2019 May/June

What’s Inside? Chairman Letter...... 4 Waters of the U.S...... 8 Understanding of Energy...... 12 RCRA Exemption...... 16 Legislative Session 2019...... 18 National Energy Policy...... 24 Message from Ed Cross...... 28 Colorado O&G Operations... 30 The Voice of the Voice of Industry...... 36 Independent KIOGA Midyear Meeting...... 38 Petroleum Industry Methane Emission Study.....40

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Former KIOGA Energy Gala in Oklahoma City, evening, as we honored a long-time Chairman Nick Oklahoma. The 2019 special NSWA industry hero who knows how to build “hero of Industry” honoree was Nick a company through hard work, innova- Powell Powell, Chairman tion, and entrepreneurial creativity,” said Honored as “Hero of of Colt Energy, Edward Cross, President of the Kansas Industry” Inc. in Mission, Independent Oil & Gas Association. On April 12, 2019, National Stripper Kansas. “Nick Powell knows how to identify Well Association (NSWA) took a diamonds in the rough, and we appre- moment to recognize one of America’s “This was ciate his philosophy and ability to see true energy heroes at its 13th Annual a wonderful Continued on page 10 KIOGA thanks the following KIOGA companies for their support through advertising in our Advertisers newsletter.

Advertiser pg # . Buyers Guide...... 13 CVR Refining...... 43 David Morris, P.A...... 27 Desk and Derrick of Wichita...... 23 Drill Baby Drill...... 27 Duke Drilling Company, Inc...... 5 Evenson Auctioneers...... 34 Foley Power Solutions...... 11 IMA...... 29 Insurance Planning...... 9 iWell...... 2 Kansas Truck Equip Co...... 9 KIOGA...... 37 Lockhart Geophysical Co...... 7 Murfin Drilling Co., Inc...... 13 . Paragon Geophysical Serv. Inc...... 10 SOER...... 22 The Independent Oil & Gas Dir...... 42 Werth Wealth Management...... 35

Front Cover [email protected] Tim Hellman Lotus Operating Co., Inc. Have a photograph you would like to see on the cover? Send to [email protected]

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2 3 succeeded in the late 1990’s. be the most obvious one, and tech- So you all are now wondering nology cannot replace our members what this has to do with KIOGA? in solving these issues. That is why Sure technology can help us. For it is so important for all members example, if we got all of you to to remain engaged and informed. agree to accept this newsletter in Technology cannot alter the percep- a digital format instead of having tions people have of our industry, to print it and mail it out, the asso- and it cannot convince politicians several of you will use your minds to the data acquisition. That took about also thought to be one ciation could save thousands of or regulators to ignore all the false overcome those obstacles. But there 6 months of talking, and I think the of the pioneers of using dollars per year. But the reality is, information being screamed at them are new technologies that we can other operator finally agreed to par- geophysics to find oil and that KIOGA’s advocacy efforts on every day. Technology is great, but use, that are affordable to us. Things ticipate in the shoot just to get rid of natural gas, so he was not behalf of its members, has to orig- it does not replace what you and I like cloud-based pumper’s gauges me. The data was actually acquired averse to adopting new inate in the minds of the men and can do to change hearts and minds, eliminate a lot of office supervision over a field that was pretty much technologies. women who make up the associa- and in reality, by itself, technology verifying and converting production fully developed, and it really did not In 2019 we have all tion. Every time an issue arises in cannot find oil and gas. data to a useable format. Electronic lead to any expansion of the field. kinds of play toys as a Washington, or Topeka, or another engine controllers allow us to pump The data did however explain why result of the computer state capitol, that we need to either Keep Drilling! low fluid wells for shorter periods Message from the dry holes did not work, and that revolution. The aforemen- support or oppose, we have to acti- of time, which in turn allows pumps information is actually worth a lot of tioned 3-D Seismic data vate our minds to come up with a Ken White and rods to last longer. Polymer money. would not be available if plan or solution for the issue. Much squeezes extend the life of high fluid the Chairman But even in areas where 3-D it were not for comput- like finding oil, the answer may not Seismic has proven a valuable tool, ers. It’s been a long time wells and lower pumping costs, and Ken White you still have to have an under- since I saw many hand- fracking…… that new technology, if Chairman, KIOGA standing of the geology, and the drawn geological maps, you consider 1948 new, allows us to extract oil and natural gas from types I have been asked several times economics, and the engineering, but recently a geologist of rocks that previously would not in the last few months to comment and the land, in order to have a suc- friend, who is my age, had give up their fossil fuels. about the role that advances in cessful exploration project. So no a self-titled “old man map” So the media keeps trying to tell technology play in the exploration matter how good the technology is, as part of a geological pre- the public that fracking is some- and production of oil and natural I still hang on to a paraphrase of a sentation he was making DUKE thing new, and we all know that the gas. Obviously, the impact of new, quote from Wallace Pratt who was to me. It was refreshing only thing new about it is the types affordable technologies is huge. I the first geologist hired by Humble to see that part of his of rocks it is being utilized on. The DRILLING use the word affordable, because Oil in 1918. Pratt’s revelation was: thought process was in his late George Mitchell who started new technologies are only useful to “Where oil is first found, is in the mind, and not generated Mitchell Energy in Houston is cred- us in Kansas if they are affordable minds of men” by a computer algorithm. COMPANY, ited with making the breakthroughs to us. There is lots of new technol- We should all be proud to note But we cannot ignore that have allowed natural gas, and ogy out there that we cannot afford that this astute observation came the impact of new tech- now oil, to be extracted from shales INC. to use, because the economics just from a Phillipsburg, Kansas native, nologies on our industry. around the world. His laboratory don’t work for us. who earned his geology degree Especially in the field, was the Barnett Shale around Dallas At least one-half of my explora- at the University of Kansas, and where new, affordable CONTRACT DRILLING and Ft. Worth. Everybody knew tion efforts rely on the acquisition whose first job was working at the advancements have VERTICAL & HORIZONTAL there were massive hydrocarbons in of 3-D Seismic data, and I readily Kansas Geological Survey. Pratt’s allowed us to do more the shale, but they could not figure admit that 3-D Seismic technology employer, Humble Oil, was acquired with less. Horizontal 11 RIGS Serving the Mid-Continent out how to produce it. After years of has changed my life. I acquired my by Standard Oil, and these enti- Drilling has only achieved ties eventually became a company moderate positive results experimenting, and millions of dol- first proprietary 3-D Seismic data 5539 2nd St./P.O. Box 823 called Exxon, which is now Exxon/ in Kansas due to the com- lars invested, Mitchell and his team 100 S. Main, Suite 410 in 1996. To accomplish that first Great Bend, Ks. 67530 finally figured out how to do it, and Wichita, Ks., 67202 shoot, I needed to persuade an off- Mobil. The giant oilfields that Pratt plexity of our geology and 316-267-1331 620-793-8366 the rest is history. Mitchell was actu- set operator to participate with us in helped discover all originated “in the that old “affordability” minds of men”. Wallace Pratt was thing. I have no doubt that ally in his late 70’s when he finally 4 5

KIOGA Mark Media Specialist and your Calendar Climate Realist Event Name Date Location J Fred Hambright Memorial Golf/Bingo June 3, 2019 Wichita, KS Scheduled for KIOGA Gregory Wrightstone Energy Council Energy & Env Conf June 13-16, 2019 Biloxi, MS 82nd Annual Convention is the author AAPL Annual Meeting June 19-22, 2019 Pittsburgh, PA in August of the book Inconvenient IPAA Midyear Meeting June 24-26, 2019 Colorado Springs, CO Facts: The Get your AESC 2019 Summer Meeting July 31-August 2, 2019 Coeur d’alene, ID Science That registration forms Al Gore on the KIOGA 82nd Annual Convention/Expo August 11-13, 2019 Wichita, KS Doesn’t Want You to Know KIOGA website. Summer NAPE August 21-22, 2019 Houston, TX that challenges www.kioga.org 2019 IOGCC Annual Conference August 25-27, 2019 Medora, ND many apocalyp- tic predictions Kansas State Fair September 6-19, 2019 Hutchinson, KS KIOGA is pleased to announce that about our ever Mark Mathis and Gregory Wrightstone dynamic climate. GWPC Annual Forum September 15-17, 2019 Oklahoma City, OK will be our featured keynote speakers for He is a geologist the 82nd KIOGA Annual Convention to with more than be held at the Century II Performing Arts This Photo by Unknown Author is licensed under CC BY-SA SA - BY CC under licensed is Author Unknown by Photo This 35 years of expe- & Convention Center in Wichita, Kansas rience researching REILLY’S on August 11-13, 2019. and studying vari- IRISH Mark ous aspects of the earth’s processes. His PUB Mathis has findings have allowed him to speak at spent most many venues around the world includ- KIOGA’S of his career ing Ireland, England, China, and India. Do business with other challeng- 82nd Annual Wrightstone is a strong proponent of the August 11-13, 2019 ing widely scientific process and believes that pol- KIOGA members accepted icy decision should be driven by science, If they aren’t, encourage them ideas that facts, and data, not a political agenda. Sponsorship | to join and help us stand up for are sim- With a strong representation of Trade Show ply untrue. Mark exceptional speakers, panel discussions, the oil and gas industry in has written, pro- seminars, and exhibitors, the KIOGA Hyatt Regency Topeka and Washington duced and directed 2019 Annual Convention is gearing up to two documentary Wichita, KS continue its reputation as the leading oil Reservations films on energy. and gas event in Kansas. We could not In Fractured he be more excited! Mark your calendars - 316.293.1234 explained how lan- for August 11-13, 2019! guage is used to dangerously deceive us about the most essential component to the function of the modern world – energy. In spOILed he examined the www.kioga.org public’s ignorance of the central role oil [email protected] plays in our lives.

