1-11-13
Report for Conservation Committee
Assignment
Comparing San Benito County’s proposed Petroleum Code to Current California Division of Oil, Gas and
Geothermal Resources Public Resources (DOGGR) Code (PRC) and the California Code of Regulations
(CCRs) to determine if the San Benito County code essentially duplicates, and therefore is preempted by
or is partially preempted by, State laws and regulations.
Documents Used to Prepare This Report
San Benito County Petroleum Code sections 19.21.001 – 19.21.044 (provided by Jerry Anderson) is
included at the end of the accompanying documents. Note: Editing appearing on the provided San
Benito County Code existed when it was provided by the Conservation Committee. Nothing was
changed. Some sections appear to be deleted, but because it is unknown who made the deletions (CIPA
editors or the County Code writers), they are treated as though they are not deleted because in most
cases the code section addresses important issues.
Division of Oil, Gas and Geothermal Resources Public Resources Code, the law (PRC)
Division 3. Oil and Gas – pertinent sections are included in the report.
Division of Oil, Gas and Geothermal Resources California Code of Regulations, the regulations (CCRs)
Title 14, Division 2 – pertinent sections are included in the report.
California Attorney General’s Opinion, Regulation of Drilling, Operation, Maintenance, Abandonment of
Oil, Gas and Geothermal Wells - Opinion NO. 76-32 dated August 24, 1976, Publication No. PRC03 is
included at the end of the accompanying documents.
EPA Primacy “Application for Primacy in the Regulation of Class II Injection Wells Under Section 1425 of
the Safe Drinking Water Act, dated April 1981, is included at the end of the accompanying documents.
Publication No. MO 7 – Blowout Prevention in California is included at the end of the accompanying
documents.
Publication No. MO 10 – Drilling and Operating Oil, Gas and Geothermal Wells in a H2S Environment is
included at the end of the accompanying documents.
Various DOGGR forms are included at the end of the accompanying documents.
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Introduction
In his opinion No. 76-32 California Attorney General Evelle J. Younger offers opinions on several
examples of potential conflicts between local governments and State government in regulating the oil
and gas industry. The full text of the opinion document is provided at the end of the accompanying
documents. Essentially he opinioned, that State government laws and regulation take precedence over
any local government codes where conflict exists between them. In those cases where state law has not
fully occupied the field, there is an opportunity for local government regulation to exist. “With regard to
state regulation for other purposes, such as land use control and environmental protection, the state
has not fully occupied the field, and more stringent, supplemental regulation by cities and counties is
valid to the extent that it does not conflict or interfere with state regulation.” In other words, essentially
the DOGGR has preemptive regulatory authority over anything in the subsurface below the ground and
in some cases shares regulatory authority above ground so long as local standards do not interfere or
conflict with State laws and regulations. This is the guidance the author used to write this report.
To prepare the comparison of the County regulatory code, and State laws (PRC) and regulations (CCR),
each San Benito code section was evaluated separately. To efficiently perform this comparison, it was
necessary to accumulate all pertinent PRC and CCR sections together after each County code section.
The accompanying document contains the original San Benito Code sections that are each followed by
all of the similar PRC and CCR sections. Needless to say the format led to a very large accompanying
document. Some of the sections in the accompanying document may not seem to be particularly
pertinent to the San Benito County Code section is question. These PRC and CCR sections are included to
give context to the sections that are pertinent or to illustrate that the DOOGR has a comprehensive
regulatory program associated with most of the individual County code sections
Upon reviewing the accompanying document it the reader will notice that various colors are used. This
color scheme will help the reader identify which document they are reading. As illustrated above, the
words in the San Benito County Code sections are colored black, the PRC are colored blue, the CCRs
are colored purple and the AG Opinion is color red.
The reason the additional documents besides the PRC and CCR are included in the report is because they
have the effect of law or regulation and have a direct bearing on the County code section under
discussion. They in fact are relied on to effect the purpose of the PRC and CCRs. For instance the Primacy
Application is the controlling document when it come to underground injection control (UIC) and the
various notices have legally binding information on them that is specified in the PRC and CCRs.
The author would like to state at this time that he is not a trained or licensed attorney or has he ever
been trained or licensed to be an attorney. He does have many years of experience implementing the
PRC and CCRS. So any apparent legal analyses of the issues in this report are nothing more than an
experienced implementer’s thoughts and observations.
Lastly, it is important for the reader to remember that, for a local ordinance to be preempted by State
standards, the State has to affirmatively exert its preemption authority. Individual companies or
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Associations may have to ask the DOGGR to do so. The DOGGR does not keep track of individual city or
county codes so they would not know when conflicting codes were being contemplated. It should be
noted that the County of San Benito acknowledges this preemption authority, and subordinates itself to
it in code section 19.21.019 – Conflicts with state law (“… Accordingly, where there is conflict with state
regulations or laws, such state regulations or law shall prevail over any conflicting provisions of this
Chapter 19.21 or contradictory prohibitions or requirements made pursuant thereto”).
Abstract
A large percentage of San Benito County codes conflict or interfere with DOGGR laws and/or
regulations. The author combed through the PRC and CCRs to finds laws and regulations that seemed to
duplicate the regulatory territory that many of San Benito County Codes attempt to occupy. In some
cases the DOGGR PRC and CCR do not occupy at all, or only partially occupy certain phases of oil and gas
operations. So the County Code would not conflict or interfere with State laws and regulations. This
report will point out those County Codes sections or parts of sections where this applies.
There are two Sections of the PRC from the Definitions and General Provisions Article that will appear
over and over. They are PRC Sections 3013 and 3106. The reason they appear repetitively is because the
writers of DOGGR regulations relied upon these two sections of the law to provide legal justification for
a very large percentage of the regulations in the CCRs. Industry and local jurisdictions can look at the
citations at the end of every section of the regulations to see what laws were being implemented with
the pertinent regulation. PRC Sections 3013 and 3106 are cited in a vast majority of the regulation
citations. DOGGR and Department of Conservation decision makers recognize this fact. These sections
carry a huge burden when justifications are needed for regulations. By intentional design, they are
general in nature and rely heavily on the expertise of the State Oil and Gas Supervisor, the Department
of Conservation Director and their well trained and knowledgeable staffs for proper utilization. Section
3013 clearly states the following: “This division (division is Division 3. Oil and Gas laws, the whole oil and
gas PRC ) shall be liberally construed to meet its purposes, and the director (of Conservation) and the
supervisor (State Oil and Gas Supervisor), acting with the approval of the director, shall all powers,
including the authority to adopt rules and regulations, which may be necessary to carry out the
purposes of this division”. And PRC Section 3106 pretty much lays out the purposes of the PRC. That is
why they are so heavily relied upon for implementing regulations. The language in PRC section 3013 is
the language the Legislature used when the PRC was first enacted many years ago. Through all of the
additions, editing and changes, including the editing of PRC Section 3106 in recent years, the Legislature
has not seen fit to modify, limit or eliminate this powerful section of the PRC which clearly makes it’s
(the Legislature’s) intent clear. The phrases “ liberally construe” and “shall have all powers” are pretty
clear in what they mean.
Each section of the San Benito County Code is addressed separately in this report. The full verbiage of
the County Code is provided and then the verbiage from appropriate PRC and CCR sections are provided.
An analysis is provided in this document under the heading of Report. There are many State PRC and
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CCR sections that precisely overlap the County Codes. In those cases the San Benito County Code is
clearly preempted by State laws or regulations. In some cases an exact match is not apparent, but the
intent of the Legislature is apparent in the language of the PRC or CCR, so a strong case can be made
that the County code is preempted. There are some cases where it is clear the State Legislature either
did not intend to, or failed to completely occupy an area of regulatory concern. In the cases where there
is no State law or regulation that conflicts with the County code section, the County is unencumbered as
far as the standards it can impose. Where there is partial, but incomplete occupation of a regulatory
area, then both the DOGGR and the County have room for regulatory oversight. During the analysis of
each County Code Section an evaluation will be offered as to whether the County is fully or partially
preempted by State laws and/or regulations or if the County is free to impose whatever standards it
deems appropriate because there is no threat of preemption by the State.
Because the San Benito County code seems to replicate it, the Santa Barbara County Petroleum
Code is added at the end of each section in the accompanying documents.
Santa Barbara and San
Benito County Petroleum Codes are quite similar. In some case though, the Santa Barbara code is less
stringent that the San Benito County Petroleum Code. No analysis or comments are offered regarding
the Santa Barbara County code sections. But the reader will find the analysis of the San Benito County
code sections insightful as they read the Santa Barbara County Code.
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Report
San Benito County Code Section 19.21.019 – Conflicts with state law, will be addressed first because it
goes to the crux of the issue this report addresses. The County acknowledges in this code section that it
will be preempted or the “State regulations and laws will prevail” “where there is conflict with state
regulations or laws”. Determining if there is significant conflict between State laws and/or regulations
and San Benito County codes is what the rest of this report will address. It is likely the reader will
discover that there are few regulatory areas available for formal county oversight and those areas open
to County regulation deal more with issues involving the Zoning Department, Planning and Development
Unit, and Fire/Hazardous Material Department. There is little left over after those areas are addressed
that would not be duplicative and thus preempted by State standards. Consequently, it is hard to
imagine what purpose a new office of Petroleum Administrator would serve. It is suggested several
times in this report that a far better way for San Benito County to utilize County resources would be to
develop a working relationship with the local DOGGR District office. An example of this cooperative
relationship is outlined in PRC section 3785. The DOGGR and the Department of Fish and Game work
together to deal with sumps. By working together in this manner, any concerns expressed by County
residences or politicians could be addressed timely and in an acceptable manner without the
expenditure of county funding. Most documents the County finds important can be view on the internet
home page for the DOGGR. Those not found in that manner can be either reviewed at the local DOGGR
office or acquired by simply making a phone call and asking for them. The DOGGR is required to provide
this service by the Public Records Act.
19.21.019 – Conflicts with state law
The first paragraph in the California Attorney General’s Opinion No. 76-32 August 24, 1976 is included
below :
Publication No. PRC03 – California Attorney General’s Opinion NO. 76-32 August 24, 1976
Subject: Regulations on Drilling, Operation, Maintenance, Abandonment of Oil, Gas and Geothermal
Wells – State laws on drilling and production activities of oil, gas and geothermal resources well for
the purpose of conserving and protecting those resources take precedence over local regulations,
particularly where the state law approves of or specifies plans of operation, methods, materials,
procedures, or equipment to be used by the well operator or where activities are to be carried out
under direction of the state Supervisor. With regard to state regulation for other purposes, such as
land use control and environmental protection, the state has not fully occupied the field, and more
stringent, supplemental regulation by cities and counties is valid to the extent that it does not conflict
or interfere with state regulation. Cities and counties may regulate drilling, operation, maintenance
and abandonment of oil, gas and geothermal wells with respect to phases of such activities not
covered by state statute or regulation so long as there is no conflict with state regulation concerning
other phases of such activities.
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It is pretty clear what the regulatory relationship is between the State and local regulatory bodies. Most
interesting is that a careful reading of the Attorney General’s Opinion reveals that not only does it affect
standards in place at the time the opinion was written in 1976, but the language seems to be such that
as changes occur in State laws and regulations, they become dominant going forward from there. “Cities
and counties may regulate drilling, operation, maintenance and abandonment of oil, gas and
geothermal wells with respect to phases of such activity not covered by state statute or regulation so
long as there is no conflict with state regulation concerning other phases of such activities”. There is no
time reference like “…. not covered by state statute or regulation in place at the time of the
promulgation of new state laws and regulation, so long as there is no conflict with State regulation….”.
So it would seem that new State standards could in fact preempt existing and older local codes.
