Bill Text: CA AB7 | 2013-2014 | Regular Session | Amended

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Bill Title: Oil and gas: hydraulic fracturing.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2014-02-03 - Died on inactive file. [AB7 Detail]

Download: California-2013-AB7-Amended.html

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BILL NUMBER: AB 7	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JUNE 10, 2013
	AMENDED IN ASSEMBLY  MAY 31, 2013
	AMENDED IN ASSEMBLY  MAY 28, 2013
	AMENDED IN ASSEMBLY  APRIL 30, 2013
	AMENDED IN ASSEMBLY  APRIL 8, 2013

INTRODUCED BY   Assembly Member Wieckowski

                        DECEMBER 3, 2012

   An act to amend Sections 3108, 3203, 3213, and 3215 of, to add
Sections 3017, 3203.1, 3203.2, and 3215.5 to, and to add Article 3
(commencing with Section 3150) to Chapter 1 of Division 3 of, the
Public Resources Code, relating to oil and gas.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 7, as amended, Wieckowski.  Oil and gas: hydraulic fracturing.
   (1) Under existing law, the Division of Oil, Gas, and Geothermal
Resources, or the division, in the Department of Conservation,
regulates the drilling, operation, maintenance, and abandonment of
oil and gas wells in the state. The State Oil and Gas Supervisor
supervises 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 regarding safety and environmental damage. Existing law
requires an operator of a well, before commencing the work of
drilling the well, to file with the supervisor or the district deputy
a written notice of intention to commence drilling, and prohibits
the commencement of drilling until approval is given by the
supervisor or the district deputy. Existing law requires the operator
of a well to keep, or cause to be kept, a careful and accurate log,
core record, and history of the drilling of the well. Within 60 days
after the date of cessation of drilling, rework, or abandonment
operations, the owner or operator is required to file with the
district deputy certain information, including the history of work
performed.
   This bill would revise that procedure to instead require the
operator to file an application before commencing drilling and would
prohibit drilling until approval or denial of the application is
given by the supervisor or district deputy within 30 working days.
The bill would require, on and after January 1, 2014, additional
information to be included in the application, including information
regarding the chemicals, if any, to be injected into a well. This
bill would additionally require the operator prior to drilling,
redrilling, or deepening operations to submit proof to the supervisor
that the applicable regional water quality control board has
approved the disposal method and location of wastewater disposal for
the well.
   This bill would define, among other things, hydraulic fracturing
and hydraulic fracturing fluid. The bill would require the owner or
operator of a well to provide to the supervisor, or to arrange with
the supplier to provide to the supervisor, specific information
relating to hydraulic fracturing as a part of the history of the
drilling of the well. The bill would, on or before January 1, 2015,
require the division, in consultation with the Office of
Environmental Health Hazard Assessment and the Department of Toxic
Substances Control, to establish a process through which all
chemicals used in hydraulic fracturing treatments may be studied or
reviewed. The bill would provide that a supplier who provides
information to the supervisor relating to hydraulic fracturing may,
at the time of submission, submit to the supervisor a claim in
writing that some or all of the information is protected trade secret
information, as specified. The bill would require a supplier
claiming trade secret protection for the chemical composition of
additives used in the hydraulic treatment to disclose the composition
to the division, in conjunction with a hydraulic fracturing
treatment notice, but would, except as specified, prohibit those with
access to the trade secret from disclosing it. Because this bill
would create a new crime, it would impose a state-mandated local
program.
   This bill would require the supervisor, on or before January 1,
2014, and annually thereafter, to transmit to the Legislature a
comprehensive report on hydraulic fracturing in the exploration and
production of oil and gas resources in the state, as specified.
   (2) Existing law requires the supervisor, on or before the first
day of October of each year, to make public a report on specified
information.
   This bill would additionally require the supervisor to include
information on the origin and total amount of freshwater used in each
county for the production of oil and gas production, the disposal of
wastewater from oil and gas production in each county, and the well
casing failures in each county.
   This bill would require the operator of a well, at least 30 days
prior to commencing a hydraulic fracturing treatment, as defined, to
provide a copy of the approved hydraulic fracturing treatment permit
to  every   specific  surface property
 owner   owners  . The bill would authorize
those property owners to request the applicable regional water
quality control board to perform water quality sampling and testing
on any water well suitable for drinking or irrigation purposes, as
specified. The bill would require a notice of intent to drill,
rework, or deepen a well where hydraulic fracturing will occur to
include specified information. Because a violation of these
requirements is a crime, this bill would impose a state-mandated
local program.
   (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.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) Hydraulic fracturing has been used in California for several
decades to extract oil and gas and is likely to be used more
extensively as the industry seeks to develop additional oil-bearing
and gas-bearing formations.
   (b) The Division of Oil, Gas, and Geothermal Resources in the
Department of Conservation, which has the obligation to protect
public health and the natural resources of the state, including
groundwater resources, has the authority to regulate all oil and
natural gas drilling in the state, but currently does not require the
disclosure of pertinent information regarding hydraulic fracturing
or ascertain all specific types of production and exploration taking
place at permitted wells.
   (c) Given California's geologic, seismic complexity, and its
finite and significantly compromised water resources, it is important
to collect basic information about natural resource production
processes. The state and the public should know when and where
hydraulic fracturing is occurring and what chemicals are being used
in the process.
  SEC. 2.  Section 3017 is added to the Public Resources Code, to
read:
   3017.  "Hydraulic fracturing" means a well stimulation treatment
that may include the application of hydraulic fracturing fluids into
an underground geologic formation in order to create fractures in the
formation, thereby causing or improving the production of oil or gas
from a well.
  SEC. 3.  Section 3108 of the Public Resources Code is amended to
read:
   3108.  (a) On or before the first day of October of each year the
supervisor shall make public, for the benefit of all interested
persons, a report in writing showing:
   (1) The total amounts of oil and gas produced in each county in
the state during the previous calendar year.
   (2) The total cost of the division for the previous fiscal year.
   (3) The total amount delinquent and uncollected from any
assessments or charges levied pursuant to this chapter.
   (4) The origin and total amount of freshwater used in each county
for oil and gas production during the previous calendar year.
   (5) The surface and underground destinations and total amount of
disposed wastewater from oil and gas production in each county during
the previous calendar year.
   (6) The total number of well casing failures in each county, the
exact location of these wells, the reason for the failures, and at
what point the failures occurred, such as during well completion,
well stimulation, or well production, during the previous calendar
year.
   (b) The report shall also include other information as the
supervisor deems advisable.
  SEC. 4.  Article 3 (commencing with Section 3150) is added to
Chapter 1 of Division 3 of the Public Resources Code, to read:

      Article 3.  Hydraulic Fracturing


   3150.  "Chemical Abstracts Service" means the division of the
American Chemical Society that is the globally recognized authority
for information on chemical substances.
   3151.  "Chemical Abstracts Service (CAS) number" means the unique
identification number assigned to a chemical by the Chemical
Abstracts Service.
   3153.  "Hydraulic fracturing fluid" includes water or other
carrier fluids that may be mixed with physical and chemical additives
for the purpose of hydraulic fracturing. The additives may, but are
not required to, serve additional purposes beyond the transmission of
hydraulic pressure to the geologic formation. Additives may be of
any phase and may include proppants.
   3154.   "Proppants" are materials inserted or injected into the
formation that are intended to prevent newly created or enhanced
fractures from closing.
   3155.  "Supplier" means an entity performing hydraulic fracturing
or a person supplying an additive or proppant directly to the
operator for use in hydraulic fracturing on a well.
   3156.  If hydraulic fracturing is performed on a well, the owner
or operator of the well shall provide to the supervisor, or shall
arrange with the supplier to provide to the supervisor, and shall
include in the well history maintained pursuant to Section 3213, all
of the following information, except for information claimed as a
trade secret pursuant to subdivision (c) of Section 3203:
   (a) A complete list of the chemical constituents formulated for
use in the hydraulic fracturing fluid that is injected into the well
and each chemical's associated CAS numbers. Where the CAS number does
not exist, the operator or supplier may provide another unique
identifier where available.
   (b) The purpose of each additive contained in the hydraulic
fracturing fluid.
   (c) The estimated total amount of the additives in the hydraulic
fracturing fluid.
   (d) The estimated maximum concentration of each chemical
constituent in the additive as disclosed on a material safety data
sheet in the hydraulic fracturing fluid expressed as a percentage by
mass.
   (e) The estimated maximum concentration of each chemical
constituent disclosed on a material safety data sheet in the
hydraulic fracturing fluid, expressed as a percentage by mass.
   (f) The amount and source of any water suitable for irrigation or
domestic purposes used to conduct the hydraulic fracturing treatment
of the well.
   (g) The amount and disposition of water and hydraulic fracturing
fluid recovered from each well where hydraulic fracturing occurred
prior to the reporting of the water produced pursuant to Section
3227.
   (h) Any radiological components or tracers injected into the well
as part of the hydraulic fracturing process and a description of the
recovery method, if any, for those components or tracers, the
recovery rate, and the disposal method for recovered components or
tracers.
   3157.  On or before January 1, 2015, the division, in consultation
with the Office of Environmental Health Hazard Assessment and the
Department of Toxic Substances Control, shall establish a process
through which all chemicals used in hydraulic fracturing treatments
may be studied or reviewed, a list containing any restricted or
prohibited toxic chemicals, and a list containing any restricted or
prohibited locations deemed extremely vulnerable to a spill or
release of chemicals.
  SEC. 5.  Section 3203 of the Public Resources Code is amended to
read:
   3203.  (a) The operator of any well, before commencing the work of
drilling the well, shall file with the supervisor or the district
deputy an application to commence drilling. Drilling shall not
commence until approval or denial of the application is given by the
supervisor or the district deputy within 30 working days. If
operations have not commenced within one year of receipt of the
application, the application shall be deemed canceled. The
application shall contain the pertinent data the supervisor requires
on printed forms supplied by the division or on other forms
acceptable to the supervisor. The supervisor may require other
pertinent information to supplement the application.
   (b) (1) On and after January 1, 2014, in addition to the
information required in the application under subdivision (a), the
application shall additionally include all of the following
information:
   (A) The type of exploration and production techniques that the
operator will use at the well or wells.
   (B) A complete list of the chemicals, if any, that will be
injected into the well for hydraulic fracturing or other production
enhancement methods in the exploration or production process or
processes. This list of chemicals shall include all of the following
information:
   (i) The name of the chemical.
   (ii) The purpose of the chemical in the production or exploration
process.
   (iii) The Chemical Abstract Service numbers for the chemical.
   (iv) The estimated total amount of the chemical used.
   (2) If any of the information required pursuant to paragraph (1)
changes over the course of the exploration and production process,
the operator shall immediately notify the supervisor.
   (c) (1) A supplier may claim trade secret protection for the
chemical composition of additives pursuant to Section 1060 of the
Evidence Code, or the Uniform Trade Secrets Act (Title 5 (commencing
with Section 3426) of Part 1 of Division 4 of the Civil Code).
   (2) If a supplier believes that information regarding a chemical