6 7 7 We welcome the following KIOGA members to the KIOGA family. Thank You for your KIOGA Provides Comments on the New Members continued support! Waters of the U.S. Name Company City & State The EPA’s revised Waters of the our belief that the proposed WOTUS and ended up in the Pacific Ocean. The Tony Caldarella Rep Com International Kansas City, MO United States (WOTUS) proposal was Rule reflects careful consideration of 9th U.S. Circuit Court of Appeals sided Andrew Peterson Harbison-Fischer Great Bend, KS published in the Federal Register on the Agencies’ prior interpretations, the with them, endorsing the so-called con- February 14th, opening a 60-day pub- broad guideposts provided by the U.S. duit theory, and found that the county Stacy Gore Gore Nitrogen Pumping Service LLC Seiling, OK lic comment period on the regulation. Supreme Court, and a genuine inter- should have had a Clean Water Act Josh Rennaker Apollo Energies Pratt, KS est in developing an interpretation of permit. In December 2018, the EPA signed Phil Sherwood SherWare, Inc. Clemmons, NC a proposed rule revising the defini- WOTUS that is clear, protective of The CWA statute governs the dis- tion of WOTUS to clarify the scope of the environment and human health, charge of a pollutant to “waters of the Nicole Koelsch Adams, Brown, Beran & Ball, Chtd Great Bend, KS waters federally regulated under the administrable, and legally sound. The United States,” or WOTUS. While the Spencer Musgrove Samual Gary Jr. & Associates, Inc. Denver, CO comments expressed KIOGA’s sup- U.S. Supreme Court and EPA have spent Clean Water Act. The proposed rule Robert Bolin Ranger Environmental, Inc. Mandeville, LA would reduce the number of waterways port for the proposed rule to narrow years wrestling with the definition of and wetlands subject to federal Clean and clarify WOTUS. KIOGA also par- WOTUS, the new case focuses on a dif- Todd Moore Kiowa Gas Company Dallas Tx Water Act protections compared to the ticipated in the review and comments ferent element of the law’s reach: Does Kevin Miller Oil Patch Pump & Supply, LLC Chanute, KS submitted by an industry coalition of the discharge have to be directly into a Independent Petroleum Association of federally regulated waterway, or does it America, Domestic Energy Producers just have to end up there? Obama-era version of WOTUS. The Alliance, American Petroleum Institute, Maui County and its supporters say it EPA held a public hearing on the pro- American Exploration & Production must be a direct discharge. While sup- posal in Kansas City on February 27th Council, Western Energy Alliance, and porters of a narrowed interpretation say and 28th to provide interested parties the Association of Oil Pipe Lines. other federal laws and state regulation the opportunity to present data, views, can fill the gap, advocates warn that the or information concerning the proposed U.S. Supreme Court to Debate U.S. Supreme Court will leave a big loop- rule. In addition, the U.S. Small Business Scope of Clean water Act - The U.S. hole in the Clean Water Act if it exempts Administration’s Office of Advocacy Supreme Court is taking up another pollution from the law simply because it hosted a small business-focused forum far-reaching debate over the scope reaches a federal waterway via an indi- in Kansas City on February 27th. The of the Clean Water Act (CWA). On rect route. comment period on the proposed action February 20th, the justices agreed to The eventual outcome in the case ends on April 15th. KIOGA President hear County of Maui, Hawaii v. Hawai’i could affect permitting for pipelines, coal Edward Cross participated in the EPA Wildlife Fund, a case involving whether ash ponds and other sites. public hearing and U.S. Small Business the law covers pollution that moves Administration forum on the proposed through groundwater before reaching a Check out the new WOTUS rule in Kansas City on federal waterway. February 27th. “This is the most significant environ- Career Center on In addition, mental law case in the last few years,” Service Bodies * Service Cranes * Dump Cross will be said Beveridge & Diamond PC attorney KIOGA Website - Bodies * Lift Gates * Storage & Cargo submitting com- John Cruden, former head of the Justice ments on behalf Department’s environment division. post a job, post a resume. of KIOGA on The Maui litigation involves a munic- Graduation is here and April 12th, ipal wastewater treatment facility on the before the April Hawaiian island. Environmentalists sued students are ready to 15th deadline. the county after alleging a link between KIOGA’s com- the wastewater injection wells and pol- go to work. ments expressed lution that seeped through groundwater Visit Us Online at KansasTruck.net

