Lawsuit Seeks to Halt Oil Industry Wastewater Disposal Practices

Stoel Rives LLP

On Thursday, May 7, 2015, two environmental groups filed a lawsuit seeking an immediate halt to oil and gas wastewater injection at 2,500 wells across California.

The suit, filed by the Sierra Club and the Center for Biological Diversity, claims that the state Division of Oil, Gas and Geothermal Resources (“DOGGR”) should be prohibited from letting companies pump produced water from their drilling operations into non-exempt aquifers.

DOGGR has repeatedly assured Californians that there has been “no contamination of water used for drinking or agricultural purposes related to underground injection by the oil and gas industry” and “no evidence has been found that underground injection has damaged sources of potential drinking water.”

Under DOGGR’s recently issued emergency proposed rulemaking, industry wastewater injections into non-exempt aquifers must be phased out by 2017.   However, the lawsuit calls for the injections to stop immediately. The proposed phasing-out period gives both DOGGR and the U.S. Environmental Protection Agency (“EPA”) the opportunity to determine whether some of the aquifers — particularly those that also contain oil — should be considered suitable places to inject produced water. The EPA has the authority to declare an aquifer exempt from the federal Safe Drinking Water Act, making it eligible for wastewater injections.

Oil companies consider the two-year timetable aggressive, but workable. Catherine Reheis-Boyd, president of the Western States Petroleum Association, said, “The experts at [DOGGR and EPA], with the cooperation of oil producers, have made a careful evaluation of the situation and developed the action plan to address it,” she said Thursday. “This lawsuit is an attempt to thwart that regulatory process.”

California’s oil reservoirs contain large amounts of water, which is not suitable for drinking. This water must be separated from the petroleum and disposed of, usually by pumping it back underground where it came from via injection wells. Injection wells are used to increase oil recovery and to safely manage the produced water. These wells can enhance oil recovery, allowing companies to produce 30 to 60 percent, or more, of the reservoir’s original oil in place. Underground injection is an integral and necessary part of oil production in California. Both the Sierra Club and the Center for Biological Diversity understand this nexus and an ulterior motive of the lawsuit appears to be halting most oil production in California’s most prolific oil fields.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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