2020 July Energy News

Energy News July 2020

From the Field Photo Llano River Photo by Ron Perez

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RRC Seeks Public Comments on Draft Statewide Rule 32 Form as Part of Effort to Reduce Oil and Gas Flaring

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Railroad Commission Keeping Close Tabs on Permian Highway Pipeline Construction

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Railroad Commission’s Underground Injection Control Program Earns Recognition from EPA for Reducing Environmental Risks

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Railroad Commission Improves Transparency through New Interactive Data Visualizations

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Webinars on Vital RRC Topics Archived and Available for Viewing

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Texas Pipeline Mapping System Updates Publication

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Commissioners’ Corner

Proposal Open to 30-Day Public Comment Period

Upcoming Events September 1, 2020

Open Meeting

Austin, TX

September 22, 2020

Open Meeting

Austin, TX

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RRC Seeks Public Comments on Draft Statewide Rule 32 Form as Part of Effort to Reduce Oil and Gas Flaring Proposal Open to 30-Day Public Comment Period The Railroad Commission took a major step toward reducing flaring in the oil and gas industry at its Aug. 4 Conference. Commissioners authorized staff to publish a new proposed version of the Application for Exception to Statewide Rule 32.

Also at the Conference, Railroad Commission staff discussed a recent positive trend that has been occurring with the rate of flaring. While the amount of gas produced in Texas declined by 13 percent from June 2019 to May 2020, the portion of produced gas that was flared dropped even more sharply, by 79%, during that same time period. Staff will continue analyzing flaring trends in the coming months.

There are several proposed modifications to the Statewide Rule 32

application, which include, but are not limited to the following: • Th e period of time for which an

operator may obtain an administrative exception to flare gas will be reduced in many cases.

For certain exceptions, the duration may be reduced by 50% to 80%.

• Provide incentives for operators to use technologies to reduce the amount of gas flared.

• Operators must provide more specific information to justify the need to flare or vent gas in accordance with Commission rules.

• Flares would be related to specific pro duction properties to facilitate compliance with reported production.

Tracking the new information and data points will be valuable in any future efforts to tailor policy that addresses flaring.

“Today, we took an important first step in ensuring we have the data necessary to get an accurate view of the scope of flaring in Texas,” said Chairman Wayne Christian.

“Since the downturn, the rate of flaring has gone down with more than 99.5 percent of the gas produced in the month of May sold and beneficially used to generate electricity, cook dinner, or make hundreds of consumer products. Now is the opportune time to implement meaningful recommendations to reduce flaring before oil and gas production climbs back to previous highs.”

“I sincerely appreciate the hard work that has gone into making these significant changes and look forward to receiving feedback during the public comment period,” said Commissioner Christi Craddick. “I am pleased with the progress we are making toward significant flaring reductions in Texas. The comprehensive IT upgrade will continue to be a priority of the Commission to ensure the availability of reliable and transparent data.”

“Flaring is a byproduct of production, but that doesn’t mean it’s not an issue that’s worth examining more closely,” said Commissioner Ryan Sitton. “That’s why I undertook the first systematic study of flaring in Texas and how our volumes compare with other major energy producers. I’m glad the Railroad Commission of Texas is stepping up and continuing to lead.”

The proposed changes include RRC staff’s analysis of a Blue Ribbon Task Force report on best practices to reduce flaring.

The draft changes are open for a 30-day comment period and can be found on

the RRC website at: https://rrc.texas.gov/ about-us/resource-center/forms/proposed-form-changes/. Commissioners will need to approve a final version of the form at a future meeting before it goes into effect.

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More actions are in the works to aid RRC’s work on flaring. The agency is working to improve reporting to get a better picture of how much gas is flared or vented and the specific reasons for doing so.

The agency is also developing an integrated online system that will allow flaring information from different types of users, such as inspectors in the field or technical specialists in Austin, to be accessible in one place.