constituent of a hydraulic fracturing fluid is a trade secret, the
supplier shall nevertheless disclose the information to the division
in conjunction with a hydraulic fracturing treatment notice, if not
previously disclosed, within 30 days following cessation of hydraulic
fracturing on a well, and shall notify the division in writing of
that belief.
   (3) The supplier is not required to disclose trade secret
information to the operator.
   (4) This subdivision does not permit a supplier to refuse to
disclose the information required pursuant to this section to the
division.
   (5) To comply with the public disclosure requirements of this
section, the supplier shall indicate where trade secret information
has been withheld and the specific name of a chemical constituent
shall be replaced with the chemical family name or similar descriptor
associated with the trade secret chemical information.
   (6) Except as provided in subparagraph (B) of paragraph (8), the
division shall protect from disclosure any trade secret designated as
such by the supplier, if that trade secret is not a public record.
   (7) The supplier shall notify the division in writing within 30
days of any changes to information provided to the division to
support a trade secret claim.
   (8) Upon receipt of a request for the release of information to
the public, which includes information the supplier has notified the
division is a trade secret and is not a public record, the following
procedure applies:
   (A) The division shall notify the supplier of the request in
writing by certified mail, return receipt requested.
   (B) The division shall release the information to the public, but
not earlier than 60 days after the date of mailing the notice of the
request for information, unless, prior to the expiration of the
60-day period, the supplier commences an action in an appropriate
court for a declaratory judgment that the information is subject to
protection or for a preliminary injunction prohibiting disclosure of
the information to the public and provides notice to the division of
that action.
   (9) (A) Except as provided in subparagraph (B) of paragraph (8),
trade secret information is not a public record and shall not be
disclosed to anyone except to an officer or employee of the division,
the state, local air districts, or the United States, in connection
with the official duties of that officer or employee, to a health
professional, under any law for the protection of health, or to
contractors with the division or the state and its employees if, in
the opinion of the division, disclosure is necessary and required for
the satisfactory performance of a contract, for performance of work,
or to protect health and safety.
   (B) A health professional may share trade secret information with
other persons as may be professionally necessary, including, but not
limited to, the patient and other health professionals.
Confidentiality of the trade secret information shall be maintained.
 The holder of the trade secret may request a confidentiality
agreement consistent with the requirements of this subdivision to
whom this information is disclosed as soon as circumstances permit.
 If necessary, a procedure for timely disclosure by the
division in the event of an emergency shall be identified.
   (10) For the purposes of this subdivision, the definitions
provided in Article 3 (commencing with Section 3150) shall apply when
appropriate.
   (d) After the completion of any well, this section also applies,
as far as it may be applied, to the deepening or redrilling of the
well, an operation involving the plugging of the well, or any
operations permanently altering in any manner the casing of the well.
The number or designation of a well, and the number or designation
specified for a well in an application filed as required by this
section, shall not be changed without first obtaining a written
consent of the supervisor.
   (e) If an operator fails to comply with an order of the
supervisor, the supervisor may deny approval of proposed well
operations until the operator brings its existing well operations
into compliance with the order. If an operator fails to pay a civil
penalty, remedy a violation that it is required to remedy to the
satisfaction of the supervisor pursuant to an order issued under
Section 3236.5, or to pay any charges assessed under Article 7
(commencing with Section 3400), the supervisor may deny approval to
the operator's proposed well operations until the operator pays the
civil penalty, remedies the violation to the satisfaction of the
supervisor, or pays the charges assessed under Article 7 (commencing
with Section 3400).
   (f) This section does not apply to routine pressure tests to
monitor the integrity of wells and well casings.
   (g) Prior to the approval of the commencement of any drilling,
redrilling, or deepening of a well, the operator shall submit written
proof to the supervisor that a waste discharge report has been filed
with the applicable regional water quality control board pursuant to
Section 13260 of the Water Code for the disposal of the wastewater
for the well.
  SEC. 6.  Section 3203.1 is added to the Public Resources Code, to
read:
   3203.1.  (a) At least 30 days prior to commencing a hydraulic
fracturing treatment, the operator shall provide a copy of the
approved hydraulic fracturing treatment permit to every surface
property  owner.   owner or authorized agent of
that owner whose property line location is one of the following:
 
