DEPARTMENT OF THE ARMY CR 1130-2-14 Omaha District, Corps of Engineers 1616 Capitol Avenue CENWO-OD Omaha, Nebraska 68102

Command Regulation No. 1130-2-14 1 July 2014 Project Operations OIL AND GAS POLICY

TABLE OF CONTENTS

Paragraph Page

1. Purpose ...... 1 2. Applicability ...... 1 3. References ...... 1 4. Definitions ...... 1 5. Policy ...... 1 6. Authority ...... 2 7. Mineral Ownership and Regulation ...... 2 8. Exploration ...... 3 9. Production Facilities ...... 4 10. Injection Wells ...... 9 11. Transportation, Collection, Distribution Pipelines ...... 9 12. Spill Response ...... 9 13. Flowage Easements ...... 11

APPENDIXES

Appendix A- References ...... A-1 Appendix B - Acronyms/Defmitions ...... B-1 Appendix C- Critical Requirement Summary ...... C-1

1 DEPARTMENT OF THE ARMY CR 1130-2-14 Omaha District, Corps of Engineers 1616 Capitol A venue CENWO-OD Omaha, Nebraska 68102

Command Regulation No. 1130-2-14 1 July 2014 Project Operations OIL AND GAS POLICY

1. Purpose. This policy is designed to provide guidance to Omaha District personnel for the development of leasable minerals under lands managed by the U.S Army Corps of Engineers (USACE), Omaha District (District) and for the management of mineral exploration and production activities on those same lands. This policy also provides guidance for lands not owned by the federal government or managed by USACE that are in close proximity to projects under the authority ofUSACE, including dams, reservoirs, their associated impoundments, levees and any other structures, including all flood risk management projects.

2. Applicability. This policy is applicable to federal land administered by USACE, USACE flowage easements on private lands, and mineral development off project lands that has the potential to adversely affect lands administered by USACE.

3. References. See Appendix A

4. Definitions. See Appendix B

5. Policy. It is the policy of the Omaha District to exercise its authorities to manage oil and gas activities at and near its Civil Works projects in a manner that protects public health and safety, USACE personnel and project purposes. This policy includes a brief discussion of mineral interests as well as guidance on exploration; production facilities; transportation, collection, distribution pipelines; spill response and flowage easements on private adjacent lands for the operation of the projects. This policy is applicable to federal property managed by USACE for project purposes and easements acquired for project operations. The District's ability to regulate certain activities is determined on a case by case basis, this policy also sets out the information each project shall collect whenever there is an application associated with oil and gas exploration and development, and whenever project personnel identify an activity on or near USACE project land that may be considered a trespass or encroachment, or which has the potential to alter or impair USACE projects or lands. Project personnel shall use this policy to develop project specific oil and gas management plans with best management practices (BMPs) as conditions of approval (COA). Appendix C summarizes critical requirements found in this policy. When oil and gas activities involve a request for an interest in real estate, project personnel will refer to the Operations Division Real Estate Policy (OREP) for guidance.

I CR 11 30-2-14 1 Jul14

6. Authority.

a. Authority to Manage Federal Property for Authorized Pw:poses. The federal government has unlimited authority to manage federal property under the U.S. Constitution. In the Flood Control Act of 1944 (Pub. L. 78-534) ("1944 FCA"), Congress authorized USACE to construct, operate and maintain the Missouri River mainstem dams and reservoirs for eight project purposes: flood control; navigation; hydro-electric power; water supply; fish and wildlife; recreation; irrigation and water quality. USACE has exclusive jurisdiction to regulate the use of the project lands and waters for those project purposes. Authorizations for dams and reservoirs within the District not authorized by the 1944 FCA are provided in Appendix A. USACE authority to regulate for project purposes at those projects must be reviewed on a case by case basis when the issue arises.

b. Authority to Manage Off Federal Activity to Protect Project Purposes. 33 U.S.C. § 408 (Section 408) expressly prohibits the public from taking possession of, using for any purpose, building upon, altering, defacing, destroying, moving, injuring, or "in any manner whatever" impairing the usefulness of any levee or other work built by the United States for navigation or flood control without prior approval from the Secretary of the Army. That approval will be granted only upon the recommendation from the Chief of Engineers after it is determined that the alteration will not be injurious to the public interest and will not impair the usefulness of such work.

Section 408 applies to actions on and off of federal lands if the activities affects or have the potential to affect a federal project constructed for navigation or flood control. Current USACE Section 408 guidance places the burden on the applicant to establish that the proposed action will not impair the usefulness of the federal project. Before the Chief of Engineers will recommend the approval of the alteration to the Secretary of the Army, he must adopt the findings of the applicant regarding the effects of the project. Further guidance on Section 408 is provided in Appendix A.

7. Mineral Ownership and Regulation. The federal government owns USACE project lands in fee. Generally the minerals on those lands are federally owned. In that case, the Bureau of Land Management (BLM) has the responsibility to lease the minerals for exploration and extraction. USACE has authority to regulate the use offederal property incident to the mineral leases. Refer to guidance in Appendix A on BLM leasing of federal mineral interests.

a In certain instances, the mineral interests on the project lands are owned by a non-federal entity because USACE did not acquire the mineral rights, either because the mineral interests were already severed from the land or because USACE determined it was in the government's best interest to allow the land owner to reserve the mineral rights. However, in every case, USACE executed subordination agreements with the mineral rights owners. USACE strictly regulates exploration and extraction activities on the surface of project lands. Additional guidance for requests for surface access to minerals underlying project lands is provided in Appendix A.

