Now we know why the energy industry suddenly cares about earthquakes…
4:00 PM EDT on October 21, 2015
Last week, the New York Times published a report on the recent earthquakes in Cushing. Apparently, some scientists are now concerned that a deadly 6.0 or stronger earthquake may strike the area, and in the process, damage and incapacitate the Cushing Oil Hub. It's apparently one of the largest oil storage facilities in the world, which means Oklahoma will probably serve as the setting for the next Mad Max movie.
Naturally, the Times report got the attention of state political leaders and energy companies. They can deal with earthquakes when they only pose a risk to human life, private property, and people with anxiety disorders, but when the quakes start to threaten the ability to make money by delivering crude oil across the nation, well, action must be taken.
Via a report by the PR-wing of The Oklahoman:
The Oklahoma Corporation Commission said Monday it has taken further action to limit activities of wastewater disposal wells in the Cushing area, home of the nation's largest commercial oil storage hub.
The action comes following several earthquakes in the area, including a magnitude 4.5 earthquake that hit Oct. 10. There have been no reports of damage to pipeline or storage infrastructure from that quake, one of the largest to shake the state this year.
The commission's Oil and Gas Conservation Division said its latest plan calls for operational changes at 13 disposal wells in the Cushing area. Operators of another 13 disposal wells have been advised their wells may come under future limits.
Commission staff have directed Cushing-area wells injecting into the Arbuckle formation to either stop injection altogether, reduce their volumes by 25 percent or prepare for future changes.
Among the disposal wells to be shut in are three from American Energy-Woodford LLC and one from Crown Energy. Nine wells are being asked to reduce their volumes, including three operated by American Energy-Woodford, three by Crown Energy, and one each by Cher Oil, Petrowarrior and FHA Investments.
The directive came in a memo sent to operators Friday. It said there have been 87 earthquakes greater than magnitude 2.5 this year within a 12-mile radius of Cushing. That's up from 29 earthquakes in that category last year and 3 in 2013.
Commission spokesman Matt Skinner said it was the first time the commission has put operators on notice of future actions. Among the 13 wells on notice are seven operated by American Energy-Woodford.
That's interesting. Considering we've known about the man-made earthquake threat for several years now, why is the Corporation Commission just now taking action?
Heh. We know why. The energy industry fears any sort of regulation or measure that promotes safety, and uses their deep pockets to essentially control and influence all levels of state government. Seriously, sucking the dick and rubbing the balls of the energy industry is one of the few bipartisan issues Republicans, Democrats and Derplahomans can get behind.
I guess that control has backfired. With the industry now calling for the Corporation Commission to save it from itself and put caps on injection well volumes, there are some concerns that the Commission is powerless...
In response to ongoing concerns about the links between wastewater disposal wells and earthquakes, the Corporation Commission has put in a “traffic light” system for disposal well permits. Staff also has issued several rounds of directives to operators to either reduce disposal well depths or reduce volumes.
Oklahoma's oil and gas industry has been generally supportive of such directives, although last month a Tulsa company, Marjo Operating Co. Inc., filed an appeal against a request to reduce volumes at one of its disposal wells in Payne County. Marjo claimed the commission's voluntary directive was arbitrary and issued without due process.
Commission staff and Marjo representatives have agreed to meet before Oct. 27 to work out technical issues regarding that appeal.
The legal issues remain, however, with at least one state lawmaker planning to file legislation giving the Corporation Commission explicit authority to regulate induced seismicity risks and wastewater disposal wells.
Oklahoma Secretary of Energy and Environment Michael Teague and the Oklahoma Independent Petroleum Association said they believe the Corporation Commission, as the state's chief energy regulator, already has the legal authority to manage risks from induced seismicity.
But members of the elected, three-person commission have expressed reservations about their power in recent public meetings.
Chad Warmington, president of the Oklahoma Oil and Gas Association, praised the “measured approach” taken by state regulators to the risks from induced earthquakes. He said not much is known about the basement rock, the faults or the stresses upon them in the Cushing area. Much more is known about faults in the layers of rock that produce oil and natural gas.
“It's an extremely challenging situation for the Corporation Commission,” Warmington said in an email Monday. “They've had significant budget cuts coupled with unusually high seismic activity and have limited hard science to rely upon for direction. Despite these challenges, they have been vigilant in protecting the public while minimizing as best they can the significant economic impact these directives have on well operators.”
Kim Hatfield, chairman of OIPA's regulatory committee, said the organization's members believe the Corporation Commission is basing its actions on sound science. He called the complaint from Marjo an outlier.
“With the swarm we've had, we think the action the commission is taking is prudent,” Hatfield said. “It's something the industry is going to cooperate on. It doesn't mean we're happy about it — we'd rather see the earthquakes go away.
“Around Cushing, it is a concern. The vast majority of seismic events are in the 2- to 3- (magnitude) range. We'd like to stand up and say for certain there's never going to be anything bigger than a 3, but we don't know, we can't say and we're not going to lie about it. The seismologists say their projections are based on naturally occurring events, but I'm not sure you can apply the same models to triggered events.”
Remember earlier where I mentioned the energy industry controls all levels of Oklahoma government? I forgot to mention they also control most of the media. Even though it reads likes branded-content or a native advertising post, this was all printed in The Oklahoman. I hope OPUBCO charges agency rates for writing this stuff.
Anyway, I hope everyone sleeps easy tonight. Kim Hatfield, the man who's spent way too much time trying to distance the energy industry from earthquakes over the past four or five years, wants us to know that the energy industry is not "going to lie about it." That's great. On that note, I'm still waiting on new Devon Energy talking points...
Yeah, they're not going to lie to us at all. They'll just try to mislead, distract, deflect blame, and turn the cause of earthquakes into a "debatable" partisan political issue. Big difference.
p.s. - Here's a link to the paper about the risks for earthquakes in the Cushing area. Check it out.