8 9 From Page 1 Nick Powell SHORT TERM. Continued LONG TERM. “Hero of Industry” YOUR TERMS. the possibilities that are achieved public botanical garden in Kansas KIOGA is delighted to see one of our through tenacity, perseverance, and City. Mr. Powell received his B.A. in own honored by a national association. hard work in our nation’s oil and nat- Economics from Tulane University Nick is a true icon of the Kansas oil ural gas fi elds.” in New Orleans in 1975. He cur- and gas industry and of the American Nick Powell is Chairman of Colt rently resides in and is a native of oil and gas industry. We are proud of Energy, Inc. Prior to forming Colt, Kansas City. Nick. Kansas was well-represented at Mr. Powell was involved in the man- The award was presented to Nick the event with over a dozen KIOGA agement of Overland Energy, Inc. by NSWA executive board member members joining Nick’s family and other This company was a wholly owned and former KIOGA Chairman Dick Kansans to celebrate Nick’s recognition. subsidiary of YRC Corporation (for- Schremmer. merly Yellow Freight System, Inc.) and engaged in investment in oil and gas exploration and production. In 1980 Mr. Powell founded Prairie Energy, Inc. (which was later merged with another company and became Prairie Resources, Inc.) until that company merged with Colt Energy, Inc. in 1990. Mr. Powell is a past chairman of the Kansas Independent Nick Powell (Left) receiving NSWA “Hero Ken White (Left) congratulates Oil & Gas Association (KIOGA) and of Industry” award from NSWA executive Nick Powell (Right) The ups-and-downs of the industry demand flexibility and a keen eye on the bottom currently serves on its board of board member Dick Schremmer (Right) line. Foley Rental Power Solutions can cover you with oilfield and distribution power directors. He is also a past president and equipment … just what you need, when and for however of the Eastern Kansas Oil and Gas long you need it. Association (EKOGA) and currently serves on its board of directors. He • Diesel & natural gas electrical is a founding member and past pres- power generation ident of the Missouri Independent • Gas compression engines Oil and Gas Association (MIOGA) • Forced air, flameless & ground and a member of the executive thaw heating equipment board of the National Stripper Well • Air compressors Association (NSWA). Additionally, Mr. Powell sits on the Advisory Providing Quality Seismic Since 1993 Board of the Tertiary Oil Recovery Contact your Kansas Foley Power Solutions rep for the equipment you need … on your terms. Project (TORP) sponsored by the University of Kansas and is a for- Southeast/Northcentral Southcentral/Western Kansas City Metro mer chairman of the Petroleum (785) 267-8213 (316) 944-7368 (816) 379-4700 Technology Transfer Council North Mid-Continent section. Mr. Powell also serves on the boards of © 2016 Foley Industries All rights reserved. CAT, CATERPILLAR, their respective logos, “Caterpillar Yellow,” the 3500 N ROCK RD. BLDG. 800 • Wichita, KS 67226 “Power Edge” trade dress as well as corporate and product identity used herein, are trademarks of Caterpillar Country Club Bank and the Linda Phone: (316) 636-5552 • Fax: (316) 636-5572 and may not be used without permission. www.cat.com www.caterpillar.com FoleyPowerSolutions.com Hall Library in Kansas City, Missouri E-mail: [email protected] and the board of Powell Gardens, a www.paragongeo.com FoleyEq-319.indd 1 3/10/16 2:14 PM 10 11 We Need a New American Understanding of Energy into the atmosphere. Carbon diox- is directly attributable to the wide- processes have become more efficient. Opinion editorial writ- ide is a gas we exhale every time we spread use of fossil fuels. Because Responsible energy development has ten by KIOGA President breathe. Erupting volcanoes, decay- they believe further warming will have and will continue to play a leading role Edward Cross that ing trees, wildfires, and the animals on catastrophic effects, they have waged in making the U.S. the world leader in appeared in media outlets which we rely for food all emit CO2. a war on carbon for many years. They greenhouse gas reductions. across Kansas and else- This by-product, which is essential for advocate restricting carbon-based Rational, data-driven, com- plant life and an unavoidable aspect of fuels in favor of subsidized alternative mon-sense approach to energy policy where in June 2019 human life, is at the center of today’s energy and encourage policymakers is what our nation needs to fulfill its America’s energy revolution has climate change controversies. to make fossil fuels more expensive in full energy potential, and sadly is all changed the global landscape. The The United Nation’s hopes of discouraging their use. too often absent from today’s energy U.S. has surpassed all expectations and Intergovernmental Panel on Climate If the goal is really to reduce car- discussion. We need a new American achieved a level of domestic energy Change (IPCC) recently released its bon emissions, it’s worth noting that understanding of energy and with it production that was unthinkable just a climate change report. The IPCC’s the U.S. is already doing a good job a national energy policy based on few years ago. We are now the num- models emphasize the need for people of achieving that goal. Greenhouse science, the free market, and entre- ber one producer of oil and natural to change their lifestyle and consump- gas emissions continue to plum- preneurial spirit. Those who act on gas. tion patterns to more sustainable met according to the latest U.S. our behalf at all levels of govern- Additionally, this market-driven alternatives, specifically in areas they Environmental Protection Agency ment should use those principles as success has helped our nation achieve can control, like modes of transpor- (EPA) data. The EPA found that green- the foundation for their energy policy significant emission reductions. tation, the buildings they inhabit and house gas emissions, mostly carbon decisions. According to Energy Information their dietary preferences. dioxide, fell 2.7% from 2016 to 2017. The oil and gas industry has proven Administration (EIA) data, U.S. carbon While the 133 report authors are Increased natural gas consumption that over the long-term it is possible emissions are the lowest they have undoubtedly well accomplished in has generated a truly incredible story to lead in energy production and envi- been in nearly seven decades. their scientific fields, they fail to under- for the environment as U.S. green- ronmental stewardship. By focusing While we can thank American oil stand the unintended consequences house gas emissions have fallen to on more efficient use of energy, it is and natural gas producers for the hard and high taxpayer and consumer their lowest levels since 1992. This possible to lower emissions without work and entrepreneurial spirit that costs that come with climate action. downward trend is occurring even imposing even more environmen- made this possible, we must ensure They want to drastically cut carbon as U.S. oil and gas production grows tal restrictions. The key is to avoid that elected officials work to ensure emissions worldwide to limit global dramatically. placing unnecessary political or legal that our nation achieves its full energy warming by 1.5 degrees over the next Methane emissions from onshore obstacles in the way of innovation potential. What we need from our few decades. In order to meet the U.S. oil and natural gas production fell and expansion. An American energy elected leaders are smart energy poli- 1.5 degree goal, the IPCC envisions a 24%, while oil and natural gas produc- policy that values innovation over cies that promote our nation’s position future where people travel less using tion rose 65% and 19%, respectively, regulation can turn energy policy as a leader in energy production. buses, trains, hybrid and electric cars. from 2011 to 2017, according to data challenges into great opportunities for In general, the most affordable And in order to overhaul agricultural from the EPA and the EIA. economic growth and energy security. forms of energy come from fossil and land-use practices, the IPCC sug- America’s oil and natural gas pro- This approach is not just good busi- fuels, such as oil, natural gas, and coal. gest eating less meat. Going all in to ducers are working hard to develop ness, it’s good stewardship and a much Compared to these energy sources, limit warming to a degree and a half America’s own abundant resources better strategy for improving the qual- CONTRACTORS AND PRODUCERS alternative fuels such as solar and would mean bilking the poor around in a safe and environmentally sound ity of life for all. wind power are considerably more the world while increasing other envi- manner. The federal government’s 250 N. Water, Suite 300, Wichita, KS 67202 expensive and less reliable. ronmental harms. own data confirms methane emissions Burning fossil fuels to generate Those who believe that increased have fallen in recent years and are 316-267-3241 electricity or provide power neces- CO2 emissions inevitably lead to continuing to drop, even as oil and nat- Serving the Oil and Gas Industry Since 1926 sarily releases carbon dioxide (CO2) global warming believe this change ural gas production has risen. Industry

12 13 KIOGA

Member News Coming soon to

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KIOGA EDUCATIONAL FOUNDATION August 11-13, 2019

Our Misson Types of Support How You Can Help Testimonials Consider making a yearly donation to KEF We are a 501 (c) (3) organization To date, the KIOGA Educational Foundation Marshall Elementary | Eureka, KS has awarded several grants, totaling over so that we can continue to help teachers 3D Printer that conducts educational programs and students with their STEM projects. & provides educational materials $4,700. The grants have been used to provide the following types of support: Contact your school, talk to the teachers relating to energy sources and and let them know about the STEM grant processes. We have implemented program. a grant program to teachers and schools across Kansas for STEM Donations can be sent directly to: KIOGA Educational Foundation (Science, Technology, Engineering 229 E. William, Suite 211 and Math) related projects. KEF will Wichita, KS 67202 “I just wanted to get back to you with some work in conjunction with Kansas [email protected] pictures and another heartfelt thank you for the Strong and KIOGA to identify grant grant money. We were able to purchase the 3D Gordon Parks Academy | Wichita, KS printer and we are working on learning how to use prospects. The grants will provide Leadership Camp it!! We have had some success and continue to funding for items such as books, learn more everyday.” FXUULFXOXPHTXLSPHQWÀHOGWULSVDQG Heller Elementary | Neodesha, KS supplies to help teachers implement Tulsa Geoscience Center Field Trip STEM Education.

“KAY camp has also helped my kids become more independent, develop better social skills and have a positive attitude. The KAY outlook inspires them to dream big and take action. It teaches them responsibility inside and outside of the classroom. ... My children and I are extremely thankful for being JLYHQWKHRSSRUWXQLW\WREHQHÀWIURPWKH.$<FDPS leadership experience.” 100% of funds donated are used to fund grant requests