A reading of PRC 3106 gives a good indication of what is and is not available to local regulatory agencies
for oversight. While the county of Santa Barbara passed rules regulating some facilities before the State
promulgated such standards, the County of San Benito is late in attempting to pass such standards and
as such, is likely preempted in almost all aspect of oil and gas operational regulations. As mentioned
above, a close reading of the quoted passage may in fact lead the reader to believe, even older codes,
laws and regulation of local agencies may in fact be preempted by newer State laws and regulations.
This is where trained legal experts would need to weigh in on the discussion. The author of this report is
not a trained or licensed attorney so any analyses of the issues in this section or report are nothing more
than an interested observer’s thoughts.
Clearly, CEQA, land use and construction standards are among the areas available for regulatory
involvement by local agencies. For instance the DOGGR standards clearly steer clear of any laws or
regulations for the construction of tanks and some facilities (PRC 3112). The construction of the subbase of storage vessels seems to be covered in DOGGR standards but construction of the actual
structure is not covered. This is where planning and fire protection experts would find a niche for
imposing regulatory codes. The DOGGR seems disinterested in creating these rules and if fact may not
be allowed to develop standards for these issues.
19.21.001 Position of petroleum administrator established
Essentially, almost all of the duties the petroleum administrator will be tasked to perform are already
performed by the State Oil and Gas Supervisor as outline in State laws and regulation. It is true that
none of the DOGGR staff has the “police power” of a sworn or deputized law enforcement officer,
though staff has the authority to enforce the State laws and regulations. In the event that the stronger
power of a sworn police authority is needed, DOGGR can access the Attorney General’s office or request
assistance from local law enforcement.
It is very interesting that no qualifications for the petroleum administrator or his/her employees are
mentioned. The DOGGR standards clearly state that individuals that are knowledgeable in oil and gas
matters will fill positions in the DOGGR (PRC sections 3103, 3104 and 3105). The petroleum
administrator will be appointed by the Board of Supervisors and will be authorized to “consult with
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experts qualified in fields related to the subject matter of this chapter and codes adopted by reference
herein as necessary to assist him/her in carrying out his/her duties……..”. It is questionable how such a
regulatory program could possibly expect to successfully inspect, or test or enforce regulations of an
industry that is as complicated as an oil or gas field operation without appropriate technical expertise.
Throughout the rest of this report it will be clear that very few of the regulatory areas San Benito County
wants to occupy are available without conflict with State standards.
19.21.002 Purpose of chapter
The purpose of San Benito County’s Code is to do exactly the same thing DOGGR does, with few
exceptions. A review of PRC Section 3106 right after reading the text of the county code will
demonstrate this clearly.
The area of this code available to the County is in regulating surface land use, fire fighting/hazardous
material and construction of structures issues. For instance the DOGGR does not regulate building codes
(PRC 3112) or require visual screening. The County controls road construction, surface grading issues
and certain other environmental issues. The County is likely the lead agency for CEQA. The DOGGR does
not regulate vehicle traffic or material transportation by trucks or other vehicles. It does regulate fluid
transportation by pipeline on the lease but not off the lease. In the area of oil spill response, the DOGGR
has some authority, but because County resources would be needed to effectively respond to a large
event, the County would be able to require more stringent and specific response capabilities.
The San Benito County Code provides a very interesting legal situation because it, in many ways,
duplicates the Santa Barbara County Code. What makes this interesting is that many of the standards in
the Santa Barbara Code were put in place before significant State law and regulation changes took place
as a result of AB 1960. Santa Barbara County standards did not interfere with or conflict with State
standards when they were implemented. They would conflict now. An interpretation of the Attorney
General’s opinion may or may not allow some of these duplications. In the case of San Benito County,
they are creating a new set of standards after the DOGGR environment standards were put in place.
Consequently, they would interfere with or conflict with State standards that are already in place. As the
Attorney General’s opinion indicates this would causes them to be “preempted”.
19.21.003 Adopted codes, regulations and standards
This is a code section where the DOGGR may not fully occupy the regulatory arena and room exists for
San Benito County to impose more stringent standards than those imposed by the DOGGR.
PRC Section 3013 of the PRC allows the Supervisor to use his/her judgment but does not set any specific
standards though it is clear the legislature is relying on the State Oil and Gas Supervisor’s expertise.
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PRC Section 3106 does not mention construction of facilities. “ The Supervisor shall so supervise
the…….and the operation, maintenance and removal or abandonment of tanks and facilities ……”.
PRC Section 3112 specifically addresses building standards. The DOGGR does not have any authority in
this area.
PRC Section 3270 (a) states the following: “ The division (in this case DOGGR) shall, by regulation,
prescribe minimum facility maintenance standards for all production facilities in the state. “ No
construction standards are implied or mentioned.
PRC Section 3270 (b) states “An operator who constructs, acquires, maintains, or alters an oil well or
production facility shall comply with the standards pursuant to subdivision (a).” Subdivision (a) is
concerned about maintenance, leak detection, corrosion prevention and testing, tank inspection and
cleaning, valve and gauge maintenance and secondary containment, with an eye toward preventing
damage to resources.
PRC Section 3270(c) again mentions construction but in the context of notifying the Supervisor so they
can add it to the facility list.
The rest of PRC Section 3270 (3270 – 3270.4) talks about spill plans, record retention and maintenance,
DOGGR inspections, remedies for facilities being operated in violation of the law, and potential
bonding. Nothing about specific standards for tank construction is mentioned.
CCR Section 1722 of the CCRs prescribes that “all operation be in accordance with good oilfield
practice”. By implication this may require operators to use standard APR, ASTM , Federal and Fire Code
standards. While the DOGGR has gone to great length to set specific standards for pipelines, spill
contingency plans, tank sub-base and tank bottom construction and fencing construction they have set
no specific standards for the actual construction of a tank. The DOGGR PRC section 3112 in fact actually
prohibits this kind of regulation by the DOGGR. That is why there is room for the County to impose their
construction standards on facilities like tanks and certain other structures.
CCR Section 1773 mentions the construction of facilities in reference to other parts of section 1773.
CCR Section 1773.2 Tank Construction and Leak Detection – This section mentions tank construction in
the title and in the wording of the regulation. But, it is only in the context of prescribing that “All new
tanks shall be constructed and designed to provide enough space between tanks to allow safe access for
maintenance, inspection, testing and repair. “ Nothing is mentioned about the minimum construction
standards that would be contained in an API standard or County building standard.
On the other hand CCR Section 1774 Pipeline Construction and Maintenance , states that “Newly
installed pipelines shall be designed, constructed, and all pipelines shall be tested, operated, and
maintained n accordance with good oil field practice and applicable standards, as set forth in either the
American Petroleum Institute (API),(API Rec. Prac. 1110, 3rd Ed., Dec. 1991, and API Spec. effective
1990), American Society for Testing and Materials (ASTM) (ASTM Designation Stand. Spec., 1991), or
Code of Federal Regulations 49, Part 192 , or other methods approved by the Supervisor. …..”. These
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standards are specific and clearly cover the specific intent of how the Supervisor expects pipelines to be
constructed and maintained. This is not the case with tank and certain other facility construction.
The accompanying document includes all relevant sections of the PRC and CCRs so the reader can see
that there is room for the County to impose stiffer standards on surface facility construction though
pipelines seem to be fully regulated as is the sub-base of any tank setting.
19.21.004 Definitions
San Benito County has allocated this section for all pertinent definitions for the whole County Code. The
DOGGR has set aside PRC Section 3200 and CCR Section 1720 for definitions but has also scattered
specific definitions throughout the PRC and CCR. For instance CCR Section 1760 provides definitions for
that subchapter that probably could just as easily been put into PRC Section 3200. The author is not sure
why this was done this way, but it is done this way in both the PRC and CCR. Other than that observation
there is no real issue to deal with relevant to the discussion of the comparisons of the codes. At some
point in time it would be nice to clean up the PRC and CCR by putting all of the definitions together.
Also, there are many more definitions that should be added at that time.
19.21.005 Permits
This section pretty much duplicates the DOGGR PRC and CCR sections provided in the accompanying
document. Consequently it looks like the County is at the very least duplicating and likely conflicting or
interfering with State processes. There does not seem to be any specific CEQA or environmental driver
in the proposed County Code. It has to be assumed that if a permit is required by the county, it is almost
exactly the same as a DOGGR permit. The permit conditions imposed by the County will likely mimic
DOGGR permit conditions. That would be cause for the County permit to be preempted by the State
permit. It that case one has to ask what the purpose is for the County notice and permit.
This section only applies to drilling a new well or re-entering a previously plugged and abandoned well.
Redrills, rework operations, plugging and abandonment, and EOR practices etc. are not specifically
mentioned as are drilling and re-entering a well.
There are a couple of insignificant differences. Permits expire in San Benito County one year from the
date of issuance. DOGGR permits expire one year from “receipt of notice”. Note: This is generally
interpreted to mean one year from the date on the Permit to Conduct Well Operations. The permit is
good for one year. Also if work is stopped for 180 days the applicant has to get a new County permit by
paying all of the required fees again. This is curious because fees cover specific work. If the drilling stops
for 180 days then the work requirement of the County stops as well. It is unclear why a simple phone
call or email from the operator, informing the County that they are reactivating drilling, would not
suffice. Also, there is another curious situation that exists because this section talks about 180 days, but
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in the Definitions Section of the County Code, the definition of “Suspended operations” is a stoppage for
30 days. No description of this suspension is provided.
19.21.006 – Permit procedures
This process is a mixture of CEQA, Zoning, Planning and Development and oil and gas process permitting.
The DOGGR has likely fully occupied the subsurface oil and gas permitting process so there is no room
for County regulatory processes. The DOGGR has not fully occupied the regulation of some surface
activities so no conflict would arise over land use type issues. It is in the regulation of the surface
facilities that includes some construction and most operation and inspections where conflict between
DOGGR and San Benito County Codes could occur. The accompanying document provides several PRC
and CCR sections that are duplicated or are similar to many of the issues raised in these County Codes.
The following is a review on a part by part basis of the County code.
(a) To regulate surface environmental issues the County would need to receive some sort of application.
It is unclear why a petroleum unit is necessary if they already have a planning and Development
Department that would be the lead on CEQA and land use issues.
(b)
(1) This seems like normal requirements for a land use or CEQA review.
(2) In order to perform their Land Use or CEQA review, the County would need financial resources to
fund the process. It is important that they perform only those tasks that do not interfere with DOGGR
authority.
(3) This is interesting. Probably the same information would be required for the zoning review as is
required here. Why not just use that information?
(4) Seems reasonable as long as the request does not ask for information that then leads to a permit
that contains conditions similar to, or in conflict with, DOGGR permit conditions.
(5) The Division will not issue a Permit to Conduct Well Operations before the County (as CEQA lead
agency), gives their land use blessing. Notice (c) is a Notice to Drill a Well. An operator can provide that
during the County’s review although it likely will not be complete. There are things on the notice such as
the County CEQA approval and well location that are required, but may change as a result of the CEQA
review. Notice (d) is a Permit to Conduct Well Operations. That cannot be provided as part of the
application as required in this section. The DOGGR will not issue one until the County CEQA process is
completed and the operator has filed a Notice of Intent. If in fact this permit process is to take place
after the CEQA process is completed, then one has to ask “what is the point?” Lastly, Notice (e) is
actually two documents. One is the official Well Summary Report and the other is the official Well
History Report. Obviously, both of these documents have to be generated after the well is drilled. So
they cannot be provided before hand in order to get a permit.
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(6) In general it looks like a drilling plan is a duplication of the County’s Land Use Permit. Why would an
operator need another plan for the petroleum administrator that is essentially already approved either
in the land use process or the CEQA process? Having said this there is no point in commenting on those
types of subsections. The DOGGR relies on the local agency to address CEQA and many land use issues in
preparation for a project. Many of these issues seem to fall into that category of conditions.
