether any deformities in the well casing exist, and an evaluation of the wells ability to withstand pressures that exceed maximum allowable injection and production pressures, with a reasonable margin for safety, at the facility in accordance with the criteria determined by the supervisor with input from independent experts pursuant to subdivision (b). If the tests reveal that a well poses a risk of failure, the supervisor shall require remediation and repeat tests as necessary to demonstrate to the satisfaction of the supervisor that remediation has mitigated any potential identified risks. If the operator cannot remediate the well to mitigate the identified risks to the satisfaction of the supervisor, the well shall be plugged and abandoned in accordance with Section 3208.
(C)(i)If a well is to be taken out of service before resumption of gas injections at the facility, it shall be removed from operation and isolated from the gas storage reservoir through plugging according to the divisions criteria, including, but not limited to, the demonstration of sufficient cement to prevent migrations between the reservoir and other zones, placement of a mechanical plug at the bottom of the well, and subsequent filling of the well with fluid, and to specifications approved by the supervisor. All gas storage wells that are taken out of service under this subparagraph shall be subjected to ongoing testing and monitoring requirements identified in the criteria determined by the supervisor with input from independent experts. The monitoring shall include, but not be limited to, real-time and daily pressure monitoring, as applicable. A gas storage well shall not be returned to service unless the testing and remediation required under subparagraph (B) has been completed.
(ii)A gas storage well, within one year of being plugged and isolated from the gas storage reservoir pursuant to clause (i), shall either be returned to service by satisfactorily completing the testing and remediation required under subparagraph (B) or be permanently plugged and abandoned to the supervisors satisfaction in accordance with Section 3208.
(D)The supervisor shall make a written finding for each gas storage well that has satisfactorily completed the testing and remediation required under subparagraph (B).
(5)The gas storage well comprehensive safety review is not complete until every gas storage well at the facility has completed the testing and remediation required under subparagraph (B) of paragraph (4), been temporarily abandoned and isolated from the reservoir as required under clause (i) of subparagraph (C) of paragraph (4), or been fully plugged and abandoned to the supervisors satisfaction in accordance with Section 3208.
(d)(1)Before commencing injections at the facility, the operator of the facility shall provide the division with the proposed maximum reservoir pressure and include data and calculations supporting the basis for the pressure limit. The pressure limit shall account for the pressure required to inject intended gas volumes at all proposed inventory levels and the pressure limit shall not exceed the design pressure limits of the reservoir, wells, wellheads, piping, or associated facilities with an appropriate margin for safety.
(2)The operators proposed maximum reservoir pressure shall be subject to review and approval by the supervisor, and the supervisor shall consult with independent experts regarding the appropriate maximum and minimum reservoir pressure at the facility.
(e)Once the gas storage well comprehensive safety review is complete pursuant to paragraph (5) of subdivision (c) and the supervisor has approved the maximum and minimum reservoir pressure pursuant to paragraph (2) of subdivision (d), the supervisor may allow injections of natural gas at the facility.
(f)All gas storage wells returning to service pursuant to subdivision (e) shall only inject or produce gas through the interior metal tubing and not through the annulus between the tubing and the well casing. The operator shall also conduct ongoing pressure monitoring and comply with any other requirements specified by the supervisor.
(g)The gas storage wells at the facility that are plugged and abandoned in accordance with Section 3208 pursuant to this section shall be periodically inspected by the operator for leaks using effective gas leak detection techniques such as optical gas imaging.
(h)(1)Before the completion of the gas storage well comprehensive safety review, production of natural gas from gas storage wells at the facility shall be limited to gas storage wells that have satisfactorily completed the testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c) unless insufficient production capacity is available. Only if production capacity supplied by the tested and remediated wells is demonstrably insufficient may the supervisor allow other gas storage wells to be used.
(2)The supervisor shall direct the operator of the facility to provide a plan to ensure, at the earliest possible time, the availability of sufficient gas production capacity using gas storage wells that have satisfactorily completed the testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c).
(i)With respect to the gas storage well comprehensive safety review at the facility, all testing, inspection and monitoring results reported to the division, gas storage well compliance status, any required remediation steps, and other safety review-related materials shall be posted in a timely manner by the division online on a public portion of its Internet Web site.
(j)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 2.Section 713 714 is added to the Public Utilities Code, to read:713.714.(a)The commission, no later than July 1, 2017, shall determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy and electric reliability for the region. This determination shall be consistent with the Clean Energy and Pollution Reduction Act of 2015 (Chapter 547 of the Statutes of 2015) and Executive Order B-30-2015. The commission shall consult with the State Energy Resources Conservation and Development Commission, the Independent System Operator, the local publicly owned utilities that rely on natural gas for electricity generation, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation, affected balancing authorities, and other relevant government entities, in making its determination.
(b)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 3.Section 715 is added to the Public Utilities Code, to read:715.(a)The commission shall direct the operator of the Aliso Canyon natural gas storage facility located in the County of Los Angeles to provide all information the commission deems necessary for the commission to determine, in consultation with the State Energy Resources Conservation and Development Commission, the Independent System Operator, and affected publicly owned utilities, the range of working gas necessary to ensure safety and reliability for the region and just and reasonable rates in California. The determination shall be based on best available data, and shall incorporate data from recent and on-going studies being conducted to determine energy and gas use in the region by the commission, the State Energy Resources Conservation and Development Commission, the Independent System Operator, and affected publicly owned utilities.
(b)Within 30 days of the effective date of the act adding this section, the commission shall publish a report that includes, but is not limited to, all of the following:
(1)The range of working gas necessary at the facility to ensure safety and reliability and just and reasonable rates in California determined pursuant to subdivision (a).
(2)The amount of natural gas production at the facility needed to meet safety and reliability requirements.
(3)The number of wells and associated injection and production capacity required.
(4)The availability of sufficient natural gas production using gas storage wells that have satisfactorily completed testing and remediation required under subparagraph (B) of paragraph (4) of subdivision (c) of Section 3217 of the Public Resources Code.
(c)The commission shall make the report required under subdivision (b) available on its Internet Web site and seek, either through written comments or a workshop, public comments on the report.
(d)The executive director of the commission, in consultation with the State Oil and Gas Supervisor, shall direct the operator to maintain the specified range of working gas, determined pursuant to subdivision (a), at the facility to ensure reliability and just and reasonable rates in California, after all of the following occur:
(1)The gas storage well comprehensive safety review is complete pursuant to paragraph (5) of subdivision (c) of Section 3217 of the Public Resources Code.
(2)The State Oil and Gas Supervisor has approved the maximum and minimum reservoir pressure pursuant to subdivision (d) of Section 3217 of the Public Resources Code.
(3)The State Oil and Gas Supervisor has allowed injections of natural gas at the facility, pursuant to subdivision (e) of Section 3217 of the Public Resources Code.
(4)The commission has allowed, and received, public comment on the report pursuant to subdivision (c).
(e)In no case may the volume of working gas set by the executive director of the commission result in reservoir pressures that fall out of the range established pursuant to subdivision (d) of Section 3217 of the Public Resources Code.
(f)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 3.SEC. 4.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
SEC. 4.SEC. 5.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to mitigate, at the earliest possible time, ongoing harm from the gas leak at the Aliso Canyon natural gas storage facility, and to evaluate the integrity of and the risks associated with older gas storage wells at that facility, it is necessary that this act take effect immediately.
(a)The supervisor shall immediately institute a moratorium on injections of natural gas into any gas storage wells located within and serving the Aliso Canyon natural gas storage facility located in the County of Los Angeles until all of the following conditions are met:
(1)The integrity of each gas storage well has been quantitatively and objectively evaluated using state-of-the-art technology, as determined by the supervisor with input from independent experts, and the risks posed by gas storage well failure have been evaluated.
(A)The age, history, and condition of each gas storage well shall be specifically addressed, with particular emphasis on gas storage wells drilled prior to 2006.
(B)The technical methods and equipment used to evaluate gas storage well integrity and the risks posed by gas storage well failure shall be determined by the supervisor with input from independent experts and the public.
(C)The division shall hold at least one public meeting concerning the technical methods and equipment. The division shall request the independent experts to also develop objective criteria to assess the overall risk of the Aliso Canyon natural gas storage facility. The division shall make the objective criteria available to the public.
(2)Any gas storage well posing an enhanced risk of failure has been repaired to mitigate the enhanced risk or plugged and abandoned.
(3)The supervisor determines that the overall risk from gas storage well failure satisfies the supervisors duty pursuant to Section 3106 to prevent damage to life, health, property, and natural resources resources, and other requirements. requirements, as specified in Section 3106.
(4)The Public Utilities Commission and the State Energy Resources Conservation and Development Commission concur with the supervisors determination in paragraph (3).
(b)The supervisor shall prohibit the production of natural gas by any gas storage well originally drilled earlier than 1954 at the Aliso Canyon natural gas storage facility located in the County of Los Angeles until after the integrity of and the risks associated with any of these gas storage wells have been evaluated and determinations by the supervisor, with the concurrence of the commissions, have been made pursuant to the process described in subdivision (a), except when necessary to do either of the following:
(1)Respond to the uncontrolled leak of natural gas from the Standard Sesnon 25 well (American Petroleum Institute identification number 03700776).
(2)Maintain regional energy reliability, at the written direction of the commissions.
(c)This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 2.Section 713 is added to the Public Utilities Code, to read:713.The commission commission, no later than July 1, 2017, shall determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy reliability for the region. The commission shall consult with the State Energy Resources Conservation and Development Commission, the Independent System Operator, the local publicly owned utilities that rely on natural gas for electricity generation, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation, and other relevant government entities, in making its determination.
SEC. 3.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
SEC. 4.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to mitigate, at the earliest possible time, ongoing harm from the gas leak at the Aliso Canyon natural gas storage facility, and to evaluate the integrity of and the risks associated with older gas storage wells at that facility, it is necessary that this act take effect immediately.
(a)The supervisor shall immediately institute a moratorium on injections of natural gas into any wells located within and serving the Aliso Canyon storage facility located in the County of Los Angeles until all of the following conditions are met:
(1)The integrity of each well has been quantitatively and objectively evaluated using state-of-the-art technology technology, as determined by the supervisor with input from independent experts, and the risks posed by well failure have been evaluated.
(A)The age, history, and condition of each well shall be specifically addressed, with particular emphasis on wells drilled prior to 2006.
(B)The technical methods and equipment used to evaluate well integrity and the risks posed by well failure shall be determined by the supervisor with input from independent experts and the public through a public process. public.
(C)The division shall hold at least one public meeting concerning the technical methods and equipment. The division shall request the independent experts to also develop objective criteria to assess the overall risk of the facility. The division shall make the objective criteria available to the public.
(2)Any well posing an enhanced risk of failure has been repaired to mitigate the enhanced risk or plugged and abandoned.
(3)The supervisor determines that the overall risk from well failure satisfies the supervisors duty pursuant to Section 3106 to prevent damage to life, health, property, and natural resources and other requirements.
(4)The Public Utilities Commission and the State Energy Resources Conservation and Development Commission concur with the supervisors determination in paragraph (3).
(b)The supervisor shall prohibit the production of natural gas by any well originally drilled earlier than 1954 at the Aliso Canyon storage facility located in the County of Los Angeles until after the integrity of and the risks associated with any of these wells have been evaluated and determinations by the supervisor, with the concurrence of the commissions, have been made pursuant to the process described in subdivision (a), except when necessary to do either of the following:
(1)Respond to the uncontrolled leak of natural gas from the Standard Sesnon 25 well (American Petroleum Institute identification number 03700776).
(2)Maintain regional energy reliability, at the written direction of the commissions.
SEC. 2.Section 713 is added to the Public Utilities Code, to read:713.The commission shall determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy reliability for the region. The commission shall consult with the State Energy Resources Conservation and Development Commission, the Independent System Operator, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation, and other relevant government entities, in making its determination.
SEC. 3.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
SEC. 4.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to mitigate, at the earliest possible time, ongoing harm from the gas leak at the Aliso Canyon storage facility, and to evaluate the integrity of and the risks associated with older wells at that facility, it is necessary that this act take effect immediately.
(a)The supervisor shall immediately institute a moratorium on injections of natural gas into any wells located within and serving the Aliso Canyon storage facility located in the County of Los Angeles until all of the following conditions are met:
(1)The integrity of each well has been quantitatively and objectively evaluated using state-of-the-art technology and the risks posed by well failure have been evaluated.
(A)The age, history, and condition of each well shall be specifically addressed, with particular emphasis on wells drilled prior to 2006.
(B)The technical methods and equipment used to evaluate well integrity and the risks posed by well failure shall be determined by the supervisor with input from independent experts and the public through a public process.
(2)Any well posing an enhanced risk of failure has been repaired to mitigate the enhanced risk or plugged and abandoned.
(3)The supervisor determines that the overall risk from well failure satisfies the supervisors duty pursuant to Section 3106 to prevent damage to life, health, property, and natural resources and other requirements.
(4)The Public Utilities Commission and the State Energy Resources Conservation and Development Commission concur with the supervisors determination in paragraph (3).
(b)The supervisor shall prohibit the production of natural gas by any well originally drilled earlier than 1954 at the Aliso Canyon storage facility located in the County of Los Angeles until after the integrity of and the risks associated with any of these wells have been evaluated and determinations by the supervisor, with the concurrence of the commissions, have been made pursuant to the process described in subdivision (a), except when necessary to do either of the following:
(1)Respond to the uncontrolled leak of natural gas from the Standard Sesnon 25 well (American Petroleum Institute identification number 03700776).
(2)Maintain regional energy reliability, at the written direction of the commissions.
SEC. 2.Section 713 is added to the Public Utilities Code, to read:713.The commission shall determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy reliability for the region. The commission shall consult with the State Energy Resources Conservation and Development Commission, the Independent System Operator, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation, and other relevant government entities, in making its determination.
SEC. 3.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
SEC. 4.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to mitigate, at the earliest possible time, ongoing harm from the gas leak at the Aliso Canyon storage facility, and to evaluate the integrity of and the risks associated with older wells at that facility, it is necessary that this act take effect immediately.