2 CR 1130-2-14 1 Jul14

b. In other cases, the minerals are owned by the federal government but administered by the Bureau of Indian Affairs (BIA) on behalf of an Indian tribe. Tribal mineral rights are subject to USACE regulations for the protection of the projects and project purposes. Refer to guidance in Appendix A on BIA management of tribal mineral interests on or near USACE project lands.

Since the horizontal directional drilling (HDD) process has became more cost effective, federal and private mineral interests on project land can now be reached from a surface location near, but not on, federal property. This has resulted in the construction and operation of production facilities that may pose a risk to USACE projects and land, but which are not regulated by the District. In order to minimize the risk of unregulated activities, the District has proposed stricter stipulations to the BLM for federal leases, even when production facilities are located off federal property.

c. Of more concern are production facilities located near project lands for the purpose of extracting private minerals on and near the projects. The District's authority to regulate those activities will be determined by the specific facts surrounding the mineral interest. For this reason, when project personnel become aware of such activities, they shall ascertain what minerals are involved, where they are and who owns them. They shall request proof that the developer has a legal right to extract the minerals and has all of the necessary permits and approvals from the state. Moreover, the developer shall provide any maps or other plans showing the method and route for extracting the minerals. Finally, project personnel will attempt to determine whether the production facility has the potential to alter or impair the project. This information shall be forwarded to the District for appropriate action. Refer to guidance in Appendix A on coordination between the District and state agencies for exploration and extraction of private minerals on and near federal property.

8. Exploration. Geophysical exploration is the common method of exploring for an oil-bearing formation prior to the drilling of wells for production purposes. Exploration typically begins with a seismic survey followed by an exploratory well. Exploratory wells can occur independently of a seismic survey but it is rare. ln most cases, Geophysical exploration will be regulated by issuing the appropriate real estate outgrant. No exploration activity shall be allowed within .5 miles of a recreation area, in project operations areas (as defined in the project Master Plan), on slopes greater than 25 percent, within habitat for threatened or endangered plant. or animal species, within 300 feet of any National Register eligible cultural site or American Indian Traditional Use Area, and within 3,000 feet of any critical infrastructure (i.e. dams and levees).

a. Review Requirements. All requests for these activities will be reviewed using the OREP. The applicant must supply the items shown in the OREP pertaining to Geophysical Exploration application requirements. Each activity shall state site-specific stipulations to be included as a condition of the outgrant. A set of standard conditions for Geophysical Exploration are outlined in the OREP.

3 CR 1130-2-14 1 Jul 14

b. Inspection/Monitoring. USACE project personnel will conduct a field inspection of the proposed exploration with the applicants' representative. The primary purpose of the inspection is to determine the extent of impact on project lands, repositioning of the exploration (if necessary), minimize impact, and come to an agreement with the applicant on exploration plans. Reclamation requirements shall be discussed at the pre-work inspection. A Memorandum for Record detailing the results of the meeting shall be included as part of the outgrant request package outlined in the OREP.

c. Seismic Surveys. A seismic survey is the common method of exploring for an oil-bearing formation. This process involves recording artificially generated seismic waves as they "bounce" off various geologic strata. These waves are generated by various methods at periodic intervals along predetermined lines. Seismic air guns are commonly used to initiate the seismic waves. This technique has largely replaced the practice of exploding dynamite underground. Electric vibrators or falling weights (thumpers) may also be employed at sites where an underground explosion might cause damage or the seismic air guns are not practical. Land disturbances can be significant so all activities shall adhere to this policy and/or project BMPs. The project shall review these requests carefully because the next step in many cases is an exploratory well. Once the activity is complete reclamation must occur. Seismic surveys can also be conducted over a water body using air guns to generate the seismic waves. These activities must also adhere to this policy and/or project BMPs. These activities will not be allowed during critical fish spawning times or in close proximity to threatened and endangered species nesting areas.

d. Exploratory Wells. Installation of exploratory wells is normally the next step after carrying out detailed geological and geophysical surveys and can cause significant impact to USACE project lands. To minimize the impact, no exploratory wells will be allowed to be drilled without a detailed geological or geophysical survey. Any activities must adhere to this policy and/or project BMPs. USACE project personnel shall review these requests carefully because the next step in many cases is a production facility. Once the activity is complete reclamation of the site must occur.

9. Production Facilities. Any requests for the construction of production facilities on federal property shall be reviewed carefully. The advancement of technology allows for production facilities to be constructed offUSACE property but still access leased minerals under USACE property. If production facilities are located on USACE property or within an easement issued by USACE, they will be required to follow this policy and any additional requirements included in a project specific oil and gas management plan. The information in this policy will be the minimum requirements for a production facility in any project specific oil and gas management plan. In most cases, Production Facilities will be regulated by issuing the appropriate real estate outgrant. Any real estate instrument issued will require the applicant to provide bonding, insurance or other security instrument in an amount deemed appropriate to ensure the application complies with this policy.

