American Oil and Gas Reporter - October 2016 - 91

ConventionSection: Oklahoma Independent Petroleum Association
restaurant.
Following breakfast on the convention's
final day, Tuesday, Oct. 25, will be the
OIPA Fall Classic Golf Tournament and

awards reception.
"Being an outdoorsman and someone
who likes cool weather, I think the fall
conference location is wonderful," Mc-

Dougall affirms. "The OIPA staff does
such a good job of putting that on. My
wife and I look forward to it so much that
we usually go out a few days early." ❒

OIPA Works To Help With Seismicity
OKLAHOMA CITY-Anyone asking
Oklahoma Independent Petroleum Association President Mike Terry what the
state's oil and gas industry is doing to
shed light on and address induced seismicity should pack a lunch. Whether cooperating with regulators, applying and
sharing geoscientific expertise, supplying
fault maps, conducting pressure tests or
participating in public meetings, OIPA
members are trying to help.
"Our industry wants this to go away
more than anyone," Terry assures. "We
were seeing results that included a considerable decline in the number of earthquakes that registered at least 3.0. Then-
boom-this happens."
"This" being a 5.8 magnitude earthquake on Sept. 3 near Pawnee, Ok., that
made national headlines.
"Having this happen when times are
tough already makes it even harder," he
remarks. "Our members operating in the
Mississippian Lime in that part of the
state are under tremendous stress."
But the state and its producers are
meeting the challenge, assesses OIPA
Chairman Jeffrey McDougall, president
of JMA Energy Company LLC in Oklahoma City. "As with everything else in
our industry, we are on the path to best
practices," he describes. "It takes time to
understand this. We think the Oklahoma
Corporation Commission's approach has
been a good one."
Regulatory Actions
In a Sept. 12 media advisory, OCC
and the U.S. Environmental Protection
agency, which has jurisdiction over Osage
County, Ok., announced further action
based on new fault data from the Oklahoma and U.S. Geological surveys. The
agencies set the total size of the "area of
interest" at 1,116 square miles, which
encompasses 67 Arbuckle disposal wells,
48 of which are under OCC jurisdiction
and 19 of which EPA oversees. Injection
volumes were to be cut a total of 40,000
barrels a day, which includes 32 wells
ordered to cease operations.
Media reports cited OCC as saying

the curtailments would drop the area's
cumulative injection rates from 75,000
to 35,000 bbl/d.
OIPA Vice President of Regulatory
Affairs A.J. Ferate draws particular attention to OCC's procedures, pointing
out that the actions following the Sept. 3
quake have been a test-drive for a process
that originated with HB 3158, which was
passed by the 2016 Oklahoma Legislature
to authorize the OCC to take certain
emergency actions. Before HB 3158,
OCC lacked such power and was limited
to requesting operators' cooperation, he
notes.
"When OCC was asking, there was
no need for due process," Ferate characterizes. "This is the first time under the
new statute that OCC has issued an order
shutting in specific wells. Predictability
becomes really important for an operator
regarding how things will be handled
after his well is shut in."
Although that new process does not
lack for rules, he says, some of them are
vague, which prompted Ferate to wonder
how things would go the first time the
commission had to follow them. "Predictable due process really is important
from a constitutional and administrative
law perspective," he reflects. "I think we
have made a significant impact toward
making sure operators have predictability."
Ferate also lauds OCC's flexibility.
He notes that a Sept. 7-8 experts' symposium on seismicity-scheduled in advance of the Sept. 3 quake-examined the
situation. "There was a lot of good discussion among experts, and the OCC adjusted its area of affected disposal wells
as a direct result," he relates. "The initial
reaction was measured, and when more
information became available, the commission did the right thing and adjusted."
Under Pressure
Not all responses have been as measured as the OCC's, Terry notes. OIPA
sent representatives to an early September
forum in Tulsa that was teeming with

vocal anti-oil-and-gas activists, he says.
"There definitely will be some efforts at
the Capitol," he predicts. "Some people
want to establish a fund to pay for damages, but I don't see how that is possible.
How do you administer such a fund when
everyone's foundation is bound to have
some cracks that predate any earthquake?"
Although some oil and gas opponents
have sown confusion that suggests hydraulic fracturing contributes to induced
seismicity, Terry contends industry representatives have made some strides in
educating the public in that regard. Even
so, he admits it is a tall order. "Some in
the media still don't know the difference
between drilling and fracturing," he muses.
"We have to explain that a lot, but it is
beginning to permeate to the point that
many people understand."
The many unique industry-led initiatives Terry cites include a new effort to
further expand the boundaries of scientific
data, in which OIPA leadership has raised
funds for pressure tests in abandoned
Arbuckle wells in northern Oklahoma.
"OIPA Induced Seismicity Subcommittee
Chairman Kim Hatfield believes there is
a lot to be learned from looking at
pressure gradients," Terry details. "We
are in the beginning stages of putting together a database of pressures from these
wells."
McDougall points out that some of
the bigger quakes have been concentrated
not in the heart of injection areas, but on
the perimeter. "It is complex, and who
knows what finally breaks the camel's
back to cause any of these faults to release
all that energy," he muses. "We keep
trying to work with the commission and
the state."
"We are putting all the resources
behind studying this that we can," Terry
emphasizes. "The Oklahoma Geological
Survey has hired new experts and the department head is under tremendous pressure to find results. It would be nice if
there was an easy fix, but since there is
not, we are going to continue to provide
whatever information, funding and assistance we can."
❒
OCTOBER 2016 91



Table of Contents for the Digital Edition of American Oil and Gas Reporter - October 2016

Contents
American Oil and Gas Reporter - October 2016 - Cover1
American Oil and Gas Reporter - October 2016 - Cover2
American Oil and Gas Reporter - October 2016 - Contents
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