(a) – N/A
(b) This is a requirement that surface owners be notified prior to project approval. The issue is being
addressed in the Legislature right now. As far as notifying the “underlying landowners”, likely they are
the mineral owners who are already encouraging or at least participating in the proposed project. There
is no point in drilling a well if the operator does not own or have the mineral rights leased. So what is
the point of this requirement? If this is for enforcement purposes, then every time a lease is sold or the
mineral rights owner changes, someone will have to notify the County and someone will have to update
their records. This is probably best left to the County Recorder.
(c) It seems that it would be impossible to comply with this requirement. While the drilling company
may be known, the other contractors and subcontractors could change at any time depending on work
schedules in the field, demands of other operations by other operators, time of day, and specific issues
that come up during normal drilling operations. It is not possible to provide all of this information in an
application to drill because most of it is not known at that time.
(d) –N/A
(e) - N/A
(f) – N/A
(g) – Clearly the county has no pertinent need for this information because anything the County would
do with it crosses into State mandated requirements. This is a State regulatory issue that would preempt
any local requirements.
(h) – N/A
(i) – N/A
(j) – N/A An operator wants to have the rig spend as little time on location as possible. Drill rigs charge
by the hour and they are expensive. This request implies that an operator might keep the rig around
idle. That is not likely unless they plan to do more work in the area within short period of time.
(k) – N/A
(l) –N/A
(m) – N/A
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(n) – While the DOGGR requires a spill plan, it is not likely going to be prepared in time for the drilling
activity. So it seems reasonable that the County hazardous material and fire fighting personnel would
want a plan for their purposes. This would typically be part of the planning documentation.
(o) – If the County required anything more than the operator simply saying “waterflood, steamflood
etc.” then they would be getting into State regulatory territory that is completely occupied. Again the
problem is what they plan to do with a detailed description of a waterflood or steamflood project.
Clearly this is DOGGR domain. They have no regulatory authority here at all. As far as water sources and
various chemicals that would be brought the site, the County has land use standards that they would
enforce. Use of fresh ground or public water systems is not in the DOGGR domain. Use of produced
water is in the regulatory domain of DOGGR. Other than the issues just articulated, the DOGGR CCR
sections 1724.6-1724.10 fully occupy this regulatory area (and the DOGGR has been delegate primacy
for underground injection by the Federal EPA – see the Primacy Application at the end of the
accompanying documents). Any conflicting County standards would be preempted by the State and by
the Federal EPA.
(p) – Not sure how an operator could provide a representative gas analysis before a well is even drilled
unless there are nearby wells. If that is the case, what do they need it for?
(q) – N/A
(r) – N/A
(c) –
(1) This is redundant. Will the county impose penalties if something does not meet DOGGR standards?
(2)What happens if there is no livestock or the mud sump is contained in a metal tank?
(3) Why? This information is published every year and monthly production reports are available at all
times, online, on the DOGGR web page.
(4) N/A
(5) N/A
(6) N/A
(7) N/A
(8) CCR Section 1722.1.1 Well Operator Identification - This DOGGR regulation section requires “signage
be posted in a conspicuous place, clearly visible, legible, and be permanently affixed”. There is no point
in having this County standard because it is completely preempted by State regulations.
(9) N/A
(10) N/A
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(11) N/A
(12) N/A
Because this permit process is likely duplicative of the planning process, it is hard to understand why
another county agency would have to do the same thing over again. There is no dispute that zoning and
land planning are the responsibility of the local government agency. The DOGGR has no jurisdiction in
this area, but does have clear authority over most oilfield operations. So why duplicate the planning
departments work with a petroleum administrator who does much the same work? Why have a
petroleum administrator who would have very little to do after substantially all of his/her
responsibilities were preempted by the DOGGR?
The included DOGGR PRC and CCR sections illustrate that DOGGR has responsibility for supervising the
drilling and operation and plugging and abandonment of wells and the operation, maintenance and
testing of production facilities. Certainly the County has cause to be involved in the permitting of
structures and tanks (PRC section3112). But, that permitting or approval process likely takes place
during the County planning phase after the CEQA requirements are addressed. It is redundant to do the
permitting all over again just prior to initiation of the drilling program. If new tanks are built after wells
are drilled, certainly this would fall into the County planning/permitting process. But since the passage
of AB 1960 and the implementation of the regulations, a lot of facility regulations are no longer available
to the local agencies.
It would seem prudent that the fire department/hazardous material unit would have an ongoing interest
in the facilities which could be address with Fire Code/hazardous material standards. A current business
and/or material handling or storage plan could be filed with one of these County agencies. Fire
prevention and hazardous material storage inspections of pertinent facilities by one or both of these
County agencies do not conflict with State mandates. In fact it seems reasonable that the fire fighting
professionals would occasionally engage in training exercises at production facilities.
19.21.007. – Fees
The number of State PRC and CCR sections cited in reference to this County Code section is very large.
The purpose for citing so many sections is to illustrate that the DOGGR has jurisdiction for everything
cited in this County Code section, and the DOGGR is well funded so it can in fact perform these duties.
Also, it is important to note that if it is determined that DOGGR does not have enough staffing or
expertise to perform its required duties, the State Oil and Gas Supervisor is authorized, in the PRC, to
increase their budget to meet its regulatory needs for the coming year (PRC Sections 3410 -3413).
Instead of creating a whole new county regulatory program, the County Planning or Zoning staff could
engage in quarterly meetings with the local DOGGR district staff to review activities in their County.
During this meeting they could determine if issues of concern have developed since the last meeting and
ensure old issues have been, or are being addressed appropriately. In the event the County is not
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satisfied with the level of regulatory oversight, they could petition the State Oil and Gas Supervisor to
increase oversight and/or staffing in their area. This seems to be a more cost effective method for
regulating the oil and gas industry and to achieve the objectives stated in the proposed County code.
Multiple layers of regulatory oversight does not improve performance, it just causes operators to spend
more time being inspected. Properly planned and executed inspections and tests is the way to
determine if an operator is performing on par. Appropriate enforcement activities with appropriate
penalties are the way to ensure compliance with laws and regulations. By reviewing the PRC and CCR
sections cited in the accompanying document, it is clear the DOGGR has the authority to regulate the oil
and gas industry effectively. And, they have significant powers to enforce the laws and regulations
including fines, life of well or facility bonding and ultimately the ability to shut in a well or facility should
an operator be a habitual offender (PRC Section 3270.3).
It seems that the County is attempting to duplicate the regulatory oversight performed by the DOGGR.
This becomes clear if the County Code and the cited PRC and CCR sections are compared.
19.21.008 Notices
With a few exceptions, this section is a complete duplication of DOGGR requirements as the PRC and
CCR sections in the accompanying document illustrate. The problem is that if the County wants these
documents provided to them, they want to act on them in some manner. Because the State has fully
occupied this regulatory area and has occupied it for some time (with the exception of facilities- they
have only recently been included in the formal regulatory scheme of the DOGGR), it seems that any
regulatory response to the notices (with a few exception to be discussed momentarily) would be
duplicative and therefore preempted by the State. As stated in previous County Code sections the
county defers to the state when conflict arises. It is their intent to supplement state standards. In almost
everything mentioned in this section, the DOGGR already performs these functions.
Most interesting is the fact that almost all of the information the County is requiring is readily available
either on the internet, at the DOGGR webpage, or by asking the DOGGR to provide it. The DOGGR sends
various documents to local agencies all the time. So there is no need to ask industry to provide this
information. Once the County receives this information they have to appropriately store it, and then
manage it to ensure it is current. These functions are already being performed by the DOGGR. This
information is readily accessible to the County so it is not clear what the point is of having a separate
County file that someone has to maintain, update and manage when the DOGGR is already doing this.
The DOGGR does not require an operator to provide a notice if they are reactivating an oil well.
Notification and likely testing is required if a UIC well is to be reactivated. Operators are also required to
notify the DOGGR if the reactivation affects idle production facilities. The DOGGR does not require
notification if an operator is going to suspend drilling operation for a period of time. There is also no
requirement to notify the DOGGR if drilling operations resume as long as the drilling permit is still timely
and no required tests are needed. It would not be unreasonable for DOGGR to require a new BOPE test
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if drilling had been suspended for more than a few weeks. If there is some need for these specific
notifications then the County would not be conflicting with State standards.
It is not unreasonable for the County to be aware when production facilities are activated (or tank
construction takes place) and to be notified immediately of any spills or environmental releases that
would require the Fire Department of Hazardous Material Unit to respond. Appropriate notice could be
given to the Planning and Development Unit or to the Fire Department/Hazardous Material Unit.
19.21.009. – Pollution control plan
The DOGGR has specific requirement for spill contingency plans (PRC 3270.1, CCR 1722-1722.9) as well
as additional DOGGR and other State requirements for the prevention and reporting of spills. Many of
these requirements are provided in the accompanying document.
While the State has a variety of requirements for pollution control plans, it is the local Fire Department
or Hazardous Materials Unit that will respond to and become the on-scene leader in the event of a
larger release or event. Consequently, it is not unreasonable for them to require the submission of a spill
response plan. It does not seem reasonable for a petroleum administrator to be the lead on oil spills.
The first responders and leaders at a spill need significant training. There is nothing in the San Benito
Codes that would lead a reader to think the petroleum administrator’s office will have this expertise.
The petroleum administrator is a political appointee who does not need any oil and gas experience to
qualify for the job. In fact the code does not specify that anyone working in the petroleum
administrator’s office must have oil and gas experience. It does say they can seek the advice of qualified
professionals. In the event of an emergency response, the responders have to already know what they
are doing. That is why the Fire Department/Hazardous Material Unit should be responsible for required
spill plans. They are the ones who will use them and in fact know how to use them.
19.21.010. – State and federal Laws
The first issue with this code section is the title. While the title indicates state and federal laws are
involved, the text also includes local laws as well.
The sheer number of local, state and federal laws and regulations that could affect oil field operations is
huge. Unless the County hires a whole lot of people to keep up to date on all of the local, state and
federal laws and regulations, this requirement is impossible to implement. The code says the petroleum
administrator has to report “any” violations, which varies from very minor to very serious. Also, laws
and regulations are always changing and the interpretation of the various laws and regulations is always
changing. So just keeping up to date so County staff could properly enforce this code section, alone,
could consume several employees time on a full time basis. And, if something is missed, someone could
claim that the petroleum administrator is failing to properly perform his/her duties. This code section
needs to be reconsidered.
15
The DOGGR has similar responsibilities but their duties are specifically prescribed in either the PRC or
the CCRs. And the specific issues to be reported are listed or described and the agency to be notified are
named. This gives the State Oil and Gas Supervisor a limited exposure and responsibility. The limited
responsibility allows the DOGGR staff a chance to actually understand what they are to report on and to
achieve the objective of the reporting requirements. Their responsibilities are limited in scope and
reporting requirements. This report, in the accompanying document, provides several examples of
events and reporting responsibilities that are found in the DOGGR’s PRC and CCR and well as MOAs that
address specific issues to be reported. While this list of PRC and CCR sections is probably not complete,
it gives the reader a sense of the methods used by the DOGGR to accomplish their tasks. And it should
be noted again that the DOGGR law specifies that staff have certain levels of expertise which would be
helpful in implementing the prescribed standards. The county does not require its staff to have
appropriate expertise because the services of experts will be used when needed. So County staff, with
limited knowledge, is being tasked with implementing a large number of complicated laws, regulation
and codes which is a prescription for incompetent observations and consequently inaccurate reports
that may cause unnecessary harm to individuals or their operations.
