American Oil and Gas Reporter - November 2016 - 21

other written OCD shut-in approval.
SLO adds that "compliance with all
OCD regulatory requirements is a
condition of maintaining a lease in good
standing."
Lessees or operators will be required
to pay annual shut-in royalty fees of
twice the annual rent, but not less than
$320 a well.
The amended rule will remain in
effect for two years, unless extended by
the state. According to SLO, the
regulation says:
Any oil lease issued by the state will
not expire if:
* A well capable of production is
on the lease and the well is shut in
because of reduced oil prices;
* The lessee notifies OCD in
writing within 30 days of the date the
well is first shut in, and includes a Form
C-103 filed with OCD; and
* The lessee pays an annual shut-in
royalty within 90 days of shutting in the
well, and annually thereafter.
The New Mexico Oil & Gas
Association and Independent Petroleum
Association of New Mexico testified in
favor of the shut-in rule during SLO
hearings. ❒

California Judge Backs
DOGGR In Lawsuit Over
Underground Injections
OAKLAND, CA.-The California
Independent Petroleum Association is
hailing a state superior court judge's
ruling that the state followed federal law
in using emergency regulations for its
underground injection control program.
Judge George Hernandez issued the
ruling Sept. 21 in Center for Biological
Diversity and Sierra Club v. California
Department of Conservation Division of
Oil, Gas and Geothermal Resources.
"Unbiased, independent scientific
reviews have proved that responsible oil
production can coexist with
environmental protection," says Rock
Zierman, chief executive officer of
CIPA, one of several interveners in the
case. "Activists with an agenda to stop
all oil production continue to ignore the
facts, and have failed in three legal
maneuvers. However, science and the
courts consistently have sided with the
facts."
According to court documents, the
plaintiffs alleged DOGGR violated the
Administrative Procedures Act by
promulgating emergency regulations
that allowed wastewater injection into
nonexempt California aquifers to

continue into 2017, and thus violated its
responsibilities for monitoring the
state's UIC program for the U.S.
Environmental Protection Agency.
Judge Hernandez rejected those
complaints, saying DOGGR had the
discretion to select the appropriate
corrective action to remedy
noncompliance, and complaints about
the emergency regulations were moot
because they had been replaced by
permanent state regulations.
State and federal regulatory agencies
signed a memorandum of understanding
on the UIC program, court documents
state. The document laid out how an
underground source of drinking water
could be exempted for injection, and
required an aquifer exemption to be in
effect prior to issuing a permit for
injection wells into that aquifer.
DOGGR issued several permits
without that exemption based on
assurances that injections were confined
to approved zones, and vertical and
lateral confinements were verified. In
2011, Hernandez's decision says,
DOGGR became aware that permitting
errors had led it to issue permits for
injections into nonexempt zones. EPA
ordered any state approval of new wells
in aquifers without approved
exemptions or into portions of aquifers
outside the specific exempted area be
limited to state-approved projects in
hydrocarbon-producing zones.
In December 2014, EPA approved
DOGGR issuing limited injection
permits in hydrocarbon-producing
zones not exempted under the Safe
Drinking Water Act, and four months
later issued requirements to bring
DOGGR back into compliance under
the act. Hernandez notes that EPA's
mandate recognized the need for
emergency orders. ❒

Terrebonne Parish
Says No Thanks To
Suing Oil Companies
BATON ROUGE-As developments
proliferate regarding civil litigation to
blame Louisiana coastal erosion on oil
and gas companies, one Pelican State
parish is telling Governor John Bel
Edwards not to sue on its behalf.
According to press accounts, four
coastal parishes already have sued oil
and gas companies that operate within
their boundaries, alleging that historical
oil and gas activity, such as dredging
canals, is responsible for an influx of
seawater that has killed stabilizing

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American Oil and Gas Reporter - November 2016

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