Brochures available upon request Highlights of 82nd Annual Convention and Expo Key Note Speakers • Mark Mathis, Author of Feeding the Media Beast • Greg Wrightstone, Author of Inconvenient Facts Breakout Sessions • What’s Next for our Nation’s Energy Policy • Excel training by Dawn Monroe Please consider making KIOGA Educational Foundation as your donation in lieu of fl owers. KEF is dedicated to the education of teachers and students, on the benefi ts of the oil and gas industry • Title and Land work panel KEF | 229 E William Suite 211 | Wichita, KS 670202 • Health Insurance and What you need to know In Memory Of: More James A “Jim” Roberts Jr. Mud-Co / Service Mud Wichita, KS • Large Trade Show Michael T “Mike” Kern Pickrell Drilling Great Bend, KS • Entertainment David R Sebits Pickrell Drilling Great Bend, KS Barry Craig Metz Kansas Corporation Commission Wichita, KS • Networking • Fabulous Food 14 15 EPA Announces Continued The complaint contends that EPA regulations and the states reject has failed to meet this mandatory them, the existence of the federal requirement for 27 years. However, regulations can create a pathway Support of Existing RCRA RCRA does not require EPA to for environmentalists to use RCRA develop guidelines or regulations; it citizen suit provisions to sue individ- only requires EPA to determine if it ual producers for failure to comply Exemption needs to. with the federal regulations – even if Significantly, the litigation asks the the producer complies with the state On April 23rd, the EPA announced Exchange participants and compile is does not need to develop RCRA to change their production waste regulations. This is likely the true that creation of Resource data and information necessary for Subtitle D production waste regu- regulations, if EPA were to create court to require EPA to comply with Conservation and Recovery Act EPA to make a sound determination. lations. KCC Commissioner Shari a federal regulatory program, that the mandatory duty and to develop objective of the litigation. (RCRA) regulations for oil and gas The Exchange’s offer to the EPA Feist-Albrecht sent a letter to the action could create a citizen suit liti- Subtitle D regulations for production We can expect environmental wastes are not necessary at this time. was instrumental in helping the EPA EPA Administrator last year urging gation path to sue individual oil and wastes. If the court compels the activists to press EPA on RCRA RCRA is the federal law governing determine that they do not need to the EPA to determine the creation of gas producers for failure to comply development of regulations, it would Subtitle D determinations going the management of solid wastes. Its revise the regulations for oil and gas RCRA regulations under Subtitle D with the federal regulations even if create risks for oil and gas producers. forward. Under RCRA, EPA must key components are Subtitle C regu- exploration and production wastes was not necessary. they were complying with the state Unlike RCRA Subtitle C (hazardous revisit its assessment of the RCRA lating hazardous waste and Subtitle under RCRA Subtitle D. Kansas was the first state to regulations. wastes) where production wastes are Subtitle D status every three years. D regulating nonhazardous waste. KIOGA President Edward Cross respond to EPA saying that it was The pivotal issue in the environ- excluded from regulation, Subtitle D The issue that the environmentalists The EPA stated: “Based on the met with EPA officials last September not necessary for the EPA to develop mental litigation is an argument that (nonhazardous wastes) – which are used to litigate was EPA’s failure to and December and oil and gas waste regulations under information gathered for this review, EPA has failed to comply with man- primarily written for municipal land- publish its assessment for several urged the EPA to Subtitle D of RCRA. Wyoming and on April 23, 2019, EPA determined datory duty under RCRA Subtitle D fills – does not create authority for decades. Consequently, we will act and announce North Dakota soon followed with that revisions to the federal reg- to determine every 3 years whether EPA to require states to implement need to closely watch these actions that it does not communications that expressed ulations for the management of it needs to develop guidelines or federal regulations or the author- in the future and continue to work need to develop federal regulations of oil and gas exploration, development and produc- regulations for Subtitle D wastes ity for EPA to regulate if the state with state regulators to support the RCRA Subtitle D wastes was inappropriate. The tion wastes of crude oil, natural gas (in this case production wastes). does not. If EPA develops federal current regulatory approach. and geothermal energy under Subtitle Production Waste IOGCC also weighed in with EPA. D of RCRA (title 40 of the Code of Regulations. He The EPA was looking for more states Federal Regulations in Part 257) are also met with KCC to engage with defensible informa- not necessary at this time.” Commissioner Shari tion to demonstrate that states are Feist Albrecht and already doing a good job regulating This is the action KIOGA had IOGCC Executive production wastes. The State Oil & been advocating. On March 13, Director Lori Gas Regulatory Exchange commu- 2019, the State Oil & Gas Regulatory Wrotenbery last year summarizing nication with EPA was instrumental Exchange (Exchange), a partnership the issue and encouraged the KCC in helping the EPA determine that between the IOGCC and the Ground and IOGCC to weigh in with the they do not need to revise the reg- Water Protection Council (GWPC) ulations for oil and gas exploration to support states in their ongoing and production wastes under RCRA process of Subtitle D. continuous Background Information - In May regulatory of 2016, environmental activist orga- improve- nizations (Environmental Integrity ment, urged the EPA to determine Project, Natural Resources Defense that additional RCRA Subtitle D reg- EPA on this issue. Cross provided Council, and others) filed litigation to ulation of oil and gas exploration the EPA, IOGCC, and KCC with a force the EPA to take action regard- and production wastes is not nec- RCRA Litigation Fact Sheet and ing the regulation of oil and natural essary. The Exchange also offered RCRA Litigation Summary Sheet and gas production waste under Subtitle to assist the EPA by assembling the asked the IOGCC and KCC to urge D of RCRA. While the RCRA knowledge and experience of the the EPA to act and announce that Subtitle D cannot compel states 16 17 Inaugural Dinner and Ball at the Kansas through four KIOGA Federal & Expocentre in Topeka on January 14th. State Legislative Reports, seven KIOGA visited with newly elected KIOGA President Reports, five Governor , Lieutenant KIOGA Express, and two KIOGA Intriguing 2019 Kansas Legislative Governor , and several Newsletters. elected officials congratulating them on their election. KPERS - On February 14th, the Session Concludes Kansas House voted not to forward to advance of the 2019 Kansas Legislative (R-Ottawa), House Majority Whip Blake State Legislative Actions final action (87-36) Governor Kelly’s Session by developing and updating Carpenter (R-Derby), House Minority 30-year re-amortization of KPERS lia- several white papers, fact sheets, bro- Policy Chair (D-Lawrence), KIOGA Presentations to Key bilities. The re-amortization plan was chures, and other informational pieces in Senate Vice President Committees – KIOGA President a key component of Governor Kelly’s advance of the session. These include: (R-Emporia), Senate Majority Leader Edward Cross made presentations budget plan. The measure would have • Kansas Oil & Gas Industry (R-Overland Park), and about the state of the Kansas oil and reduced the state’s contribution to the Strategic Analysis (January the Senate Assistant Minority leader gas industry and the key challenges state pension program (KPERS) free- 2019) – an annual comprehensive Oletha Faust-Goudeau (D-Wichita). and opportunities the industry faces in ing up money Governor Kelly wanted The 2019 Kansas Legislative Session report that provides the latest In addition, Cross met with the Chairs 2019, including the impact of volatile to use for K-12 funding and expanding kicked off on January 14th and gav- information on the economic of the House Energy Committee, oil prices, federal state government. The proposal came eled out for first adjournment on April impact of the Kansas oil and House Appropriations Committee, legislative and under strong criticism from Republican 5th. Legislators began the veto session gas industry including statistics House Rural Revitalization Committee, regulatory chal- leaders in both on May 1st and adjourned on May 5th. on Kansas oil and gas industry Senate Utilities Committee, and Senate lenges, and state chambers, who KIOGA prepared for the 2019 Kansas activity, taxes, production, issues, Insurance & Financial Institutions legislative and maintained the Legislative Session and was actively challenges, and opportunities; Committee. Cross discussed the state regulatory chal- refinancing plan engaged. Many KIOGA members par- • State of the Oil & Gas Industry of the Kansas oil and gas industry and lenges. Cross made these presentations would endan- ticipated in legislative and regulatory – Dynamic Challenges Facing what 2019 may hold for the Kansas oil before the Kansas House Appropriations ger state and meetings focusing on issues important Kansas Oil & Gas Industry “Your shop comes up with some and gas industry, impact of volatile oil Committee and the Kansas House school work- to the independent oil and gas industry. (January 2019) – a white paper of the most informative papers in the prices, federal methane issues, electric Energy, Utilities, & Telecommunications ers’ pensions and would cost the state KIOGA also diligently monitored com- that summarizes America’s Statehouse.” – State Representative John rates, environmental assaults (injection Committee on February 7th. The over $7 billion in interest money. The mittee hearings to cover interests of the energy picture today, challenges Carmichael (D-Wichita) wells, induced seismicity, etc.), aban- Kansas House Rural Revitalization February 14th House vote essentially Kansas independent oil and gas industry. faced by the small businesses doned well issues, and tax issues. Cross Committee examined property tax killed the measure. Also in February, that make up the Kansas oil and KIOGA shared these white papers, also met with Representatives Eileen impacts and asked KIOGA President the Senate unanimously passed a $115 KIOGA State Advocacy gas industry, and what indus- fact sheets, reports, brochures, and Horn (D-Lawrence), Edward Cross to share his narrative on million makeup of pension fund contri- Strategy try is doing to address those other informational pieces with key (D-Hutchinson), Jim Ward (D-Wichita), the development and progress of the butions bill, which makes up for KPERS challenges; state legislators. The reference mate- John Carmichael (D-Wichita), and Annie property tax in Kansas. Cross shared the payments that lawmakers did not make KIOGA prepared for the 2019 legis- • The Whole Fracking Story rial was also shared with the Kansas Kuether (D-Topeka) and discussed injec- paper with the committee on January two years ago when the state budget was lative session. KIOGA Chairman Ken – Regulatory & Policy Congressional delegation and other key tion wells/induced seismicity issues and 28th. Cross also met with a number tight. The House passed the measure. White and KIOGA President Edward Considerations (January 2019) federal policymakers. Many state and concerns. of key legislators multiple times during Governor Kelly signed the bill into law Cross visited with several KIOGA mem- • Hydraulic Fracturing & Drinking federal policymakers have expressed the legislation session including the on March 8th. bers across the state last October and Water Contamination (January their gratitude for factual scientific-based KIOGA Participates in 2019 Senate President, House Speaker, House November to listen to concerns about 2019) information. All of the reference mate- Kansas Gubernatorial Inauguration Majority Leader, House Tax Committee Taxes – On February 7th, the Kansas state and federal issues. KIOGA’s legisla- • Climate Issues (January 2019) rial can be found on the KIOGA website - KIOGA participated in the 2019 Kansas Chair, House Energy Committee Chair, Senate passed (26-14) its tax cut bill. tive agenda was discussed and reviewed • Facts About Induced Seismicity at www.kioga.org. Gubernatorial inauguration activities for Senate Utilities Committee Chair, and The measure would remove restrictions during the KIOGA Board Meeting on (January 2019) Governor Laura Kelly and Lieutenant several Republican and Democrat under current law preventing Kansas December 5, 2018, and was generally • Seismic Activity in Kansas Meetings with Key Legislators – Governor Lynn Rogers. KIOGA was legislators. individual income taxpayers from item- determined to be one in which we will (January 2019) KIOGA President Edward Cross met present during the izing deductions for work to minimize legislative assaults • Induced Seismicity & Injection I have had more requests for your with House Speaker Ron Ryckman swearing-in cere- KIOGA “ state income tax on the independent oil and gas indus- Wells in Kansas (January 2019) presentation of any meeting over the past (R-Olathe) and Senate President Susan monies on the south tracked 19 purposes unless try and optimize legislative targets of • Property Taxes in Kansas Wagle (R-Wichita) in early January. lawn of the Kansas issues of 4 years.” they also itemize opportunity. (January 2019) He also met with the House Minority State Capitol on interest to Patricia Kready, • Economic Impact of Steel and deductions for fed- Leader Tom Sawyer (D-Wichita), KIOGA Reference Material - Aluminum Tariffs (January 2019) January 14th. KIOGA the independent oil and gas industry eral income tax purposes. The House House Speaker Pro Tem KIOGA is proactive and prepared in • And More also participated in and have kept membership updated Continued on page20 18 19 From Page 19