The way the San Benito County Code is written, it requires every employee to be aware of all local, state
and federal laws and regulations, any and all new laws and regulation, any and all changes to laws and
regulations and any and all reinterpretations of enforcement standards. The amount of time each
person would spend learning about all the laws and regulations and the constant updates is
unimaginable. This is not possible and would make field inspections by County staff impossible to
complete. This is a standard that may open the county up to significant legal liability either from not
reporting or from inappropriate reporting due to inaccurate interpretations of other laws and
regulations.
19.21.011. – Public Records.
In many ways, the San Benito County Code duplicates the DOGGR laws and regulations. As mentioned
before, many of the forms and information the County is asking operators to provide is readily available
from the DOGGR either on the internet at the DOGGR webpage or by mail if a request is made. Very,
very few, if any, records that the County would be interested in are not immediately available to them.
By accessing DOGGR information, the County would not have to file, store, manage or waste staff time
receiving this material. All of the responsibility for getting updated information and managing the
records would be left to the DOGGR. If for some reason the County needed some documents or form of
information they could either download it from the internet or ask for it. The worst case scenario is
either DOGGR staff would come to the San Benito County offices and bring the information or County
staff would go to the DOGGR District office. This would provide an opportunity for collaboration, but
would occur very infrequently.
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19.21.012. – Service of notice
It looks like the agent for the State would also be the agent for the County. In many ways, this would
work out well. In those instances where the County did have jurisdiction or shared jurisdiction the same
person would be able to communicate with both the DOGGR and County. Because there does not seem
to a need for the County Petroleum Administrator, this code sections should be put in another location.
It would be a good idea for the two agencies to have access to the same agent.
19.21.013. – Extensions or waivers
The DOGGR has primary jurisdiction over almost all of the areas this San Benito Code section addresses.
Those areas where DOGGR has not completely occupied the regulatory landscape, the County has a
right to participate in the regulatory environment. In the case of the Petroleum Code most of the areas
available to County regulations are mainly in the arena of construction of structures, land use or zoning.
Consequently, when talking about extensions or waivers, the County is attempting to give extension to
or waivers for regulations where they are preempted by State laws and regulations. Therefore, they
have no jurisdictional power to offer either in most cases.
As demonstrated by the cited sections of the PRC and CCRs in the accompanying document, the DOGGR
has the authority to offer extensions on certain deadlines and waivers if appropriate. These decisions
would be made by trained staff who would understand the ramifications of the changes. In most cases it
would not be necessary for the DOGGR to hire consultants to help make these decisions.
19.21.014. - Enforcement
This County code section is where significant conflicts and interference would occur. It is very likely that
almost any order by the petroleum administrator would be preempted by the DOGGR. The only place
where the County could take enforcement action would be in the arena of land use such as CEQA or
grading, or tank or structure construction (though not maintenance or testing of tanks), or Fire
Protection or Hazardous material handling. The County would have no powers over the drilling,
operation, maintenance or abandonment of wells, construction (?), operation or removal of pipelines,
and the operation of most facilities. Once the County finishes their planning process and the facilities
are built, the DOGGR laws and regulations seem to preempt any attempt by the county to enter this
regulatory arena once the wells and facilities become operational.
As the cited PRC and CCR sections in the accompanying document show, the DOGGR has a very strong
regulatory and enforcement program that the County should have confidence in. From inspections and
tests, to fines, to more frequent testing requirements, to life of facility bonding, to more frequent
inspections, to cease and desist orders that require deficient facilities to shut down in an orderly
manner, the DOGGR has the power and financial resources to enforce the provisions of both the PRC
and the CCRs. And, it has a long history of doing so.
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There are no specified procedures or incremental processes in the County code for the petroleum
administrator to follow(such as progressively more costly or onerous fines or other penalties) before the
ultimate step is taken to order cessation of operations in order to obtain compliance with the rules in
the code. The DOGGR PRC and CCRs provide enforcement provisions, some timelines, and actions to be
taken if compliance is not obtained. For instance the DOGGR State Oil and Gas Supervisor can issue a
cease and desist order, but only after an operator has been subjected to fines, more frequent
inspections or increased bonding amounts (unless there is an imminent threat or emergency). So even
handed enforcement of County Codes is certainly going to be difficult. It seems that due process is
embedded in the DOGGR PRC and CCRs, but lacking in the County code.
The DOGGR’s expertise is apparent in the way many of the laws and regulations are written. For
instance, while this County code would call for “immediate cessations of operations” the DOGGR
standards call for a “cease and desist order”. The difference is causing an immediate termination of say,
the operation of a tank or pipeline would very likely lead to a burst pipe or tank elsewhere on the lease
due to excess pressures. A cease and desist order allows the operator to shut down all affected facilities
before shutting down the offending piece of equipment. Negative, secondary effects would be avoided.
Instead of imposing its own petroleum standards, a much better way for the County to ensure that the
oil and gas operation in their county are operated in a prudent and environmentally safe manner is to
meet on a regular basis with the District Deputy to discuss concerns that have come up. As illustrated by
PRC section 3785, the DOGGR engages in these collaborations. The DOGGR has the enforcement ability
to ensure operators comply with the strict standards of the DOGGR.
19.21.015. Penalties
The California State Legislature provided the DOGGR State Oil and Gas Supervisor significant powers to
penalize deficient operators or others who fail to comply with the DOGGR PRC and/or CCRs. As provided
in PRC sections 3236 and 3236.5 the DOGGR State Oil and Gas Supervisor has the power to impose
criminal penalties and/or civil penalties for noncompliance with the laws and regulations. (Note: Any
actions by a District Deputy or other DOGGR employee are actions taken on behalf of for the DOGGR
State Oil and Gas Supervisor. Consequently, their actions are the actions of the State Oil and Gas
Supervisor who is ultimately responsible for those actions.)
As stated in part B of this County Code section, any violation of the San Benito County code is a criminal
offense and is only punishable with criminal penalties. The petroleum administrator has to charge
someone with a crime (when a violation occurs) in order to begin the process of gaining compliance. The
standards for obtaining evidence for criminal prosecution are quite restricted by Federal Constitutional
law such as self incrimination and illegal searches and seizures. Obtaining compliance using the civil
penalty procedures is much less complicated, time consuming and has a lower standard of proof. So any
efforts on the part of the petroleum administrator to gain compliance with any of the County code
sections would require someone who clearly understands the rules for obtaining evidence for a criminal
prosecution. The simple act of failing to provide a history form in a timely manner would be handled as
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a criminal offense by the San Benito County petroleum administrator because he/she has no other tools
available to them such as civil penalties. To be sure the DOGGR State Oil and Gas Supervisor could also
handle such an offense as a criminal manner, but the PRC gives him/her latitude in choosing how to
handle such an issue. If there were gross operator negligence to file such reports and the reports were
important to preventing a significant event that imperiled life, health, property or natural resources ,
and it was determined that the gross negligence was willful, then the DOGGR State Oil and Gas
Supervisor might choose to prosecute an offender criminally. Otherwise the significant other civil tools
available to him/her would be used. A $25,000 civil penalty per offense per day and/or termination of
the right to operate is a pretty significant way to force a wayward operator or person to do what is
necessary to come into compliance.
As discussed in San Benito County Code section 19.21.014 Enforcement, any enforcement actions the
petroleum administrator attempted to take, would in most cases, be preempted by the State. An
enforcement action would need to be taken in order to demonstrate the need for a penalty. If an
enforcement action is preempted by the State then a penalty would not follow. It is also interesting to
note that the County of San Benito has determined that its fines will be in addition to any levied by
other agencies. As provided in PRC section 3236, DOGGR criminal penalties can stand on their own. But
the civil penalties can be levied in addition to those criminal penalties imposed by the DOGGR (PRC
section 3236.5).
While the county petroleum administrator has to achieve the lofty standards for a criminal prosecution
to penalize someone for failing to abide by county standards, the DOGGR State Oil and Gas Supervisor
can determine that an operator or person failed to comply with either the PRC or the CCRs and issues
increasingly larger civil penalties, require additional bonding, increase the frequency of inspections or
shut an operator down without having to criminally prosecute them to gain compliance. The DOGGGR
suite of penalties is much more flexible and can achieve compliance in a timelier manner.
The DOGGR State Oil and Gas Supervisor has the ability to “sort of punish” or “be prepared to punish”
operators who are conducting operation that could cause harm to the State or the environment in the
future. For instance the idle well management program outlined in PRC section 3206 requires
operators to plug and abandon long term idle wells (which is very costly) or pay fees (not fines) that are
increasingly more expensive as the time the well remains idle increases . Using PRC section 3237 the
DOGGR Supervisor can order wells plugged and abandoned if they meet the criteria of being deserted as
outline in the PRC section. Plugging and abandoning wells is a very costly endeavor. While this order is
not punitive, it is an enforcement action that feels like, or appears to have the effect of a significant
penalty for an operator who has been ordered to plug and abandon a well. The operators must provide
a cash or indemnity bond for up to $1,000,000 that requires significant annual maintenance payments,
when they want to drill a well or wells. A life of the well or facility bond is worth a huge sum of money
and the annual premiums would be a significant burden on any operator. While standard drilling bonds
are not punitive in nature, they are required in order to drill a well so that in the event an operator
walks away from a well the DOGGR will have financial resources to go in and plug and abandon the well
or wells. The premium operators pay these well drilling bonds is significant. Lastly, part of the annual oil
and gas assessment, imposed annually on all operators in the State, is used to fill a couple of funds or
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line items on the DOGGR ledger. One of those funds is the Hazardous and Idle Deserted Well Abatement
program. Funding from this line item is used to plug and abandon any wells the DOGGR State Oil and
Gas Supervisor determines to be hazardous first and then those that are classified and idle deserted.
While there are too many idle deserted wells in the State to plug all of them each year, some of them
are plugged and abandoned after any hazardous wells are plugged and abandoned first. Also, there is a
specific fund that is used to plug and abandon any and all really hazardous or potentially hazardous well.
While an operator may not have any of these wells, they are still charged for them in their annual
assessment, as prescribed by the Legislature in PRC sections 3250-3266.
Lastly, the DOGGR State Oil and Supervisor can order an operator to take specific actions that he/she
deems necessary to protect life, health, property or natural resources. The Supervisor would not issue
such are order unless an operators operations were out of compliance or endangering the life, health,
property or natural resources. The effect on the operator by complying with, making changes or
repairing etc. as so ordered, in many cases feels like it is punitive (though it is not) because it can be very
expensive. Failure to comply with an order would likely result in a formal action that is punitive. But the
net effect on an operator who has to spend money to comply with an order, feels like it is punitive,
though it is not a formal punitive action.
The County does not have such a sophisticated system of penalties as specified in their code as the
DOGGR does in its PRC and CCRs. Consequently, the County code uses a one size fits all penalty
philosophy, regardless of the seriousness of the offense or deficient operation. The County should
simply work cooperatively with the DOGGR to ensure the level of compliance they desire. The most
effective use of staff and resources is to develop a working relationship with the local DOGGR District
office. The County would see that a collaboration effort, similar to that outlined in PRC section 3785,
would serve the purposes of the County.
19.21.016 – Appeals
As mentioned in the previous sections, the State likely preempts most of the standards outlined in the
San Benito County Code. So, many of the potential decisions of the County petroleum administrator will
not take place. If a petroleum administrator position is created then their decisions will be more in line
with land use and structure construction issues rather than with petroleum facilities issues. Again this
really limits the value of a separate petroleum administrator unit.
As demonstrated by the PRC sections in the accompanying document, the DOGGR has a solid appeal
process that is orderly and certain. The State Oil and Gas Supervisor is given the option in the PRC to
determine if an offending operator should be charge with a crime or with a violation of a civil code or be
charge with both depending on the circumstances of the failure to obey the State laws or regulations.