4 CR 1130-2-14 1 Jul14

a. Clearance. There are two options that an applicant has to begin the Federal drilling permit process. The applicant can either file a notice of staking (NOS), followed later by an application for permit to drill (APD), or the applicant can skip the NOS altogether and just file an APD. All APD requests for production facilities will be reviewed using the OREP. BLM or the applicant, in cases where reserved minerals are involved, must supply the items shown in the OREP pertaining to Production Facility application requirements. A set of standard conditions for production facilities are outlined in the OREP. Each APD must have site-specific BMPs attached as a condition of approval.

b. Monitoring and Assessment. As part of the APD approval process, but prior to approval of the APD, a resource and reporting plan must be approved by US ACE. This plan shall include ·a schedule for gathering existing conditions data before, during and after construction. The plan shall include baseline information on soils, vegetation, air quality, sound, visual resources, ground water, and other environmental conditions. Most of this information will be included in the Environmental Assessment. The plan shall also provide details of interim reclamation measures to be implemented while the well is in production phase. A third party approved by the project but hired by the applicant will be required to monitor and submit monitoring reports to the project during and following drilling operations. The schedule will be determined on a site specific basis in coordination with the project staff. The applicant shall set up a localized ground water monitoring network which will include the installation of at least three groundwater wells to ensure oil and gas well development does not have adverse effects on aquifers that connect to project reservoirs. The applicant is responsible for the cost to install the wells, the housing to protect wells, and proper closure of the wells once they are no longer required. The wells shall be locked to avoid unauthorized entry. An independent third party approved by the project shall sample the wells for common water quality parameters to establish a baseline for the project area. During well development (i.e. hydraulic fracturing processes) and during well production, the independent third party is responsible for taking water quality samples ·and submitting, as part of the monitoring report, the results to the applicant and the project. The applicant is responsible for all payment while the sampling is being done. Standard water quality sampling methodologies shall be used including the use of blind duplicates to verify integrity of sample results. Water quality sampling protocols shall be provided by USACE. Sampling and reporting shall continue for the life of the well, or until USACE determines no effect to aquifers has occurred due to well development. At the time it is determined the well is no longer required, the applicant shall ensure the well is closed according to federal and state regulations.

c. On-Site Meeting. Prior to approval of the APD a mandatory on-site meeting shall be held. The purposes of the meeting will provide an opportunity to view the proposed location, review District policy, answer questions, identify reclamation requirements, and make necessary site layout modifications with the applicant, BLM and the appropriate USACE representatives. In addition, areas marked can include, but not be limited to well location, exterior pad dimensions, outer limits of the area to be disturbed (catch points) and any off site attendant features or temporary disturbances (i.e. stockpiling of topsoil).

5 CR 1130-2-14 1 Jull4

d. Site Selection. Any production facility occurring on federal or flowage easement lands must meet this policy, project BMPs, and the site specific oil and gas management plan if one has been developed. No production facilities shall be allowed within .5 miles of a recreation area, in project operations areas (as defmed in the project Master Plan), on slopes greater than 25 percent, within habitat for threatened or endangered plant or animal species, within 300 feet of any National Register eligible cultural site or American Indian Traditional Use Area, and within 3,000 feet of any critical infrastructure (i.e. dams and levees). All production facilities, because of their critical infrastructure status, will be flood proofed to the 500-year level of protection. If necessary, projects can make more stringent limitations in their oil and gas management plans where applicable. In addition to these limitations, projects shall identify within their oil and gas management plan, times of year when no construction will be allowed to protect sensitive species.

e. Construction of Facilities. As part of the clearance process, BLM or the applicant, in cases where reserved minerals are involved, as part of their APD will provide drawings, specifications, appropriate studies and operational plans to the USACE for review and approval prior to start of construction. All construction activities are subject to immediate suspension if weather will affect site integrity, as defined by the plans and specifications. During production facility construction, soil conditions will need to be evaluated to ensure that site integrity is not jeopardized due to highly permeable soils. Additional erosion control measures, secondary liners and gentler slopes may need to be constructed, if potential impacts are identified. While construction in a floodplain is discouraged, if it cannot be avoided, then National Flood Insurance Program (NFIP), E011988, and NWDR 1110-2-5 must be followed. Examples include the balancing of cut and fill as directed by NWDR Ill 0-2-5 and critical facilities, infrastructure, and all electrical utilities and systems (meters, transformers, etc) will be water tight and flood proofed to a minimum 500-year level of protection as directed by NFIP. Any new disturbances (e.g. roads, pipelines, electrical lines, etc.) must stay within the corridor of existing disturbances. Pipelines shall run from the wellheads to centralized production facilities to help reduce truck traffic, minimize areas of spill occurrence, and reduce the footprint of the production facility location. Natural gas shall be piped to processing facilities if nearby infrastructure exists. The use of a completely closed loop system including all muds, fluids, and cuttings, will be required for all production facilities located on USACE lands. No reserve pits will be allowed and all waste must be disposed of in a state approved disposal facility. After the production facility is constructed and prior to any fill or other construction materials being placed on the facility location, the entire area will be covered with an impervious geomembrane liner. In addition to the lining, a separate lined trenched containment system is to be constructed and located on the down slope side of the facility to catch any runoff fluids. If storage tanks holding areas are constructed, each and every vessel or group of vessels containing production fluids of any kind must be surrounded on all four sides by an impermeable dike/berm of sufficient capacity to adequately retain 100% of the contents of the largest vessel within the dike plus the amount necessary to contain precipitation from a 25-year, 24-hour storm event. The entire production facility will be fenced; signs installed, gated and have cattle guards installed according to USACE guidelines and standards prior to any drilling equipment entering the

6 CR 1130-2-14 I Jul 14 facility location. If lights are needed during construction they must be of the non-focused type (light shrouding). All above ground facilities, equipment, and accessories shall be painted an earth tone color. Upon completion of the production facility the project will have as-built survey plats and geographical information system (GIS) shape files submitted. The well head, access roads, storage tanks, flair pit and any other appurtenances associated with the production facility shall be maintained in an orderly and safe manner. An Emergency Action Plan will be completed to address actions to be taken during a significant flood event.