Oil and gas production is a critical industry that fuels our lives and provides us with many everyday products that we depend upon, and has helped recent energy independence for the United States.

Methane emissions related to the extraction of crude oil and natural gas have gone down by 23 percent since 1990, according to the EPA’s 2020 Inventory of U.S. Greenhouse Gas Emissions and Sinks.

And, despite considerable growth in the Texas oil and gas industry between 20032018, the EPA’s 2018 Toxics Release Inventory, published in 2020, shows a 42 percent drop in the release of toxic air chemicals over the same period in the state.

400-Mile Project Is Currently Making Way Through the Hill Country

Railroad Commission Keeping Close Tabs on Permian Highway Pipeline Construction

Railroad Commission inspectors are keeping a close watch on the Permian Highway Pipeline, a natural gas pipeline project being constructed from the Permian Basin to the Houston area.

The pipeline is more than 400-miles long, and it will bring natural gas from West Texas to the world market when it’s complete.

Given the sheer scale of the PHP and its route through the sensitive Texas Hill Country, RRC has engaged in a comprehensive response to ensure that the pipeline is constructed safely in a manner protective of public health and the environment. Since March inspectors from two key RRC divisions, Oil and Gas and Pipeline Safety, have conducted more than 75 inspections and investigated close to 20 complaints related to the pipeline.

Currently RRC inspectors are on-site near the Pedernales River in Gillespie County as the pipeline operator, Kinder Morgan, works to excavate a pathway for the pipeline beneath the river.

“Our inspectors have been hard at work, even during the COVID-19 pandemic, to ensure Kinder Morgan is compliant with Commission rules that are in place to protect public safety and natural resources,” said RRC Executive Director Wei Wang. “In addition to the all-hands efforts within the agency, we are also in contact with resident groups and the company as construction progresses. When it is complete, this pipeline will add vital capacity to convey natural gas, which in turn will also help ongoing efforts to further reduce flaring in West Texas.”

New pipelines are important to efficiently and safely transport large amounts of natural gas and oil.

The Texas Pipeline Association estimates that a 20-inch pipeline running 50 miles can replace 1,650 tanker trucks carrying oil on the road. Pipelines also help reduce flaring by alleviating potential backing up of supply at the point of production.

RRC Oil and Gas inspectors have been at construction sites to ensure the operator has been compliant with agency rules to prevent the pollution of surface and groundwater resources.

Oil and Gas Field Operations staff also issued a notice of violation related to a drilling fluid spill that occurred in the spring.

Pipeline Safety inspectors have conducted multiple inspections of pipeline installation and pipe yards. The inspections include but are not limited to welding, pipe transportation procedures, coating thickness inspections; backfilling of trenches; safety equipment operability, and materials records.

The PHP is expected to be complete in early 2021.

Railroad Commission’s Underground Injection Control Program Earns Recognition from EPA for Reducing Environmental Risks

The Railroad Commission’s Underground Injection Control program continues improve its processes to protect underground sources of water and seismic activity, according its annual evaluation by Environmental Protection Agency.

any seismic activity because of them,” said Paul Dubois, RRC Assistant Director for Technical Permitting. “We will continue to work with our federal counterparts to build on and improve our work to help protect Texans.”

The recent report titled, “2019 EPA Region 6 End-Of-Year Evaluation Railroad Commission of Texas Underground Injection Control Program,” can be found on RRC’s website at https://www.rrc.texas.gov/ oil-gas/applications-and-permits/injection-permit-types-and-information/.

The report’s key findings include:

V I E W T H E E VA L U AT I O N4 RRC’s UIC program protects the state’s drinking water and controls seismic activity through enforcement of EPA-approved rules on permitting, construction, and testing of underground injection wells. Injection wells are used to process waste fluid from oil and gas operations, especially water with high levels of brine; for brine mining; for enhanced recovery, which prolongs the life of oil and gas fields; and hydrocarbon storage. Wells are located in underground formations geologically separate from aquifers that are sources of drinking water.