The San Benito County petroleum administrator can only seek criminal penalties to punish out of
compliance operators.
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The State Oil and Gas Supervisor not only has the power to issue orders to prevent damage to life,
health, property and natural resources, he/she can order immediate compliance if an imminent threat
exists (PRC Sections 3224-326). Also, should the offending party not obey an order or is unable to take
immediate action to prevent or stop an immediate threat to life, health, property or natural resources
the State Oil and Gas Supervisor has the authority and financial resources to step in and take such action
as is necessary to end the imminent threat. The County Code has no provisions for taking such action
before or after an appeal.
It is an interesting process that a criminal offense (section 19.21.015 states that “Any violation of this
chapter is hereby determined to be a misdemeanor and is punishable by imprisonment in the County
Jail not exceeding six months or by fine not exceeding $1000 or both fine and imprisonment”) would be
heard by an appointed board of appeals or the Planning Commission. The County appeal process seems
to be a political process rather than due process as would be found in the criminal court system. There is
no recourse in this code for civil penalties as is found in the DOGGR PRC section 3236.5. So the County
appeal process is a criminal process that should probably be resolved in the criminal courts because the
penalty is a criminal penalty of a fine or imprisonment.
19.21.017 – Appeals Board
As demonstrated by the included PRC sections in the accompanying document, the DOGGR has a solid
appeal process that is orderly and certain. Appeals are made to the Director of Conservation and
appeals of the Director’s decisions are made in the local Superior Court. The State Oil and Gas
Supervisor is given the option in the PRC to determine if an offending operator should be charge with a
crime or with a violation of a civil code or be charge with both depending on the circumstances of the
failure to obey the State laws or regulations. The San Benito County petroleum administrator can only
seek criminal penalties to punish out of compliance operators.
Not only does the State Oil and Gas Supervisor have the power to give orders to prevent damage to life,
health, property and natural resources, he/she can order immediate compliance if an imminent threat
exists. Also, should the offending party not obey and order or is unable to take immediate action to
prevent or stop an immediate threat to life, health, property or natural resources the State Oil and Gas
Supervisor has the authority and financial resources to step in and take such action as is necessary to
end the imminent threat. The County Code has no provisions for taking such action before or after an
appeal.
It is an interesting process that a criminal offense (section 19.21.015 states that “Any violation of this
chapter is hereby determined to be a misdemeanor and is punishable by imprisonment in the County
Jail not exceeding six months or by fine not exceeding $1000 or both fine and imprisonment”) would be
heard by an appointed board of appeals or the Planning Commission. The County appeal process seems
to be a political process rather than due process as would be found in the courts. There is no recourse in
this code for civil penalties as is found in the DOGGR PRC section 3236.5. So the County appeal process
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is a criminal process that should probably be resolved in the courts because the penalty is a criminal
penalty of a fine or imprisonment.
19.21.018 – Appeals Hearing Fee
The DOGGR does not charge an offending party a fee in order to appeal a decision of the State Oil and
Gas Supervisor. Costs to operate the DOGGR and parts of the Department of Conservation are paid
annually in their assessments by the operator of oil and gas wells in the State. The appeal process is just
one of the functions the DOGGR performs as part of their normal regulatory functions.
19.21.019 – Conflicts with state Law (This is a duplication of the earlier discussion)
The first paragraph in the California Attorney General’s Opinion No. 76-32 August 24, 1976 is included
with the sections of the PRC and CCR in this code Section. It is pretty clear what the regulatory
relationship is between the State and local regulatory bodies. Most interesting is that a careful reading
of the Attorney General’s Opinion reveals that not only does it affect standards in place at the time the
opinion was written in 1976 but the language seems to be such that as changes occur in State laws and
regulations, they become dominant going forward from there. “Cities and counties may regulate drilling,
operation, maintenance and abandonment of oil, gas and geothermal wells with respect to phases of
such activity not covered by state statute or regulation so long as there is no conflict with state
regulation concerning other phases of such activities”. There is no time reference like “…. not covered
by state statute or regulation in place at the time of the promulgation of new state laws and regulation,
so long as….”so it would seem that new State standards could in fact preempt existing local codes.
A reading of PRC 3106 gives a good indication of what is and is not available to local regulatory agencies
for oversight. While a county of Santa Barbara passed rules governing some facilities before the State
promulgated such standards, the County of San Benito is late in attempting to pass such standards and
as such is likely preempted in almost all aspect of oil and gas operational regulations. As mentioned
above, a close reading of the quoted passage may in fact lead the reader to believe even older codes,
laws and regulation of local agencies may in fact be preempted. This is where trained legal experts
would need to weigh in on the discussion. The author of this report is not a trained or licensed attorney
so any analyses of the issues in this section or report are nothing more than a trained observer’s
thoughts.
Clearly, CEQA, land use and construction standards are among the areas available for regulatory
involvement by local agencies. For instance the DOGGR standards clearly steer clear of any standards for
the construction of tanks and some facilities. The construction of the sub-base of storage vessels seems
to be covered in DOGGR standards but construction of the actual structure is not covered. This is where
planning and fire protection experts would find a niche for imposing regulatory standards. The DOGGR
seems disinterested in participating in creating these standards.
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19.21.020 – Reserved
No comment
19.21.021 – Spacing and location
The DOGGR laws and regulations relative to spacing are the most complicated laws in the PRC. They are
included so the reader can see that there are many circumstances that go into deciding where to locate
wells on the surface of the ground. While DOGGR CCR section 1721.1 – Exceptions -- Allows the State Oil
and Gas Supervisor to approve the surface and subsurface locations of wells as he/she determines is
necessary, the local jurisdiction have an important role to play in this discussion. Clearly, the location of
wells on the surface is a land use issue so CEQA, zoning, construction standards and land use planning
requirements would have to be considered.
The location of surface facilities is not contemplated in either the PRC or CCRs relative to spacing. In
reality, this is an area where the State Oil and Gas Supervisor would defer to local land use standards
unless they precluded the lawful extraction of the State’s oil and gas resources. In that case, after a
public hearing the State Oil and Gas Supervisor might preempt local standards and allow wells to be
drilled and facilities constructed in areas not acceptable to the local jurisdictions. This is highly unlikely
though. Unless a local jurisdiction was being grossly unreasonable, it is unlikely the State Oil and Gas
Supervisor would be inclined to preempt the local agencies relative to the surface location of wells or
facilities.
As far surface facilities goes, there are very few circumstances where the DOGGR would attempt to
preempt local jurisdictions. This is clearly are area where the local jurisdiction has the primary lead and
the DOGGR would likely stand back and follow so long as reasonable standards were implemented that
allowed exploitation of the States resources. This assumes the surface area in question is not precluded
from utilization by local laws, codes or regulations. In that case the DOGGR would not intervene.
19.21.022 – Grading
Almost all planning for, and actual dirt moving activity prior to well drilling or facility construction, would
be permitted exclusively by the local jurisdictions. Nothing in the PRC or CCRs addresses this phase of
operation. Once well drilling begins and facilities are built and begin operation, then the DOGGR laws
and regulations begin to overlap and could preempt local jurisdictional authority. Much of the earth
movement that takes place prior to and during the operational life of an oil field would be permitted
and supervised by a local jurisdiction. The DOGGR laws and regulations do require certain limited
standards that are so minor that interference between the two agency standards should be
inconsequential.
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Once it comes time to decommission an oil field, the State DOGGR has the dominant position relative to
local jurisdiction. The DOGGR CCRs are pretty clear on this. Please see the discussion is Section 19.21.31
- Well abandonment and lease restoration, for a detailed analysis of this phase of oil operations. There
is room for cooperative local jurisdictional involvement. After all they are the ones who will have to live
with the restored area once the restoration effort is completed. This is an area where representatives
from both local and State entities should get together to plan for the restoration of the defunct oil field
and then execute the plan together. A similar collaboration takes place between the DOGGR and the
Department of Fish and Game as outlined in PRC section 3785.
19.21.023 – Blowout equipment
The regulation of blowout prevention equipment, its installation, and inspection or testing is exclusively
regulated by the DOGGR. It is not possible to have two different standards for these devices. There is no
room for local jurisdiction to participate in the regulation of blowout prevention equipment. The DOGGR
publication No. MO 7 – Blowout Prevention in California is essentially the bible in California when it
comes to blowout prevention standards. A copy of MO7 is included in the accompanying documents.
DOGGR engineers are trained to use this manual when prescribing required blowout prevention
equipment and are experts when it comes to inspecting and testing blowout prevention equipment that
is installed on drilling and production rigs in the field.
In the event of a blowout, the local jurisdiction can surely look to the DOGGR to determine if proper
equipment was required, installed and tested and then to see if it was properly utilized by the operator.
19.21.024 – Cementing operations
The regulation of cementing operation is fully regulated by the DOGGR. There is no room for local
jurisdictional participation. Any local rules would conflict or interfere with DOGGR laws and regulations,
which mean all local standards, would be preempted.
19.21.025 – Emission control
As illustrated by the DOGGR PRC and CCR sections in the accompanying document and the reference to
Publication No. MO 10 – Drilling and Operating Oil, Gas and Geothermal Wells in a H2S Environment,
DOGGR has a fairly complete set of standards for well and facility’s operation, testing and fluid leak
prevention and detection. There are many references to visual inspections of tanks, pipeline and other
facilities. Also, pressure tests of pipelines and tank tests for wall and bottom thickness are important
prevention measures to ensure fluid leakage is minimized.
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But there does not seem to be specific language or reference to gas emission detection. While the air is
a natural resource, there is no specific procedure outlined that in fact protects it from facility leakage by
specified testing procedures. Consequently, it would seem that an APCD or the ARB would clearly have
authority to inspect facilities and test them for illegal low level emissions due to gas leakage that might
not be apparent during normal visual inspections. Construction standards for these facilities would have
been clearly outlined during the CEQA and land use permit process. These standards likely would include
monitoring and detection plans. And certainly, if H2S appeared after a facility began operation; it would
not be unreasonable for the local land use or hazardous material unit to require some sort of retrofitting
of monitors and detectors. The DOGGR could make these requirements and their staff does have various
gas detection tools to check for gas emission. But, gas detection procedures are fairly complicated by
nature and might best be left to air resource experts. If the DOGGR field inspectors were properly
trained to use sophisticated gas detectors and to perform appropriate gas detection tests on facilities,
there is no reason why the DOGGR field staff could not perform these functions. In the past this has
been left to agencies with more expertise than DOGGR staff.
19.21.026 – Drilling and well servicing structures
The DOGGR does not really have standards similar to this section. It would make sense that the County
would impose the mobile unit rule during the planning process. The DOGGR would have no quarrel with
this requirement. As far as proving the rig is of sufficient capability to perform the drilling operation in a
safe manner, the County is getting into OSHA and Cal OSHA areas of expertise. It is questionable
whether the county would have the expertise to make this judgment. It can be fairly asked why they
would assume such a liability? If the County told an operator to use an alternative rig or other
equipment and things went wrong, the County might be in line for a lawsuit. Unless an operator has a
track record of poor work practices, it is not likely the county would weigh in on this. So why have it in
the code. If it is in the code and they do not get some sort of assurance from the operator, and
something goes wrong, then they could be liable in that situation as well. Unless the County has the
appropriate expertise, there seems to be no reason for this code section to exist.