f. Hazardous Materials Management. The applicant shall manage hazardous materials in a manner that is protective of human health and the emironment; ensure hazardous materials are transported safely and securely; comply with all applicable federal, state and local laws and regulations. Hazardous materials shall be labeled properly and stored in a protective manner to minimize the threat of release, fire, or explosion. Appropriate spill supplies shall be on site. The Applicant shall disclose and provide USACE with an inventory of the kinds, amounts, and hazards of all chemicals, additives, hydraulic fracturing fluid/mud materials, and/or any other substances used during drilling and/or production of the well. Safety Data Sheets (SDS) for all hazardous materials shall be available on site.

g. Waste/Hazardous Waste Management. The applicant shall comply with legally applicable and appropriate federal, state and local regulations for the generation, management, storage, transportation and disposal of hazardous wastes. This includes terms and conditions of federal and state permits. In addition, they shall establish local procedures and responsibilities for the execution of waste management programs which emphasize proper waste storage, transportation and disposal, hazardous waste minimization, and organization responsibilities to achieve compliance. Specifically, all hazardous waste shall be deposited in a state approved facility, no sewage wastes will be disposed of on USACE lands, and no waste or byproduct, fluids or solids, shall be discharged into waters managed by USACE. Treatment ofhazardous waste is not allowed. All hazardous waste will be stored in approved containers with proper labeling and secondary containment. Only hazardous waste generated at the production facility may be stored on site. The Applicant shall ensure any rig runoff is captured and disposed of at a state approved facility.

h. Disturbance Guidelines. There are many disturbances that occur during production of an oil and gas well. All production equipment, compressors or other components associated with the production facility will be electrically powered, to avoid disturbance to the general public, wildlife, livestock and surface owners. If flaring is required applicable federal and state guidance will be followed, including: A flare pit must be used to minimize visual disturbance to the landscape; the flare pit must be surrounded on all four sides by an impermeable dike/berm of sufficient capacity to adequately contain any incidental discharge from flare stacks; no elevated flare stacks shall be allowed; flare pit igniters must be functional; flare pits will not be constructed in coal seams; and a minimum thirty foot vegetation free buffer must be maintained around flare pit.

7 CR 1130~2-14 1 Jul 14

i. Transportation. Only equipment necessary to complete work at the production facility location shall be on site. All equipment in support of the facility must be located within the boundaries of the site. Road location, design, and construction will require efforts to protect the environment. This includes minimal clearing and disposal of vegetation. All roads will only be one lane with gravel or clinker (scoria) overlay allowed to reduce impacts. Protection against erosion must occur after road construction is complete. Existing local drainage will be minimally impacted, with culverts being provided through the road embankment to allow for drainage where needed.

j. Water Resources Management. The borrowing or taking of water from federal lands for use during any phase of construction, drilling, operations, or maintenance is not allowed unless required permits, outgrants and water supply agreements are acquired. A permit pursuant to Section 10 of the Rivers and Harbors Act will be required if construction activities take place below the normal high water line of a river channel, or the normal operation pool of the reservoir, and involve placement of structures, alter flow configurations, or otherwise impede navigation. A permit pursuant to Section 404 of the Clean Water Act will be required if construction activities involve placement of fill or dredge material into rivers, streams, lakes, or other wetlands (whether permanent or temporary). An agreement pursuant to section 6 of the Flood Control Act of 1944 or the 1958 Water Supply Act will be required for use of water stored in a USACE reservoir (whether permanent or temporary). No groundwater wells for water supply will be allowed on USACE lands.

k. Reclamation. Appropriate closure of access roads, well pads and pipelines located on federal property is required once production facilities are no longer used for their intended purpose. All equipment, tanks, buildings, liners, pipelines and chemicals must be removed from the site, and the leased area must be restored to its original or like condition as stipulated by the lease. Lease language will stipulate that the lessee will comply with all applicable federal, state, municipal laws, and this policy regarding closure and disposal.

To complete closure, the lessee will provide USACE a reclamation plan. The reclamation plan must be approved before closure activities begin and will at a minimum include a sampling plan, waste handling and disposal plan, and a remediation plan. The reclamation plan will include aerial photos of the site, both current and historical. Historical photos are required if the location ofthe burn pit, reserve pit, reserved top soil, tanks, etc. is unknown. Current leases require a close loop system with no reserve pits, but leases prior to 2000 may have had open reserve pits. The sampling plan must include illustration of areas to be sampled, depth, name of testing lab, testing lab credentials, etc. The waste handling and disposal plan must include both hazardous and solid waste. The remediation plan will set the course for eventual ecosystem restoration, including restoration of original contours, the natural vegetation community, hydrology, and wildlife habitats. The remediation plan must describe areas of soil removal, source of replacement soil, vegetation replacement, contour replacement and monitoring. The 2007 (or more recent version) ofthe BLM Gold Book, Chapter 6 can be used as a guide for the development of the reclamation plan.

8 CR 1130-2-14 1 Jull4

10. Injection Wells. Effective immediately no new injection wells shall be allowed on federally­ owned or flowage easement lands. An injection well or waste water disposal well is a vertical well in the ground into which produced water, other liquids, or gases are pumped or allowed to flow. This includes any wells constructed using HDD methods that shall extend under federally owned land from land not owned by the federal government. Existing injection well or wells completed before this policy becomes effective shall be allowed to remain until no longer operational or degraded to the point that replacement or major refurbishment is required at which time the injection well is to be abandoned according to state regulations and formal reclamation consistent with this policy is to occur.