   (1) Within a 1,500 foot radius of the wellhead.  
   (2) Within 500 feet from the horizontal projection of all
subsurface portions of the designated well to the surface. 
   (b) (1) A property owner notified pursuant to subdivision (a) may
request the applicable regional water quality control board to
perform water quality sampling and testing on any water well suitable
for drinking or irrigation purposes and on any surface water
suitable for drinking or irrigation purposes as follows:
   (A) Baseline measurements prior to the commencement of the
hydraulic fracturing treatment.
   (B) Followup measurements after the hydraulic fracturing treatment
on the same schedule as the pressure testing of the well casing of
the hydraulically fractured well.
   (2) The regional water quality control board may contract with an
independent third party that adheres to board-specified standards and
protocols to perform the water sampling and testing.
   (3) The regional water quality control board shall retain and
archive sufficient samples collected pursuant to this subdivision to
permit a reasonable number of additional analyses.
  SEC. 7.  Section 3203.2 is added to the Public Resources Code, to
read:
   3203.2.  A notice of intent to drill, rework, or deepen a well
where hydraulic fracturing will occur shall include all of the
following information:
   (a) A description of the estimated quantity of water planned to be
used in the hydraulic fracturing process.
   (b) The source or sources of water to be used. 
   (c) A groundwater monitoring plan to the appropriate regional
water quality control board. The groundwater monitoring plan shall
include, at a minimum, all of the following information:  
   (1) The current water quality of the groundwater basin through
which the well will be drilled that is sufficient to characterize the
quality of the aquifer and identify the zone of influence of the
proposed well.  
   (2) Water quality data or a plan to obtain data for monitoring
wells regarding the presence and concentration of the constituents to
be used in, or that can be influenced by, the drilling process for
the period of active use.  
   (3) An emergency monitoring plan that will be implemented in the
case of well casing failure or any other event which has the
potential to contaminate groundwater.  
   (d) Water quality monitoring data shall be submitted
electronically to the State Water Resources Control Board geotracker
database and any public data registry identified by the division for
disclosure of hydraulic fracturing data.  
   (e) This section shall not apply if the appropriate regional water
quality control board confirms that the proposed well will not
penetrate or will not be located within the zone of influence of an
aquifer that is designated for a beneficial use. 
  SEC. 8.  Section 3213 of the Public Resources Code is amended to
read:
   3213.  The history shall show the location and amount of
sidetracked casings, tools, or other material, the depth and quantity
of cement in cement plugs, the shots of dynamite or other
explosives, the results of production and other tests during drilling
operations, and the information required pursuant to Section 3156.
  SEC. 9.  Section 3215 of the Public Resources Code is amended to
read:
   3215.  (a) Within 60 days after the date of cessation of drilling,
rework, hydraulic fracturing, or abandonment operations, or the date
of suspension of operations, the owner or operator shall file with
the district deputy, in a form approved by the supervisor, true
copies of the log, core record, and history of work performed, and,
if made, true and reproducible copies of all electrical, physical, or
chemical logs and tests. Upon a showing of hardship, the supervisor
may extend the time within which to comply with this section for a
period not to exceed 60 additional days.
   (b) (1) The supervisor shall post the information provided
pursuant to Section 3156 and that is not claimed as a trade secret
pursuant to subdivision (c) of Section 3203 to existing Internet maps
on the division's Internet Web site, and shall make that information
available to the public in a way that the information is associated
with each specific well where chemicals are injected for purposes of
hydraulic fracturing.
   (2) For purposes of complying with the posting requirements of
paragraph (1), the supervisor may use an existing public Internet Web
site administered by the Ground Water Protection Council or the
Interstate Oil and Gas Compact Commission if all of the following are
met:
   (A) The information is transmitted and posted to the public
Internet Web site in a form and manner approved by the supervisor and
includes the information provided to the supervisor pursuant to
Section 3156, except for trade secret information pursuant to
subdivision (c) of Section 3203.
   (B) There is an electronic link from the wells represented on the
division's existing internet maps that allows members of the public
to view the information about specific wells based on their location.