19.21.027 – Storage
The first sentence + part (d) of this code section do not make sense. The following is quoted directly
from the code: “Containment facilities including walls and berms, shall be designed and constructed so
as to prevent the escape of fluids from the immediate storage area and be of sufficient size to contain
one and one-half times the capacity of the largest tank.” Part (d): “ Containment facilities shall be kept
clear of all grass, brush, refuse or other inflammable materials and be fenced off against livestock.” The
reason these code provisions do not make sense is clear once the reader reviews the following definition
from San Benito County Code section 19.21.004. Containment defined: The first level of containment
such as the inside portion of storage tanks, vessels, pipes and/or devices fitted to them that normally
hold petroleum production fluids and/or gases during normal operations.” Facilities defined: Includes
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tanks, compressors, pumps, vessels, and other large equipment or structures pertinent to oil field
operations sited at a single location.” Secondary containment defined: Means containment which is
external to and separate from the primary containment, typically constructed of concrete, brick, or
earth walls.”
A literal interpretation of the above verbiage leads the reader to realize it is impossible to comply with
this code section. If containment facilities are the inside of tanks, vessels, pipes and devices fitted to
them and the containment facility must be “of sufficient size to contain 1.5 times the internal capacity of
the largest tank (a containment facility) then the inside of a tank, vessel, pipe or device fitted to them
must be 50% larger than it is possible for it to be. Something cannot hold 50% more volume than the
actual volume of the container. Yet this is what this code section requires. Likely the writer meant
“secondary containment”. But that is clearly not what they wrote. The terms “containment”, “facility”,
and “secondary containment” are specifically defined in section 19.21.004.
In part (c) the writers attempt to specifically define “containment facility” as storage reservoirs, pits,
storage tanks or excavations. This is a flawed definition as well if the previous verbiage is considered. So
a containment facility is now a storage reservoir, pit, storage tank or excavation that must hold 1.5 times
the volume of the largest tank. So again a storage tank has to hold 50% more fluid than it actually can
hold. Secondly, pits, storage reservoirs and excavations are not typically built or used as secondary
containment facilities for storage facilities. Pits and excavations typically are used during specific well or
facility operations and are temporary in nature. Storage reservoirs most likely are more permanent in
nature and would be similar to skim ponds or over follow catch basins. Secondary containment facilities
are built around the storage and production facilities in a manner that should a tank or vessel fail, the
secondary containment would hold the fluid in place until an emergency respond group could arrive to
begin draining the fluid to appropriate other tanks or vacuum trucks.
The second paragraph in the code only partially makes sense. It is possible to construct a storage tank
with a sensor and pump that could ensure that the fluid level would always remain 12 inches or more
below the lowest point of the enclosing wall. But it is a mystery how a pit (a hole in the ground) or
excavation (another hole in the ground) can be “constructed” so the fluid level will be kept at least 12
inches below the lowest point of the enclosing wall. Basically, these holes are holes, which mean they
are constructed below ground level.
Part (d) needs to be rewritten if tanks are considered containment facilities. It is hard to keep a tank
clear of grass, brush or other refuse. Tanks are usually made of metal or a poly material which do not
promote the growth of vegetation.
It is really unclear how parts (a), (b),( c) and (d) are subparts of the second paragraph. There is no
relationship between them.
The following analysis will be done assuming that tanks are storage tanks and secondary containment is
the berm or wall constructed around a production facilities (defined as any combination of tanks,
vessels, pipes, headers, and valves attached to thereto) to contain a large leak or fluid from a
catastrophic failure of one or more of the production facility units.
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The county code calls for secondary containment that is capable of holding one and one-half times the
volume of the largest capacity tank. The DOGGR standard in CCR section 1773.1(b) calls for one times
the volume of the largest tank volume. It also specifies that the secondary containment must be able to
hold the fluid for no less than 72 hours. Because there are specific DOGGR standards already in place
and the 50% increase in secondary containment does not really improve the value of the containment
facility because both will manage a complete failure of the largest tank, it seems the DOGGR has fully
occupied this area and the County code requirement would be preempted.
The second paragraph requires operators to construct their secondary containment berm or wall so that
the fluid level inside the secondary containment wall would be “kept” at least 12 inches below the
lowest point on the enclosing wall. The word “kept” implies longer term storage. In the event of a
catastrophic failure of a tank, an operator is not going to use the secondary containment as the primary
containment for very long. First of all, it is a violation because now there is no secondary containment as
specified in both County and State standards. Second of all, the spilled oil is worth a lot of money. An
operator will quickly bring vacuum trucks in and remove the oil to another location for shipping and
sale. They will not just leave it there. As specified before, the county requires an operator to have a
secondary containment that can hold one and one-half the volume of the largest tank. Now the County
is also requiring an additional 12 inches of containment wall height on top of that. Clearly this overkill. If
everything collapses inside the secondary containment at the same time it is likely the result of a huge
earthquake. In which case the secondary containment structure likely will have failed as well and the
County and oil operators will have much bigger problems than one secondary containment structure
failure.
The DOOGR offers some specification on tank construction but likely the County would have specific
standards that would mimic API standards or other similar widely accepted standards for construction.
The DOGGR would not preempt County tank construction standards (PRC section 3112). The DOGGR
requires impermeable material below a tank that causes leaked fluid to flow out from under the tank so
it can be visually observed. (CCR section 1773.2(b) and (c)). The County requires 40 ml liner or an
equivalent only to prevent leakage. The DOGGR also requires some sort of leak detection system, even
on older tanks (CCR section 1773(d)) which the county does not require. It would seem that the County
and the DOGGR requirements are similar, with the DOGGR’s requirement much more comprehensive.
Consequently, it looks like the State would preempt these requirements.
Part (c) requires “containment facilities” to be constructed no closer than 50 feet from the adjoining
property line. This is not a standard in conflict with DOGGR standards. But it seems that this issue would
be addressed by a Planning or Zoning department not a newly created petroleum administrator unit.
Part (d) is pretty much fully covered by DOGGR requirements. CCR sections 1773.1, 1777(c) (2) and
1777(d) are among the laws and regulations that fully occupy this area.
The PRC and CCR section in the accompanying document provides a pretty comprehensive structure for
regulating petroleum facilities and secondary containment. As described above, the County code is not
real clear on what or how it wants to regulate this area. It would probably be a good idea for the County
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to let the DOGGR perform these functions. The County does have the sole land use responsibility for
establishing where tanks can be placed (within reason), and it clearly has the lead when it comes to
setting tank construction standards.
19.21.028 - Piping
As the PRC and CCR sections in the accompanying document illustrate there is no room for local
government regulation relative to piping. The last chance a local regulatory agency has to impose
standards on piping is in the planning and development or CEQA phase. After that process is complete,
the DOGGR has pretty much filled up this regulatory area. In fact this section of the County code says
“The petroleum administrator may require test and inspections to establish the reliability of pipeline
systems, including those not specifically regulated or inspected by state or federal authorities (including
testing, treating and storage facilities). Because there are no pipelines in the oil field that the DOGGR or
State Fire Marshal or Federal Authorities do not regulate, that leaves nothing for the County to regulate.
Not only would the County be preempted on all of its regulatory efforts, it preempts itself by the
language in this code section. There are literally no pipelines available for the County to regulate.
19.21.029 – Fire prevention and control equipment.
The DOGGR does not engage in primary fire prevention or firefighting efforts. There is little room for the
DOGGR to be involved in this regulatory area. There is nothing in this code section that would be
preempted by DOGGR laws or regulations. While DOGGR laws and regulations are fairly strong when it
comes to preventing or responding to leakage, this DOGGR effort is designed to prevent pollution rather
than fire hazards. As far as the need for a petroleum administrator, there is nothing here that requires
their attention. In fact the County could ask the local DOGGR office to send the fire department copies
of drilling notices and permits and any other notice or permit they felt would help them be prepared to
respond when needed. It is already a common practice to send copies of various notices, permits and/or
reports automatically to local jurisdictions when the originals are being mailed to the primary recipient.
19.21.030 – Secondary and enhanced recovery operations
The Federal Safe Drinking Water Act (SDWA) passed by congress, took jurisdictional control of all
underground injection (UIC) projects in the United States. An amendment to the original SDWA
permitted States to apply for, and conditionally received primacy to regulate the injection of fluids
below the ground surface. The conditions prescribed by congress were far reaching and rigorous with
the intent of protecting potential and known sources of underground drinking water. No provisions
were made for local jurisdictions to participate in the regulation of UIC. Consequently, any local
regulations governing the underground injection of fluids is preempted by the Federal Government first
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and then by any State Government that has an EPA approved UIC regulatory program. Needless to say
there is no regulatory area in the subsurface that can be subject to local controls.
For purposes of clarity of terms, the San Benito County Code refers to UIC as secondary or enhanced
recovery operations. The operations that the County is attempting to regulate are a subset of the full
spectrum of UIC operations. In California the DOGGR has been granted primacy regulatory authority
over all Class II UIC operations. EPA Class II UIC project s involves the underground injection of produced
fluids and other specified fluids that are produced in, or attendant to, primary oil and gas operations.
The Primacy Application found in the accompanying documents will provide the reader with a
comprehensive overview of this program and the jurisdictional relationships that exist.
Included in the accompanying documents are DOGGR PRC and CCR sections that deal with spacing and
tanks as well as other sections with more apparent similarity. The State Oil and Gas Supervisor can allow
any spacing of wells on the surface or subsurface that he/she deems necessary to fully exploit the
State’s oil and gas resources. The application of steam and other UIC techniques requires very tight well
spacing both at the surface and subsurface. So spacing not only has to do with production, but it also is
related to UIC. Many tanks on leases are associated with UIC operations. That is why PRC and CCR
sections relative to these containers were included as well in the accompanying document. While UIC
regulations do not preempt county regulatory participation in the facility operations, the other PRC and
CCR sections appear to.
(a) – PRC section 3270.2 requires DOGGR staff to conduct inspections of surface facilities. PRC section
1760(e) defines the term “environmentally sensitive”. This definition sounds a lot like the provisions in
the San Benito County Code subsection. So it seems that DOGGR inspectors would likely be conducting
periodic inspections of these facilities and certain tests as prescribe in other PRC and CCR sections found
in the accompanying document. The County subpart (a) does not even hint at what a County inspector
might be looking for during their inspections. So it hard to determine if significant overlap exists
between the County and DOGGR requirements. If the County is looking for zoning violations or fire
hazard issues then there is likely regulatory room available. If they are looking to regulate operational
issues, then they are likely in conflict with State standards and preempted.
(b) Certainly local regulators have authority to regulate the movement and storage of hazardous
material within their jurisdiction. It appears that the County Code is anticipating a significant increase in
hazardous material use with the initiation of UIC operations. This is baffling because, by in large, the
only substance going down an injection well is previously produced water from local oil operations.
There is no County Code section dealing with produced water, so it seems that the County is not worried
about this fluid. Some chemicals are used in various UIC operations, but in very minor quantities. Those
materials could easily be addressed by a Fire Code business plan or Hazardous Material unit. Certainly,
the quantities used would not endanger surface waters or subsurface water due to leaching. The State
of California has experienced many decades of UIC operations and significant pollution from chemicals
used for UIC purposes has not been a problem.
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(c) This is a perplexing County code sub section. It is hard to imagine what issues the County wants
addressed with warning signs. What is there to warn about? There are tanks full of salt water and pipes
that transfer the salt water to injection wells under pressure. But nothing that cries out for specific
warning like, for instance, an open hole. Production wells are much more dangerous, because of the
counter balance going around and around, than UIC facilities. Not to mention the flammable nature of
the fluid being produced. Yet no code section addresses this issue. Possibly exposed hot pipes in steam
injection operations may qualify. But they are contained in specific locations that are not accessible to
the public. Person moving about a lease where steam operations are taking place should be trained and
knowledgeable before venturing out on the oil field operation unattended. Inspector should have similar
expertise. This is not an issue worthy of a County Code sub section in a petroleum ordinance.
d) This information would have been vetted during the CEQA and Land Use Planning phase of the
project where the County if fully in charge. Issues involving the subsurface and the operation of facilities
are most likely fully regulated by the DOGGR. There is little room for County involvement in the UIC
operations in an oil field after they have vetted a project to make sure it comports with appropriate land
use standards.