SECTION 1.Article 24 (commencing with Section 70050) is added to Chapter 2 of Part 42 of Division 5 of Title 3 of the Education Code, to read:24.Topline Teacher Recruitment and Retention Program70050.It is the intent of the Legislature to enact legislation to establish the Topline Teacher Recruitment and Retention Program, under the administration of the Student Aid Commission, to make funds available to students at public postsecondary educational institutions who have graduated in the top 5 percent of their secondary school classes and have committed to teaching in public secondary schools for a specified number of years.
It is the intent of the Legislature to enact legislation to establish the Topline Teacher Recruitment and Retention Program, under the administration of the Student Aid Commission, to make funds available to students at public postsecondary educational institutions who have graduated in the top 5 percent of their secondary school classes and have committed to teaching in public secondary schools for a specified number of years.
|
Date
|
Status
|
|---|---|
| Mar 3, 2016 | From committee: Do pass as amended and re-refer to Com. on APPR. (Ayes 13. Noes 0.) (February 22). |
| May 10, 2016 | Chaptered by Secretary of State. Chapter 14, Statutes of 2016. |
| May 10, 2016 | Approved by the Governor. |
| May 4, 2016 | Enrolled and presented to the Governor at 2:30 p.m. |
| May 2, 2016 | Assembly amendments concurred in. (Ayes 37. Noes 0.) Ordered to engrossing and enrolling. |
| May 2, 2016 | Assembly amendments concurred in. (Ayes 37. Noes 0. Page 3734.) Ordered to engrossing and enrolling. |
| Apr 28, 2016 | Read third time. Urgency clause adopted. Passed. (Ayes 70. Noes 2. Page 4591.) Ordered to the Senate. |
| Apr 28, 2016 | Read third time. Urgency clause adopted. Passed. Ordered to the Senate. |
| Apr 28, 2016 | In Senate. Concurrence in Assembly amendments pending. |
| Apr 20, 2016 | Read second time. Ordered to third reading. |
| Apr 19, 2016 | Read second time and amended. Ordered to second reading. |
| Apr 18, 2016 | From committee: Do pass as amended. (Ayes 15. Noes 0.) (April 13). |
| Mar 30, 2016 | From committee with author's amendments. Read second time and amended. Re-referred to Com. on APPR. |
| Mar 7, 2016 | Read second time and amended. Re-referred to Com. on APPR. |
| Feb 24, 2015 | Introduced. Read first time. To Com. on RLS. for assignment. To print. |
| Feb 16, 2016 | From committee with author's amendments. Read second time and amended. Re-referred to Com. on U. & C. |
| Feb 8, 2016 | Referred to Com. on U. & C. |
| Jan 28, 2016 | Unanimous consent granted to take up without reference to file. |
| Jan 28, 2016 | Read third time. Urgency clause adopted. Passed. (Ayes 40. Noes 0. Page 2975.) Ordered to the Assembly. |
| Jan 28, 2016 | Re-referred to Com. on N.R. & W. |
| Jan 28, 2016 | Ordered to third reading. |
| Jan 28, 2016 | Joint Rule 62(a) suspended. |
| Jan 28, 2016 | In Assembly. Read first time. Held at Desk. |
| Jan 28, 2016 | From committee: Do pass. (Ayes 7. Noes 0. Page 2981.) (January 28). |
| Jan 28, 2016 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 9. Noes 0. Page 2981.) (January 28). Re-referred to Com. on APPR. |
| Jan 27, 2016 | From committee with author's amendments. Read second time and amended. Re-referred to Com. on RLS. |
| Mar 5, 2015 | Referred to Com. on RLS. |
| Feb 25, 2015 | From printer. May be acted upon on or after March 27. |
|
Date
|
Description
|
Location
|
Votes
|
|
|---|---|---|---|---|
| May 2, 2016 | Unfinished Business SB380 Pavley Urgency Clause Concurrence | Senate Floor |
Passed |
|
| Apr 28, 2016 | SB 380 Pavley Third Reading Urgency By WILK | Assembly Floor |
Passed |
|
| Apr 13, 2016 | Do pass as amended. | Assembly Standing Committee on Appropriations |
Passed |
|
| Feb 22, 2016 | Do pass as amended and be re-referred to the Committee on [Appropriations] | Assembly Standing Committee on Utilities and Commerce |
Passed |
|
| Jan 28, 2016 | W/O REF. TO FILE SB380 Pavley Urgency Clause | Senate Floor |
Passed |
|
| Jan 28, 2016 | Do pass, but first be re-referred to the Committee on [Appropriations] | Senate Standing Committee on Natural Resources and Water |
Passed |
|
| Jan 28, 2016 | Do pass | Senate Standing Committee on Appropriations |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
|
Organization
|
Position
|
Date
|
|---|---|---|
| Alhambra Chamber of Commerce | ** Against | May 2, 2016 |
| American Chemistry Council | ** Against | May 2, 2016 |
| American Lung Association in California | ** Support | May 2, 2016 |
| Asian Pacific Environmental Network | ** Support | May 2, 2016 |
| Azul | ** Support | May 2, 2016 |
| CalAsian Chamber of Commerce | ** Against | Feb 22, 2016 |
| California Asian Pacific Chamber Of Commerce | ** Against | May 2, 2016 |
| California Business Roundtable | ** Against | May 2, 2016 |
| California Chamber Of Commerce | ** Against | May 2, 2016 |
| California ISO | * Indeterminate | Feb 22, 2016 |
| California League Of Conservation Voters | ** Support | May 2, 2016 |
| California League of Food Processors | ** Against | May 2, 2016 |
| California Manufacturers And Technology Association | ** Against | May 2, 2016 |
| California Retailers Association | ** Against | May 2, 2016 |
| California Taxpayers' Association | ** Against | May 2, 2016 |
| Center on Race, Poverty & the Environment | ** Support | May 2, 2016 |
| Central City Association Of Los Angeles | ** Against | May 2, 2016 |
| Chatsworth Neighborhood Council | ** Support | May 2, 2016 |
| Chatsworth Porter Ranch Chamber of Commerce | ** Support | May 2, 2016 |
| Clean Water Action | ** Support | May 2, 2016 |
| Climate Action Campaign | ** Support | May 2, 2016 |
| Command Packaging | ** Against | May 2, 2016 |
| Congress of California Seniors | ** Against | May 2, 2016 |
| Courage Campaign | ** Support | May 2, 2016 |
| DE Solutions | ** Against | May 2, 2016 |
| Desert Valley Builders Association | ** Against | May 2, 2016 |
| Dignity Health | ** Support | May 2, 2016 |
| El Monte | ** Against | Feb 22, 2016 |
| Energy Commission | * Indeterminate | Feb 22, 2016 |
| Environment California | ** Support | May 2, 2016 |
| Environmental Defense Fund | ** Support | May 2, 2016 |
| Environmental Working Group | ** Support | May 2, 2016 |
| Food & Water Watch | ** Support | May 2, 2016 |
| Foster, Bob | ** Against | Feb 22, 2016 |
| Friends Committee On Legislation Of California | ** Support | May 2, 2016 |
| FuturePorts | ** Against | Feb 22, 2016 |
| Harris Ranch | ** Against | Feb 22, 2016 |
| Harris Ranch Beef Company | ** Against | May 2, 2016 |
| Industrial Environmental Association | ** Against | May 2, 2016 |
| Industry Manufacturers Council | ** Against | May 2, 2016 |
| Inland Empire Economic Partnership | ** Against | May 2, 2016 |
| Keenan Farms, Inc. | ** Against | May 2, 2016 |
| Kelly, James | ** Against | Feb 22, 2016 |
| Kern Economic Development Corporation | ** Against | May 2, 2016 |
| Kheir Clinic | ** Against | May 2, 2016 |
| Los Angeles Area Chamber Of Commerce | ** Against | May 2, 2016 |
| Los Angeles City Council | ** Support | May 2, 2016 |
| Los Angeles County Board of Supervisors | ** Support | May 2, 2016 |
| Los Angeles Latino Chamber of Commerce | ** Against | May 2, 2016 |
| Los Angeles Unified School District | ** Support | May 2, 2016 |
| Mayor Eric Garcetti, City of Los Angeles | ** Support | May 2, 2016 |
| National Parks Conservation Association | ** Support | May 2, 2016 |
| Orange County Business Council | ** Against | May 2, 2016 |
| Page U | ** Support | Feb 22, 2016 |
| People Demanding Action | ** Support | May 2, 2016 |
| Pomona Chamber of Commerce | ** Against | May 2, 2016 |
| Porter Ranch Neighborhood Council | ** Support | May 2, 2016 |
| Religious Action Center of Reform Judaism | ** Support | May 2, 2016 |
| Rootskeeper | ** Support | May 2, 2016 |
| San Fernando Valley Field Deputy | * Support | Feb 22, 2016 |
| San Gabriel Valley Economic Partnership | ** Against | May 2, 2016 |
| Santa Susana Mountain Park Association | ** Support | May 2, 2016 |
| Save Porter Ranch | ** Support | May 2, 2016 |
| Scott Schmerelson, LAUSD District 3 Board | ** Support | May 2, 2016 |
| Shaw Industries Group, Inc. | ** Against | May 2, 2016 |
| Sierra Club California | ** Support | May 2, 2016 |
| South Coast Air Quality Management District | ** Support | May 2, 2016 |
| South El Monte Chamber of Commerce | ** Against | Feb 22, 2016 |
| Southern California Leadership Council | ** Against | May 2, 2016 |
| Southern Californis Gas Company | * Support | Feb 22, 2016 |
| Supervisor Linda Parks, Ventura County | ** Support | May 2, 2016 |
| Sweetener Products Company | ** Against | May 2, 2016 |
| U.S. Representative Ted Lieu | ** Support | May 2, 2016 |
| U.S. Senator Dianne Feinstein | ** Support | May 2, 2016 |
| Ventura, County Of | ** Support | Feb 22, 2016 |
| VerdeXchange Institute | ** Against | May 2, 2016 |
| Voices for Progress | ** Support | May 2, 2016 |
| Vote for Progress, California Office | ** Support | Feb 22, 2016 |
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | SB |
UNFINISHED BUSINESS
Bill No: SB 380
:
SENATE NATURAL RES. & WATER COMMITTEE: 9-0, 1/28/16
AYES: Pavley, Stone, Allen, Hertzberg, Hueso, Jackson, Monning, Vidak, Wolk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 1/28/16
AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen
SENATE FLOOR: 40-0, 1/28/16
AYES: Allen, Anderson, Bates, Beall, Berryhill, Block, Cannella, De León, Fuller, Gaines, Galgiani, Glazer, Hall, Hancock, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson, Lara, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell, Monning, Moorlach, Morrell, Nguyen, Nielsen, Pan, Pavley, Roth, Runner, Stone, Vidak, Wieckowski, Wolk
ASSEMBLY FLOOR: 70-2, 4/28/16 - See last page for vote
DIGEST: This bill continues the moratorium on injection of natural gas at the Aliso Canyon gas storage facility until specified criteria, including testing, are met, requires the feasibility of the storage facility to be addressed and requires the California Public Utilities Commission (Commission), with input from others, to determine the amount of gas necessary at the facility for safety, regional reliability and to ensure just and reasonable rates, as specified, among other provisions. This bill codifies elements of the Governor’s Proclamation of a State of Emergency on January 6, 2016.
Assembly Amendments incorporate the Division of Oil, Gas and Geothermal Resources’ (DOGGR’s) announced comprehensive safety review criteria for well testing, revise and clarify the Commission’s obligations to assess energy reliability, specify the use of a Commission proceeding to address the feasibility of the Aliso Canyon gas storage facility and sunset the bill’s provisions on January 1, 2021.
Existing law:
- Establishes DOGGR in the Department of Conservation.
2) Requires that DOGGR regulate the drilling, operation, maintenance and abandonment of oil and gas wells in the state.
3) Requires DOGGR’s leader, the state oil and gas supervisor (supervisor), to supervise the drilling, operation, maintenance, and abandonment of oil and gas wells and facilities related to oil and gas production within an oil and gas field, among other activities, so as to prevent damage to life, health, property, and natural resources, as provided.
4) Authorizes the Commission to supervise and regulate every public utility in the state.
This bill continues the moratorium on injection of natural gas at the Aliso Canyon gas storage facility until specified criteria, including testing, are met, requires the feasibility of the storage facility to be addressed and requires the Commission, with input from others, to determine the amount of gas necessary at the facility for safety, regional reliability and to ensure just and reasonable rates, as specified, among other provisions. This bill codifies elements of the Governor’s Proclamation of a State of Emergency on January 6, 2016. Specifically, this bill:
- Requires the supervisor to continue prohibiting the Southern California Gas Company (SoCalGas) from injecting gas into the Aliso Canyon gas storage facility until the safety review is completed and the supervisor makes a variety of determinations, as specified.
- Prohibits the supervisor from lifting the prohibition on injection until the Commission executive director has concurred with the determination of safety via letter.
- Requires the supervisor to determine the criteria and methodology for the safety review, as specified.
- Establishes required steps, as specified, for the safety review to ensure external and internal well mechanical integrity.
- Provides the safety review is not complete until all wells are categorized and the appropriate action is taken as follows:
- Gas storage wells have completed testing and remediation;
- Gas storage wells have been temporarily abandoned and isolated from the reservoir; or
- Gas storage wells have been fully plugged and abandoned, as specified.
- Requires the operator of the facility to propose maximum reservoir pressure limits and associated data to DOGGR before commencing operations. Requires the supervisor to review and approve the maximum reservoir pressure limit, as specified.
- Requires any wells returning to service to inject or produce gas only through interior metal tubing, and expressly prohibits injection or production through the annulus (space) between the tubing and the well casing. Requires wells returning to service to conduct ongoing pressure monitoring and comply with any other requirements specified by the supervisor.
- Requires plugged and abandoned wells to be periodically inspected, as specified.
