American Oil and Gas Reporter - April 2016 - 18

IndustryDigest
lines.
PHMSA says the proposed rules
address four congressional mandates
from the Pipeline Safety, Regulatory
Certainty and Job Creation act of 2011,
one General Accounting Office
recommendation, and six National
Transportation Safety Board
recommendations, including a
recommendation adopted in the wake of
the San Bruno, Ca., explosion that
pipelines built before 1970 be tested.
The agency notes pipelines built before
1970 are grandfathered against current
safety regulations.
PHMSA says the rules also address
priorities outlined in the White House's
Climate Action Plan to reduce methane
emissions, and would change the way
pipeline operators secure and inspect
gas transmission infrastructure
following extreme weather events.
Among the changes, PHMSA says it
is proposing to:
* Modify repair criteria for
pipelines inside and outside of high
consequence areas;
* Expand assessment and repair criteria protocols to transmission lines located in areas of medium population
density (moderate consequence areas);
* Provide additional direction on
how to evaluate internal inspection results to identify anomalies;
* Clarify requirements for conducting
risk assessments for integrity management, including addressing seismic risk;
* Expand mandatory data collection
and integration requirements for integrity management, including data validation and seismicity;
* Require additional post-construction quality inspections to address coating integrity and cathodic protection issues;
* Require new safety features for
pipeline launchers and receivers; and
* Require a systematic approach to
verify a pipeline's maximum allowable
operating pressure and require operators
to report MAOP overages.
Of significance to oil and gas
producers, attorneys Baker Botts point
out in a notice to clients, PHMSA is
proposing to eliminate the exemption
for onshore gas gathering lines from
reporting incidents, safety-related
conditions, and annual summary data.
The proposed rule may be found on
PHMSA's website at
www.phmsa.dot.gov. ❒
18 THE AMERICAN OIL & GAS REPORTER

OCC Issues A Second
Areawide Disposal Well
Volume Reduction Order
OKLAHOMA CITY-The Oklahoma
Corporation Commission has issued a
second areawide volume reduction
order (VRO) for Class II disposal wells
and increased its area of interest that
restricts disposal operations.
Oil & Gas Conservation Division
Director Tim Baker says the March 7
Central Oklahoma Volume Reduction
Plan initially covers 406 Arbuckle
disposal wells and 5,200 square miles.
Under the order, he says, wells will be
limited to the lesser of 20,000 barrels a
day or two times their previous reported
daily average, not to exceed a 30-day
average of 15,000 bbl/d. The reductions
were to be completed in four phases
concluding between March 28 and May
28.
Baker says the goal of the VRO is to
bring total injection volumes in the area
40 percent below 2014 levels. "That
means a reduction of more than 300,000
bbl/d from 2015 volumes," he adds.
The central Oklahoma VRO follows
the Western Oklahoma Volume
Reduction Plan announced Feb. 16,
which covered 5,281 square miles and
245 Arbuckle injection wells (AOGR,
March 2016, pg. 16).
Also on March 7, the OCC
announced it was expanding its area of
interest (AOI), in which disposal well
operators must record injection volumes
daily and report them weekly. The OCC
adds that any new AOI disposal well
applications may be approved only by a
majority vote of the commissioners (no
administrative approvals), will be
limited to six months, and will include
requirements for seismic monitoring
and regular testing. In addition, the
Conservation Division may shut in AOI
disposal wells without a hearing.
An OCC map indicates the western
Oklahoma VRO affects all of Woods,
Alfalfa, Grant and Major counties, as
well as significant portions of
Woodward and Garfield counties. The
central Oklahoma VRO adds nearly all
of Noble, Pawnee, Payne, Logan,
Lincoln, Oklahoma and the remainder
of Garfield counties, as well as portions
of Kingfisher, Canadian, Cleveland,
Pottawatomie and Creek counties. The
AOI encompasses both VRO regions
and adds the remainder of Canadian,

Blaine and Kay counties, as well as
portions of Dewey, Seminole and
Okfuskee counties.
Published reports note that the AOI
extends into the STACK (Sooner Trend
Anadarko Canadian Kingfisher) tightoil play where companies have been
targeting the Woodford, Meramec and
Osage formations.
The OCC mentions that the central
Oklahoma VRO and expanded AOI are
its 18th and 19th actions responding to
Oklahoma earthquakes since March
2015, and bring the total injection
volume reductions ordered to more than
1 million barrels a day. ❒

Courts Uphold A Pair
Of ESA No-List Rulings
Oil patch opponents of Endangered
Species Act listings scored two victories
in two days in separate federal courts.
The Texas Independent Producers &
Royalty Owners Association reports
that on Feb. 29, the U.S. District Court
for the Western District of Texas denied
a request by the U.S. Fish & Wildlife
Service and the Department of Interior
to reconsider its Sept. 1, 2015, decision
to vacate USFWS's listing of the lesser
prairie chicken as threatened.
On the following day, according to
the Texas Alliance of Energy Producers,
the U.S. Court of Appeals for the D.C.
Circuit upheld a 2014 lower court
decision that confirmed the USFWS's
2012 decision not to list the dunes
sagebrush lizard.
In September, Western Texas District
Judge Robert Junell found the USFWS
failed to fully evaluate the effectiveness
of the rangewide conservation plan
(RWP) developed by Texas, New
Mexico, Oklahoma, Kansas and
Colorado before it listed the lesser
prairie chicken as threatened (AOGR,
October 2015, pg. 20). On Feb. 29,
TIPRO says, Junell affirmed that ruling
by denying USFWS's and DOI's motion
for rehearing.
"The court's (September) decision
and the (Feb. 29) ruling underscore the
validity of a comprehensive
conservation effort involving state
conservation agencies, landowners and
industry," TIPRO quotes the Western
Association of Fish and Wildlife
Agencies, which administer the RWP.
"This plan allows agriculture producers
and industry to continue operations

American Oil and Gas Reporter - April 2016

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