(e) Without a definition or hint of what a secondary recovery nuisance might be, it is hard to figure what
the county might be concern about. Certainly their concern for damage to surface and subsurface water
strata is not in their jurisdiction. This falls completely into the regulatory regime of the Federal and State
UIC program.
19.21.031 – Well abandonment and lease restoration procedures.
Compliance with this County Code Section and DOGGR CCR section 1776 is where the two regulatory
entities will clash and where operators could get stuck in the middle. A large number of DOGGR PRC and
CCR sections have been provided in the accompanying document that clearly demonstrates that the
DOGGR is fully in charge of most oil field operations and procedures. With few exceptions, such as
standards for tank construction (PRC 3112), the DOGGR fully occupies the regulatory arena of the oil
fields. A close reading of DOGGR CCR section 1776 also demonstrates the superior position that the
DOGGR occupies relative to regulating the restoration of a well site or of a whole lease. In fact, the San
Benito County code is in many ways a duplication of various DOGGR laws and regulations. That means
the two regulatory codes conflict which most likely means the County code interferes with DOGGR laws
and regulation. Because the County code requirements conflict or interfere with DOGGR laws and
regulations they are preempted.
Also, CCR section 1776 parts (a), (e), and (g) provide language that is insightful as to which regulatory
body is dominant. In sub section (a) the CCR requires an operator to “complete site restoration within 60
days following the plugging and abandonment of the well.” There is no discussion of local standards or
requirements like there are in (b) relative to the Regional Water Quality Control Board and the
Department of Toxic Substances Control. In sub section (e) “Lease restoration must begin within three
(3) months and be completed within one year after the plugging and abandonment of the last well(s) on
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the lease. However, the Supervisor may require or approve a different deadline for lease restoration.”
Again there is no discussion of coordination with, or a requirement to, address local standards. Sub
section (g) is actually the most powerful sub section because it clearly shows that it is the State Oil and
Gas Supervisor who grants exceptions if the local or federal agencies have conflicting requirements.
Please note that it says “exceptions may be granted” not that they must be, or shall be granted. This
leaves a significant amount of discretion up the State Oil and Gas Supervisor. “ CCR section 1776(g)says
“Upon written request of the operator or property owner, exceptions to this section may be made
provide the condition does not create a public nuisance or hazard to public safety. Exceptions may also
be granted by the Supervisor when these requirements conflict with local or federal regulations. If a
written request for an exception is received from the operator, consent to the exception from the
property owner may be required before it is approved by the Supervisor.” In every case it the Supervisor
who has the power to decide if an exception is to be made.
A few additional issues will be addressed next.
Why does San Benito County want an operator to provide copies of DOGGR Notices and Permits? What
would they do with them or more importantly, what could they do with them? They have no power to
modify the applications or the permits. This is an attempt to usurp the authority of DOGGR or to at least
modify it.
Why does the County need to verify compliance with all DOGGR requirements specified on the well
plugging and abandonment permit? What happens if the District Deputy modifies a permit to address an
immediate condition? Does the County think they can object? Again, what is the point?
What is the point of having a County code that simply tells an operator that they have to do what the
DOGGR tells them to do? Are they seeking fees or funding from some sort of penalty?
The most interesting issue is found in (b)(2)c vi which says “ Completion: Upon completion of full site
restoration the petroleum administrator will furnish a closure letter to the operator”. But in the next
section (c) the code says “The operator shall furnish the petroleum administrator with sufficient
evidence to verify compliance with all state requirements.” So the County is going issue a closure letter
to the operator once they comply with preempted County standards that are almost the same as the
more comprehensive DOGGR standards. That seems a bit odd.
There are many PRC and CCR sections shown in the accompanying document. They illustrate the
comprehensive nature of the DOGGR regulatory program in this area. Additionally, many of the
inspection and test data, facility maps, spill plans and inspection reports would prove valuable in
developing a final lease restoration plan. This information is available in each DOGGR district office and
is accessible to county staff during normal business hours.
As the discussion above illustrates, the DOGGR is the dominant regulatory body when it comes to
restoration of oil fields. The verbiage of CCR section 1776 is pretty clear on this point. But, the author
suggests that there is a role to play for the local jurisdiction as a commenting or helpful partner. The
lease restoration process is complicated and in the end the local governing body will be left with the
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restored oil filed area. So it seems that cooperation between the two governing bodies, similar to that
specified in PRC section 3785, would be constructive if the local agency chose to be helpful rather than a
barrier to timely restoration efforts.
The time lines in the CCRs were finalized after a public comment period where local jurisdictions were
given the chance to offer modifications to the timelines or extend the times or modify the process.
California regulations are not created in a vacuum. Local government regulatory agencies and the public
have ample opportunity to comment on new regulations as they did on these. The result was the
inclusion of the timelines and the prescription of the Supervisor’s dominate role in this regulatory arena.
Local agencies may have a role to play in the lease restoration process, if they choose to be constructive.
Otherwise the DOGGR can proceed with little interference because, as the Attorney General opinioned,
and the San Benito County code affirms (SB code section 19.21.019) local codes that conflict or interfere
with State laws and regulations are preempted.
19.21.032 – Removal of drilling and service equipment
This code section seems like it is a land use issue so the County is well within its rights to make such
requirements. The interesting thing about this code is that it is almost completely unnecessary. A rig
sitting idly on a well site is not producing any income nor is it being serviced so it can be used again right
away. It is unusual for an operator to leave an idle rig on a location unless they have immediate plans for
it. Also, it could be subject to vandalism if left unattended. So there is little incentive for an operator to
leave a rig idle on a well site. More than likely they will be bringing it to the rig yard for maintenance or
to another well location to begin work. A similar discussion can be made relative to Baker tanks, dog
houses, and pump trucks etc. that are used when drilling or reworking a well.
19.21.033 –Right of entry
Both the DOGGR and the County claim to have the right to enter a property uninvited. In fact both the
State and the County claim that preventing an inspector from entering a property is a criminal offense.
Please refer to the accompanying documents for the verbiage of the County code and PRC. This San
Benito County code section presents an interesting legal question that some legal scholar might want to
address. According County Code section 19.21.015, all violations of the County code are criminal
violations punishable by a fine or imprisonment. Does a County inspector, regardless of whether he/she
is deputized, have the right to come onto an operator’s premises, uninvited, without a search warrant,
to determine if any crimes are being committed, even if no probable cause exists that would lead an
inspector to believe a crime is actually being committed ?
The DOGGR is charged by the State to protect its resources from damage and waste so inspectors can
come onto premises to make sure no damage or wastage is taking place. They are most likely enforcing
civil codes rather than criminal codes. The DOGGR has the power to charge someone with a crime, but
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in the author’s almost thirty years of experience it was rarely done. Almost all enforcement actions are
civil in nature rather than criminal. If the DOGGR started charging folks with criminal offenses then the
question would apply to them as well.
An operator understands that when they initiate operations in the State, laws are in place to protect
State resources; resources that belong to the citizens of the State ((see (d) below)) and those laws
include inspections, tests and order to perform certain tasks. By agreeing to operate in the State they
acknowledge the State’s right to protect its resources from damage and wastage. The legislature created
the State laws. The Public Resources Code is a statement of those laws the legislature passed. DOGGR
PRC Section 3106 states in part “ 3106. (a) The supervisor shall so supervise the drilling, operation,
maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of
tanks and facilities attendant to oil and gas production, including pipelines not subject to regulation
pursuant to Chapter 5.5 (commencing with Section 51010) of Part 1 of Division 1 of Title 5 of the
Government Code that are within an oil and gas field, so as to prevent, as far as possible, damage to life,
health, property, and natural resources; damage to underground oil and gas deposits from infiltrating
water and other causes; loss of oil, gas, or reservoir energy, and damage to underground and surface
waters suitable for irrigation or domestic purposes by the infiltration of, or the addition of, detrimental
substances.
(b) The supervisor shall also supervise the drilling, operation, maintenance, and abandonment of wells so
as to permit the owners or operators of the wells to utilize all methods and practices known to the oil
industry for the purpose of increasing the ultimate recovery of underground hydrocarbons and which, in
the opinion of the supervisor, are suitable for this purpose in each proposed case. To further the
elimination of waste by increasing the recovery of underground hydrocarbons, it is hereby declared as a
policy of this state that the grant in an oil and gas lease or contract to a lessee or operator of the right or
power, in substance, to explore for and remove all hydrocarbons from any lands in the state, in the
absence of an express provision to the contrary contained in the lease or contract, is deemed to allow the
lessee or contractor, or the lessee’s or contractor’s successors or assigns, to do what a prudent operator
using reasonable diligence would do, having in mind the best interests of the lessor, lessee, and the state
in producing and removing hydrocarbons, including, but not limited to, the injection of air, gas, water, or
other fluids into the productive strata, the application of pressure heat or other means for the reduction of
viscosity of the hydrocarbons, the supplying of additional motive force, or the creating of enlarged or new
channels for the underground movement of hydrocarbons into production wells, when these methods or
processes employed have been approved by the supervisor, except that nothing contained in this section
imposes a legal duty upon the lessee or contractor, or the lessee’s or contractor’s successors or assigns, to
conduct these operations.
(c) The supervisor may require an operator to implement a monitoring program, designed to detect
releases to the soil and water, including both groundwater and surface water, for aboveground oil
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production tanks and facilities.
(d) To best meet oil and gas needs in this state, the supervisor shall administer this division so as to
encourage the wise development of oil and gas resources.
The County inspectors are not charged with protecting resources, they are charged with detecting
pollution events or hazards which are treated as crimes by the County. As such, they do not concern
themselves with resource protection in the sense of preventing damage to or wastage of oil and gas
resources or ground water; mainly because they have no jurisdiction in these areas. The DOGGR clearly
does have the power and the direction to do just that. In almost every case the enforcement action the
DOGGR uses to protect the state’s resources is a civil action rather than a criminal action. It would be
interesting to hear what someone trained in law would say about the fine line between civil penalties
and criminal penalties and how the various agencies detect the violations and then enforce the
penalties.
19.21.034 – Surface inspections
It is unclear what a County official will be inspecting because there are so few issues available to them to
regulate. Once the construction phase of an oil operation is completed, it is hard to imagine what they
would be inspecting. As the PRC and CCR sections in the accompanying document illustrate, the DOGGR
has pretty much wrapped up all regulatory issues available in the oil field. With the exception of fire
prevention and establishing sites for facilities on a lease, hazardous material handling and storage and
land use issues like road construction and maintenance, the County really has no primary responsibilities
involving operations of facilities on oil field leases. Almost everything in the County code piggy backs on
DOGGR laws and regulations, including fines, and other penalties. Consequently, it appears there is little
advantage to creating the position of Petroleum Administrator. It would be a far better use of County
resources to establish a cooperative working relationship with the local DOGGR District office.
19.21.035 – Hazardous conditions or nuisances
Everything in this County Code Section is preempted by the DOGGR laws and regulations. Additionally,
unlike the county, the DOGGR has financial resources already available in the form or bonds and
allocated funding to perform these tasks if needed. This is a regulatory area where the County should be
interested in making sure these issues are eliminated. Close cooperation and communication between
the County and local District staff would prove valuable to both agencies. Certainly the County has
legitimate concerns in this area and the DOGGR staff should be willing to work with them to effect the
elimination of significant hazardous conditions or nuisances. The PRC and CCR sections in the
accompanying document illustrate the breath of DOGGR responsibilities.