- Prior to the completion of the safety review, limits the production of natural gas to wells that have completed testing and remediation unless insufficient production capacity is available, as specified.
- Requires DOGGR to hold a noticed public hearing in the community on the safety review findings, as well as the proposed pressure limits prior to commencing operations at the facility.
- Requires DOGGR to post all testing, safety review, and compliance status and remediation requirements on its Web site in a timely manner.
- Requires the Commission, no later than July 1, 2017, to open a proceeding to determine the feasibility of diminishing or eliminating the use of the Aliso Canyon natural gas storage facility while maintaining energy reliability in the region. Requires the Commission to consult with the California Energy Commission (CEC), Independent System Operator (ISO), locally public owned utilities, DOGGR, affected balancing authorities, and other relevant government entities prior to making its determination.
- Requires the Commission to publish a report within 30 days of enactment of this bill regarding gas production at the facility. Requires the Commission to seek public comments and publish the report on its Internet Web site.
- Requires the Commission’s executive director to direct the operations of the facility, as specified, to ensure reliability and just and reasonable rates.
- Sunsets the provisions of this bill on January 1, 2021.
Background
On October 23, 2015, a significant uncontrolled natural gas leak from a gas storage well (“SS-25”) was discovered. The well is located in SoCalGas’ Aliso Canyon natural gas storage facility located in northeastern Los Angeles County. This well is located uphill from and approximately 1-1/4 miles away from homes in the Porter Ranch community. The storage facility is the largest in the western United States. The leak received local, national and international news coverage.
The leak caused severe disruption in the vicinity. Over 8,000 households relocated at some point during the almost four months of the leak (at SoCalGas’ expense) and the Los Angeles County Department of Public Health and the local air quality regulator (the South Coast Air Quality Management District) received thousands of health and odor complaints between them. The Los Angeles Unified School District relocated two schools. Several news reports cite losses for local businesses. After drilling a relief well, SS-25 was finally “killed” and the leak was declared stopped on February 18, 2016. Estimates are that 100,000 metric tons of methane, a potent greenhouse gas and short-lived climate pollutant, were emitted to the atmosphere from the leak.
Over two months after the leak was stopped, public health complaints continue from many who have returned to their homes. Community monitoring of ambient concentrations of methane, benzene and related gases also continues.
State agency response. Numerous state agencies responded to the leak as the magnitude became clear. On January 6, 2016, the Governor issued a Proclamation directing various state entities to oversee SoCalGas' actions to stop the leak, protect public safety, ensure accountability and strengthen oversight of natural gas storage facilities.
The Aliso Canyon gas storage facility is under the jurisdiction of the Commission, although DOGGR has jurisdiction over the wells. Both the Commission and DOGGR have active investigations of the leak underway. No natural gas has been injected into the facility since October 25, 2016, and in late January 2016, the Commission ordered SoCalGas to retain 15 billion cubic feet of working gas in the facility for use, as needed, as gas supply.
On March 4, 2016, DOGGR issued an order to SoCalGas to follow a comprehensive safety review, upgrade equipment and detection devices, and plug and abandon wells as specified. This order prohibits the supervisor from lifting the injection prohibition until all specified requirements have been met.
Energy reliability. The Governor’s Proclamation requires the Commission and CEC, in coordination with the ISO, to take all steps necessary to ensure energy reliability during the moratorium. A report assessing summer reliability was issued in early April followed by a public workshop. Efforts continue to assess winter reliability. Under the California Emergency Services Act, the Governor has the authority to take all actions necessary in the event of a sudden and severe energy shortage.
Additionally, news reports indicate that SoCalGas anticipates meeting the DOGGR safety criteria in the late summer. As of April 29, almost all of the 114 wells at the facility have completed the first two leak tests, nine wells have undergone the additional four proactive tests required by the criteria to return to service and seven more wells are undergoing the proactive tests. Information on the tests is available on DOGGR’s Web site. Eight work-over rigs are at work on wells at Aliso Canyon now and SoCalGas has stated publicly that more may be brought in.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
According to the Assembly Appropriations Committee, for a prior version of this bill, this bill increases Commission costs by approximately $1.7 million for the require proceeding, increase DOGGR costs by an estimated $250,000 or more and have the potential to increase costs an unknown amount to the CEC and ISO for their required roles.
American Lung Association in California
Asian Pacific Environmental Network
Azul
California League of Conservation Voters
California Public Interest Research Group
Center on Race, Poverty & the Environment
Chatsworth Neighborhood Council
Chatsworth Porter Ranch Chamber of Commerce
Clean Water Action
Climate Action Campaign
Courage Campaign
Dignity Health
Environment California
Environmental Defense Fund
Environmental Working Group
Food & Water Watch
Friends Committee on Legislation of California
Los Angeles City Council
Los Angeles County Board of Supervisors
Los Angeles Unified School District
Mayor Eric Garcetti, City of Los Angeles
National Parks Conservation Association
People Demanding Action
Porter Ranch Neighborhood Council
Religious Action Center of Reform Judaism
Rootskeeper
Santa Susana Mountain Park Association
Save Porter Ranch
Scott Schmerelson, LAUSD District 3 Board
Sierra Club California
South Coast Air Quality Management District
Supervisor Linda Parks, Ventura County
U.S. Representative Ted Lieu
U.S. Senator Dianne Feinstein
Voices for Progress
Alhambra Chamber of Commerce
American Chemistry Council
California Asian Pacific Chamber of Commerce
California Business Roundtable
California Chamber of Commerce
California League of Food Processors
California Manufacturers and Technology Association
California Retailers Association
California Taxpayers Association
Central City Association of Los Angeles
Command Packaging
Congress of California Seniors
DE Solutions
Desert Valley Builders Association
Harris Ranch Beef Company
Industrial Environmental Association
Industry Manufacturers Council
Inland Empire Economic Partnership
Keenan Farms, Inc.
Kern Economic Development Corporation
Kheir Clinic
Los Angeles Area Chamber of Commerce
Los Angeles Latino Chamber of Commerce
Orange County Business Council
Pomona Chamber of Commerce
San Gabriel Valley Economic Partnership
Shaw Industries Group, Inc.
Southern California Leadership Council
Sweetener Products Company
VerdeXchange Institute
Western Milling Quality Feeds
Western States Petroleum Association
Wiretech, Inc.
ARGUMENTS IN SUPPORT: According to the author, “Now that the leak is stopped, the community and many of my constituents remain deeply concerned and worried about moving back home. Health complaints have continued for many who have moved back.”
“SB 380 provides a statutory framework for the gas storage wells at Aliso Canyon only to be rigorously evaluated and the risks to the community minimized before injections of natural gas restart at the facility.”
“The amendments reflect the Administration’s safety criteria which allow for some wells to be temporarily plugged and go offline in order to speed up the inspection of the other wells so that the facility could be cleared for injections which could occur if needed for energy reliability. Additional equipment and operators could accelerate this process further without compromising safety.”
“SB 380 will ensure that operations at the Aliso Canyon storage facility do not rapidly return to resuming injections into and withdrawals from wells that have not been sufficiently inspected for leaks. It is a far greater risk to rush too quickly to increase pressure in the reservoir which could cause another leak. Certainty about safety and energy reliability must be provided to the community and the entire LA region.”
ARGUMENTS IN OPPOSITION: Opponents generally express concern about the risk of gas supply interruption during the injection moratorium at the Aliso Canyon storage facility and seek specific language to provide an exception to the moratorium for energy reliability.
For example, in a joint sign-on letter, the California Manufacturers and Technology Association and others state “We strongly urge you to amend SB 380 to ensure ongoing natural gas supplies critical to Southern California for both power generation and industrial customers. We believe that this may be accomplished in a safe manner by allowing state regulators to permit injection when it has been deemed necessary for maintaining reliability of natural gas and electrical supplies.
ASSEMBLY FLOOR: 70-2, 4/28/16
AYES: Achadjian, Alejo, Arambula, Atkins, Baker, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Dodd, Eggman, Frazier, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon
NOES: Beth Gaines, Grove
NO VOTE RECORDED: Travis Allen, Bigelow, Chávez, Daly, Mathis, Mayes, Olsen, Patterson
5/2/16 10:01:15
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | SB |
UNFINISHED BUSINESS
Bill No: SB 380
:
SENATE NATURAL RES. & WATER COMMITTEE: 9-0, 1/28/16
AYES: Pavley, Stone, Allen, Hertzberg, Hueso, Jackson, Monning, Vidak, Wolk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 1/28/16
AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen
SENATE FLOOR: 40-0, 1/28/16
AYES: Allen, Anderson, Bates, Beall, Berryhill, Block, Cannella, De León, Fuller, Gaines, Galgiani, Glazer, Hall, Hancock, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson, Lara, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell, Monning, Moorlach, Morrell, Nguyen, Nielsen, Pan, Pavley, Roth, Runner, Stone, Vidak, Wieckowski, Wolk
ASSEMBLY FLOOR: 70-2, 4/28/16 - See last page for vote
DIGEST: This bill continues the moratorium on injection of natural gas at the Aliso Canyon gas storage facility until specified criteria, including testing, are met, requires the feasibility of the storage facility to be addressed and requires the California Public Utilities Commission (Commission), with input from others, to determine the amount of gas necessary at the facility for safety, regional reliability and to ensure just and reasonable rates, as specified, among other provisions. This bill codifies elements of the Governor’s Proclamation of a State of Emergency on January 6, 2016.
Assembly Amendments incorporate the Division of Oil, Gas and Geothermal Resources’ (DOGGR’s) announced comprehensive safety review criteria for well testing, revise and clarify the Commission’s obligations to assess energy reliability, specify the use of a Commission proceeding to address the feasibility of the Aliso Canyon gas storage facility and sunset the bill’s provisions on January 1, 2021.
Existing law:
- Establishes DOGGR in the Department of Conservation.
2) Requires that DOGGR regulate the drilling, operation, maintenance and abandonment of oil and gas wells in the state.
3) Requires DOGGR’s leader, the state oil and gas supervisor (supervisor), to supervise the drilling, operation, maintenance, and abandonment of oil and gas wells and facilities related to oil and gas production within an oil and gas field, among other activities, so as to prevent damage to life, health, property, and natural resources, as provided.
4) Authorizes the Commission to supervise and regulate every public utility in the state.
This bill continues the moratorium on injection of natural gas at the Aliso Canyon gas storage facility until specified criteria, including testing, are met, requires the feasibility of the storage facility to be addressed and requires the Commission, with input from others, to determine the amount of gas necessary at the facility for safety, regional reliability and to ensure just and reasonable rates, as specified, among other provisions. This bill codifies elements of the Governor’s Proclamation of a State of Emergency on January 6, 2016. Specifically, this bill:
- Requires the supervisor to continue prohibiting the Southern California Gas Company (SoCalGas) from injecting gas into the Aliso Canyon gas storage facility until the safety review is completed and the supervisor makes a variety of determinations, as specified.
- Prohibits the supervisor from lifting the prohibition on injection until the Commission executive director has concurred with the determination of safety via letter.
- Requires the supervisor to determine the criteria and methodology for the safety review, as specified.
- Establishes required steps, as specified, for the safety review to ensure external and internal well mechanical integrity.
- Provides the safety review is not complete until all wells are categorized and the appropriate action is taken as follows:
- Gas storage wells have completed testing and remediation;
- Gas storage wells have been temporarily abandoned and isolated from the reservoir; or
- Gas storage wells have been fully plugged and abandoned, as specified.
- Requires the operator of the facility to propose maximum reservoir pressure limits and associated data to DOGGR before commencing operations. Requires the supervisor to review and approve the maximum reservoir pressure limit, as specified.
- Requires any wells returning to service to inject or produce gas only through interior metal tubing, and expressly prohibits injection or production through the annulus (space) between the tubing and the well casing. Requires wells returning to service to conduct ongoing pressure monitoring and comply with any other requirements specified by the supervisor.
- Requires plugged and abandoned wells to be periodically inspected, as specified.
- Prior to the completion of the safety review, limits the production of natural gas to wells that have completed testing and remediation unless insufficient production capacity is available, as specified.
- Requires DOGGR to hold a noticed public hearing in the community on the safety review findings, as well as the proposed pressure limits prior to commencing operations at the facility.
- Requires DOGGR to post all testing, safety review, and compliance status and remediation requirements on its Web site in a timely manner.
- Requires the Commission, no later than July 1, 2017, to open a proceeding to determine the feasibility of diminishing or eliminating the use of the Aliso Canyon natural gas storage facility while maintaining energy reliability in the region. Requires the Commission to consult with the California Energy Commission (CEC), Independent System Operator (ISO), locally public owned utilities, DOGGR, affected balancing authorities, and other relevant government entities prior to making its determination.
- Requires the Commission to publish a report within 30 days of enactment of this bill regarding gas production at the facility. Requires the Commission to seek public comments and publish the report on its Internet Web site.
- Requires the Commission’s executive director to direct the operations of the facility, as specified, to ensure reliability and just and reasonable rates.
- Sunsets the provisions of this bill on January 1, 2021.
Background
On October 23, 2015, a significant uncontrolled natural gas leak from a gas storage well (“SS-25”) was discovered. The well is located in SoCalGas’ Aliso Canyon natural gas storage facility located in northeastern Los Angeles County. This well is located uphill from and approximately 1-1/4 miles away from homes in the Porter Ranch community. The storage facility is the largest in the western United States. The leak received local, national and international news coverage.
The leak caused severe disruption in the vicinity. Over 8,000 households relocated at some point during the almost four months of the leak (at SoCalGas’ expense) and the Los Angeles County Department of Public Health and the local air quality regulator (the South Coast Air Quality Management District) received thousands of health and odor complaints between them. The Los Angeles Unified School District relocated two schools. Several news reports cite losses for local businesses. After drilling a relief well, SS-25 was finally “killed” and the leak was declared stopped on February 18, 2016. Estimates are that 100,000 metric tons of methane, a potent greenhouse gas and short-lived climate pollutant, were emitted to the atmosphere from the leak.
Over two months after the leak was stopped, public health complaints continue from many who have returned to their homes. Community monitoring of ambient concentrations of methane, benzene and related gases also continues.
