Radioactive Waste Disposal: Examining the Legal Horizon
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BakerHostetler Shale Symposium The Utica Shale Play: Working in and with the State of Ohio June 6, 2013 The Regulation of Natural Gas and Liquids Pipelines and Related Infrastructure in Ohio: Who, What, When, Where and How? Martin T. Booher, Partner Gas/Liquids System Overview (Ohio) 3 Why Are Pipelines and Related Infrastructure Important in Ohio • The Utica can provide (as can other historically produced areas using new drilling techniques) significant oil, natural gas and natural gas liquids • But unless there are markets (e.g., ethane) and the product can be processed and then moved to the markets, the oil, natural gas and natural gas liquids are going to stay in the ground • Gathering lines, processing facilities, fractionation facilities and pipelines are needed and, as noted, several proposals are pending 4 Regulation of Natural Gas Pipelines and Related Infrastructure • Several Layers of Potentially Overlapping Jurisdiction – Federal – State – Local • Depends on the Type of Pipeline/Project – Natural Gas Vs. Oil/Natural Gas Liquids – Interstate – Intrastate – Gathering Line, Processing Facility, Transmission Pipeline, Distribution Pipeline 5 Federal Jurisdiction • Natural Gas Act – Grants Jurisdiction to the Federal Energy Regulatory Commission (“FERC”) over Interstate Natural Gas Pipelines (associated compressor stations), Storage Facilities and LNG Terminals (Interstate Commerce) – State Law Preemption – Right of Eminent Domain – Rigorous Licensing Process (National Environmental Policy Act) 6 Federal Jurisdiction • What is Not Regulated – Oil and Natural Gas Liquids Pipelines (Licensing/Construction) – Intrastate Pipelines – Production and gathering pipelines – Distribution pipelines (i.e., local gas utilities) 7 Ohio Jurisdiction • Ohio Regulatory Agencies still play critical role in FERC-jurisdictional pipelines through the implementation of various federal environmental laws • SB 315 changed/clarified a number of jurisdictional issues in Ohio as it relates to “non FERC-jurisdictional” pipelines (e.g., intrastate pipelines, production and gathering pipelines and intrastate distribution pipelines) 8 Ohio Regulatory Agencies Key Ohio Regulatory Agencies Regulating Natural Gas Pipelines and Related Infrastructure in Ohio • ODNR • OPSB • PUCO • OEPA/US Army Corps of Engineers • Resource Agencies 9 ODNR • Critical O&G agency in Ohio • Regulates Drilling and Pad, Production Pipelines • Deep Injection Wells • No meaningful, direct regulatory oversight over natural gas pipelines/related infrastructure (beyond production site) 10 OPSB • Pre-S.B. 315 controversy over definition of gas pipelines • Kinder Morgan 2010 application to OPSB filed under protest (for natural gas liquids pipeline) • S.B. 315 limited OPSB’s regulatory authority over natural gas and liquids pipelines/related infrastructure • OPSB still a key player: Issues certificates (through an adjudicatory proceeding) for natural gas pipelines (and associated facilities) which are: (1) > 500 feet in length; (2) > 9 inches in outside diameter; and (3) designed for transporting gas at MAOP in excess of 125 psi • Excluded from OPSB certification requirements: gathering lines, gas gathering pipelines, processing plant gas stub pipelines, gas processing plants, natural gas liquids finished product pipelines, pipelines from gas processing plants to interstate or intrastate gas pipelines or to any natural gas liquids fractionation plant, an oil, gas or other production operated regulated by the Ohio, including pipelines upstream of any gathering lines and certain compressor stations. 11 PUCO • Primarily Responsible for Pipeline Safety • No Direct Licensing/Siting Authority – Requires pipelines transporting gas from horizontal wells constructed on or after September 10, 2012 to comply with applicable federal design standards – 21 Day Preconstruction Notice – Submission of as-builts (60 days) • No authority exercised over liquid pipelines (rests with PHMSA) 12 OEPA/Resource Agencies • Air Quality – PTI/PTO – Title V – No General Air Permit for Compressors – GHGs • Water Quality – NPDES • General Stormwater Permit • General Hydrostatic Testing Permit – Wetlands • 401/404 Permits/NWP 12 (U.S. Army Corps of Engineers Involvement) • Resource agencies (endangered species, cultural resources, fisheries, etc.) • Indiana Bats and Inadvertent Discharges 13 Other Ohio-Specific Siting Observations • Board of Building Standards Regulations eliminate local jurisdiction over the construction of buildings/structures associated with the operation of natural gas liquids fractionation or processing facilities. • ODNR requirements supplant local jurisdiction • OPSB requirements supplant local jurisdiction • PUCO requirements