11. Transportation. Collection, Distribution Pipelines. Transportation, collection, and distribution pipelines are the infrastructure that oil and gas companies use to move their product to distribution centers to be prepared for export. This infrastructure typically requires easements across federal property or HDD underneath and across the project reservoir.

a. Transportation, Collection. Distribution Pipelines on Federal Surface. Any request to cross project land or reservoir will be restricted to areas of established corridors to reduce impact. All transportation, collection, and distribution pipelines will comply with the American Society of Mechanical Engineers (ASME) B31, ASME B 1G, 49 CFR Part 192, Department of Transportation (DOT) Pipeline Manual Part 195, Non-Recreational Outgrant Policy (NROP), and adhere to project established BMPs within an oil and gas management plan. If the pipeline is to be placed under the reservoir the preferred method of installation will be HDD. Alternative locations to cross the lake, amended HDD depths and/or methodologies may be required if it is determined that HDD in the desired corridor is not feasible. Once installation activity is completed reclamation must occur for any damage to project land that occurred during construction.

b. Transportation, Collection. Distribution Pipelines on Flowage Easement Lands. Development on flowage easements requires USACE approval for consent to cross. The flowage easement interest acquired by USACE is a perpetual right to occasionally overflow, flood, and submerge the land. USACE does not own the land in fee but does have perpetual rights. Any development request must be reviewed closely so that impacts to the project purposes and the flowage easements perpetual rights are not impacted. All transportation, collection, and distribution pipelines will comply with ASME B31, ASME B 1G , 49 CFR Part 192, DOT Pipeline Manual Part 195, NROP, and adhere to established project BMPs within an oil and gas management plan.

12. Spill Response. The Omaha District follows the guidelines set in ER 200-2-3, Environmental Compliance Policies, Chapter 10, Spill Reporting and Response, 29 October 2010. The guidelines in the section apply to oil and gas releases from pipelines, drilling rigs, tanks or other applicable facility on federal property or flowage easement lands and waters.

9 CR 1130-2-14 1 Jul 14

a. Spill Prevention. An applicant will be required to develop a Spill Prevention Control and Countermeasures Plan (SPCCP) as required by 40 CFR 112. A copy of the SPCCP must be on site at the facility if the facility is normally attended at least four hours per day or at the nearest field office if the facility is not attended. The applicant must provide USACE a copy of their SPCCP (and facility response plan if required). Secondary containment is required for all petroleum, oil, lubricants, hydrofracking fluids, and other hazardous liquids on site. Secondary containment must comply with 40 CFR 112.7-112.9. All secondary containment must be consistent with good engineering practices and provide containment for the content of the largest container plus sufficient freeboard to contain precipitation from a 25-year, 24-hour storm event. Appropriate spill supplies must be on site.

b. Spill Reporting. The applicant must report all discharges of oil or other petroleum products which violate applicable water quality standards or cause a film or a sheen upon or discoloration of the surface of the water or adjoining shoreline or cause sludge or emulsion to be deposited beneath the surface of the water or upon adjoining shores to the National Response Center (NRC) as required by 40 CFR 11 0.2, II 0.3, II 0.5, and 11 0.6. The NRC is the sole federal point of contact for reporting oil and chemical spills. Contact the NRC at 800-424-8802 (24 hours/day, 7 days/week) or use the online reporting tool at htt;p ://www.nrc.uscg.mil/nrchp.html. For releases of hazardous substances, the federal government has established Superfund Reportable Quantities (RQs). If a hazardous substance is released to the environment in an amount that equals or exceeds its RQ, the release must be reported to federal authorities, unless certain reporting exemptions for hazardous substance releases also apply. The applicant must also report the spill information to USACE and may be required to report to the state.

c. Spill Response. Spills are the responsibility of the applicant. Spills on federal property where the spill poses an immediate threat to USACE operated facilities or personnel and is not being adequately controlled or contained by the applicant or another spill response team, USACE responders may respond if they are adequately trained and qualified to respond. This is at the discretion ofthe OPM. Spills that occur off federal property which pose a threat to US ACE operated facilities or personnel, refer to ER 200-2-3, Chapter I O.c.(3). All response actions shall be conducted in accordance with National Contingency Plan or local Regional or Sub Area Contingency Plan. Physical recovery and removal of oil is the preferred Cleanup technique; however the lessee may wish to use other methods. The use of dispersants, bioremediation, and burning require consultation with USACE and concurrence of the Environmental Protection Agency Regional Response Team (RRT) representative and the appropriate state RRT representatives. For oil, gas, and hazardous substances spills that occur off federal property, USACE project personnel shall ensure that adjacent oil pad owner/operators have a contact number for the project office in the event of a spill. Ifthe release enters federal property or causes a sheen on USACE navigable water, USACE shall be notified immediately. If project personnel discover a release, they shall follow the appropriate reporting procedures identified previously.

10 CR 1130-2-14 1 Jull4

13. Flowage Easements. Development on flowage easements requires USACE approval for consent to cross or consent to construct easement structures. The flowage easement interest acquired by USACE is a perpetual right and easement to occasionally overflow, flood, and submerge the land. USACE does not own the land in fee but does haYe perpetual rights. Any development request must be reviewed closely so that impacts to the project purposes and the flowage easements perpetual rights are not impacted. Special conditions for development may be needed to ensure there are no impacts. The mineral interest deed of ownership needs to be reviewed to determine when the mineral interest was severed and when the federal government acquired the flowage easement. If the mineral interest was severed before USACE acquired the flowage easement the applicant must apply for consent to cross and comply with this policy a project specific oil and gas management plan, BMPs and any special conditions USACE wishes to place based on the proposed development. If it is determined that there is an impact to USACE perpetual right or any project purposes the development is not allowed. If the mineral interest was severed after USACE acquired the flowage easement there will be no surface land development allowed within: the flowage easement.