measure that would have allowed the measures that could impact oil and board of county commissioners of any gas operations. Each of the last five Kansas Legislative county in Kansas to adopt a resolution years, the Sierra Club and other activists imposing a severance tax of $1 per ton have had bills introduced that include on limestone severed from the earth. a list of onerous rules and regulations Session Continued KIOGA President Edward Cross met designed to stop oil and gas produc- with several key legislators to express tion. This year (2019) was no exception our strong opposition explaining that with Representative Ponka-We Victors passed the measure (76-43) on March 26th that centered on the concept that 25 members, employees, or employees may assist future legislative and regula- counties should not be allowed to (D-Wichita) and Representative Jason 8th, but included a 1% cut in food sales the amount of money actually spent on of members to be offered group acci- tory efforts in developing electric policy impose traditional state taxes and that Probst (D-Hutchinson) introducing tax and added a partial internet purchase schools is not as important as increas- dent and health insurance coverage. that includes regionally competitive such a measure is a slippery slope that bills negatively impacting oil and gas sales tax. The Senate concurred with ing performance of pupils, and that the The bill also modifies the definition rates and reliable electric service. The sets a bad precedent. The measure did operations in the final days for bill intro- the House changes. The measure would will find that tac- of “small employer” to remove “asso- bill requires the study to be completed not advance out of committee. ductions. Much of the foundation for have wrecked tic as good as just increasing Base State ciation” for entities eligible for group in two parts. The first part would be the bills was based on unfounded infor- Governor Kelly’s Aid per Pupil. After a rant against the sickness and accident insurance and required to be completed by January Nuisance Abatement – A measure mation and activist propaganda. One budget plans Governor Kelly/Senate school finance separately require, when determining the 8, 2020 and would examine the effec- that would have allowed counties the measure would have directed the KCC and made fis- plan, the House agreed to the Senate number of eligible employees, employ- tiveness of current Kansas ratemaking ability to abate nuisances within unin- to assess a one-time fee in the amount cally impossible plan passing the measure 76-47 on April ees participating in an AHP be counted practices and examine options available corporated areas of the county. The of $100 upon each operator of a class much of the 4th. Governor Kelly signed the bill into in the aggregate at the association level. to the KCC and the measure was problematic for the oil II disposal well in the state. The money Governor’s plans law on April 6th. KIOGA Chairman Ken White submit- to affect Kansas retail electricity prices and gas industry as those who oppose collected would go to a newly desig- for expanding ted testimony to the Senate Financial to become regionally competitive while American energy development might nated state geological survey monitoring state government. Budget/Appropriations Measures Institutions and Insurance Committee providing the best practicable combi- see this as a tool for stopping oil and gas well fund to be used to drill monitoring On March 25th, The House/Senate budget conference and the House Insurance Committee nation of price, quality, and service. production. KIOGA President Edward wells in the Arbuckle formation for the Governor Kelly committee pushed the budget bill to the underscoring the need to make sure The second part of the study would be Cross expressed strong opposition to the purpose of measuring underground vetoed the tax bill veto session. The veto session began on 501(c)(6) trade associations like KIOGA required to be completed by July 1, 2020 measure to the House Appropriations pressure in the formation and for the that passed both houses of the Kansas May 1st with the denying may participate in a fully-insured group and would examine other consequen- Committee. The measure did not purpose of monitoring confining beds Legislature. During the veto session, Medicaid expansion this year. Medicaid health plan, that the measure does not tial energy issues materially affecting advance out of committee. in the injection zone of the formation. state lawmakers passed a $238 mil- expansion assed the Kansas House ear- alter the ability of associations to partic- Kansas electric rates. Another measure would have charged lion three-year tax cut plan that would lier in the regular session. Medicaid ipate in fully-insured group health plans, County Home Rule Powers – This the KCC with promulgating rules and decouple Kansas individual income expansion was a key issue for Governor and that single member small businesses Uniform Partition of Heirs measure would have amended the regulations to require Class II disposal taxpayers from the federal standard Kelly and she was not pleased that the not be left out of the opportunity to par- Property Act – The Uniform Partition Constitution of the State of Kansas well applications to include statements deduction. The bill is expected to be measure failed to make it to the Senate ticipate in their association group health of Heirs Property Act proposal would to give counties ability to levy taxes, that such well is not located above a vetoed by Governor Kelly because it floor for debate. Supporters of Medicaid plan. This bill was grouped with sev- have made excises, fees, charges, and other known fault and does not pose a direct reduces state revenues she wants to expansion attempted to leverage the eral other insurance bills in conference it prac- extractions. It would have also given risk of induced seismic activity, based use to expand state government. If passage of the budget in the House to committee including the controversial tically counties the ability to exempt them- on a seismic risk analysis conducted Governor Kelly vetoes the measure, the force the Senate to vote on Medicaid Kansas Farm Bureau insurance bill. impossible selves in whole or in part from any by a professional geologist. Both Legislature will have the opportunity to expansion. That tactic pushed the veto The measure passed the House and to parti- enactment of the legislature. KIOGA measures were assigned to the House override the veto when it meets for sine session into the early hours of Sunday, Senate on April 5th. Governor Kelly tion many and a number of other associations and Energy, Utilities, & Telecommunications die on May 29th. May 5th, but was ultimately unsuc- did not veto the measure, but allowed parcels of real estate in Kansas. The groups voiced strong opposition to the Committee. KIOGA President Edward cessful. The Kansas House passed the the measure to become law without her problem is that partitioning is often the measure. The measure did not advance Cross met with the House Energy School Finance - Governor Kelly budget bill in the early morning hours of signature. best option to fix title problems that out of committee. Committee chair and several members proposed and had introduced a single May 5th (79-45). The Senate quickly fol- would otherwise render the land unable of the committee providing fact-based bill that makes a $92 million increase lowed by passing the budget bill (26-14). Electric Rate Study – An elec- to be developed for oil and gas produc- Numerous Bills Introduced at scientific information about injection in state aid to schools that is believed tric rate study bill passed the Kansas tion. KIOGA Chairman Ken White and 11th Hour – Over 150 bills were intro- wells and earthquakes explaining that to satisfy the Kansas Supreme Court’s Association Health Plan Bills – On House on March 26th. The mea- Joe Schremmer, Attorney at Law at duced in the final days allowed for bill the bills and the information used by judgment that the state isn’t adequately March 26th, the Kansas House passed sure had passed the Senate (38-1) on Depew Gillen Rathbun McInteer, LC, introductions. those supporting the bills does not financing public education. Kelly’s bill (101-23) an Association Health Plan March 14th. The measure directs the testified on behalf of KIOGA in oppo- Included hew to strict scientific precision, but also includes the budget for the entire (AHP) measure that KIOGA supported. Legislative Coordinating Council (LCC) sition to the measure. The measure did in those are instead hyperbole and non-verifi- Kansas Department of Education. The The measure would remove a mem- to authorize a study of retails rates of not advance out of committee. last-minute able statements of subjective opinion. senate passed the measure. The House bership limitation placed on AHP’s that Kansas electric public utilities. The bill filings The good news is that many legislative passed a school policy bill on March requires the association to have at least study would provide information that County Tax on Limestone – A were several Continued on page 22