State agency response. Numerous state agencies responded to the leak as the magnitude became clear. On January 6, 2016, the Governor issued a Proclamation directing various state entities to oversee SoCalGas' actions to stop the leak, protect public safety, ensure accountability and strengthen oversight of natural gas storage facilities.
The Aliso Canyon gas storage facility is under the jurisdiction of the Commission, although DOGGR has jurisdiction over the wells. Both the Commission and DOGGR have active investigations of the leak underway. No natural gas has been injected into the facility since October 25, 2016, and in late January 2016, the Commission ordered SoCalGas to retain 15 billion cubic feet of working gas in the facility for use, as needed, as gas supply.
On March 4, 2016, DOGGR issued an order to SoCalGas to follow a comprehensive safety review, upgrade equipment and detection devices, and plug and abandon wells as specified. This order prohibits the supervisor from lifting the injection prohibition until all specified requirements have been met.
Energy reliability. The Governor’s Proclamation requires the Commission and CEC, in coordination with the ISO, to take all steps necessary to ensure energy reliability during the moratorium. A report assessing summer reliability was issued in early April followed by a public workshop. Efforts continue to assess winter reliability. Under the California Emergency Services Act, the Governor has the authority to take all actions necessary in the event of a sudden and severe energy shortage.
Additionally, news reports indicate that SoCalGas anticipates meeting the DOGGR safety criteria in the late summer. As of April 29, almost all of the 114 wells at the facility have completed the first two leak tests, nine wells have undergone the additional four proactive tests required by the criteria to return to service and seven more wells are undergoing the proactive tests. Information on the tests is available on DOGGR’s Web site. Eight work-over rigs are at work on wells at Aliso Canyon now and SoCalGas has stated publicly that more may be brought in.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
According to the Assembly Appropriations Committee, for a prior version of this bill, this bill increases Commission costs by approximately $1.7 million for the require proceeding, increase DOGGR costs by an estimated $250,000 or more and have the potential to increase costs an unknown amount to the CEC and ISO for their required roles.
American Lung Association in California
Asian Pacific Environmental Network
Azul
California League of Conservation Voters
California Public Interest Research Group
Center on Race, Poverty & the Environment
Chatsworth Neighborhood Council
Chatsworth Porter Ranch Chamber of Commerce
Clean Water Action
Climate Action Campaign
Courage Campaign
Dignity Health
Environment California
Environmental Defense Fund
Environmental Working Group
Food & Water Watch
Friends Committee on Legislation of California
Los Angeles City Council
Los Angeles County Board of Supervisors
Los Angeles Unified School District
Mayor Eric Garcetti, City of Los Angeles
National Parks Conservation Association
People Demanding Action
Porter Ranch Neighborhood Council
Religious Action Center of Reform Judaism
Rootskeeper
Santa Susana Mountain Park Association
Save Porter Ranch
Scott Schmerelson, LAUSD District 3 Board
Sierra Club California
South Coast Air Quality Management District
Supervisor Linda Parks, Ventura County
U.S. Representative Ted Lieu
U.S. Senator Dianne Feinstein
Voices for Progress
OPPOSITION: (Verified 4/29/16)
Alhambra Chamber of Commerce
California Asian Pacific Chamber of Commerce
California Business Roundtable
California Chamber of Commerce
California League of Food Processors
California Manufacturers and Technology Association
California Retailers Association
Central City Association of Los Angeles
Command Packaging
Congress of California Seniors
DE Solutions
Desert Valley Builders Association
Harris Ranch Beef Company
Industry Manufacturers Council
Inland Empire Economic Partnership
Keenan Farms, Inc.
Kern Economic Development Corporation
Kheir Clinic
Los Angeles Area Chamber of Commerce
Los Angeles Latino Chamber of Commerce
Orange County Business Council
Pomona Chamber of Commerce
San Gabriel Valley Economic Partnership
Shaw Industries Group, Inc.
Southern California Leadership Council
Sweetener Products Company
VerdeXchange Institute
Western Milling Quality Feeds
Western States Petroleum Association
Wiretech, Inc.
ARGUMENTS IN SUPPORT: According to the author, “Now that the leak is stopped, the community and many of my constituents remain deeply concerned and worried about moving back home. Health complaints have continued for many who have moved back.”
“SB 380 provides a statutory framework for the gas storage wells at Aliso Canyon only to be rigorously evaluated and the risks to the community minimized before injections of natural gas restart at the facility.”
“The amendments reflect the Administration’s safety criteria which allow for some wells to be temporarily plugged and go offline in order to speed up the inspection of the other wells so that the facility could be cleared for injections which could occur if needed for energy reliability. Additional equipment and operators could accelerate this process further without compromising safety.”
“SB 380 will ensure that operations at the Aliso Canyon storage facility do not rapidly return to resuming injections into and withdrawals from wells that have not been sufficiently inspected for leaks. It is a far greater risk to rush too quickly to increase pressure in the reservoir which could cause another leak. Certainty about safety and energy reliability must be provided to the community and the entire LA region.”
ARGUMENTS IN OPPOSITION: Opponents generally express concern about the risk of gas supply interruption during the injection moratorium at the Aliso Canyon storage facility and seek specific language to provide an exception to the moratorium for energy reliability.
For example, in a joint sign-on letter, the California Manufacturers and Technology Association and others state “We strongly urge you to amend SB 380 to ensure ongoing natural gas supplies critical to Southern California for both power generation and industrial customers. We believe that this may be accomplished in a safe manner by allowing state regulators to permit injection when it has been deemed necessary for maintaining reliability of natural gas and electrical supplies.
ASSEMBLY FLOOR: 70-2, 4/28/16
AYES: Achadjian, Alejo, Arambula, Atkins, Baker, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Dodd, Eggman, Frazier, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon
NOES: Beth Gaines, Grove
NO VOTE RECORDED: Travis Allen, Bigelow, Chávez, Daly, Mathis, Mayes, Olsen, Patterson
4/29/16 12:39:21
SENATE THIRD READING
STR Bill Id:SB 380
Author:(Pavley)
As Amended Ver:
2/3 vote. Urgency
SENATE VOTE: 40-0
Committee | Votes | Ayes | Noes |
Utilities | 13-0 | Gatto, Achadjian, Bonilla, Burke, Dahle, Eggman, Hadley, Roger Hernández, Obernolte, Quirk, Santiago, Ting, Williams | |
Appropriations | 15-0 | Gonzalez, Bloom, Bonilla, Bonta, Calderon, Daly, Eggman, Eduardo Garcia, Roger Hernández, Holden, Obernolte, Quirk, Santiago, Weber, Wood |
SUMMARY: Continues the moratorium on injecting natural gas into the Aliso Canyon gas storage facility, requires the Department of Conservation's Division of Oil, Gas and Geothermal Resources (DOGGR) to complete a gas storage well comprehensive safety review (safety review), and requires the California Public Utilities Commission (CPUC) to determine the feasibility of minimizing or eliminating use of the facility, as specified. This bill, in part, codifies administrative actions ordered by the Governor in his January 6, 2019, Proclamation of a State Emergency. Specifically, this bill:
- Requires the DOGGR Supervisor (Supervisor) to continue prohibiting the Southern California Gas Company (SoCalGas) from injecting gas into the Aliso Canyon Storage Facility until the safety review is completed and the Supervisor makes a variety of determinations, as specified.
- Prohibits the Supervisor from lifting the prohibition on injection until the CPUC has concurred with the determination of safety via letter.
- Requires the Supervisor to determine the criteria and methodology for the safety review, as specified. Requires DOGGR to hold a noticed public hearing in the community on the safety review findings, as well as the proposed pressure limits prior to commencing operations at the facility.
- Establishes required steps, as specified, for the safety review to ensure external and internal well mechanical integrity.
- Provides the safety review is not complete until all wells are categorized and the appropriate action is taken as follows: a) gas storage wells have completed testing and remediation; b) gas storage wells have been temporarily abandoned and isolated from the reservoir; or c) gas storage wells have been fully plugged and abandoned, as specified.
- Requires the operator of the facility to propose maximum reservoir pressure limits and associated data to DOGGR before commencing operations. Requires the Supervisor to review and approve the maximum reservoir pressure limit, as specified.
- Requires any wells returning to service to inject or produce gas only through interior metal tubing, and expressly prohibits injection or production through the annulus (space) between the tubing and the well casing. Requires wells returning to service to conduct ongoing pressure monitoring and comply with any other requirements specified by the Supervisor.
- Requires plugged and abandoned wells to be periodically inspected, as specified.
- Prior to the completion of the safety review, limits the production of natural gas to wells that have completed testing and remediation unless insufficient production capacity is available, as specified.
- Requires DOGGR to post all testing, safety review, and compliance status and remediation requirements on its Web site in a timely manner.
- Requires the CPUC, no later than July 1, 2017, to open a proceeding to determine the feasibility of diminishing or eliminating the use of the Aliso Canyon natural gas storage facility while maintaining energy reliability in the region. Requires the CPUC to consult with the California Energy Commission (CEC), Independent System Operator (ISO), locally public owned utilities, DOGGR, affected balancing authorities, and other relevant government entities prior to making its determination.
- Requires the CPUC to publish a report within 30 days of enactment of this bill regarding gas production at the facility. Requires the CPUC to seek public comments and publish the report on its Internet Web site.
- Requires the CPUC Executive Director to direct the operations of the facility, as specified, to ensure reliability and just and reasonable rates.
- Sunsets the provisions of this bill on January 1, 2021.
FISCAL EFFECT: According to the Assembly Appropriations Committee:
- Increased costs for the CPUC of approximately $1.7 million to determine the feasibility of a full or partial closure of the facility through a proceeding (Public Utilities Commission Utilities Reimbursement Account.)
- To the extent this bill requires DOGGR to repeat steps already taken, increased costs of $250,000 or more (Oil, Gas, and Geothermal Administrative Fund).
- Potential unknown increased costs for CEC and ISO to consult with DOGGR and the CPUC as specified (special fund).
COMMENTS:
- Purpose: According to the author, the leak of natural gas from the Aliso Canyon facility posed a public health and climate emergency. This bill builds upon and codifies portions of the Governor's State of Emergency declaration and proposed emergency regulations and DOGGR orders.
- Aliso Canyon Gas Leak: The Aliso Canyon Gas Storage Facility is owned by SoCalGas and is located in Los Angeles County just north of Porter Ranch. SoCalGas is a gas corporation regulated by the CPUC.
On October 23, 2015, SoCalGas detected a methane gas leak at its Aliso Canyon Gas Storage Facility at Well # SS-25. Following an initial evaluation and several attempts to stop the leak, SoCalGas began drilling a relief well in order to plug the leaking well. The initial attempts to plug the leak failed, and the leak lasted 112 days before being permanently capped on February 18, 2016.
A study in the journal Science confirmed that the methane gas leak was not only the largest in California's history, but also the second largest in the nation. According to the lead author of the study, as much as 60 metric tons of methane spewed from the leak each hour.
The leak displaced nearly 2,290 households, requiring families to move into temporary housing and hotels provided by SoCalGas.
Since October 25, 2016, no natural gas has been injected into the facility.
- Chronology of Events and State Response: Following the detection of the leak, in November and December 2015, DOGGR and the CPUC issued orders establishing a moratorium on natural gas injection at Aliso Canyon. The orders included requirements to provide data, retain evidence, and track the costs of the effort to plug the well. Additionally, the Air Resources Board (ARB) began collecting and publishing data on methane emissions caused by the leak.
On January 6, 2016, the Governor issued a Proclamation directing various state entities to oversee SoCalGas' actions to stop the leak, protect public safety, ensure accountability and strengthen oversight of natural gas storage facilities.
On February 11, 2016, SoCalGas announced it had temporarily controlled the flow of natural gas at the leaking well and would continue to work in coordination with DOGGR and other agencies during the process of permanently sealing the well.
On February 18, 2016, DOGGR confirmed the leaking well was permanently sealed and taken out of service. On March 4, 2016, DOGGR issued an order to SoCalGas to follow a comprehensive safety review, upgrade equipment and detection devices, and plug and abandon wells as specified. This order prohibits the Supervisor from lifting the injection prohibition until all specified requirements have been met.
On March 28, 2016, the CPUC, DOGGR, ARB, and CEC issued an update on the status of state actions taken in response to the gas leak.
- Governor's Emergency Proclamation and Budget Proposals: In addition to the provisions in this bill, the Governor's Proclamation required DOGGR to issue emergency regulations and require all gas storage facilities in the state to undertake specific actions to protect against uncontrolled has leaks. Additionally, the Proclamation: a) requires ARB to expand its monitoring of emissions in the community; b) requires the Office of Environmental Health Hazzard Assessment to review health concerns and determine if additional measures are necessary; and c) requires the CPUC and CEC, in coordination with the ISO, to take all steps necessary to ensure energy reliability during the moratorium.
Analysis Prepared by: Sue Kateley / U. & C. / (916) 319-2083 FN: 0002760
Date of Hearing: April 13, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
SBPCA Bill Id:SB 380
Author:(Pavley) – As Amended Ver:March 30, 2016
Policy Committee: | Utilities and Commerce | Vote: | 13 - 0 |
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Urgency: Yes State Mandated Local Program: Yes Reimbursable: No
SUMMARY:
This bill continues the moratorium on injecting natural gas into the Aliso Canyon gas storage facility, requires the Division of Oil, Gas and Geothermal Resources (DOGGR) to complete a gas storage well comprehensive safety review (safety review), and requires the California Public Utilities Commission (PUC) to determine the feasibility of minimizing or eliminating use of the facility, as specified. This bill, in part, codifies administrative actions ordered by the Governor in his January 6, 2019 Proclamation of a State Emergency. Specifically, this bill:
- Requires the DOGGR Supervisor to continue prohibiting the Southern California Gas Company (SoCalGas) from injecting gas into the Aliso Canyon Storage Facility until the safety review is completed and the Supervisor makes a variety of determinations, as specified.
