March Legislative Affairs

Aaron Meek & Dave Hampton

Hampton and Milligan

On February 16th, the OCC their northwestern regional wastewater plan to include all of Alfalfa county, and parts of Woods, Woodward, Major, Garfield, and Grant counties. On March 7th, the OCC created a new central region wastewater plan to include all of Noble, Payne, Logan, and Lincoln counties, and parts of Garfield, Kay, Pawnee, Creek, Lincoln, Pottawatomie, Cleveland, Oklahoma, Canadian, and Kingfisher counties. The goal of these regional plans is to reduce wastewater volumes by 40% from 2014 levels. The OCC also announced an expansion of its “area of interest” to include Arbuckle disposal wells in areas that have not yet had earthquake activity (See “Oklahoma regulators expand earthquake plan to central Oklahoma,” March 7, 2016).

SB 1517 (Sen. Marlatt) and HB 3158 (Rep. Hickman) would confirm that the OCC has the complete authority to regulate saltwater disposal wells and to immediately respond to “emergency situations having potentially critical environmental or public safety impact” without notice or hearing. HB 3158 passed the House and has been sent to the Senate.

Oklahoma faces a large budget shortfall this year, prompting many proposals to fill the gap and avert future budget crises caused by falling oil and gas prices. Among the ideas that have surfaced are raising the cap on the state’s rainy day fund (Senate Joint Resolution 44), creating a “Revenue Replacement Endowment Fund” consisting of yearly deposits of 5% of gross production tax revenue (Senate Joint Resolution 61), and creating an Energy Stabilization Fund which would essentially serve as a second rainy day fund tied exclusively to gross production tax revenue (HB 2763). SJR 44 passed the Senate and was sent to the House, and HB 2763 passed the House and was sent to the Senate. SJR 61 has not progressed.

HB 2303 (Rep. Watson) has advanced and would extend the termination date for the OCC plugging fund from 2016 to 2021 and requires the balance to be maintained at $5 million.

HB 2276 (Rep. Denney & Sen. Halligan) would essentially make the location of a pipeline an issue in pipeline condemnation proceedings. Landowners could request a judicial location exception, requesting that the county court chose an alternative location for the right-of-way. This bill passed the House 62-29 and has been sent to the Senate.

HB 1802 (Rep. Hardin) was discussed at the most recent OCAPL board meeting. This bill would require applicants for newly drilled or newly converted injection or disposal wells to submit information on the impact of the well on the conditions of roads and bridges used to access the well. The OCC would be prohibited from issuing a permit for the well unless they found that the roads and bridges met minimum standards and could be used without any substantial detriment to the roads and bridges. If the roads and bridges did not meet the minimum standards, the applicant would have to upgrade or pay to upgrade them. The bill would also require the OCC to notify the Department of Transportation and the applicable boards of county commissioners of the proposed well and plan for the applicant to upgrade or pay to upgrade the roads and bridges. Significantly, the bill states that “[i]f the Department or boards of county commissioners disapprove the plan, the Commission shall work with the Department or boards to revise the plan.”

HB 2599 (Rep. Wood & Sen. Sharp) would prohibit flying a drone below 400 feet above “critical infrastructure” and it would prohibit flying a drone so close to “critical infrastructure” as “to interfere with the operations of or cause a disturbance to the facility.” The bill defines “critical infrastructure” to include several types of facilities, including refineries, natural gas compressor stations, LNG terminals or storage facilities, gas processing plants, natural gas distribution facilities, pipeline interconnections, aboveground pipelines, and other facilities. This bill recently passed the House and has been sent to the Senate.

HB 1951 (Rep. Watson & Sen. Griffin) would remove the municipal exemption from the requirement that excavators call the statewide one-call notification center. This bill recently passed the House and has been sent to the Senate.

SB 1414 (Sen. Marlatt & Rep. Calvey), the Oil and Gas Water Recycling and Reuse Act, would consider “fluid oil and gas waste” as the property of the person who takes possession of that waste for the purpose of treating the waste until that person transfers the waste or treated waste to another person for disposal or use. This bill passed the Senate and has been sent to the House.

HB 2651 (Rep. Scott & Sen. Griffin), the Oil and Gas Waste Efficiency and Recycling Act, requires the OCC to work in conjunction with the Secretary of Energy and Environment, Oklahoma Water Resources Board, and Department of Environmental Quality, to implement recommendations of the Water for 2060 Produced Water Working Group and to, develop energy and water-use best-practices, and promote the use of marginal-quality water in energy industrial applications. This bill passed the House and has been sent to the Senate.

If you know of legislative or regulatory activity that you would like the Legislative Affairs Committee to analyze and discuss, please let us know by contacting Aaron Meek at meek@hampton-milligan.com or (405) 235-5620.