   (C) On and after January 1, 2014, the Chemical Disclosure Registry
allows for the division staff and the public to aggregate data and
search and sort the registry for information by geographic area,
ingredient, Chemical Abstract Service number, time period, and
operator.
   (D) Members of the public are permitted to copy, reproduce,
modify, republish, upload, post, transmit, or distribute the
information without restriction.
  SEC. 10.  Section 3215.5 is added to the Public Resources Code, to
read:
   3215.5.  (a) Notwithstanding Section 10231.5, on or before January
1, 2014, and annually thereafter, the supervisor shall prepare and
transmit to the Legislature a comprehensive report regarding
hydraulic fracturing in oil and gas exploration and production in
California, using the information provided pursuant to Section 3156.
Where the information involves trade secret protection, the
supervisor shall only use information provided pursuant to paragraph
(5) of subdivision (c) of Section 3203 to complete the report. The
report shall additionally include, but is not limited to, the
following relevant information:
   (1) Aggregated data detailing the volumes of hydraulic fracturing
fluid used during hydraulic fracturing, identifying whether it is
water suitable for irrigation or domestic purposes, water not
suitable for irrigation or domestic purposes, or something other than
water.
   (2) Aggregated data detailing the disposition of hydraulic
fracturing fluid used to conduct hydraulic fracturing.
   (3) Aggregated data detailing the volumes of each chemical used in
hydraulic fracturing treatments in the state, in each county, and by
each company, during the preceding year.
   (4) The number of emergency responses to a spill or release.
   (5) The number of well failures.
   (6) Based on a representative sampling of information submitted to
the division pursuant to Section 3156 and subdivision (c) of Section
3203, the percentage of chemical information withheld within the
representative sample as trade secret information.
   (b) A report to the Legislature pursuant to subdivision (a) shall
be submitted in compliance with Section 9795 of the Government Code.
  SEC. 11.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B 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 XIII B of the California
Constitution.