- Prohibits the Supervisor from lifting the prohibition on injection until the PUC has concurred with the determination of safety via letter.
- Requires the Supervisor to determine the criteria and methodology for the safety review, as specified. Requires DOGGR to hold at least one public meeting to provide the opportunity for comment on the criteria.
- Establishes required steps, as specified, for the safety review to ensure external and internal well mechanical integrity.
- Provides the safety review is not complete until all wells are categorized and the appropriate action is taken as follows: a) gas storage wells have completed testing and remediation; b) gas storage wells have been temporarily abandoned and isolated from the reservoir; or c) gas storage wells have been fully plugged and abandoned, as specified.
- Requires the operator of the facility to propose maximum reservoir pressure limits and associated data to DOGGR before commencing operations. Requires the Supervisor to review and approve the maximum reservoir pressure limit, as specified.
- Requires any wells returning to service to inject or produce gas only through interior metal tubing, and expressly prohibits injection or production through the annulus (space ) between the tubing and the well casing. Requires wells returning to service to conduct ongoing pressure monitoring and comply with any other requirements specified by the Supervisor.
- Requires plugged and abandoned wells to be periodically inspected, as specified.
- Prior to the completion of the safety review, limits the production of natural gas to wells that have completed testing and remediation unless insufficient production capacity is available, as specified.
- Requires DOGGR to post all testing, safety review, and compliance status and remediation requirements on its website in a timely manner.
- Requires the PUC, no later than July 1, 2017, to determine the feasibility of diminishing or eliminating the use of the Aliso Canyon natural gas storage facility while maintaining energy reliability in the region. Requires the PUC to consult with the California Energy Commission (CEC), Independent System Operator (ISO), locally public owned utilities, DOGGR, affected balancing authorities, and other relevant government entities prior to making its determination.
- Requires the PUC to publish a report within 30 days of enactment of the bill regarding gas production at the facility. Requires the PUC to seek public comments and publish the report on its Internet Web site.
- Requires the PUC Executive Director to direct the operations of the facility, as specified, to ensure reliability and just and reasonable rates.
- Sunsets January 1, 2021
FISCAL EFFECT:
- Increased costs for the PUC of approximately $1.7 million to determine the feasibility of a full or partial closure of the facility through a proceeding (Public Utilities Commission Utilities Reimbursement Account.)
- To the extent this bill requires DOGGR to repeat steps already taken, increased costs of $250,000 or more (Oil, Gas, and Geothermal Administrative Fund).
- Potential unknown increased costs for CEC and ISO to consult with DOGGR and the PUC as specified (special fund).
COMMENTS:
- Purpose. According to the author, the leak of natural gas from the Aliso Canyon facility posed a public health and climate emergency. This bill builds upon and codifies portions of the Governor's State of Emergency declaration and proposed emergency regulations and DOGGR orders.
- Aliso Canyon Gas Leak. The Aliso Canyon Gas Storage Facility is owned by the SoCalGas and is located in Los Angeles County just north of Porter Ranch. SoCalGas is a gas corporation regulated by the PUC.
On October 23, 2015, SoCalGas detected a methane gas leak at its Aliso Canyon Gas Storage Facility at Well # SS-25. Following an initial evaluation and several attempts to stop the leak, SoCalGas began drilling a relief well in order to plug the leaking well. The initial attempts to plug the leak failed, and the leak lasted 112 days before being permanently capped on February 18, 2016.
A study in the journal Science confirmed that the methane gas leak was not only the largest in California's history, but also the second largest in the nation. According to the lead author of the study, as much as 60 metric tons of methane spewed from the leak each hour.
The leak displaced nearly 2,290 households, requiring families to move into temporary housing and hotels provided by SoCalGas.
Since October 25, 2016, no natural gas has been injected into the facility.
- Chronology of Events and State Response. Following the detection of the leak, in November and December 2015, DOGGR and the PUC issued orders establishing a moratorium on natural gas injection at Aliso Canyon. The orders included requirements to provide data, retain evidence, and track the costs of the effort to plug the well. Additionally, the Air Resources Board (ARB) began collecting and publishing data on methane emissions caused by the leak.
On January 6, 2016, the Governor issued a Proclamation directing various state entities to oversee SoCalGas' actions to stop the leak, protect public safety, ensure accountability and strengthen oversight of natural gas storage facilities.
On February 11, 2016, SoCalGas announced it had temporarily controlled the flow of natural gas at the leaking well and would continue to work in coordination with DOGGR and other agencies during the process of permanently sealing the well.
On February 18, 2016, DOGGR confirmed the leaking well was permanently sealed and taken out of service.
On March 4, 2016, DOGGR issued an order to SoCal Gas to follow a comprehensive safety review, upgrade equipment and detection devices, and plug and abandon wells as specified. This order prohibits the Supervisor from lifting the injection prohibition until all specified requirements have been met.
On March 28, 2016, the PUC, DOGGR, ARB, and CEC issued an update on the status of state actions taken in response to the gas leak.
- Governor's Emergency Proclamation and Budget Proposals. In addition to the provisions in this bill, the Governor's Proclamation required DOGGR to issue emergency regulations and require all gas storage facilities in the state to undertake specific actions to protect against uncontrolled has leaks. Additionally, the Proclamation: 1) requires ARB to expand its monitoring of emissions in the community; 2) requires the Office of Environmental Health Hazzard Assessment (OEHHA) to review health concerns and determine if additional measures are necessary; and 3) requires the PUC and CEC, in coordination with the ISO, to take all steps necessary to ensure energy reliability during the moratorium.
On April 1, 2016 the Governor revised his proposed January budget to include additional augmentations to the following agencies to implement the directed actions and improve public safety statewide:
- CEC – $1,739,000 and three positions to monitor, model and analyze the interaction of electricity and natural gas systems for reliability (Public Interest Research, Development, and Demonstration Fund);
- DOGGR – $4,172,000 and 20 positions to support increased regulatory activities and $1 million to increase efforts to remediate orphan wells (Oil, Gas and Geothermal Resources Fund);
- ARB – $2,276,000 and four positions to provide air quality monitoring near oil and gas operations (Oil, Gas and Geothermal Resources Fund);
- OEHHA – $350,000 and 2 positions to support ARB's air quality monitoring (Oil, Gas and Geothermal Resources Fund);
- PUC – $1,479,000 and 10 positions for increased workload related to regulating natural gas facilities and $1,694,000 and 11 positions to create the Division of Safety Advocates (Public Utilities Commission Utilities Reimbursement Account).
- Amendments. The Committee is proposing two amendments to address implementation concerns. First, per Administrative directive, the safety review is already underway and over 50 of the 114 wells have been reviewed. Thus, the public hearing requirement on the safety review criteria is not timely and may require re- starting the review process. Instead, the Committee proposes requiring DOGGR to hold a noticed public hearing in the community on the safety review findings, as well as the proposed pressure limits prior to commencing operations at the facility.
Second, the CEC and PUC are currently conducting a statewide reliability review. This information will help inform the PUC to meet its requirement to determine the feasibility of diminishing or eliminating the use of the Aliso Canyon natural gas storage facility. Currently the bill requires the PUC to make its determination by July 1, 2017. Alternatively, the Committee proposes requiring the PUC to open a proceeding on the issue by July 1, 2017 to allow the statewide reliability review to be completed before making a determination.
- Emergency Authority for Reliability. This bill limits natural gas production at the facility prior to the completion of the safety review to wells that have completed testing and remediation, unless production capacity is insufficient to ensure reliability. There is no similar provision for well injection.
In order to ensure electrical and gas energy reliability during the moratorium, the Administration is proposing an amendment to expressly give the Governor the authority to adjust the requirements of the bill in the event of extraordinary circumstances, catastrophic events, or threat to public health and safety from the loss of energy reliability.
The author has rejected this amendment and contends the Governor and Supervisor have sufficient existing authorities to address emergencies. Specifically, Section 8558(c), Chapter 7 of Division 1 of Title 2 of the Government Code which allows the Governor to take all actions necessary in the event of a sudden and severe energy shortage, among other things. Further, the author contends the Supervisor has broad discretion under existing law.
- Related Legislation. Numerous bills have been introduced to respond to the Aliso Canyon Gas Storage Facility leak. AB 1902 (Wilk) extends the statute of limitations for civil actions resulting from exposure to hazardous materials from the Aliso Canyon gas leak. This bill is pending in the Judiciary Committee.
AB 1903 (Wilk) directs the Public Utilities Commission and the State Department of Public Health to jointly study the long-term health impacts of the Aliso Canyon natural gas leak. This bill is pending in the Health Committee.
AB 1904 (Wilk) Requires the Office of Environmental Health Hazard Assessment (OEHHA) to evaluate and report to the Legislature on natural gas odorants and potential alternatives by January 1, 2018. This bill is scheduled to be heard in this Committee today.
AB 1905 (Wilk) directs the Natural Resources Agency to conduct an independent scientific study on natural gas injection and storage practices and facilities. This bill is pending in this Committee.
SB 886 (Pavley) requires the Division of Oil, Gas, Geothermal Research (DOGGR) to institute a moratorium on natural gas injections at the Aliso Canyon gas storage facility and prevent use of wells drilled pre-1954. This bill is pending in the Senate Energy, Utilities and Communications Committee.
SB 887 (Pavley) requires DOGGR to prescribe standards for natural gas storage wells and requires annual inspections. This bill is pending in the Senate Environmental Quality Committee.
Analysis Prepared by: Jennifer Galehouse / APPR. / (916) 319-2081
Date of Hearing: February 22, 2016
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Mike Gatto, Chair
SBPCA Bill Id:SB 380
Author:(Pavley) – As Amended Ver:February 16, 2016
SENATE VOTE: 40-0
SUBJECT: Natural gas storage: moratorium
SUMMARY: Places a moratorium on injecting natural gas into the Aliso Canyon gas storage facility and establishes requirements for resuming natural gas injections at the Aliso Canyon gas storage facility, as specified. Specifically, this bill:
- Codifies a moratorium on injections of natural gas into any well at the Aliso Canyon storage facility until each well has been tested and evaluated for integrity and risks posed by well failure with particular emphasis on wells drilled prior to 2006.
- Specifies the moratorium shall continue until each Aliso Canyon well has been evaluated using state-of-the-art technology as determined by the Department of Conservation's Division of Oil, Gas, and Geothermal Resources (DOGGR) with input from independent experts.
- Requires at least one public meeting and that DOGGR shall request that the independent experts develop objective criteria for assessing the overall risk of the facility that DOGGR can then make public.
- Specifies that any well posing an enhanced risk of failure is to be repaired or plugged and abandoned.
- Specifies that the Supervisor of DOGGR is to determine the overall risk from well failure satisfies the supervisor's duty to prevent damage to life, health, property, and natural resources and other requirements; and requires the California Public Utilities Commission (CPUC) and the California Energy Commission (CEC) concur with the supervisor's determination.
- Allows production of natural gas by any well drilled earlier than 1954 at the Aliso Canyon storage facility when necessary to either respond to the uncontrolled leak of natural gas from the "Standard Sesnon 25" well or maintain regional energy reliability, at the written direction of the commissions.
- Requires the CPUC, in consultation with the CEC, DOGGR, and the California Independent System Operators (Cal ISO), to determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility while still maintaining energy reliability for the region.
- Includes an urgency clause for the statute to take effect immediately in order to mitigate ongoing harm from the gas leak at the Aliso Canyon storage facility and evaluate the integrity and risks associated with older wells at that facility.
EXISTING LAW:
- Authorizes the CPUC to regulate private corporations that own, operate, control, or manage a line, plant, or system for the transportation or the production, generation, transmission, or furnishing of heat, power, or storage directly or indirectly to or for the public, (California Constitution, Article XII, Section 3)
- Authorizes the CPUC to regulate gas corporations, including underground storage. (Public Utilities Code Sections 216(a), 221, 222, 227, and 228)
- Authorizes the CPUC to require that utility charges are just and reasonable and requires utilities to maintain facilities as necessary to promote safety, health, comfort, and convenience of patrons, employees, and the public. (Public Utilities Code Section 451)
- Authorizes the CPUC to do all things, whether specifically designated in this part or in addition thereto, which are necessary and convenient in the exercise of such power and jurisdiction. (Public Utilities Code Section 701)
- Establishes that the CPUC is responsible for regulating and enforcing intrastate gas pipeline transportation and pipeline facilities pursuant to Chapter 601 (commencing with Section 60101) of Subtitle VIII of Title 49 of the United States Code, including the development, submission, and administration of a state pipeline safety program certification for natural gas pipelines pursuant to Section 60105 of that chapter. (Public Utilities Code Section 955(b))
- Requires gas storage facilities to receive a Certificate of Public Convenience and Necessity (CPCN) before constructing a gas storage facility. Requires that the CPUC grant a CPCN on the grounds that the present or future public convenience and necessity requires or will require the gas storage facility. (Public Utilities Code Section 1001, et seq.)
- Authorizes the CPUC to investigate, as part of the rate proceeding for any gas corporation, impediments to the in-state production and storage of natural gas and encourage in-state production or storage of natural gas unless the CPUC finds it likely that it will result in consequences adverse to the interests of gas customers. (Public Utilities Code Section 1001, et seq.)
Directs the Department of Conservation to:
Supervise the drilling, operation, maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of tanks and facilities attendant to oil and gas production so as to prevent, as far as possible, damage to life, health, property, and natural resources; damage to underground oil and gas deposits from infiltrating water and other causes; loss of oil, gas, or reservoir energy, and damage to underground and surface waters suitable for irrigation or domestic purposes by the infiltration of, or the addition of, detrimental substances.
Supervise the drilling, operation, maintenance, and abandonment of wells so as to permit the owners or operators of the wells to utilize all methods and practices known to the oil industry for the purpose of increasing the ultimate recovery of underground hydrocarbons and which, in the opinion of the supervisor, are suitable for this purpose in each proposed case.