“The Railroad Commission continues to confront significant challenges in the program and has taken some innovative measures to address them,” the summary of EPA’s report reads.

“The EPA’s report acknowledges the efforts of Railroad Commission staff to responsibly manage injection wells to protect our natural resources and mitigate

• More than half of all injection wells in the state are inspected annually. The EPA report notes that “Those numbers assure more than adequate inspection and monitoring surveillance actions.”

• The report also noted that RRC rules enacted in November 2014, a guidance document adopted in 2019, and increased UIC staffing “enhance RRC authority regarding seismicity related to Class II disposal … and establish new permit application information to address seismic risk in problematic areas of the State.”

• A recognition of RRC’s critical review of disposal well applications, which resulted in 65 permits issued with special conditions, 19 withdrawn or returned applications, hearings scheduled for 56, and three permits issued without any special conditions. Also, the agency evaluated the role of two disposal wells in an earthquake near Timpson in September 2018, which resulted in the modification of one permit to reduce pressure and the canceling of the other permit.

Railroad Commission Improves Transparency through New Interactive Data Visualizations Latest Projects Highlight Site Remediation and Abandoned Mine Land Reclamation The Railroad Commission has produced another round of data visualization on its website.

The data visualizations help make RRC data more accessible and transparent for the public. The latest visualizations present data from RRC’s Site Remediation and Abandoned Mine Land (AML) programs in user-friendly interactive layouts.

Each data visualization project includes bar graphs, an interactive Texas map, a list of counties, and other options to fine tune a search.

RRC’s Site Remediation Section oversees several cleanup programs to restore former oil and gas fields. The AML program works to reclaim and restore land and water resources as the result of abandoned mines.

“The Railroad Commission has made great strides in laying out our large amount of data in easy-to-understand formats,” says Wei Wang, RRC Executive Director.

“These latest additions will help the public and energy industry operators easily see key aspects of the important work we do in protecting the safety of Texans and the environment.”

These are the newest data visualization presentations: • State Managed Site Cleanup Activities (updated quarterly)

• Operator Cleanup Program Sites (updated quarterly) • Voluntary Cleanup and Brownfield Program Sites (updated quarterly) • Abandoned Mine Land Reclamation Project Sites (updated mont hly) All of the RRC data visualization projects can be found at https://rrc.texas.gov/ data-visualization/.

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Webinars on Vital RRC Topics Archived and Available for Viewing The RRC has been conducting successful webinars this summer on important information related to the agency’s oversight of the energy industry. The webinars guided individuals and operators on applicable laws, and RRC rules, procedures and assistance related to oil and gas operations in Texas.

In July, a series of more than a dozen regulatory webinars covered topics, including Oil Storage, GIS New Viewer Tool, Oil and Gas Waste Stream Management, Statewide Rule 32: Flaring, Field Transfers, and Introduction to Drilling Permits and Online Filing.

The archived presentations can be found at this link https://rrc.texas. gov/oil-gas/oil-gas-workshops-andseminars/rrc-regulatory-webinars-oil-gas/schedule/

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The Oil and Gas webinars covered a variety of topics including: • c ompletions filings for oil, gas and under-

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ground injection control; drilling permits and online filings; field transfers; groundwater protection determinations; inactive wells; oil storage – surface and underground; oil and gas waste stream management requirements; production reporting and commingle permit applications; production sharing agreement and allocation wells; Public GIS Viewer new tools; severance tax incentive certification application; transportation and storage reporting; and underground injection control permitting, testing and monitoring requirements.

The RRC also hosted a webinar in conjunction with the Texas Commission on Environmental Quality on the Brownfields Response Program. The program provides grants to government agencies, nonprofit organizations, universities and school districts, and economic development corporations to help redevelop abandoned oil and gas sites.

