In a hearing on Friday, July 19, 2024, Judge Gregory A. Pulskamp officially extended an ongoing injunction against CalGEM related to reinjecting produced water within active oil fields through January of 2025.
Review is helpful here, since this critically important legal action began in January 2017. At the time, CIPA and other interested parties joined together to sue the State of California over its planned response to federal overseers who were requiring an “audit” of the state’s Underground Injection Control Program, which is a program delegated by USEPA to California regulators.
In 2015 the U.S. Environmental Protection Agency (USEPA) tasked DOGGR with assessing aquifers to determine if, over time, the continued expansion of existing oil field production could be endangering sources of drinking water. DOGGR responded by agreeing to audit every Aquifer Exemption (AE) on record.
CIPA and other trade groups argued then, and continue to argue, that DOGGR (now CalGEM) could “shut in” thousands of oil production wells due to the inability to continue reinjecting produced water into federally approved aquifers during the extraction process. Over ninety percent of fluids lifted in the extraction process is brackish water.
CalGEM (California Geologic Energy Management Division) was formerly known as “DOGGR” (Division of Oil, Gas and Geothermal Resources). In response to federal requirements related to the UIC program, which exists to ensure the Clean Water Act of 1970 is properly followed while extracting minerals, DOGGR was planning to implement a schedule to review exempt aquifers, and during the review period oil producers could have been required to stop reinjecting produced water.
In practice, that action would have banned a great percentage of California oil production, shutting in approximately 100,000 barrels of production per day. That’s where the due process violation exists, since all the injection wells were duly permitted. Additionally, it could have been a constitutional “takings,” since preventing extraction from perfectly compliant and permitted oil wells would have bankrupted numerous independent producers—unable to continue production due to the planned pause.
During Friday’s court proceedings, despite the fact that seven AE applications remain outstanding, CalGEM’s attorneys took the position in status conference briefing ordered by the Court that: (1) the injunction should be lifted or narrowed to only those parties that filed the lawsuit; and (2) that CalGEM should be permitted to dispense with its obligation to maintain a litigation hold to preserve discoverable materials relating to the audit and the rule making resulting from the audit.
In the opposition briefing, CIPA and other stakeholder attorneys raised several legal arguments against CalGEM’s positions. After considering the arguments of the parties, the Court ruled in favor of CIPA and the other stakeholders and agreed to continue the stay fully for another 6 months and also ordered CalGEM to continue to maintain records relevant to the proceeding under its litigation hold.
The Court has ordered the parties to a further status hearing on 1/24/2025 and status briefing must be filed by the parties on 1/14/2025.
Over the last eight years, twenty-two aquifer exemption boundary adjustments have been fully approved by the US EPA. Twelve remain to be submitted by the state to the US EPA. Four have been submitted but were returned to the state by US EPA Region 9 with further questions and data requests, one recently completed public review, one is pending public review, and six are at the State Water Resources Control Board. All applications are many years old.
CIPA’s legal counsel will continue to fight in court for California’s independent oil producers and will keep CIPA’s members informed of progress going forward.
For more information, contact Sean Wallentine.