20 21 From Page 21 Legislative Session Susan Duffy Confirmed as New Continued KCC Commissioner

Susan Duffy and experience has prepared her to was nominated serve as a KCC commissioner. On by Kansas a unanimous vote, the committee JOIN! leaders and committee members recog- emissions, moratoriums on injection Department of Revenue’s first severance Governor endorsed Duffy’s nomination for the nized the misleading nature of the bills. wells, establishing an earthquake risk tax attorney and as General Counsel. Laura Kelly KCC post. The measures did not receive hearings. pool fund, and other measures with the on March On May 3rd, the Kansas Senate goal of stopping oil and gas produc- Legislature Adjourns voted (38-1) to confirm Duffy’s nom- Environmental Assaults - KIOGA tion. KIOGA is prepared and ready to The legislature adjourned on May 5th 18th to serve ination. Duffy will serve a term on stays keenly poised to address any defend the oil and gas industry at every until sine die when lawmakers can con- as a Kansas The Wichita Desk and Derrick is a dynamic attempts by those who oppose American opportunity. sider any vetoes that might occur. The Corporation the KCC through March 15, 2023 and organization that promotes the education of Commission (KCC) Commissioner. is eligible for reappointment. Duffy the petroleum, energy and allied industries oil and gas development to promote leg- Burghart confirmed as Revenue Legislature officially adjourned on sine and advances the professional islation and/or regulations designed to Secretary – On March 26th, the Kansas die (May 29th), after which legislators Duffy will replace KCC will join KCC Chairman Dwight development of its members. stop oil and gas production. The Sierra Senate confirmed (38-1) Governor can legally receive financial contribu- Commissioner Jay Emler, whose Keen and Commissioner Shari Feist- Club annually proposes a laundry list Kelly’s appointment tions to their re-election campaigns. term expired in March 2019. Albrecht on the three-commissioner Member Benefits: • Learn from energy industry experts. of oil and gas regulations that have no of Mark Burghart as The Legislature will stay adjourned until Duffy served as the KCC exec- agency. • Network with energy industry leaders environmental benefit but high associ- Secretary of Revenue. January 2020, unless a special session utive director from 2003-2011. “Susan and colleagues. ated costs. This list includes carefully Burghart has 36 years’ is called. is a distin- • Attend regional and national meetings. She has also worked in the Kansas • Receive critical updates and information thought-out restrictions on hydrau- experience in tax law. He Legislative Research Department, guished and about the energy industry. lic fracturing, waste management, has served as the Kansas Kansas State Historical Society, experienced • Enhance communication and leadership skills. public service Kansas Department of Revenue, • Make friends for life! and the Division of the Budget. She leader,” said has served KCC Chairman For more information about the Wichita as general Dwight Keen. Desk and Derrick and to learn about member eligibility, visit our Wichita Desk manager of “Kansas and the commission will and Derrick facebook page, or contact the Topeka significantly benefit from her service Shannon Wiseman Metropolitan on the KCC.” [email protected]| 316.267.4214 Transit KIOGA congratulates Susan The Wichita Desk and Derrick is a proud affiliate of the Association of Desk And Derrick Authority Duffy and extend our best wishes Clubs, www.addc.org the last sev- for success! eral years. My administration is focused on strengthening the KCC’s ability to Get on Board the KIOGA Express serve the people of Kansas now and Contact the Wichita office and get your into the future,” said Governor Kelly. office signed up today to start receiving “Susan Duffy has the skills and expe- rience to enhance and improve how up to date information. Kansas provides critical services in energy, telecom, natural resources, and transportation.” On May 2nd, the Kansas Senate Utilities Committee held a confirma- www.kioga.org tion hearing on Duffy’s nomination. Duffy explained how her background [email protected]

22 23

Some pages failed to load Reload Close Barrasso (R-WY), Risch (R-ID), Hoeven the Senate bill’s (R-ND), Cassidy (R-LA), and Manchin chief sponsor Ed (D-WV). He also met with U.S. House Markey (D-MA) Energy Committee Members Shimkus voted in favor. KIOGA Contributes to Important (R-IL), Scalise (R-LA), Olson (R-TX), Democrats, who and Engel (D-NY). In addition, he were sponsors of met with U.S. Senators Daines (R-MT), the resolution, voted ‘present’ on the National Energy Policy Discussions Roberts (R-KS), Moran (R-KS) and motion to avoid a public and intraparty follow-up to a September 17, 2018 met with U.S. House Energy Committee U.S. Representatives Marshall (R-KS), fight and it failed. Ocasio-Cortez was Provides Input for meeting with Secretary Pompeo. Cross Members Shimkus (R-IL), Scalise (R-LA), Watkins (R-KS), and Estes (R-KS). Cross angry by the vote but her Democratic Recommended National voiced the positions of the small busi- Olson (R-TX), and Engel (D-NY). In addressed many of the dingbat ideas colleagues dodged the issue. Energy Plan - Addresses Flaws nesses that make up addition, Cross met with U.S. Senators proposed in the “Green New Deal”. The Green New Deal’s sponsors in “Green New Deal” - Provides the onshore inde- Daines (R-MT), Roberts (R-KS), Moran exhort us to pay any price and bear any pendent oil and (R-KS) and U.S. Representatives Marshall burden to combat climate change. But Emissions Facts - And Submits gas industry during (R-KS), Watkins (R-KS), and Estes (R-KS) when given the chance to show their The CSA met with Secretary Pompeo Comments for Carbon Capture both meetings with Cross provided an historical summary dedication to the cause, voting for their to explain the purpose of the organiza- Secretary Pompeo. of the impact of low oil prices on the own bill is somehow too great a personal Tax Credits tion and highlight how we can help the He outlined some of Kansas and U.S. oil and gas industry as sacrifice. On March 26th, KIOGA President Trump administration advance the goal the challenges and well as the Kansas and U.S. economy. Also on March 26th, Senate environ- Edward Cross had the honor and priv- of energy dominance and strengthen opportunities facing the small indepen- He told them that ment committee chair John Barrasso ilege of meeting with U.S. Secretary of Israel’s presence in the Middle East. dent oil and gas industry and provided historically high oil (R-WY) blocked a Democratic effort State Mike Pompeo. Pompeo is a long- DEPA is an organization of state oil them a copy of the KIOGA white paper prices slowed eco- to establish a select committee on cli- time KIOGA member and has attended and gas associations from across the titled State of the Oil & Gas Industry nomic activity and mate change. “We don’t need another and spoken at several KIOGA Annual country who works to execute on critical that provides insight on climate issues low oil prices led to committee, we don’t need the Green Conventions. At a time of rising tur- objectives of the onshore independent and national energy policies. a strong economy. New Deal,” said Barrasso stopping bulence, Secretary Pompeo is the right oil and However, the lead- Democratic Minority Leader Chuck chief diplomat who fundamentally gas KIOGA Weighs-in on Trump ership role the U.S. Schumer’s (D-NY) attempt to establish understands that it takes development indus- Administration Position on Crude plays in world oil markets has helped the special climate committee. “Adding and diplomacy alongside defense to try. Cross is a DEPA executive board Oil Prices flip the historic model. Today, with the a layer of bureaucracy is not the answer advance American global leadership. member. U.S. leadership role in world oil markets, to every problem,” said Barrasso. “It’s Cross met with Secretary Pompeo as CSA/DEPA met with Secretary Last November and again in February higher oil prices give rise to an increase the same thinking that gave us the Green part of a group representing the Council Pompeo to preview a recommended and March, President Trump called for in production and jobs in the U.S. Job New Deal.” for a Secure America (CSA) and the energy plan and essen- OPEC to soften output cuts to lower creation is a huge trade-off. Cross said Congressional Democrats are now Domestic Energy Producers Alliance tial steps to achieve the cost of crude oil. President Trump the bottom-line is policymakers and the trying to put the Green New Deal in the (DEPA). American energy dom- sees low oil prices as key to sustaining Trump administration should work to rearview mirror and pursue less stupid The CSA is a coalition of represen- inance, particularly in and boosting economic growth. OPEC advance policies which lead to stable oil legislation. tatives from the independent onshore regard to oil and gas brushed off Trump’s request saying they prices at a level which supports healthy oil and gas industry and the American production. We pro- were taking a very slow and measured and robust economic activity. Cross Facts Debunk Green New Deal Jewish community. Cross is a CSA vided Secretary Pompeo approach to establish market stability. prepared a white paper titled NOPEC Ideas – Many scientists, policymakers a copy of recommended This is a complicated issue for Kansas Bill Would Weaken American Energy from both parties, and common sense energy policy priorities for the Trump producers. KIOGA President Edward Dominance” that detailed our concerns have discredited the dingbat ideas pro- administration. President Trump was Cross communicated the concerns of and shared the paper with policymaker’s posed in the Green New Deal. Climate board member. The purpose of CSA is presented the plan several weeks earlier. Kansas producers to staffers. science conventional wisdom is flawed, to encourage and support strengthening The plan lays out energy policy priorities several key federal relies on alarmist scenarios, exaggerates U.S. foreign policy objectives with smart and divides the recommendations into policymakers. In late Climate Issues economic impacts, and fails to note the domestic energy policy. The CSA works priorities achievable through executive March, Cross met with climate has actually become milder. The to educate the public about U.S. depen- action, priorities achievable through the The political left has said Americans U.S. Senate Energy The U.S. Senate blocked consider- ‘Green New Deal’ failed for many rea- dency on foreign oil and the benefits and Congressional Review Act, and priori- need to do something urgently about cli- Committee Members ation of the Green New Deal on March sons. One is that the people pushing it reasons it is in America’s best interest to ties requiring either legislative action or mate change. On March 26th, KIOGA Barrasso (R-WY), 26th. It turns out that Representative seem oblivious to the needs of low-in- assist Israel in maintaining a strong and administrative rulemaking. President Edward Cross met with U.S. Risch (R-ID), Hoeven (R-ND), Cassidy Alexandria Ocasio-Cortez’s Green New come families, who would be directly secure presence in the Middle East. The March 26th meeting was a Senate Energy Committee Members (R-LA), and Manchin (D-WV). He also Deal isn’t so popular after all. Not even hurt by the plan. Continued on page 26 24 25 From Page 25 KIOGA Contributes to National Energy Policy Discussions Continued