Encourage the wise development of oil and gas resources to best meet oil and gas needs in this state. (Public Resources Code Section 3106)
- Requires the Department of Conservation to maintain surveillance over underground gas storage facilities to insure that the original reserves are not lost, that drilling of new wells is conducted properly, and that no damage occurs to the environment by reason of injection and withdrawal of gas. (Public Resources Code Section 3403.5)
FISCAL EFFECT: Unknown
COMMENTS:
- Author's Statement. "My constituents have been on the receiving end of a natural disaster for the last three plus months. The uncontrolled leak of natural gas from the Aliso Canyon facility is a public health and climate emergency.
"SB 380 builds on the Governor's State of Emergency declaration, [DOGGR] proposed emergency gas storage regulations and statements by the CPUC and the [CEC], among others. It institutes a public, rigorous and transparent process to ensure the integrity of the gas storage wells. We have an obligation to the public to ensure that they have a formal voice in this process to ensure its credibility to them."
- Background. A leak was discovered on October 23, 2015, at a natural gas well located at the Aliso Canyon storage facility, owned and operated by Southern California Gas Company (SoCalGas). SoCalGas made several unsuccessful well "kill" attempts. On December 4, 2015, SoCalGas began drilling a relief well to intercept and cap the leaking well near the bottom of the well. SoCalGas estimated the well could be capped by March 2016. Through November and December 2015 DOGGR and the CPUC issued orders establish a moratorium on natural gas injection at Aliso Canyon, to provide data, retain evidence, and track costs of the effort to plug the well. The Air Resources Board began collecting and publishing data on methane emissions caused by the leak.
On January 6, 2016, the Governor issued a Proclamation[1] directing various state entities to oversee SoCalGas' actions to stop the leak, protect public safety, ensure accountability and strengthen oversight of natural gas storage facilities. Relevant to this bill, portions of the Governor's Proclamation:
- Ordered DOGGR to continue its prohibition against SoCalGas injecting any gas into the Aliso Canyon Storage Facility until a comprehensive review of the safety of the storage wells and the air quality of the surrounding community utilizing independent experts is completed; and
- Tasked the CEC in coordination with CPUC to maintain energy reliability during this incident.
On February 11, 2016, SoCalGas announced it had temporarily controlled the flow of natural gas at the leaking well and will continue to work in coordination with DOGGR and other agencies during the process of permanently sealing the well.
- Reliability of California's energy system. One of the important questions is whether or not the moratorium specified in this bill impacts energy reliability. According to the CEC and the CPUC in a letter to the Governor on February 1st, "There is good reason to be concerned that reliability of supply may be critical for electric generators in the LA Basin, especially those serving [the Los Angeles Department of Water and Power]." The CEC and CPUC expect to complete their assessment of reliability for the summer of 2016 by April 1, 2016.
The SoCalGas system consists of a pipeline system (Backbone Transmission System) and storage facilities. Most of SoCalGas' gas supply (90%) originates outside of California largely from production basins in Texas, New Mexico, and the Rocky Mountains. Gas from these regions is delivered via interstate pipelines into SoCalGas' Backbone Transmission System. Gas inventory in storage facilities is then used when demand exceeds the flowing supplies provided through the Backbone Transmission System. In Los Angeles County there are three natural gas storage facilities:
Field Name | Operator | Active Well Count | Working Capacity (Mcf) | Max Daily Delivery (Mcf) |
Playa del Rey | SoCalGas | 22 | 2,400,000 | 480,000 |
Aliso Canyon | SoCalGas | 92 | 86,000,000 | 1,860,000 |
Honor Rancho | SoCalGas | 32 | 24,200,000 | 1,000,000 |
Concerns regarding energy reliability relate to all three of California's major uses for energy:
- Natural Gas. Natural gas is used for electric generation, home heating, water heating (residential, commercial), cooking (residential and commercial), and industrial processes. Natural gas supplies are critical for public health and safety.
SoCalGas' system-wide demand for gas supplies is highest in the winter—reflecting gas needs for heating buildings, hot water and cooking.
To some extent, California's natural gas storage facilities provide some financial benefits to ratepayers in that the presence of the stored gas avoids both real and perceived supply shortages in the event of a disruption of suppliers from non-state sources, which can ameliorate natural gas commodity price spikes.
It is unclear the extent to which the supply of natural gas via pipelines into the Los Angeles region can meet 100% of demand for natural gas reliably.
According to the CPUC, to minimize risks of curtailments to residential and small commercial customers and electric generators and to minimize the possibility of curtailment to core customers, the CPUC ordered SoCalGas not to reduce inventory levels at Aliso Canyon below 15 Billion cubic feet (Bcf) other than to meet unspecified reliability requirements.
- Electricity. Electricity is used by residential, commercial, industrial, and agricultural customers for a variety of uses (for example, lighting, cooling, financial transactions, entertainment, manufacturing, etc.).
There are 18 natural gas power plants supplying baseload, peaking, and voltage support into the Los Angeles region. These power plants supply electricity customers of Los Angeles Department of Water and Power (LADWP), Southern California Edison (SCE), and publicly owned utilities serving customers in Long Beach, Glendale, Burbank, Pasadena, Anaheim, and Vernon. According to their 2014 Power Content Labels,[2] approximately one-fourth of the electricity is supplied via natural gas generation (see Table 1). Other sources of energy include: wind, solar, geothermal, bioenergy, hydroelectric, nuclear, and coal. It is unclear the extent to which the Los Angeles region can reliably provide electricity 100% of the time if the power plants were to rely solely on natural gas delivered via pipelines into the region. This information does not include self-generation (roof-top solar, fuel cells, energy storage).
Table 1: Los Angeles Region Sources of Electricity (%)
Retail Supplier | Anaheim | Burbank | Glendale | LADWP | Pasadena | SCE | Vernon |
Resource Type | % of electricity generation by type of resource | ||||||
Bioenergy | 15 | 16 | 15 | 5 | 19 | 1 | 12 |
Geothermal | 5 | 2 | 4 | 1 | 2 | 9 | 0 |
Small Hydro | 1 | 3 | 3 | 1 | 0 | 0 | 0 |
Solar | 0 | 2 | 1 | 1 | 0 | 4 | 0 |
Wind | 7 | 5 | 24 | 12 | 7 | 10 | 7 |
Subtotal Renewable | 28 | 28 | 46 | 20 | 28 | 20 | 19 |
Coal | 41 | 37 | 10 | 40 | 48 | 0 | 0 |
Large Hydro | 2 | 2 | 6 | 2 | 4 | 3 | 2 |
Natural Gas | 24 | 25 | 31 | 22 | 8 | 27 | 59 |
Nuclear | 0 | 6 | 8 | 9 | 7 | 6 | 7 |
Other | 0 | 2 | 0 | 0 | 0 | 0 | 0 |
Unspecified Sources of Power | 7 | 0 | 0 | 7 | 5 | 40 | 13 |
According to the CPUC, Aliso Canyon is an integral part of the SoCalGas system and is essential for meeting demand in the Los Angeles Basin. The CPUC also states that limited use or loss of Aliso’s storage capacity under normal conditions can be supplemented in the short term using increased flowing supply and, to a limited extent, the Honor Rancho storage facility. The CPUC adds that Aliso Canyon storage is the only source available to meet the gas supply needed for gas-fired electric generators in Los Angeles Basin during summer hot days when electric demand increases to meet cooling needs (air conditioning, etc.).
The CPUC states that analysis of the full impact on the electric system, if storage from Aliso Canyon is not available, is ongoing. However, they state that initial studies indicate that even with 15 Bcf in storage now, as the 15 Bcf is drawn down over the course of the summer, it will be increasingly difficult for SoCalGas to respond to increases in electric generation demand and therefore likely that electric generation in the Los Angeles Basin that relies on gas from Aliso Canyon will be curtailed.
- Petroleum Fuels. The Tesoro Refinery located near the Los Angeles Harbor is the largest refinery in Los Angeles County. The facility is capable of providing approximately 35% of the California's unique gasoline blend sold in the Los Angeles basin, 40% of the jet fuel for Los Angeles International Airport (LAX) and two million gallons per day of ultra-low sulfur diesel. Tesoro is also the majority owner of the Watson gas-fired cogeneration facility, which provides electricity to the Tesoro-Carson refinery. The Watson facility exports power to SCE customers through a power purchase agreement with SCE. Other larger refineries in the region include Chevron and ExxonMobil.
For the most part, these refineries purchase their natural gas needs directly from gas suppliers and take delivery of their gas via the SoCalGas Backbone Transmission System.
If these refineries were ordered to curtail their gas use in the event of peak demand for natural gas at the local power plants, there could be problems with maintaining sufficient inventories of petroleum fuels in the region (gasoline, diesel, aircraft fuels). Historically, fuel shortages have led to retail fuel price spikes.
It is unclear whether this bill's moratorium would impact the reliability of transportation fuel supplies provided by refineries located in the region or whether this concern is to be addressed by the analysis that the CPUC and CEC will make available in April 2016.
- Other similar gas storage facilities. This bill addresses operation of wells located in Aliso Canyon. However, there are six operators of 12 storage facilities in California with 343 active wells. Those other storage facilities are located in the following counties: Santa Barbara, Madera, Butte, Colusa, Contra Costa, San Joaquin, Solano, and Yolo. The Governor's proclamation addresses all storage facilities in California and specifically requires DOGGR to promulgate emergency regulations for gas storage facility operators throughout the state, requiring: at least daily inspection of gas storage well heads using gas leak detection technology such as infrared imaging; ongoing verification of the mechanical integrity of all gas storage wells; ongoing measurement of annular gas pressure or annular gas flow within wells; regular testing of all safety valves used in wells; minimum and maximum pressure limits for each gas storage facility in the state; a comprehensive risk management plan for each facility that evaluates and prepares for risks, including corrosion potential of pipes and equipment.
At Aliso Canyon there are 39 pre-1954 wells and 98 pre-2006 wells (including the pre-1954 wells. Honor Rancho has no pre-1954 wells and 41 pre-2006 wells. La Goleta has 13 pre-1954 wells and 20 pre-2006 wells (including the pre-1954 wells). Playa del Rey has 41 pre-1954 wells and 51 pre-2006 wells (including the pre-1954 wells).
Data on the age of wells at other natural gas storage facilities in California was not available.
The Governor's proclamation orders DOGGR, the CPUC, California Air Resources Board (CARB), and the CEC to submit to the Governor's Office a report that assesses the long-term viability of natural gas storage facilities in California. This bill does not include this provision.
- Two Moratoria – Similar but different. If enacted, this bill would codify a portion of the Governor's proclamation. The relevant portions of the Governor's proclamation are:
Protecting Public Health and Safety: The state will: continue its prohibition against [SoCalGas] injecting any gas into the Aliso Canyon Storage Facility until a comprehensive review of the safety of the storage wells and the air quality of the surrounding community utilizing independent experts is completed; expand its real-time monitoring of emissions in the community; convene an independent panel of scientific and medical experts to review public health concerns; and take all actions necessary to ensure the continued reliability of natural gas and electricity supplies in the coming months.
Strengthening Oversight: The state will promulgate emergency regulations for gas storage facility operators throughout the state, requiring: at least daily inspection of gas storage well heads using gas leak detection technology such as infrared imaging; ongoing verification of the mechanical integrity of all gas storage wells; ongoing measurement of annular gas pressure or annular gas flow within wells; regular testing of all safety valves used in wells; minimum and maximum pressure limits for each gas storage facility in the state; a comprehensive risk management plan for each facility that evaluates and prepares for risks, including corrosion potential of pipes and equipment. Additionally, [DOGGR, CPUC, CARB and CEC] will submit to the Governor's Office a report that assesses the long-term viability of natural gas storage facilities in California.
The significant differences between the Governor's moratorium and the moratorium proposed by this bill are as follows.
The moratorium specified in this bill:
- Requires DOGGR to specifically address Aliso Canyon wells placed in service prior to 2006.
- Specifies that state-of-the-art technology must be used to assess well integrity.
- Specifies that the DOGGR supervisor's duty includes "other requirements."
- Requires the DOGGR supervisor to determine that overall risk from well failure is satisfied, with the concurrence of the CEC and CPUC.
- Prohibits the production of natural gas by any well drilled earlier than 1954 at the Aliso Canyon storage facility until after the integrity and risks have been evaluated unless the well(s) are needed to maintain regional energy reliability at the written direction of the CEC.
- Requires the CPUC to determine the feasibility of minimizing or eliminating use of the Aliso Canyon storage facility in consultation with DOGGR, CARB, the Cal ISO, and the CEC.
The moratorium specified in the Governor's proclamation:
- Prohibits gas injection at Aliso Canyon until a comprehensive review of safety and air quality is completed and requires that all actions be taken as are necessary to ensure continued reliability of natural gas and electricity supplies.
- Requires actions to be taken by DOGGR to ensure safety at all natural gas storage facilities and requires a multi-agency assessment of the long-term viability of natural gas storage facilities in California.
- Requires convening of an independent panel of scientific and medical experts to review public health concerns; and take all actions necessary to ensure the continued reliability of natural gas and electricity supplies in the coming months.
It is unclear whether having moratorium provisions in statute would enhance, inhibit, or present difficulties in implementing the Aliso Canyon activities underway as a result of the Governor's proclamation. While the Governor is able to take administrative actions in a relatively short amount of time, statutes are generally modified no more frequently than annually.
If this bill included a sunset date on the provisions applicable to DOGGR it would ensure that the Legislature revisits the statute to verify that the work specified by this bill is actually completed. Further, this bill requires a multiagency assessment, led by the CPUC, of the feasibility of minimizing or eliminating the use of Aliso Canyon's natural gas storage facility. The author may wish to consider a date by which this assessment is to be completed and require the CPUC to also consult with local publicly owned utilities in preparing this assessment.
- Support and Opposition. Supporters of this bill raise concerns regarding health and safety, climate change, and maintenance practices at the facility (with some supporters emphasizing concerns regarding aging infrastructure). In particular, local community supporters raise concerns about providing a safe environment for public education, worker compensation claims, and the safety of children and families.