3 APPENDIXES A: References B: Acronyms/Definitions C: Critical Requirement Summary

DISTRIBUTION: D

11 CR 1130-2-14 1 Jul 14 APPENDIX A REFERENCES

• Authorized Purposes o PL 78-534, Flood Control Act of 1944. o PL 85-500, Title III, Water Supply Act of 1958. o PL 85-624, Fish and Wildlife Coordination Act of 1958. o PL 92-500, Federal Water Pollution Control Acto Amendments of 1972. o PL 93-205, Endangered Species Act of 1973. • Acquisition Authorities o Garrison (Fort Berthold) Act, Pub. L. No. 81-437, 63 Stat 1026 (1949). o Oahe (Cheyenne River) Act, Pub. L. No. 83-776,68 Stat. 1191 (1954). o Oahe (Standing Rock) Act, Pub. L. No. 85-915,72 Stat. 1762 (1958). o Fort Randall (Crow Creek) Act, Pub. L. No. 85-916, 72 Stat. 1766 (1958). o Fort Randall (Lower Brule) Act, Pub. L. No. 85-923, 72 Stat. 1773 (1958). o Big Bend (Lower Brule) Act, Pub. L. No. 87-734,76 Stat. 698 (1962). o Big Bend (Crow Creek) Act, Pub. L. No. 87-735, 76 Stat. 704 (1962). • The Fort Berthold Mineral Restoration Act of 1984 (Pub. L. 98-602). • 33 U.S.C. § 408, Taking possession of, use of, or injury to harbor and river improvements (Section 14 of the Rivers and Harbors Act approved March 3, 1899, as amended). • Mineral Leasing Act of 1920 as amended (30 U.S.C. 181 et. Seq.). • Mineral Leasing Act for Acquired Lands of 1947 (30 U.S.C. 352 et. Seq.). • EO 11988 Flood Plain Management. • 33 C.F.R 208.10, Local Flood protection works; maintenance and operation of structures and facilities. • 40 CFR 112. Oil Pollution Prevention. • 40 CFR 260. Hazardous Waste Management System. • 40 CFR 261. Identification and Listing of Hazardous Waste. • 40 CFR 262. Standards Applicable to Generators of Hazardous Waste. • 40 CFR 265.16. Hazardous Waste Generators (Personnel Training). • 43 CFR 3160, Oil and Gas Operations- General. • 49 CFR 172.101. Hazardous Materials Table. • 49 CFR 172.700 subpart H. DOT Hazardous Materials Transportation. • 49 CFR Part 192. Transportation ofNatural and Other Gas by Pipeline: Minimum Federal Safety Standards. • 53 Federal Register 15284. • AR 405-30, Mineral Exploration and Extraction. c EM 385-1-1, Safety and Health Requirement Manual. • ER 200-2-3, Environmental Compliance Policies, 29 October 2010.

A -1 CR 1130-2-14 1 Jul14 APPENDIX A REFERENCES

• ER 200-2-2, Environmental Quality Procedures for Implementing NEPA. • ER 405-1-12, Real Estate Handbook. • ER 1110-2-1156. Dam Safety- Organization, Responsibilities, and Activities. • Assistant Secretary of the Army (Civil Works) Memorandum for the Chief of Engineers, Subject: Delegation of Authority Pursuant to 33 U.S.C. 408, 16 April2004. • CECW-PB Memorandum for Distribution, Subject: Clarification Guidance on the Policy and Procedural Guidance for the Approval of Modifications and Alterations of Corps of Engineers Projects, 17 November 2008. • Chief of Engineers Memorandum for the Director of Civil Works, Subject: Delegation of Authority Pursuant to Section 408, 2 April2009. • CECW-PB Memorandum for Major Subordinate Commands and District Commands, Subject: Delegation of Authority to District Commanders to Approve Pursuant to 33 U.S.C. 408 Those Minor, Low Impact Modifications to Flood Protection Works Operated and Maintained by Non-Federal Sponsors Previously Being Considered under 33 C.F.R. 208.1 O(a)(5), 18 June 2010. • Operations Division Real Estate Policy. (2011). QMS Process Number: 13000 Operations Processes. 13500 NWO Operations Division Real Estate Outgrants. • ASME B31. Pipeline Transportation Systems for Liquid Hydrocarbons and Other Liquids. • ASME B31G. Manual for Determining the Remaining Strength of Corroded Pipelines. • Department of Transportation (DOT) Pipeline Manual Part 195 Transportation of Hazardous Liquids by Pipeline. • NWDR 1110-2-5. Land Development Guidance at Corps Reservoir projects. • Managing Floodplain Development in Approximate Zone A Areas. A Guide for Obtaining and Developing Base (1 00-Year) Flood Elevations 1995. • Use of Corps Reservoir Flowage Easement Land Policy Guidance Letter No.32. (1993). • Non-Recreational Outgrant Policy (NROP). (2009, March 30). • US Department of the Interior and US Department of Agriculture 2007. Surface Operating Standards and Guidelines for Oil and Gas Exploration and Development. BLM/WO/ST- 06/021+3071/REV 07. Bureau ofLand Management. Denver, Colorado. 84 pp. • BLM Gold Book.