The webinar can be viewed at this link http://www.adminmonitor.com/tx/rrc/webinar/20200623/

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Texas Pipeline Mapping System Updates Publication The Railroad Commission’s Texas Pipeline Mapping System has adopted a new name for its Attribute Definitions, Valid V alid Codes and Digital Projection Requirements publication. It’s now known as A Guide to Shapefile Submissions, Submissions , which is available at https://rrc.texas.gov/pipeline-safety/mapping/digital-submissions/.

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The TPMS is a geographic information system database that requires pipeline attributes to be represented by certain codes. A Guide to Shapefile Submissions includes the required fields that pipeline operators must follow when submitting shapefiles to pass validations. The requirement document defines the required attribute fields within the database and explains which codes are valid representations of those attributes.

The revisions to the requirements, effective Sept. 1, are in response to amendments to 16 Texas Administrative Code §3.70, which can be found at https://texreg.sos.state.tx.us/ public/readtac$ext.TacPage?sl=R&app=9&p_dir=&p_rloc=&p_tloc=&p_ploc=&pg=1&p_ tac=&ti=16&pt=1&ch=3&rl=70

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A new TPMS frequently asked questions is now available at https://rrc.texas.gov/about-us/ resource-center/faqs/pipeline-safety-faqs/faq-pipeline-permitting-and-mapping/

V I E W F AQ'S4 For question, the RRC’s Pipeline Permitting Section can be contacted at tpms@rrc.texas.gov or 512-463-7058.

Chairman Christian CO M M I S S I O N E R S’ CO R N E R

The Interstate Oil and Gas Compact Commission (IOGCC) passed Railroad Commission Chairman Wayne Christian’s (R – Texas) resolution urging the federal government to investigate excessive dumping of crude oil by Saudi Arabia and Russia and take appropriate action.

You can read the Chairman’s resolution at https://www.rrc.texas.gov/media/59190/080620_ chairmans_resolution.pdf

V I E W T H E R E S O L U T I O N4 “For much of 2019 and early 2020, Saudi Arabia shipped relatively little crude to America, with average arrivals running at about 475,000 barrels a day,” said Christian. “After the COVID-19 pandemic crippled the U.S. oil and gas industry, Saudi Arabia shipped 1.3 million barrels a day to our nation, roughly four times February’s daily volume and the highest figure since 2014.”

“Flooding the market during ongoing negotiations with President Trump and the international community is disingenuous,” continued Christian. “More than 100,000 oil and natural gas jobs in the United States have been lost according to Rystad Energy Group. Our federal government must push back against international efforts that harm American energy dominance.”

For more, see https://rrc.texas.gov/about-us/commissioners/christian/news/072120oildumping/

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Commissioner Craddick CO M M I S S I O N E R S’ CO R N E R

Commissioner Craddick provided oil and gas industry updates to several groups this month. The groups included the retail, manufacturing, and construction sectors and represent some of the most important parts of our state economy.

Additionally, Commissioner Craddick commends the work by Chairman Wayne Christian, Texas Railroad Commission staff, and stakeholders on updates to flaring regulations. The August Conference marks significant strides toward the completion of this important task. The comments and feedback received on the Statewide Rule 32 Data Sheet are appreciated, and I look forward to reviewing them.

Commissioner Sitton CO M M I S S I O N E R S’ CO R N E R

Commissioner Ryan Sitton attended and voted on key issues before the Railroad Commission during this week’s virtual conference. Commissioner Sitton continues monitoring trends across the industry as they affect all Texans.

Oil and Gas Production Statistics

View monthly production totals of crude oil, condensate and total oil; and of gas well gas, casinghead gas, and total natural gas.

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Enforcement Actions

The Commission has primary oversight and enforcement of the state’s oil and gas industry and intrastate pipeline safety. View RRC’s Latest Enforcement Actions here.

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Public GIS Viewer

The Public GIS Viewer allows users to view oil, gas and pipeline data in a map view.

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