Department of Conservation Interim Well Stimulation Treatment Regulations (SB 4) Effective January 1, 2014

On January 1, 2014 SB 4 took effect along with interim regulations over well stimulation treatment undertaken by oil and gas operators.

SB 4 requires operators to obtain a permit from the Division of Oil, Gas and Geothermal Resources ("DOGGR") in order to use well stimulation treatments. Operators will have to apply and provide information on the types of fluids used, a ground water monitoring plan and water management plan. Operators must send copies of the approved permit to neighboring property owners and tenants. Upon request, water well testing must be provided. Well stimulation treatment is allowed to continue without a permit until January 1, 2015 when permanent regulations take effect, however, the operator must certify its compliance under proposed interim regulations.

The interim regulations address the integrity of a well, notice of well stimulation, neighbor notification and water testing, pressure testing of equipment prior to well stimulation treatment, disclosure and trade secrets and storage and handling of well stimulation fluids.

Under interim regulations now in effect, an operator may not commence well stimulation until the operator provides all required information and certifications to DOGGR at least 10 days in advance of well stimulation. Operators must notify DOGGR at least 72 hours before commencing well stimulation so that DOGGR staff may witness the process. Interim regulations also require operators provide neighbor notification at least 30 days prior to well stimulation treatment. After well stimulation treatment, interim regulations require operators to post within 60 days, disclosure reports regarding the fluids used. Interim regulations also require disclosure of the chemical composition of fluids used by operators, which may or may not implicate certain trade secret protections.

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We will continue to monitor the proposed permanent regulations as they make their way through the rulemaking process.

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