A-2 CR 11 30-2-14 1 Jul-14 APPENDIXB ACRONYMS/DEFINITIONS

Ac.ronym!> Explanatton'Definitton APD Application for Permit to Drill - This is submitted to BLM for all federal minerals who in term provided to the appropriate federal agency for review and approval. To approve an APD the BLM needs to complete appropriate NEPA actions and gain affected agency approval. BLM then provides the real estate instrument, associated requirements and monitors implementation. BLM is also responsible for enforcement on any violations. BMP Best Management Practices. COA Conditions of Approval. FRP Facility Response Plan. HD Horizontal Drilling. HDD Horizontal Directional Drilling. NOS Notice of Staking. OREP Operations Division Real Estate Policy -process coordinated through project and the District multidisciplinary team to evaluate applications for real estate outgrants requests. This process ensures that prior to issuing the appropriate real estate instrument; the applicant has complied with all applicable laws, regulations and procedures. RQ Reportable Quantity. USACE United States Army Corps of Engineers.

Term~ Explanation!Definitton Access Road A road giving access to a place or to another road (see Figure A-1). Catch Points Point where the design side slope intersects with the ground. The actual intersection position ofthe side slope with the existing ground surface-the catch point- is determined iteratively (by repetition). Clinker (Scoria A hard rock created from claystone, siltstone, and sandstone that was baked or fused local term in (low grade metamorphism) by the heat generated from the burning of an underlying North Dakota) coal bed. Typically, used as a base for road and well pad development (see Figure A- 1). Flare Pit Pit which contains a flare and which is used for temporary storage of liquid hydrocarbons (see Figure A-1). Flare Pit Berm Raised area typically constructed of dirt surrounding the flare pit (see Figure A-1 ). Flowage Land that is privately ·owned which the federal government has acquired certain Easement perpetual rights. Geomembrane Very low permeability synthetic membrane liner or barrier used with any geotechnical engineering related material so as to control fluid (or gas) migration in a human-made project, structure, or system. Hazardous A substance or material that the Secretary of Transportation has determined is capable Material of posing an unreasonable risk to health, safety, and property when transported in commerce, and has designated as hazardous under section 5103 of Federal hazardous materials transportation law (49 U.S.C. 5103). The term includes hazardous substances, hazardous wastes, marine pollutants, elevated temperature materials,

B-1 CR 1130-2-14 1 Jul14 APPENDIXB ACRONYMSillEFINITIONS

materials designated as hazardous in the Hazardous Materials Table (see 49 CFR 172.101 ), and materials that meet the defining criteria for hazard classes and divisions in 49 CFR 173 ( 49 CFR 171.8) 2. A liquid material or substance, other than oil or liquefied gases, listed under 46 CFR 153.40 (a), (b), (c), or (e) (33 CFR 154.105 and 156.105). Hazardous A solid waste identified as a characteristic or listed hazardous waste in 40 CFR 261.3 Waste (40 CFR260.10). Hydraulic The forcing open of fissures in subterranean rocks by introducing liquid at high Fracturing pressure, especially to extract oil or gas. Impermeable Defined as not allowing any substances used in the development and production process to pass through or permeate to the unprotected surface. Mineral Interest Ownership right to minerals on property; could also be a lease. Oil Well Head Component at the surface of an oil and gas well that provides the structural and pressure-containing interface for the drilling and production equipment (see Figure A-· 1). Production All structures, piping, or equipment used in the production, extraction, recovery, Facility lifting, stabilization, separation or treating of oil, or associated storage or measurement, and is located in an oil or gas field, at a facility (see Figure A-1). Also referred to as a Well Pad. Stipulation A condition, demand, or promise in an agreement or contract. Storage Tank Containers that hold liquids, compressed gases (gas tank), hazardous waste, hazardous material or petroleum used for the short- or long-term storage. Storage tanks may be above ground or underground (see Figure A-1). Storage Tank Raised area typically constructed of dirt surrounding the storage tank area used as Berm secondary or tertiary containment for the content of the largest tank plus sufficient free-board for a 25-year, 24-hour rain event (see Figure A-1 ). Well Head Structure over a well, typically an oil or gas well (see Figure A-1). Well Pad A temporary drilling site, usually constructed of local materials such as gravel or rock. The area is typically lined with an impermeable liner. Gravel or rock then is placed on top and the entire area is surrounded by a dirt berm (see Figure A-1). Also referred to as a Production facility.

B-2 APPENDIXB CR 1130-2-14 ACRONYMS/DEFINITIONS 1 May2014

TypicaJ Well Pad Layout Figure A-1

B-3 CR 1130-2-14 1 Jul 14 APPENDIX C CRITICAL REQUIREMENT SUMMARY

RdC'r('nce C r~tica l J

9.0 Production Facilities No reserve pits will be allowed and all waste must be disposed of in a e. Construction of Facilities State approved disposal facility. 9.0 Production Facilities The entire production facility will be covered with an impervious e. Construction of Facilities geomembrane liner. 9.0 Production Facilities Separate lined trenched containment system must be constructed. e. Construction ofFacilities 9.0 Production Facilities If storage tanks holding areas must be surrounded by an impermeable e. Construction ofFacilities dike/berm and contain 100% ofthe contents of the largest vessel.