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19.21.036 – Hazardous Equipment
The DOGGR has the authority to address these concerns. There is no need for local standards. If an oil or
gas operation appeared to be operating in or is left temporarily in a hazardous condition, the County
should notify the local District office about their concerns. A field engineer will be dispatched to inspect
the location and determine what action is necessary. If the operator fails to comply with an order from
the Supervisor that leads to the elimination of the hazard, the DOGGR can fence the location
themselves, or take whatever action is necessary to eliminate the hazard to life or limb. The operator
will be charged for the work. Should they fail to stay in compliance; the DOGGR can fine the operator
and/or order the operator to cease operations until the hazard is eliminate. There is no need for the
County to apply its enforcement powers.
19.21.037 – Pollution
The DOGGR has a comprehensive oil spill and waste discharge prevention and control program as
illustrate by the PRC and CCR sections found the in accompanying document. While there are legitimate
issues for the Fire Department to be involved in the oil fields as well as the hazardous materials unit,
there is little need for local involvement when it comes to minor spills and waste discharges to the
surface. There is no room for local involvement when it comes to subsurface placement of fluids and
wastes that is controlled by the DOGGR UIC program. The DOGGR fully and completely occupies this
regulatory area. The DOGGR laws and regulations are pretty detailed relative to how unpermitted waste
discharges and spills are prevented, controlled and cleaned up.
19.21.038 – Sumps
The last line of this County Code section says “No unlined or unscreened skimming ponds, separation
basins or storage reservoirs for salt water, oil field wastes or oil field products will be permitted.“ The
intent of this requirement is pretty clear. Unfortunately, there is no language in the DOGGR PRC or CCRs
that is this clear about the intent of the standard. There is wiggle room for operators who operate in
areas with no fresh ground water to use unlined sumps. Fortunately, for the purpose of this report, San
Benito County likely does have ground water, so unlined sumps are not permitted in the County by
DOGGR laws and regulations. A reader has to look at three CCR sections to clearly see that the DOGGR
does not allow unlined sumps in areas where fresh ground water could be impacted. Those DOGGR CCR
sections are:
1770 Oilfield Sumps (a) Location. Sumps for the collection of waste water or oil shall not be permitted
in natural drainage channels. Contingency catch basins may be permitted, but they shall be evacuated
and cleaned after any spill. Unlined evaporation sumps, if they contain harmful waters, shall not be
located where they may be in communication with freshwater-bearing aquifers.
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1775 Oilfield Wastes and Refuse (a) Oilfield wastes, including but not limited to oil, water, chemicals,
mud, and cement, shall be disposed of in such a manner as not to cause damage to life, health,
property, freshwater aquifers or surface waters, or natural resources, or be menace to public safety.
Disposal sites for oilfield wastes shall also conform to State Water Resources Control Board and
appropriate California Regional Water Quality Control Board regulations.
1775(b). Dumping harmful chemical where subsequent meteoric waters might wash significant
quantities into freshwaters shall be prohibited. Drilling mud shall not be permanently disposed of into
open pits. Cement slurry or dry cement shall not be disposed of on the surface.
As the three CCR sections demonstrate, the DOGGR does not allow unlined sumps in San Benito County.
Because the DOGGR already regulates these sumps in San Benito County, the local code is unnecessary.
The rest of County code section 19.21.038 is already covered by the DOGGR CCRs and PRC as illustrated
in the accompanying document. Therefore, this County code section is unnecessary and would be
preempted by the DOGGG regulatory authority.
19.21.039 – Oilfield waste transporters
Other than the underground injection control program, the DOGGR does not have many standards that
cover the transport and disposal of hazardous materials.
19.21.040 – Cellars
The primary DOGGR CCR section dealing with cellars is CCR section 1777(c)(3) “Well cellars shall be
covered and kept drained. Grating or flooring shall be installed and maintained in good condition so as
to exclude people and animals. Cellars should be protected from as much runoff water as practical.“
Because the County code addresses other issues such as fluid levels etc., the author has included
verbiage from other PRC and CCR sections that address fluid containers and DOGGR requirements in the
accompanying document. In the end though, PRC sections 3013 and 3106 give the Supervisor the
authority to ensure the safety of cellars. This County code section is unnecessary because the DOGGR
clearly regulates cellars, sumps and production facilities. This regulatory activity would be preempted by
DOGGR laws and regulations.
The third line of the County Code is confusing. “The oil/petroleum depth, may not exceed two inches
and be kept free from water, petroleum, drilling fluids or other substances which might constitute a
hazard.” So the oil depth cannot exceed two inches in the cellar and the cellar has to be kept free of oil?
The line before this one says the cellar cannot “exceed fifty percent of the depth of the cellar” yet the
next line says it has to be kept free of the named fluids which would be the fluids the cellar would
accumulate. Lastly, this code section does not address sever rain storms. While DOGGR requires cellars
to be drained (an ongoing activity – a cellar can be drained day after day if necessary) the County
prescribes that the cellar depth cannot (“shall not”) exceed the arbitrary depth of 50% of the depth of
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the cellar. This is impractical and likely unenforceable. During periodic inspections of cellars, the DOGGR
will require operator to drain any fluids from their cellars if any is present. Failure to keep cellars drained
is a deficiency that the DOGGR inspector will note and ask to have eliminated.
19.21.041 – Signs
As the PRC and CCR sections included in the accompanying document show, the DOGGR has complete
regulatory authority on signage and what information needs to be provided on each sign or label. The
County Code duplicates these requirements which make them redundant and unnecessary. DOGGR
requirement preempts any county attempt to participate in this regulatory arena. The only unique
requirement in the County code is that a sign has to be legible from a distance of 25 feet. Likely, this is
so emergency vehicles can easily indentify the entry points to oil and gas operations. The requirement
seems reasonable, so the County could ask the DOGGR to ensure entry point signs meet this
requirement. The DOGGR PRC sections 3013 and 3106 give the Supervisor this ability to make
appropriate adjustments to the PRC and CCRs. Because this is an emergency response issue, there is no
doubt that the DOGGR would cooperate with the county concerns relative to this issue.
19.21.042 – Severability
Various PRC Articles have this clause. For instance PRC section 3252 in Article 4.2 Hazardous Wells. It is
unimportant to cite more of these sections because they are not relevant to purpose of the report.
What is interesting is that if much of the San Benito petroleum code is preempted by State laws and
regulations, as indicated in this report, then dependent parts of the County code are rendered useless.
For instance, if the County does not have jurisdiction for UIC, then they cannot take enforcement actions
against operators, which means they cannot levy penalties. Or, if it is determined that the inspection
and violation process fails to meet due process considerations necessary for criminal prosecution, then
much of the County code is unenforceable.
19.21.043 – Remediation of high risk operations
There appears to be two different strategies in use by the County and DOGGR relative to ensuring
operator compliance with codes, laws and regulations. The DOGGR PRC section 3106 outlines general
objectives for governing operation of wells and facilities in an oil field. Then there are several specific
PRC and CCRs sections that are more specific in the operational requirements oil and gas operators must
comply with. There are several sections of both State documents that prescribe inspection and testing
standards. All of this regulatory effort is designed to prevent problems from occurring at regulated sites
in an oil field. For instances DOGGR staff conduct inspection and tests and require corrections to any
deficiencies (conditions that could become serious problems later if not corrected promptly) discovered
during these inspection or tests of production facilities. Operators who do not comply timely or
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repeatedly misbehave or fail to conduct their business properly can be assessed civil penalties for the
poor performance or their operation can be shut in.
If the State Oil and Gas Supervisor believe a problem exists either before or after a significant damaging
event, he/she may take necessary action to investigate to see if a systematic problem exists. If
systematic problems exist, the State Oil and Gas Supervisor can order tests or remedial actions to fix
those problems or force operators to take prescribed preventative actions to make sure future problems
do not occur. If an operator fails to take appropriate actions as ordered by the Supervisor, the
Supervisor, using DOGGR funding, can take action on his/her own to correct any identified issue.
Should prevention measures fail, and an operator has a significant damaging event, such as an oil spill or
pipeline failure, the DOGGR has the authority to require an operator to clean up and remediate what
they have damaged. Should the violator fail to take appropriate action, the DOGGR has some financial
resources to ensure that the effects of the damaging event are remediated. Also, if an operator has a
history of compliance failure or significant damaging incidents, the Supervisor can order an operator to
shut in their facility until compliance is achieved or the Supervisor believes will be achieved. The
Supervisor can also impose an increase in testing frequency of a well or facility and/or a life of a well or
life of a facility bond on an operation that has a track record of damaging incidents or failure to follow
proper procedures. The amount of the bond is devastating to the operator because it must cover the
costs to plug and abandoned covered wells, remove all facilities and remediate the land to its natural
state. This is a huge sum of money.
The DOGGR attempts to prevent damage by inspections, tests and investigation into potential problems.
Then, if an operator does not follow the rules, they are issued civil penalties that are proportionate to
level of the non-compliance and the Supervisor can even shut an operation in if the problem is serious
enough. Then if the prevention measure fail and an incident occur, the Supervisor has the authority and
resources to ensure remediation. Lastly, if an operator is habitually having problems, the Supervisor can
shut down their operations until they come into compliance and/or impose a life the facility bond that
typically is in an amount that would be financially devastating to most operators. At all phases of the
enforcement process, DOGGR inspectors are ensuring compliance with whatever orders the Supervisor
issues.
On the other hand, the county strategy to deal with poor operator performance is to react to damaging
incidents forcefully. Much of the County strategy for addressing “High risk operations” is similar to or
has the effect of being the same as the DOGGR’s last enforcement phase. So it would seem that much of
this code section would be preempted by State laws and regulations.
A much better strategy for dealing with all operators is for the County to hold periodic meeting with the
local District staff to ensure their concerns about compliance are being addressed. Should a particularly
significant incident occur, it would not be unreasonable for the Board of Supervisors to ask the District
Deputy to come to a meeting, after the incident is under control, and make a report to them about the
incident and answer their questions.
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19.21.044 - Bonds
It appears that the County was contemplating a bond section in their code. Included in the
accompanying documents are the boding requirements found in the PRC and CCRs. Besides the various
fees and annual assessment that funds the DOGGR, these bonds can be used to plug and abandon wells,
remove facilities and remediate soil. There is a substantial financial resource available to the Supervisor
should the need for action develop.
The problem with the bonding the county might require is that, the action they would use the bond
money for, in all likelihood, would be illegal because it would conflict or interfere with normal DOGGR
regulatory operation. It seems unnecessary for the County to get involved in bonding processes. They
can work with the local DOGGR district office to make sure issues of concern are addressed.
Summary
Local governmental agencies have primary responsibility for CEQA, land use standards, zoning, fire
fighting standards, hazardous material handling requirements, and major spill response which means
they need an appropriate spill plan. And the DOGGR will not participate in the development of building
standards for tanks or other vessels. The DOGGR PRC prohibits this. After those regulatory areas are
addressed by local government organizations, most other regulatory issues relative to an oil field
operation and decommissioning are the primary responsibility of the DOGGR. As the Attorney General
opinioned and the San Benito County code acknowledges, any local codes or standards that conflict or
interfere with State laws and regulations are preempted. The State laws and regulations will prevail. This
report along with the supporting information in the accompanying document illustrates that the DOGGR
has a comprehensive regulatory program for oil field operations. So comprehensive in fact that most of
the San Benito County petroleum code is preempted by DOGGR laws and regulations. There is little need
for the petroleum code and even less need for a petroleum administrator.
Remember, for a local ordinance to be preempted by State standards, the State has to exert its
preemption authority. Likely individual companies or Associations will have to be aware of local efforts
to usurp DOGGR regulatory authority and notify the DOGGR of these efforts so DOGGR can
communicate with the local governmental agency to let them know that they intend to assert this
preemption.
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Jerry13
1-11-13
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