supplant local jurisdiction • Eminent domain for siting of pipelines and related facilities is available • Acceptance by local communities remains critical 14 BakerHostetler Shale Symposium The Utica Shale Play: Working in and with the State of Ohio June 6, 2013 Radioactive Waste Disposal: Examining the Legal Horizon Ben L. Pfefferle, Partner Radioactive Materials • The land formations that contain oil and gas deposits also contain radioactive materials. • The drilling process may expose these materials to the surface. • Such radioactive materials include: – Uranium – Thorium – Radium – Lead-210 17 NORM & TENORM • The radioactive materials associated with the drilling process are commonly classified into two categories: – Naturally Occurring Radioactive Materials (NORM) – Technologically Enhanced Naturally Occurring Radioactive Materials (TENORM) • The most recent version of Ohio’s proposed budget contains the following definitions of NORM and TENORM: 18 NORM • NORM: material that contains any nuclide that is radioactive in its natural physical state – Does not include source material, byproduct material, or special nuclear material 19 TENORM • TENORM: naturally occurring radioactive material with radionuclide concentrations that are increased by or as a result of past or present human activities – Does not include drill cuttings, natural background radiation, byproduct material, or source material • Drilling creates TENORM by concentrating the naturally occurring radionuclides and exposing them to the surface environment and human contact. 20 Ohio Senate’s Proposed Budget • The Ohio Senate’s proposed budget includes several provisions regulating the disposal of NORM and TENORM. • The provisions are similar in some ways to NORM/TENORM provisions that the Ohio House stripped out of Governor John Kasich’s proposed budget. 21 Key Provisions • Under the Senate’s proposed budget: 1) Well operators generally must sample any wastes potentially containing TENORM for radium prior to shipping wastes off-site. 2) Well operators do not, however, have to sample wastes for radium if: a) The material is reused in a horizontal well b) The material is disposed of at an injection well for which a permit has been issued under Ohio law c) The material is used in a method of enhanced recovery for which a permit has been issued under Ohio law d) The material is transported out of Ohio for lawful disposal 22 Key Provisions • Under the Senate’s proposed budget: 3) If materials other than TENORM come in contact with a refined oil-based substance, then the well operator must either: a) Dispose of the materials at a solid waste facility authorized to accept such material under Ohio law; b) Beneficially use the material in accordance with Department of Environmental Protection rules; OR c) Recycle or reuse the material with the approval of the Chief of the Division of Oil and Gas Management. 4) Solid waste landfills are prohibited from receiving TENORM if the material contains radium-226 or radium-228 equal to or greater than 5 picocuries per gram above natural radiation levels. 23 Key Provisions • Under the Senate’s proposed budget: 5) Solid waste landfills may accept TENORM containing radium-226 or radium-228 above acceptable levels for “purposes other than transfer or disposal,” so long as the landfill operator maintains all necessary authorizations. 6) Solid waste facilities may not receive or dispose of TENORM from drilling operations without first receiving representative testing results to determine compliance with Ohio law. 24 Key Provisions • Under the Senate’s proposed budget: 7) The Director of Environmental Protection may adopt rules governing the handling and disposal of radioactive materials by solid waste facilities. 8) The Director of Environmental Protection may establish the definition of “beneficially use” as it applies to non-TENORM materials from horizontal wells that have come in contact with refined oil- based substances. 9) The Director of the Department of Health must promulgate rules governing TENORM, and the rules must not apply to NORM. 25 Brine Disposal • The Senate’s proposed budget also includes provisions governing the disposal of brine and other fluids associated with the drilling process. • In general, the provisions: – Require that the Chief of the Division of Oil and Gas Resources Management adopt rules governing brine disposal – Prohibit the storing or processing of brine without the required permits – Establish rules governing impoundments 26 On the Horizon • Industry and environmentalists have not had an opportunity to comment on the Senate’s NORM/TENORM provisions, as they were just released on June 4. • Similar provisions in the Governor’s proposed budget, however, faced strong opposition from both industry and environmentalists. 27 On the Horizon •