NM Oil Conservation Division IPANM Presentation August 3, 2016 David Catanach, Director Oil Conservation Division
PRESENTATION OUTLINE • Roswell Ground Water Basin Update • Marginal Well Shut-In Relief Program • Spill & Leak Delineation & Remediation Standards Workgroup • Focused Enforcement Efforts • Upcoming Issues NMOCD IPANM Presentation 8-3-16
ROSWELL GROUND WATER BASIN • Large area defined by the State Engineer • Approximate area: 105 Miles North to South 33 Miles East to West • Within a portion of the RGWB there exists two fresh water aquifers. Shallow Aquifer : 450’ & Deeper Artesian Aquifer: 1200’ - 1400’ • Remaining portion of RGWB: Deeper Aquifer only • OCD initially contacted by Representative Townsend • Initial reports indicated possible water contamination • OCD attended 2 public meetings with Pecos Valley Conservancy District, Office of the State Engineer & Various legislative members • At issue is whether a single casing string set through both aquifers provides adequate protection NMOCD IPANM Presentation 8-3-16
. .·- ._ ' ' i 2.« t..--.c..., , c · C : - ·, : P R E P A R E D I N C O O P E R A T I O N W I T H T E C H N I C A L R E P O R T 4 2 N E W M E X I C O S T A T E E N G I N E E R S T A T E S G E O L O G I C A L S U R V E Y T H E U N I T E D R O S W E L L B A S I N S A N T A F E , N E W M E X I C O N E W M E X I C O 1 0 6 ° 10 ° 1 0 4" T 3 N Map of Roswell 2 T I · · . l , ' w I · ' 1 I : I ' i I : _ . . , . . .. I ' N ' , ••• " i '" : .!. " 2. _., ·- , 1 - -- -n- . . . .. : : c .l - -" '''-· ·--'· - · · --·"-''· '-·-',--- :, , ... . . -t - " - - - ' ,,; 't,. .- - - T - : -· • - • ' - s ! i N - - . 1 8 Ground Water f • .. -, I . .2 i./"· L! ( 3 Basin 5 6 7 !3 9 10 T-5S to T-23S 1 1 \ - ,.,,. .. 1 2 - -------- - ---' ----··· - ' ' i 3 ---- ! 1 4 R-21E to R-27E 5 1 6 1 7 ( 18 19 20 2 1 +-· • ····- - ··-· • ·- - ,s - - + - - , - - - . ;::, .... . . j ---· - · - - · -- ,,, ., .. 24 \ [ > , ; ; ,· • ' ' ]5 5 ? 25 i '<' ' 2' 5 .5 - ) i 6 ·? · . t f n . a Mtxr co . - / ,,, .. E W v,i ' 6 • 1 T E X AS "t, 22 23 25 27 R 9 E 1 0 11 1 2 1 3 14 1 6 17 18 19 2 0 2 1 2 4 2 6 R 2 8 E 15 Base from U. S. Geolog i ca l 10 20 30 0 40 MI LE Su rv ey State base map, - - - - - - - - - - - - - - - S - - - · J 1 :500 , 000 E X P LANAT I O N .,,.--·-- -- Surface-water d r a i nage d i v ide ---··- - -··- Lega l boundary of Roswe l l U n d e r g r o u n d Water Bas i n i n 1 97 9 Appr oxi mate l i m i t of a rt es i an a qu i fer Ap p rox i ma t e 1 i m i t of s ha l l oe1 aq u i f e r Figure 1 • Map showing the surf ace drainage, legal boundar y , and aquif er limits NMOCD IPANM Presentation 8-3-16 of the Roswell ground-wat er basin, sout heastern New Mexic o. '. - -
ACTIONS TAKEN BY OCD • OCD’s primary concern: Protection of fresh water while not hindering oil & gas drilling activities • All APD’s within the RGWB are currently suspended by emergency order • Drilling is allowed within the RGWB provided that OCD approves revised casing programs • OCC hearing will establish: • A clearly defined area for the RGWB • A definitive casing/cementing program for oil & gas wells that will continue to provide protection of both aquifers & prevent communication between these water zones
RGWB PUBLIC HEARING • Case will be presented to the Oil Conservation Commission • Parties to the case include the OCD, Pecos Valley Conservancy District, COG Operating, Fasken Oil & Ranch, Oxy USA, Inc., Yates Petroleum, Mack Energy, Devon Energy & IPANM • August 8 : Meeting to schedule hearing • Hearing in September or October
OCD MARGINAL WELL SHUT-IN PROGRAM • New OCD program allows operators to shut-in marginal producing wells during times of low oil & gas prices • Program commenced early 2016 • Will reduce premature plugging of marginal producing wells • Must be conducted in a manner that will protect fresh water resources • 12 Operators; 400-500 Wells NMOCD IPANM Presentation 8-3-16
