On December 30, 2014, the California Office of Administrative Law approved permanent regulations issued by that state’s Department of Conservation, Division of Oil, Gas and Geothermal Resources (“Division”) governing fracking.  The regulations follow the Division’s final interim regulations (effective January 1, 2014), which we discussed here, and further implement California’s fracking statute (SB 4), which we summarized here.

The regulations are supported by a statement of reasons.  According to that statement, the new regulations are intended to supplement the Division’s current oil and gas regulatory framework with regulations specific to well stimulation (“a treatment of a well designed to enhance oil and gas production or recovery by increasing the permeability of the formation”) to meet the mandates of SB 4.  The regulations set requirements to ensure integrity of wells, well casings, and the geologic and hydrologic isolation of the oil and gas formation during and following well stimulation treatments.  They also require full disclosure of the composition and disposition of well stimulation fluids, including hydraulic fracturing fluids, acid well stimulation fluids, and flowback fluids.

Among other things, the regulations implement new requirements for well stimulation permits, neighbor notification, and water well testing.  For example, applications for well stimulation treatment permits will require a water management plan that includes an estimate of the amount of water to be used in the treatment, the anticipated source of the water to be used in the treatment, and the disposal method for the recovered water in the flowback fluid from the treatment.

The new regulations go into effect on July 1, 2015.

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Photo of Mark D. Herman Mark D. Herman

Mark Herman advises policyholders on insurance coverage and represents clients in complex commercial litigation and arbitration, with a focus on insurance coverage disputes. He has helped clients reach favorable resolutions of a wide variety of insurance claims, including property, business interruption, products liability…

Mark Herman advises policyholders on insurance coverage and represents clients in complex commercial litigation and arbitration, with a focus on insurance coverage disputes. He has helped clients reach favorable resolutions of a wide variety of insurance claims, including property, business interruption, products liability and mass torts, directors and officers liability (D&O), errors and omissions and professional liability (E&O), cyber, aviation, trade credit, and political risk claims.