C-1 CR 1130-2-14 1 Jul 14

APPENDIX C CRITICAL REQUIREMENT SUMMARY

9.0 Production Facilities The entire production facility must be fenced, signs installed, gated and e. Construction of Facilities have cattle guards installed according to USACE guidelines 9.0 Production Facilities Lights during construction they must be of the non-focused type (light e. Construction of Facilities shrouding). 9.0 Production Facilities All above ground facilities, equipment, and accessories shall be painted e. Construction ofFacilities an earth tone color. 9.0 Production Facllities Manage hazardous materials in compliance with all applicable federal, f. Hazardous Materials state and local laws and regulations. Management 9.0 Production Facilities Safety Data Sheets (SDS) for all hazardous matenals shall be avallable on f. Hazardous Materials site. Management 9.0 Production Facilities All hazardous waste shall be deposited in a state approved facility, no g. Waste Management sewage wastes will be disposed of on USACE lands, and no waste or byproduct, fluids or solids, 9.0 Production Facilities All hazardous waste will be stored in approved containers with proper g. Waste Management labeling and secondary containment. 9.0 Production Facilities Any rig runoff must be captured and disposed of at a state approved g. Waste Management facility. 9.0 Production Facilities All production equipment, compressors or other components associated h. Disturbance Guidelines with the production facilit} will be electrically powered. 9.0 Production Facilities If flaring is required applicable federal and state guidance will be h. Disturbance Guidelines followed. 9.0 Production Facilities All equipment in support of the facility must be located within the i. Transportation boundaries ofthe site. 9.0 Production Facilities Road location, design, ~d construction will require efforts to protect the i. Transportation environment. 9.0 Production Facilities All roads will only be one lane with a gravel or clinker (scoria) overly i. Transportation allowed to reduce impacts. 9.0 Production Facilities Erosion control must occur after road construction is complete. i. Transportation 9.0 Production Facihties The borrowing or takmg of water from federal lands is not allowed unless j. Water Resources required permits, outgrants and water supply agreements are acquired. Management 9.0 Production Facilities A permit pursuant to Section 10 of the Rivers and Harbors Act will be j. Water Resources required under certain conditions. Management 9.0 Product10n Facilities A permit pursuant to Section 404 of the Clean Water Act will be reqmred j. Water Resources under certain conditions. Management 9 .0 Production Facilities An agreement pursuant to section 6 ofthe Flood Control Act of 1944 or j. Water Resources the 1958 Water Supply Act will be required for use of water stored in a Management USACE reservoir.

C-2 CR 1130-2-14 1 Jul14 APPENDIXC CRITICAL REQUIREMENT SUMMARY

9.0 Production Facilities No groundwater wells for water supply will be allowed on USACE lands. J. Water Resource'!! Management 9.0 Production Facilities Appropriate closure is required once production facilities are no longer k. Reclamation used for their intended purpose. 9.0 Production Facilities All equipment, tanks, buildings, liners, pipelines and chemicals must be k. Reclamation removed from the site, and the area restored to its original condition. 10.0 Injection Wells No injection wells shall be allowed on federally-owned or flowage easement lands. 10.0 Injection Wells Existing inJectiOn well or wells 8hall be abandoned according to state regulations and reclamation requirements in this policy. 11.0 Transportation, All transportation, collection, and distribution pipelines will comply with Collection, Distribution the American Society ofMechanical Engineers (ASME) B31, ASME Pipelines BIG, 49 CFR Part 192, Department of Transportation (DOT) Pipeline a. Transportation, Collection, Manual Part 195, Non-Recreational Outgrant Policy (NROP), and adhere Distribution Pipelines on to project established BMPs within an oil and gas management plan. Federal Surface 11.0 Transportation, If the pipeline is to be placed under the reservoir the preferred method of Collection, Distribution installation will be HOD. Pipelines a. Transportation, Collection, Distribution Pipelines on Federal Surface 11.0 Transportation. All transportation, collection, and distribution pipelines will comply with Collection, Distribution tht: American Society of Mechanical Engineers (AS:ME) B31, ASME Pipelines B 1G, 49 CFR Part 192, Department of Transportation (DOI) Pipeline b. Transportation, CollectJon, Manual Part 195, Non-Recreational Outgrant Policy (NROP), and adhere Distribution Pipelines on to project established BMPs \\lthin an oil and gas management plan. Flowage Easement 12.0 Spill Response All applicants will develop a Spill Prevention Control and a. Spill Preyention Countermeasures Plan (SPCCP). 12.0 Spill Response Secondary containment is required for all petroleum, oil, lubricants, a. Spill Prevention hydrofracking fluids, and other hazardous liquids on site. 12.0 Spill Response Secondary containment must comply with 40 CFR 112.7-112.9. a. Spill Prevention 12.0 Spill Response All secondary containment must be consistent with good engineering a. Spill Prevention practices and provide containment for the content of the largest container plus sufficient freeboard to contain precipitation from a 25-year, 24-hour storm event. 12.0 Spill Response Spill supplies must be on site. a. Spill Prevention 12.0 Spill Response All applicants must report all discharges of oil or other petroleum b. Spill Reporting products to the National Response Center (NRC) as required by 40 CFR 110.2, 110.3, 110.5, and 110.6.

C-3 CR 1130-2-14 1 Jul 14

APPENDIX C CRITICAL REQUIREMENT SUMMARY

12.0 Spill Response If a hazardous substance is released to the environment in an amount that b. Spill Reporting equals or exceeds its RQ, the release must be reported to federal authorities. 12.0 Spill Response The applicant must report the spill information to USACE and may be b. Spill Reporting required to report to the state. 12.0 Spill Response All spills are the responsibility of the applicant. c. Spill Re~onse 12.0 Spill Response All response actions shall be conducted in accordance with National c. Spill Response Contingency Plan (NCP) or local Regional or Sub Area Contingency Plan.

C-4