Opponents raise concerns, while also expressing support for safety and inspection requirements, regarding electric reliability, adverse impact on the economy (some raise concern that the exception for energy reliability is vague and does not define the term or provide an exception to maintain gas production at Aliso Canyon in the event of near term natural gas needs). They express concern that this bill will disrupt business operations, negatively impact the local economy, and predict service outages and blackouts that are harmful to consumers and businesses.
- Recommended amendments.
The author may wish to consider the following amendments to this bill:
- Clarify that Public Resources Code Section 3217 applies specifically to gas storage wells.
- Clarify that Public Resources Code Section 3217(a)(3) "and other requirements" refers to those requirements in Public Resources Code Section 3106.
- Include a sunset date (January 1, 2021) to ensure that the Legislature will have an opportunity to verify that the state agencies have completed the tasks specified in Section 3217.
- Specify a date by which the CPUC is to complete its assessment of need for the Aliso Canyon natural gas storage facility (July 1, 2017) and include local publicly owned utilities among the entities the CPUC is required to consult with on this assessment.
The specific amendments are as follows:
SECTION 1. Section 3217 is added to the Public Resources Code, to read:
3217. (a) The supervisor shall immediately institute a moratorium on injections of natural gas into any gas storage wells located within and serving the Aliso Canyon storage facility located in the County of Los Angeles until all of the following conditions are met:
(1) The integrity of each gas storage well has been quantitatively and objectively evaluated using state-of-the-art technology, as determined by the supervisor with input from independent experts, and the risks posed by gas storage well failure have been evaluated.
(A) The age, history, and condition of each gas storage well shall be specifically addressed, with particular emphasis on gas storage wells drilled prior to 2006.
(B) The technical methods and equipment used to evaluate gas storage well integrity and the risks posed by gas storage well failure shall be determined by the supervisor with input from independent experts and the public.
(C) The division shall hold at least one public meeting concerning the technical methods and equipment. The division shall request the independent experts to also develop objective criteria to assess the overall risk of the Aliso Canyon natural gas storage facility. The division shall make the objective criteria available to the public.
(2) Any well posing an enhanced risk of failure has been repaired to mitigate the enhanced risk or plugged and abandoned.
(3) The supervisor determines that the overall risk from gas storage well failure satisfies the supervisor’s duty pursuant to Section 3106 to prevent damage to life, health, property, and natural resources, and other requirements, as specified in Section 3106.
(4) The Public Utilities Commission and the State Energy Resources Conservation and Development Commission concur with the supervisor’s determination in paragraph (3).
(b) The supervisor shall prohibit the production of natural gas by any gas storage well originally drilled earlier than 1954 at the Aliso Canyon storage facility located in the County of Los Angeles until after the integrity of and the risks associated with any of these gas storage wells have been evaluated and determinations by the supervisor, with the concurrence of the commissions, have been made pursuant to the process described in subdivision (a), except when necessary to do either of the following:
(1) Respond to the uncontrolled leak of natural gas from the “Standard Sesnon 25” well (American Petroleum Institute identification number 03700776).
(2) Maintain regional energy reliability, at the written direction of the commissions.
(c) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
SEC. 2. Section 713 is added to the Public Utilities Code, to read:
713. The commission, no later than July 1, 2017, shall determine the feasibility of minimizing or eliminating use of the Aliso Canyon natural gas storage facility located in the County of Los Angeles while still maintaining energy reliability for the region. The commission shall consult with the State Energy Resources Conservation and Development Commission, the Independent System Operator, the local publicly owned utilities that rely on natural gas for electricity generation, the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation, and other relevant government entities, in making its determination.
REGISTERED SUPPORT / OPPOSITION:
Support
Lieu, Ted, Member of the United State House of Representatives
Schmerelson, Scott, Member of the Los Angeles Unified School District Board of Education
AZUL
Asian Pacific Environmental Network
California League of Conservation Voters
California Public Interest Research Group (CALPIRG)
Center on Race, Poverty & the Enviroment
Clean Water Action
Climate Action Campaign
Dignity Health
Environment California
Environmental Defense Fund
Environmental Working Group
Friends Committee on Legislation in California
Los Angeles, City of
Los Angeles, County of
National Parks Conservation Association
People Demanding Action
Porter Ranch Neighborhood Council
Santa Susana Mountain Park Association
Sierra Club California
Ventura, County of
Vote for Progress, California Office
Opposition
Foster, Bob
Kelly, James
Alhambra Chamber of Commerce
CALASIAN Chamber of Commerce
California Business Roundtable
California League of Food Processors
California Manufacturers & Technology Association (CMTA)
California Retailers Association
Central City Association (CCA)
Congress of California Seniors
Command Packaging
DE Solutions
Desert Valley Builders Association
El Monte/South El Monte Chamber of Commerce
Futureports
Harris Ranch
Industry Manufacturers Council
Inland Empire Economic Partnership
Keenan Farms Inc.
Kern Economic Development Corporation
Kheir Clinic
Latino Chamber of Commerce
Los Angeles Chamber of Commerce
Los Angeles Latino Chamber of Commerce
Orange County Business Council
Pomona Chamber of Commerce
San Gabriel Economic Partnership
Southern California Leadership Council
Sweetener Products Company
Verdexchange Institute
Western Milling
Western States Petroleum Association (WSPA)
WireTech, Inc.
Analysis Prepared by: Sue Kateley / U. & C. / (916) 319-2083
SENATE COMMITTEE ON
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 380 (Pavley) - Natural gas storage: moratorium
Version: | Policy Vote: Pending |
Urgency: | Mandate: |
Hearing Date: January 28, 2016 | Consultant: |
This bill meets the criteria for referral to the Suspense File.
Bill Summary:
SB 380 would place a moratorium on the injection and production of natural gas at the Aliso Canyon storage facility until specific conditions are met regarding well integrity and would require the California Public Utilities Commission (CPUC) to determine the feasibility of minimizing or eliminating use of that facility.
Fiscal Impact:
- Unknown, but potentially in the hundreds of thousands of dollars from the Oil, Gas, and Geothermal Administrative Fund (special) to the Department of Conservation for the additional required evaluation of wells at the Aliso Canyon storage facility.
- Minimum costs likely in the high hundreds of thousands and possibly in the low millions to the Public Utilities Reimbursement Account (special fund) for the CPUC to determine the feasibility of minimizing or eliminating the use of the Aliso Canyon storage facility and to make a determination regarding the lifting of the moratorium.
- Unknown costs to the California Energy Commission to the Energy Resources Program Account (General Fund).
Background:
In October 2015, a significant uncontrolled natural gas leak from a gas storage well was discovered within the Southern California Gas Company’s Aliso Canyon natural gas storage facility. The Aliso Canyon natural gas storage facility is the largest natural gas storage facility in the western United States.
The facility has approximately 115 wells of which 108 are gas storage wells. Forty-eight of the gas storage wells at Aliso Canyon were originally drilled in 1954 or earlier (almost half of those in gas storage service now). An additional 47 wells were all originally drilled at least 15 years ago.
The Division of Oil, Gas, and Geothermal Resources (DOGGR) within the Department of Conservation and headed by the supervisor is responsible for the regulation of natural gas wells while the regulation of the storage facility itself is under the California Public Utilities Commission (CPUC).
Proposed Law:
This bill would require DOGGR to institute a moratorium on the injections of natural gas at the Aliso Canyon storage facility until several conditions are met regarding the integrity of the wells. Specifically, each well must be evaluated by “state-of-the-art” technology for well integrity and well failure risks. The technical methods and equipment used would be determined by DOGGR with input from independent experts and through a public process. The supervisor of DOGGR, the CPUC, and the California Energy Commission (CEC) must all concur that the DOGGR’s responsibility to prevent the damage to life, health, property, and natural resources has been fulfilled before the moratorium is lifted.
This bill would also prohibit the use of wells drilled prior to 1954 for the production of natural gas at the Aliso Canyon storage facility until the wells have been evaluated as specified unless the well is needed to respond to the current gas leak or to maintain regional energy reliability as determined by the “commissions.”
Related Legislation:
SB 886 (Pavley), which was introduced on January 20, 2016, is identical to this measure. No actions have yet been taken on SB 886.
Staff Comments:
This bill would require DOGGR to determine what “state-of-the-art” technology must be used to evaluate well integrity and risks posed by well failure through a public process, which presumably would be through the development of regulations. As DOGGR has been widely criticized for using outdated and inadequate methods, such technology is likely to be a departure from its current practices and therefore reasonably may result in additional costs to DOGGR. That said, staff notes that DOGGR has received significant additional resources in the last two budgets to both improve and expand its existing programs in a manner generally consistent by this bill. It is unclear whether those new resources would be sufficient to cover the additional actions required by this bill.
This bill would require the CPUC to determine the feasibility of minimizing or eliminating the use of the Aliso Canyon storage facility while maintaining energy reliability for the region. While reliability is considered by the CPUC as part of its regular duties, this feasibility study would require additional analysis, similar to those studies conducted regarding electricity reliability after the closure of San Onofre nuclear power plant and the adoption of once-through-cooling regulations. The large size of the Aliso Canyon facility will also increase the impacts that need to be considered. Depending on the level of existing analyses, staff roughly estimates that these costs could range in the high hundreds of thousands of dollars to low millions.
Staff notes that this bill would require the CPUC and the CEC to make a determination regarding whether DOGGR’s responsibilities have been fulfilled. At this time, it is unclear how this determination will be made by those agencies and therefore any costs associated with such a determination are unknown.
-- END --
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | SB |
THIRD READING
Bill No: SB 380
: 1/27/16
SENATE NATURAL RES. & WATER COMMITTEE: 9-0, 1/28/16
AYES: Pavley, Stone, Allen, Hertzberg, Hueso, Jackson, Monning, Vidak, Wolk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 1/28/16
AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen
SUBJECT: Natural gas storage: moratorium
DIGEST: This bill imposes an immediate moratorium on natural gas injection and a restriction on natural gas production at the Aliso Canyon storage facility until certain conditions are met.
Existing law:
- Establishes the Division of Oil, Gas and Geothermal Resources (DOGGR) in the Department of Conservation.
- Requires that DOGGR regulate the drilling, operation, maintenance and abandonment of oil and gas wells in the state.
- Requires DOGGR’s leader, the state oil and gas supervisor, to supervise the drilling, operation, maintenance, and abandonment of oil and gas wells and facilities related to oil and gas production within an oil and gas field, among other activities, so as to prevent damage to life, health, property, and natural resources, as provided.
- Authorizes the California Public Utilities Commission (CPUC) to supervise and regulate every public utility in the state.
This bill:
- Imposes an immediate moratorium on natural gas injection at the Aliso Canyon natural gas storage facility.
- Imposes a restriction on natural gas production at the same facility for wells originally drilled earlier than 1954 except where needed to respond to the ongoing significant uncontrolled natural gas leak from a well in the facility or to ensure regional energy reliability, as specified.
- Requires, that the integrity of each well is quantitatively and objectively evaluated using state-of-the-art technology and the risks posed by well failure evaluated. The following conditions must be met in order to lift the moratorium and production restriction:
- Well age, history and condition shall be considered in the evaluation with an emphasis on wells older than 10 years of age.
- The supervisor shall determine the technical methods used to do the evaluation and the risks posed by well failure with input from independent experts and the public through a public process.
- Wells posing an enhanced risk of failure must be repaired or plugged and abandoned.
- The supervisor shall determine that the overall risk from well failure satisfies the supervisor’s requirement to prevent damage to life, health, property and natural resources, as specified, and
- The CPUC and the State Energy Resources Conservation and Development Commission concur with the supervisor’s assessment of the overall risk.
- Requires the CPUC, in consultation with other state regulators, to determine the feasibility of minimizing or eliminating the use of the Aliso Canyon natural gas storage facility while maintaining regional energy reliability.
- Includes an urgency section due to ongoing harm to the community.
Background
On October 23, 2015, a significant uncontrolled natural gas leak from a gas storage well (“SS-25”) was discovered. The well is located in the Southern California Gas Company’s (SoCal Gas’) Aliso Canyon natural gas storage facility located in northeastern Los Angeles County. This well is located uphill from and approximately 1-1/4 miles away from homes in the Porter Ranch community. The leak has received local, national and international news coverage.
The natural gas storage facility at Aliso Canyon includes (approximately) 115 wells of which 108 are gas storage wells. In the early 1970s, a depleted existing oil reservoir was converted to use as a gas storage reservoir. It is the largest gas storage reservoir in the western United States at 86 billion cubic feet working capacity. Many existing oil wells serving the depleted reservoir were converted to gas storage service at the time of the conversion. Forty-eight of the gas storage wells at Aliso Canyon were originally drilled in 1954 or earlier (almost half of those in gas storage service now). An additional 47 wells were all originally drilled at least 15 years ago. DOGGR’s existing regulations are not proactive with respect to identifying the locations of incipient leaks. Aliso Canyon may not be unusual, however. Over half of the approximately 420 gas storage wells in service in the state are over at least 40 years old.
DOGGR was apparently notified the day of the leak’s discovery by SoCal Gas. The local air quality regulator, the South Coast Air Quality Management District began receiving calls reporting the smell of leaking gas from the community on the next day, October 24. It was several more days before SoCal Gas acknowledged the leak to the community and the public. To date, South Coast Air Quality Management District has received thousands on complaints regarding the odor.
In mid-November, the Los Angeles County Department of Public Health, citing public health concerns associated with the use of odorants in the natural gas, ordered SoCal Gas to provide temporary housing relocation assistance to affected residents.
The well continues to leak natural gas. As of three months, the amount of natural gas leaked is estimated to be approximately equivalent to the annual greenhouse gas emissions of 450,000 cars. Seven well “kill” attempts by SoCal Gas and its contractors have failed to control or stop the leak. DOGGR ordered a relief well to be drilled for use in killing the well. Recent reports indicate that the relief well will be completed in February and efforts to kill the leaking well using the relief well will commence in mid-to-late February.
