The earthquakes in Oklahoma has brought a lot of attention to the industry over the past few months. That being said, the Oklahoma Corporation Commission has established some new rules for new & existing disposal wells.
For those of you with production in Oklahoma, more specifically production in the Arbuckle formation, heads up!
As of September 1st (2 days ago), disposal well operators injecting into the Arbuckle formation are required monitor daily volumes, casing pressure, surface injection pressure.
Remember, GreaseBook tracks daily cums, pressure, and casing. That being said, most of you are probably already doing this — which is great!
If not, please holler and we’ll be happy to get you set up immediately…
Let us be very clear: while you are required to monitor your wells, the submission of the information is only required upon request.
Essentially, you are not required to report it unless it is specifically requested by Commission staff or Oklahoma Geological Survey staff.
The commission is paying special attention to disposal wells within seven “areas of interest” in central and northern Oklahoma. The areas are near the epicenters of the 20 magnitude 4.0 or greater quakes the state has experienced over the past five years.
Oklahoma is dotted with nearly 12,000 water injection and disposal wells — that being said, it seems there are only 97 wells in which they are particularly interested…
For more background information, check out the article printed in the Sunday Oklahoman on August 24th, entitled “Quake Study Leads to Cooperation”:
Special thanks to Glenn Blumstein, President of GLB Exploration, Inc. and his team in Oklahoma City for tipping us off…
And, a BIG thank you to Brian Woodard (the OIPA’s former VP of Regulatory Affairs, now Director of EHS Regulatory Affairs at Chesapeake) for helping GreaseBook to clarify the new rules!!
Wanna take a look at the new rules for yourself?
You’ll find them attached below…
1. Oklahoma Corporation Commission (OCC)
a. Joint Advisory Subcommittee and Technical Rulemaking Conference Highlights
i. OIPA representatives attended OCC’s Technical Rulemaking Conferences held on January 14th, January 29th, February 7th, February 19th, February 28th, in addition to the final, hearing en banc which was held before the Commissioners on March 13th. Substantive rulemaking items which were addressed, include:
1. OAC 165:10 – Oil and Gas Conservation Rules
a. OAC 165:10-3-15 (A-E) Venting and Flaring
1. Provides a 72-hour exemption period for conditioning producing wells and provides a 14-day exemption period for gas flared subsequent to initial flowback of a newly completed or recompleted well. Moreover, the rule provides for an additional 30-day period exemption if gas volumes flared are less than a rate of 300 mcf/d on a rolling average basis. The 14-day timeline commences following >50 mcf/d of combustible gas flow.
b. OAC 165:10-3-17 (D) Required Lease Signs
1. Requires API number and Global Positioning System (GPS) coordinates on lease signs for wells completed following the effective date of the rulemaking (July, 2014).
c. OAC 165:10-3-26 (A-D) Well Logs
1. Revises all instances where “wireline logs” are referenced to be more robust through the inclusion of the verbage “geophysical formation evaluation type well logs.” Also, the final rule requires producers to submit sonic logs to the OCC and allows the Commission to request additional well logs.
d. OAC 165:10-5-6 (D)(1)(A)Testing and Monitoring Requirements for Enhanced Recovery Injection Wells and Disposal Wells (D) Subsequent Mechanical Integrity Tests (MIT).
1. Requires operators of non-commercial disposal wells permitted for injection at volumes equal to or greater than 20,000 barrels shall demonstrate mechanical integrity by using one of the following methods:
a. Conduct a pressure test of the casing tubing annulus at least once every five years year according to the minimum testing standards of (3) of this subsection, or
b. If a continuous pressure monitor is installed on the casing tubing annulus that will automatically notify the operator of a mechanical failure, then the well shall demonstrate mechanical integrity at least once every five years according to the minimumtesting standards of (3) of this subsection.
e. OAC 165:10-5-7 (b) (3)(B)Monitoring and Reporting Requirements for Wells Covered by 165:10-5-1 – Required Monthly Monitoring
1. On a daily basis, the operator of each well authorized for disposal into the Arbuckle formation shall monitor and record the volumes, the casing tubing annulus pressure and the surface injection pressure for the well. The operator must maintain the information required by this subparagraph for a minimum of three years. This information shall be produced upon request by an authorized representative of the Commission.
f. Additional items concerning the concurrent development of horizontal and non-horizontal drilling and spacing units were a significant topic of discussion during these technical rulemaking hearings. The following was a significant provision adopted within the Ch. 5 and Ch. 10 rulemaking.
1. OAC 165:10-3-28(e)(4) – upon the formation of a horizontal well unit that includes within the boundaries thereof one or more non-horizontal drilling and spacing units, the Commission may provide that such horizontal well unit supersedes one or more of such non horizontal drilling and spacing units or mayshall provide that such horizontal well unit exists concurrently with one or more of such non-horizontal drilling and spacing units, In the event the Commission provides for the concurrent existence of a horizontal well unit and a non horizontal drilling and spacing unit, as provided above, and each such unit may be concurrently developed.