Although global temperature has risen power sector CO2 emissions continue Carbon Capture Tax Credit are not likely to about one degree Celsius since the start to decline, a trend that has been widely Concerns access 45Q tax of the industrial revolution, this has attributed to the increased use of natu- credits for car- TITLE WORK not wholly been caused by industrial ral gas in electricity generation. In fact, On May 2nd, the Internal Revenue bon capture EOR DRILLING & DIVISION ORDER OPINIONS warming gasses linked to the economic growth in natural gas consumption was Service (IRS) requested comments on projects. Cross KANSAS & NEBRASKA growth that has increased the world’s credited for 61% of electric generation anticipated regulations and other guid- provided a briefing DAVID A. MORRIS, PA wealth, health, and life expectancy so CO2 reductions since 2005. ance under section 45Q of the Internal paper on the issue Revenue Code. Section 45Q was orig- to Senator Roberts, ATTORNEY AT LAW Emission Facts - Carbon dioxide inally enacted in 2008 to provide a tax Senator Hoeven, 8100 E 22nd N Bldg 600 Suite M emissions from U.S. energy consumption credit to taxpayers that sequester carbon Representative WICHITA, KANSAS 67226 will remain near current levels through dioxide. Comments are due to the IRS Estes, and EMAIL ADDRESS: [email protected] 2050, according to projections in the by the end of June. KIOGA will be sub- Representative TELEPHONE: 316.686.9998 FAX: 316.681.0153 Energy Information Administration’s mitting comments. Cramer and will (EIA) Annual Energy Outlook 2019 Last year, KIOGA President Edward be submitting that (AEO 2019). The AEO 2019 projects Cross met with Senator Pat Roberts paper to the IRS that U.S. energy-related carbon dioxide (R-KS), Senator John Hoeven (R-ND), during the comment (CO2) emissions will be 5,019 million Representative (R-KS) and period. metric tons in 2050, 4% below their 2018 Representative Kevin Cramer (R-ND) dramatically. Atmospheric physicists value. to discuss establishing regulatory cer- on both sides of the debate over poten- tainty and criteria to access tax credits tial climate catastrophe agree that the for carbon capture (45Q Tax Credit). first half of the rise, before 1945, was While Congress passed legislation in largely caused by natural sources like early 2018 which expands and extends long-term cycles or solar fluctuations. the 45Q tax credit, problems remain. At that point, emissions were too low The expansion is still a problem because to have much of an impact. The sub- the definition of secure geologic stor- stantial feedback warming that many age does not work climate models have predicted from fos- Associated Press Climate Report for EOR proj- sil-fueled heat in the form of increased from June 29, 1989 - “A senior U.N. ects. Congress humidity and hence water vapor, the environmental Official says entire or the Treasury primary natural warming gas, has not nations could be wiped off the face Department needed yet been observed. U.S. greenhouse gas of the earth by rising sea levels if the to act to ensure reg- emissions fell significantly from 2005 global warming trend is not reversed ulatory certainty, as to 2017, even while oil and natural gas by the year 2000. Coastal flooding and well as incentivize production skyrocketed, according to crop failures would create an exodus carbon capture the EPA 2019 greenhouse gas inven- of ‘eco-refugees,’ threatening political through access to tory. The EPA report shows total U.S. chaos, said Noel Brown, director of the the 45Q tax cred- CO2 decreased nearly 14%, while meth- New York office of the U.N. Environment its. Without clarity ane emissions were reduced by more Program, or UNEP. He said govern- and certainty on than 4% since 2005. Meanwhile, U.S. ments have a 10-year window of what constitutes oil and natural gas production increased opportunity to solve the greenhouse secure geologic more than 80% and 51% respectively. effect before it goes beyond human storage, oil and The EPA data also show that electric control.” gas operators

26 27 We Must Bring a Better policy decisions we will make in the simply will not give up. They never 21st century. If we are to continue have despite the challenges, because our nation’s positive energy trends, risk-taking is a way of life. Understanding of Energy we must implement energy policies KIOGA will be here to inform based on current reality and our and guide our industry through any potential as an energy leader, not challenges. We will stay vigilant and Issues political ideologies or the wishes of stand up for different issues perti- nent to our industry and America’s A Message from your professional environmental groups. natural gas are to our lives, to our businesses, and the econ- and energy in general, they support American energy policy should future. Going forward through the KIOGA President, Edward prosperity and security, and to our omy. Imposing new public policies that include oil and focus on what’s important: American remainder of 2019, we will work Cross future. duplicative federal regu- natural gas. Good communication jobs, American energy security, and together with our allies to promote KIOGA’s advocacy for the issues Oil and natural gas are the foun- lations when the industry requires accurate, fact-based infor- American global energy leadership. sensible energy policy that promotes and concerns our industry faces has dation of our energy-dependent is already well-regulated mation. KIOGA continually updates Energy, specifically oil and natural American energy development and only gotten more urgent over the last economy. They profoundly affect by the states will not put our fact sheets and reference mate- gas, is foundational to our way of life. not penalize America’s independent few years. KIOGA, and its members how we live and work. They are America on a path of pre- rial and all of you can find that Today, domestic production and oil and gas producers. and allies, are now as busy, rele- key to our mobility, to keeping our paring for its real energy information on our website at www. crude oil price, federal and state Thank you for your continued vant and strong in our efforts as at homes and businesses warm, to pro- future. Imposing burden- kioga.org or contact us and we will policy issues, governmental reg- membership and support. Your any time in the association’s history, viding us with electric power, and some and restrictive air get that information to you. ulation, and constant litigation by membership makes a positive differ- working on behalf of the Kansas to supplying the raw materials for emission and greenhouse The energy policy choices our environmentalist opponents are ence and your support is vital to our independent oil and gas industry. countless consumer and industrial gas regulations will not nation makes today are among the fundamental challenges to indepen- industry’s future. Of course, it has always been products. ensure Americans have most important and far-reaching dent producers. Yet independents KIOGA’s members as leaders in this As the public continues focusing ample supplies of the oil industry that have driven our suc- on how to move to a vibrant energy and natural gas that every cess and set the way for creating a future, we must recognize that oil projection shows they will thriving network of advocacy and and natural gas will continue to be demanding in the near PROUDLY information that we are now able to serve as the principal component future. exercise and expand upon. of our economy for many years to We must continue to INDEPENDENT Our industry continues to face come. bring home to Americans many challenges. We have powerful Those who oppose American a better understanding IN OUR FIELD enemies that want to severely limit energy development at the state and of energy issues and our our access to abundant reserves national level are using environmen- industry. Our challenge of oil and natural gas, shut down tal and regulatory issues to disrupt going forward as advo- our drilling because of exagger- orderly oil and natural gas develop- cates of this industry is to ated issues, litigate us to death, and ment and influence policymakers. work hard each and every unfairly tax and regulate us to the They use these issues not to make day to make sure people breaking point. We are straining to energy development better, but to have access to the best adjust to a host of potentially harm- impede or stop oil and natural gas information available. I COVERING THE ful issues that raise pointed questions development. They have shown a encourage all of you to about our industry’s future. The propensity to align themselves rhe- communicate with state bottom-line is that unsound policies, torically with public sentiment for and federal policymakers INDEPENDENTS regulations, and public perceptions more American energy develop- and the public about why OF YOUR FIELDS threaten profit and growth oppor- ment even as they espouse policies making the right decisions IMA’S TOTAL COVERAGE tunities of every company in the oil that would put that goal farther and on energy is so important and gas industry. farther out of reach. for our nation’s future. I INSURANCE | RISK MANAGEMENT | SURETY | EMPLOYEE BENEFITS During the give and take of pub- History has shown that increasing have found that when peo- lic discourse, few truly stop to think taxes on oil and natural gas develop- ple know more about our PROTECTING ASSETS. MAKING A DIFFERENCE. IMA, Inc. | imacorp.com how absolutely essential oil and ment negatively affects consumers, industry, energy issues,