While the gas storage facility itself is under the primary jurisdiction of the CPUC, the storage wells are under DOGGR’s jurisdiction. Seven state entities in total are involved in the response to the leak in some capacity. In addition to DOGGR and the CPUC, these include the Governor’s Office of Emergency Services, the Office of Environmental Health Hazard Assessment, the Air Resources Board (ARB), the Division of Occupational Safety and Health and the California Energy Commission. In addition Governor Brown has been directly involved in leak response, issuing a State of Emergency on January 6, and the Governor’s Office has coordinated state response.
Of particular note:
- The DOGGR supervisor has issued two orders to SoCal Gas regarding the leak. The first, on November 18, 2015, required immediate sharing of monitoring data and ordered preparations for drilling a relief well to start. The second, on December 10, 2015, required numerous actions by SoCal Gas including, among other items, pursuing options to capture the leaking gas, prepare for a second relief well, reduce reservoir pressure by producing stored gas, continuing to not inject gas into the storage reservoir and maximizing the rate of withdrawal from the facility. DOGGR reports convening a panel of technical experts from national labs to assist it in its response to the leak.
- The Governor’s State of Emergency, among other provisions, directed DOGGR to strengthen oversight of gas storage wells by promulgating new emergency regulations and directed DOGGR, the CPUC, ARB and California Energy Commission to assess the long-term viability of natural gas storage facilities in California.
- On January 15, 2016, DOGGR announced emergency regulations to improve the regulation of gas storage wells. While much is left at the discretion of the supervisor, the emergency regulations provide for more regulatory oversight including testing.
- On January 21, 2016, the CPUC wrote to SoCal Gas ordering the working gas capacity at Aliso Canyon be reduced to 15 billion cubic feet until further notice. SoCal Gas agreed in its response the next day.
Comments
Public process. The public has an opportunity to comment on the DOGGR emergency regulations through the rulemaking process. The public did not have a formal role in developing the proposal to best of the Senate Natural Resources and Water Committee’s staff’s knowledge. Two 1940s era wells at Aliso Canyon have recently had upgraded operating and other conditions imposed upon them (API #s 03700722 and 03700723, originally drilled in 1945 and 1946, respectively). It is not known what results prompted the additional requirements for these two wells.
State-of-the-art technology? DOGGR’s existing gas storage regulations have been criticized for detecting leaks only after the leak has started. The proposed emergency regulations are substantially revised, although, as noted above, provide significant discretion to the supervisor. Proactive leak detection using, for example, ultrasonic imaging, is, according to reports, widely available. The two wells noted in the preceding comment have both been required to undergo ultrasonic imaging.
FISCAL EFFECT: Appropriation: Fiscal Com.: Yes Local: Yes
According to the Senate Appropriations Committee:
- Unknown, but potentially in the hundreds of thousands of dollars from the Oil, Gas, and Geothermal Administrative Fund (special) to the Department of Conservation for the additional required evaluation of wells at the Aliso Canyon storage facility.
- Minimum costs likely in the high hundreds of thousands and possibly in the low millions to the Public Utilities Reimbursement Account (special fund) for the CPUC to determine the feasibility of minimizing or eliminating the use of the Aliso Canyon storage facility and to make a determination regarding the lifting of the moratorium.
- Unknown costs to the California Energy Commission to the Energy Resources
Program Account (General Fund).
None received
OPPOSITION: (Verified 1/27/16)
None received
ARGUMENTS IN SUPPORT: According to the author, “My constituents have been on the receiving end of a natural disaster for the last three months. The uncontrolled leak of natural gas from the Aliso Canyon facility is a public health and climate emergency.”
“Over 2,500 Porter Ranch households have relocated, and another 1,600 are in the process of being relocated. The Los Angeles Unified School District relocated two schools to avoid students and staff breathing in the noxious fumes. There are concerns about public health, the health of our children, long-term damage to a robust and happy community, lost business revenues, property value loss and more. Not all of these issues are necessarily appropriately addressed by the Legislature. For example, the Los Angeles City Attorney, the Los Angeles City Council, the Los Angeles Board of Supervisors, local regulators, including City and County Fire, the Department of Public Health and the South Coast Air Quality Management District have all taken action to address and facilitate response to the leak for areas within their jurisdiction. Additionally, state regulators, coordinated by the Governor’s Office, have and are taking appropriate action to respond too.”
“However, we have an important role in ensuring that this never happens again and taking appropriate steps to calm and address the community’s concerns about the risks associated with the continued operation of Aliso Canyon. SB 380 builds on the two DOGGR orders, the Governor’s State of Emergency declaration, DOGGR’s proposed emergency gas storage regulations and statements by the CPUC and the California Energy Commission, among others. It institutes a public, rigorous and transparent process to ensure the integrity of the gas storage wells. We have an obligation to the public to ensure that they have a formal voice in this process to ensure its credibility to them.”
“With the first relief well likely to be completed within weeks and a hoped-for successful effort to stop the leak using the relief well, it is urgent that we pass this legislation in order to address the community’s fears about moving back to their homes and near the gas storage facility.”
1/28/16 10:22:36
**** END ****
SENATE COMMITTEE ON NATURAL RESOURCES AND WATER
Senator Fran Pavley, Chair
2015 - 2016 Regular
Bill No: SB 380 Hearing Date: January 28, 2016
Author: | Pavley | ||
Version: |
| ||
Urgency: | Yes | Fiscal: | Yes |
Consultant: | |||
Subject: Natural gas storage: moratorium
BACKGROUND AND EXISTING LAW
On October 23, 2015, a significant uncontrolled natural gas leak from a gas storage well (“SS-25”) was discovered. The well is located in the Southern California Gas Company’s (SoCal Gas’) Aliso Canyon natural gas storage facility located in northeastern Los Angeles County. This well is located uphill from and approximately 1-1/4 miles away from homes in the Porter Ranch community. The leak has received local, national and international news coverage.
The natural gas storage facility at Aliso Canyon includes (approximately) 115 wells of which 108 are gas storage wells. In the early 1970s, a depleted existing oil reservoir was converted to use as a gas storage reservoir. It is the largest gas storage reservoir in the western United States at 86 billion cubic feet working capacity. Many existing oil wells serving the depleted reservoir were converted to gas storage service at the time of the conversion. Forty-eight of the gas storage wells at Aliso Canyon were originally drilled in 1954 or earlier (almost half of those in gas storage service now). An additional 47 wells were all originally drilled at least 15 years ago. DOGGR’s existing regulations are not proactive with respect to identifying the locations of incipient leaks. Aliso Canyon may not be unusual, however. Over half of the approximately 420 gas storage wells in service in the state are at least 40 years old.
DOGGR was apparently notified the day of the leak’s discovery by SoCal Gas. The local air quality regulator, the South Coast Air Quality Management District began receiving calls reporting the smell of leaking gas from the community on the next day, October 24. It was several more days before SoCal Gas acknowledged the leak to the community and the public. To date, South Coast Air Quality Management District has received thousands on complaints regarding the odor.
In mid-November, the Los Angeles County Department of Public Health, citing public health concerns associated with the use of odorants in the natural gas, ordered SoCal Gas to provide temporary housing relocation assistance to affected residents.
The well continues to leak natural gas. As of three months, the amount of natural gas leaked is estimated to be approximately equivalent to the annual greenhouse gas emissions of 450,000 cars. Seven well “kill” attempts by SoCal Gas and its contractors have failed to control or stop the leak. DOGGR ordered a relief well to be drilled for use in killing the well. Recent reports indicate that the relief well will be completed in February and efforts to kill the leaking well using the relief well will commence in mid-to-late February.
While the gas storage facility itself is under the primary jurisdiction of the California Public Utilities Commission (CPUC), the storage wells are under DOGGR’s jurisdiction. Seven state entities are involved in the response to the leak in some capacity. In addition to DOGGR and the CPUC, these include the Governor’s Office of Emergency Services, the Office of Environmental Health Hazard Assessment, the Air Resources Board, the Division of Occupational Safety and Health and the California Energy Commission. In addition Governor Brown has been directly involved in leak response, issuing a State of Emergency on January 6, and the Governor’s Office has coordinated state response.
Of particular note:
- The DOGGR supervisor has issued two orders to SoCal Gas regarding the leak. The first, on November 18, 2015, required immediate sharing of monitoring data and ordered preparations for drilling a relief well to start. The second, on December 10, 2015, required numerous actions by SoCal Gas including, among other items, pursuing options to capture the leaking gas, prepare for a second relief well, reduce reservoir pressure by producing stored gas, continuing to not inject gas into the storage reservoir and maximizing the rate of withdrawal from the facility. DOGGR reports convening a panel of technical experts from national labs to assist it in its response to the leak.
- The Governor’s State of Emergency, among other provisions, directed DOGGR to strengthen oversight of gas storage wells by promulgating new emergency regulations and directed DOGGR, the CPUC, ARB and California Energy Commission to assess the long-term viability of natural gas storage facilities in California.
- On January 15, 2016, DOGGR announced emergency regulations to improve the regulation of gas storage wells. While much is left at the discretion of the supervisor, the emergency regulations provide for more regulatory oversight including testing.
- On January 21, 2016 the CPUC wrote to SoCal Gas ordering the working gas capacity at Aliso Canyon be reduced to 15 billion cubic feet until further notice. SoCal Gas agreed in its response the next day.
Existing law:
- Establishes the Division of Oil, Gas and Geothermal Resources (DOGGR) in the Department of Conservation.
- Requires that DOGGR regulates the drilling, operation, maintenance and abandonment of oil and gas wells in the state.
- Requires DOGGR’s leader, the state oil and gas supervisor, to supervise the drilling, operation, maintenance, and abandonment of oil and gas wells and facilities related to oil and gas production within an oil and gas field, among other activities, so as to prevent damage to life, health, property, and natural resources, as provided.
- Authorizes the Public Utilities Commission to supervise and regulate every public utility in the state.
PROPOSED LAW
This bill would impose an immediate moratorium on natural gas injection and a restriction on natural gas production at the Aliso Canyon storage facility until certain conditions are met.
Specifically, this bill would:
- Impose an immediate moratorium on natural gas injection at the Aliso Canyon natural gas storage facility.
- Impose a restriction on natural gas production at the same facility for wells originally drilled earlier than 1954 except where needed to respond to the ongoing significant uncontrolled natural gas leak from a well in the facility or to ensure regional energy reliability, as specified.
- Require that the integrity of each well is quantitatively and objectively evaluated using state-of-the-art technology and the risks posed by well failure evaluated. The following conditions would have to be met in order to lift the moratorium and production restriction:
- Well age, history and condition be considered in the evaluation with an emphasis on wells older than 10 years of age.
- The supervisor must determine the technical methods used to do the evaluation and the risks posed by well failure with input from independent experts and the public through a public process.
- Wells posing an enhanced risk of failure must be repaired or plugged and abandoned.
- The supervisor shall determine that the overall risk from well failure satisfies the supervisor’s requirement to prevent damage to life, health, property and natural resources, as specified, and
- The Public Utilities Commission and the State Energy Resources Conservation and Development Commission concur with the supervisor’s assessment of the overall risk.
- Require the Public Utilities Commission, in consultation with other state regulators, to determine the feasibility of minimizing or eliminating the use of the Aliso Canyon natural gas storage facility while maintaining regional energy reliability.
- Include an urgency section due to ongoing harm to the community.
ARGUMENTS IN SUPPORT
ARGUMENTS IN SUPPORT: According to the author, “My constituents have been on the receiving end of a natural disaster for the last three months. The uncontrolled leak of natural gas from the Aliso Canyon facility is a public health and climate emergency.”
“Over 2,500 Porter Ranch households have relocated, and another 1,600 are in the process of being relocated. The Los Angeles Unified School District relocated two schools to avoid students and staff breathing in the noxious fumes. There are concerns about public health, the health of our children, long-term damage to a robust and happy community, lost business revenues, property value loss and more. Not all of these issues are necessarily appropriately addressed by the Legislature. For example, the Los Angeles City Attorney, the Los Angeles City Council, the Los Angeles Board of Supervisors, local regulators, including City and County Fire, the Department of Public Health and the South Coast Air Quality Management District have all taken action to address and facilitate response to the leak for areas within their jurisdiction. Additionally, state regulators, coordinated by the Governor’s Office, have and are taking appropriate action to respond too.”
“However, we have an important role in ensuring that this never happens again and taking appropriate steps to calm and address the community’s concerns about the risks associated with the continued operation of Aliso Canyon. SB 380 builds on the two DOGGR orders, the Governor’s State of Emergency declaration, DOGGR’s proposed emergency gas storage regulations and statements by the CPUC and the California Energy Commission, among others. It institutes a public, rigorous and transparent process to ensure the integrity of the gas storage wells. We have an obligation to the public to ensure that they have a formal voice in this process to ensure its credibility to them.”
“With the first relief well likely to be completed within weeks and a hoped-for successful effort to stop the leak using the relief well, it is urgent that we pass this legislation in order to address the community’s fears about moving back to their homes and near the gas storage facility.”
ARGUMENTS IN OPPOSITION
None received
COMMENTS
Public process. The public has an opportunity to comment on the DOGGR emergency regulations through the rulemaking process. The public did not have a formal role in developing the proposal to best of staff’s knowledge. Two 1940s era wells at Aliso Canyon have recently had upgraded operating and other conditions imposed upon them (API #s 03700722 and 03700723, originally drilled in 1945 and 1946, respectively). It is not known what prompted the additional requirements for these two wells.
State-of-the-art? DOGGR’s existing gas storage regulations have been criticized for detecting leaks only after the leak has started. The proposed emergency regulations are substantially revised, although, as noted above, provide significant discretion to the supervisor. Proactive leak detection using, for example, ultrasonic imaging, is, according to reports, widely available. The two wells noted in the preceding comment have both been required to undergo ultrasonic imaging.
SUPPORT
None Received
OPPOSITION
None Received
-- END --
Discussed in Hearing
17MIN
Senate Floor
9MIN
Assembly Floor
15MIN
Assembly Standing Committee on Appropriations
1H
Assembly Standing Committee on Utilities and Commerce
37MIN
Senate Standing Committee on Natural Resources and Water
14MIN
