Fulbright & Jaworski LLP: New Drilling and Recycling Regulations Proposed by Texas Railroad Commission Relating to Hydraulic Fracturing

Fulbright & Jaworski LLP: New Drilling and Recycling Regulations Proposed by Texas Railroad Commission Relating to Hydraulic Fracturing

In recent weeks, the Texas Railroad Commission (RRC) approved several amendments to the Administrative Code relating to drilling, casing, cementing, well control, and the commercial recycling of produced water and/or hydraulic fracturing flowback fluid.

On August 21, 2012, the RRC proposed regulations covering:

  1. casing, cementing, drilling, and completion requirements,
  2. cathodic protection wells, and
  3. seismic holes and core holes (16 Tex. Admin. Code §§ 3.13, 3.99, and 3.100 respectively).

These changes reflect the transfer of the Texas Commission on Environmental Quality's Groundwater Advisory Unit to the RRC. Proposed § 3.13 details the RRC's requirements for all wells, consolidates the requirements for well control and blowout preventers, and updates the requirements for drilling, casing, cementing, and fracture stimulation.  

This section provides for the isolation of usable-quality water zones, potentially productive zones, and over-pressured zones in order to prevent contamination and the migration of fluids behind the casing. Important provisions include:

  • A proposal to set surface casing to a depth of 3,500 feet or greater must be in writing and requires prior approval of the appropriate district director.
  • The proposal must detail how the operator plans to maintain well control during drilling, ensure successful circulation and adequate bonding of cement, and, if necessary, prevent upward migration of deeper formation fluids into protected water.
  • All casing installed in a well that will be subjected to fracture stimulation must have a minimum internal yield pressure rating designed to withstand at least 1.2 times the maximum pressure to which the casing may be subjected.
  • The operator must pressure test the casing or fracture tubing on which the pressure will be exerted during the fracturing.
  • All annuli must be monitored during stimulation operations. If the pressure deviates above the anticipated increases, the operator shall immediately suspend fracturing and notify the appropriate district director within 24 hours of the deviation.
  • An operator must set and cement sufficient surface casing to protect all usable quality water strata.
  • On bay and offshore wells, all tool pushers, drilling superintendents, and operators' representatives (when the operator is in control of the drilling) must furnish certification of satisfactory completion of API training or similar nationally recognized training program on well control equipment and procedures.
  • A mechanical integrity test of the surface casing must be conducted after total depth or the next casing depth is reached to ensure integrity of the casing after drilling.

On September 11, 2012, the RRC approved new regulations relating to the commercial recycling of produced water and/or hydraulic fracturing flowback fluid. (16 Tex. Admin. Code, Chapter Four, Subchapter B, Divisions I-VI).  

Proposed Division 5 sets out requirements for off-lease or centralized commercial recycling, while proposed Division 6 concerns stationary commercial recycling of produced water and/or hydraulic fracturing flowback fluid.  

Under the proposed regulations, a commercial recycling applicant must provide engineering, geological, and other information sufficient to show that the "issuance of the permit will not result in the waste of oil, gas, or other geothermal resources, the pollution of surface or subsurface water, or a threat to the public health or safety."  

On-lease, non-commercial recycling is to be authorized by concurrent amendments to 16 Texas Administrative Code § 3.8, relating to water protection, which states that "no person conducting activities subject to regulation by the commission may cause or allow pollution of surface or subsurface water in the state."

The amendments approved on August 21, 2012 can be found at http://www.rrc.state.tx.us/rules/prop-amend-3-13-Aug21-2012.PDF; and the September 11, 2012 amendments are at is http://www.rrc.state.tx.us/rules/prop-amend-3-8-comm-recycling-Sept2012.PDF.

This article was prepared by Barclay R. Nicholson (bnicholson@fulbright.com or 713 651 3662) and Stephen C. Dillard (sdillard@fulbright.com or 713 651 5507) from Fulbright's Energy Practice and Fulbright's Litigation Practice.

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