Requirements/Parameters • Applicable to wells that are planned to be shut-in or have recently been shut-in due to low prices • Must execute an agreed compliance order • Must demonstrate economic need • After a shut-in period of 15 months (currently allowed by OCD rules) wells can remain shut-in for an additional 3-year period • Wells must demonstrate mechanical integrity by Bradenhead Test at month 27 and annually thereafter • Additional financial assurance may be required • Check with BLM & SLO NMOCD IPANM Presentation 8-3-16
SHUT-IN WELL PROGRAM OCD CONTACT PERSON DANIEL SANCHEZ OCD Compliance & Enforcement Manager 505-476-3493 NMOCD IPANM Presentation 8-3-16
Spill & Leak Delineation & Remediation • Standards for delineating & remediating spills & leaks are currently contained within an OCD guidance document • Industry is concerned that standards are not established by rule & are not uniformly enforced within OCD • Industry recommendation: Form an OCD/Industry committee to establish a rule for spill & leak delineation & remediation standards
SPILL & LEAK DELINIATION & REMEDICATION WORKGROUP OBJECTIVES • Develop a rule to replace guidelines • Establish delineation protocals for leaks & spills • Establish characterization values • Develop timelines for compliance OCD is in the early stages of identifying workgroup participants NMOCD IPANM Presentation 8-3-16
NMOCD IPANM Presentation Leak & Spill Data Monthly Reported Releases Statewide 200 180 160 140 120 100 80 60 Recent Data Indicates Spills/Leaks Occurring at a Rate of 4.4 Per Day 40 20 0 6/1/2014 9/29/2014 1/27/2015 5/27/2015 9/24/2015 1/22/2016 5/21/2016 Date
FOCUSED ENFORCEMENT EFFORTS • Inactive wells: Rule 19.15.5.9 • 2,331 Non-compliant wells • Letters have been sent to 150 operators currently out of compliance • OCD is requesting operators submit a plan to bring wells into compliance • Enforcement action may be taken against non-responsive operators NMOCD IPANM Presentation 8-3-16
FOCUSED ENFORCEMENT EFFORTS • Financial Assurance: Rule 19.15.8.9 • OCD audit revealed that 151 operators were in violation of FA • OCD has sent out 124 letters to operators • Industry response has been outstanding • Additional FA in the amount of $472K has been furnished to OCD by industry as a result of this program NMOCD IPANM Presentation 8-3-16
FOCUSED ENFORCEMENT EFFORTS • Administrative & Hearing Orders • Many administrative & hearing orders issued by OCD contain certain requirements necessary for approval • Issue: Non-compliance with provisions contained within OCD orders • OCD will track order for compliance • OCD will send letters to operators for non- compliance NMOCD IPANM Presentation 8-3-16
FOCUSED ENFORCEMENT EFFORTS • Illegal dumping of oil field waste • OCD & New Mexico Junior College working to educate industry, public, law enforcement agencies, & district attorneys on issue of illegal dumping of produced water & oilfield waste • OCD is establishing relationships with law enforcement & district attorneys to criminally prosecute cases NMOCD IPANM Presentation 8-3-16
UPCOMING ISSUES • Delaware Formation Injection (Over Pressured & Injection into Potentially Productive Horizons) • Horizontal Well Rule Revision • Streamline Regulations • Drilling Activity Across State Lines • OCD Proposed Legislation OCD IPANM Presentation 8-3-16
David Catanach Director, NMOCD Energy, Minerals and Natural Resources Department David.Catanach@state.nm.us (505) 476-3468 OCD Website: http://www.emnrd.state.nm.us/ocd OCD Well Information and Operator Data: https://wwwapps.emnrd.state.nm.us/ocd/ocdpermitting/Data/Wells.aspx
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