- Associated Press - Sunday, April 26, 2015

OKLAHOMA CITY (AP) - The oil and gas industry needs wastewater disposal wells as much as it needs pipelines and customers. But in some areas of the state, operators have been put on notice that their previously permitted facilities might not meet an evolving standard.

There is a growing consensus among seismologists that injecting fluid near the crystalline basement rock layer can put pressure on faults, and could trigger earthquakes. However, it is difficult for scientists to prove that a particular disposal well triggered a specific tremor.

But the ongoing and unusual increase in seismic activity drove Tim Baker to change his approach to the permitting process for wastewater disposal wells. The Oklahoma Corporation Commission’s Oil and Gas Conservation Division director said he needs flexibility to change newly issued permits’ terms.

Oklahoma has been noted as one of the best places to invest in oil and gas operations, according to a report by the Fraser Institute, a Canadian think tank. One driving reason behind the ranking is the stable regulatory environment, The Journal Record (https://bit.ly/1Pqp7Vp) reports.

Considering seismicity likely wasn’t in anyone’s business model, Baker said.



Despite the fact that the conditions governing disposal well permits can change without a hearing, the state’s largest industry trade association hasn’t objected to the agency’s approach. Oklahoma Independent Petroleum Association spokesman Cody Bannister said the OCC regulates firmly but fairly.

“The Corporation Commission moved rationally and reasonably. The rules aren’t knee-jerk reactions,” he said.

In March, Baker expanded the area of interest for examining disposal wells near seismic swarms, or series of earthquakes in a short period of time and in close proximity. He prioritized 347 of about 1,000 wells injecting wastewater into the Arbuckle formation that are closest to the seismic activity.

He directed 92 operators to prove those 347 wells didn’t touch the basement rock. Wells too close to the rock will be required to add more cement, creating a shallower total depth and putting more space between the bottom of the hole and the granite. As a result of the directive, the agency found a number of wells that were drilled too deep, Baker said.

April 18 was the deadline for those companies to show that evidence. The agency is still tabulating the results and did not have a tally by press time of how many wells would be required to plug back.

The cost to fill in a well to a shallower depth could be about $100,000, which is significant for some companies, said Bannister.

OCC spokesman Matt Skinner said the agency has to be flexible in its regulatory response to seismic activity near disposal wells because those tremors are an unpredictable force. It’s an ever-changing situation and the agency needs to respond accordingly, he said.

“Our response is to be able to respond quickly to what is happening and to what is known,” Skinner said. “That, by definition, will make a somewhat unpredictable environment for business, and we can’t help that.”

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Information from: The Journal Record, https://www.journalrecord.com

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