28 29 • Tempers local authority with “protect and minimize adverse a requirement that local reg- impacts to public health, safety, ulations be “necessary and welfare, and the environment”; reasonable’; • Modified the pooling percent- New Era of Change and Uncertainty • Clarifies that local govern- ages and royalty rates to be ments only have authority over more conservative. surface impacts of oil and gas The full effects of the new leg- for Oil & Gas Operations in Colorado operations; islation remain to be seen because A bill that would mandate sweeping • Amendments addressing the and the environment. lower court ruling that had • Reiterates that local govern- the final regulatory regime is depen- changes in how companies drill for oil authority of the COGCC. The Over the last year, however, several concluded that the COGCC ments only have authority dent on a number of post-enactment and natural gas in Colorado passed the bill initially stated that the changes have pushed state leaders to should more heavily weigh within their jurisdiction; rulemakings under the leadership of Colorado Senate and House and was COGCC can refuse to issue a take swift legislative action to prioritize public health, safety and the • Professionalizes the COGCC the COGCC. As a result of industry signed into law by Colorado Governor permit while certain rulemak- health and environmental issues over environment when considering by making COGCC posi- pressure, state officials have promised Polis on April 16th. ings are being completed. Later production in the regulation of oil and new drilling. Democrats in the tions governor-appointed, to work with industry during these amendments changed the lan- gas. state reacted negatively to this senate-confirmed, and paid rulemakings. Also, even though the guage from “refuse to issue” to • In 2017, a fatal explosion in decision. and downgrading the members new legislation empowers communi- “delay the final determination Firestone, Colorado resulting • As a result of these develop- who must have environmental ties to regulate oil and gas in a way regarding a permit application.” from an abandoned flow line ments, it was widely expected or wildlife experience from two they never could before, communities In addition, language added in began to galvanize support that legislation increasing pro- to one; where the majority of development the Senate said COGCC “would for further regulation of the tection of public health and the • Clarifies the COGCC may only occurs are heavily dependent on oil not act in an arbitrary or capri- industry. environment and addressing delay permit applications until a and gas operations and are unlikely to cious manner.” This clarifies • This led to a statewide bal- climate change would emerge limited number of rules become wield their newfound power in a man- the “commission must regulate lot initiative, Proposition 112, early this year, and it did. effective, and requiring that the ner that would harm industry. The measure gives local govern- oil and gas operations in a rea- which proposed a statewide The Democrats’ introduction of COGCC’s decision to reject a ments more authority over oil and gas sonable manner.” 2,500-foot mandatory setback legislation aimed at oil and gas oper- permit be based on “objective New Colorado Law Stalls Oil development. The measure counters • Finally, the bill provides a way on the drilling and completions ations was not a surprise. The bigger criteria” published after a public Investment multiple decisions made by majority to codify details surrounding from homes, schools and other surprise was that such sweeping legis- comment period; will in elections. the nature of local control. buildings. lation was introduced without a broad • Requires the consent of sur- The new Colorado law has chilled The measure invokes sev- • Proposition 112 was defeated in stakeholder process and the speed face owners on permit-specific investment in the state’s oil and gas eral changes to existing law, Background the 2018 election (43% to 57%); at which the bill moved through the conditions for wildlife habitat fields as companies grapple with how including increased input from local however, a number of Colorado legislature. Democratic leadership in protection that directly impact local officials will respond to a law communities, changes to forced pool- The sweeping Colorado oil and gas counties voted in favor of the Colorado rushed the measure through their property; giving them more power to restrict ing thresholds and an update to the regulatory measure follows Colorado’s measure. Representatives from the legislative process, which exacer- • Defines “minimize adverse energy production. The resulting mission and make-up of the Colorado move toward greater restrictions on these areas have been support- bated the problem because Colorado impacts” as “the extent neces- uncertainty over how local author- Oil and Gas Conservation Commission oil and gas development in recent ive of increased restrictions on lawmakers moved forward without sary and reasonable, to protect ities will use their newfound power (COGCC). These changes include: years and was an unsurprising direct the industry, and environmen- knowing all the facts. The lack of public health, safety, and wel- has nearly halted energy deal activity, • Changes regarding profession- response to recent political and judi- talists continued to push for adequate process for such a signifi- fare and the environment, and including acreage purchases. alization of COGCC. It also cial developments, including the stricter setback requirements. cant piece of legislation resulted in wildlife resources”; The new Colorado law is a bea- describes who is going to com- democrats’ recent sweep of all lev- • Democrats, many of whom are many stakeholders being left out of • Provides a technical review con to all other oil and gas producing prise the commission and the els of government in the state. The vocally supportive of further the discussion including the oil and process to assist with siting states. The new Colorado law is an expertise required for each role. principal regulator of oil and natural restrictions on the oil and gas gas industry, agriculture interests, disputes between local govern- example of what happens when polit- • Changes the threshold of forced gas within the state, the Colorado Oil industry, also took control of landowners, home builders, develop- ments and operators; ical orthodoxy drives rulemakings or pooling from 50% to 45%. It and Gas Conservation Commission the General Assembly and the ers, and more. • Requires only that the Air decisions on energy policy and high- also changes the royalty rate for (COGCC) traditionally worked with Governor seat in the election. Nevertheless, the oil and gas Quality Control Commission lights the need to get our nation’s and oil wells to 16% and keeps the industry to strike a balance between • A few months later, in January industry secured some favorable review its existing rules and state’s energy policy right to ensure gas royalty rate at 13%. competing interests of all stakehold- 2019, the state Supreme Court amendments prior to the bill’s final consider “more stringent that we not only take advantage of • States those local governments ers. This was largely because the issued a decision in Colorado passage. While these changes soften provisions”; our vast energy resources to help meet can address the surface impacts COGCC had a mandate to “foster the Oil & Gas Conservation some aspects of the new law, the man- • Requires that the COGCC our nation’s and world’s ever-growing of oil and gas operations “in a responsible, balanced production, and Commission v. Martinez date to prioritize health, safety, and the enact rules amending the energy needs, but also boost our eco- reasonable manner”. It also utilization of the natural resources” of that reinvigorated tensions. environment over resource production Commission’s flowline and inac- nomic competitiveness. specifies that local governments the state in a manner “consistent” with Specifically, the Colorado remains. Some of these concessions tive, abandoned and shut-in well don’t have ability to regulate protecting public health, safety, welfare Supreme Court reversed a include: rules only “to the extent neces- downhole considerations. sary” to ensure that the rules 30 31 THANK YOU KIOGA TRADE SHOW VENDORS 2019 MID-YEAR SPONSORS Apergy | ESP Systems Automated Treating Systems Diamond Testing, LLC AND VENDORS DXP Safety Division ELI Wireline Services, LLC PLATINUM $5,000 OR MORE GENERAL - $300 OR MORE Extract Production Services IMA, INC COMMERCE BANK Foley Equipment Company CATHODIC SYSTEMS CO. Gore Nitrogen Pumping GOLD - $2,500 OR MORE COBALT ENERGY, LLC Service, LLC CVR REFINING Gressel Oil Field Service, LLC COBBS ALLEN HARTMAN OIL CO., INC. Hess Resources, LLC - CRAWFORD SUPPLY Land & Leasing DAYSTAR PETROLEUM, INC. Hurricane Services, Inc. SILVER - $1,000 OR MORE EDMISTON OIL CO., INC. IMA, Inc. AMERICAN WARRIOR, INC. EXPRESS WELL SERVICE & SUPPLY, Jonah Bank & PALMER MFG. & TANK, INC. INC. 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32 33 Your ad could be here A Big Thank You! [email protected] The Kansas independent oil and Ken White We have learned many things gas industry has an outstanding Nick Powell over the past several years. One of talent pool that includes experts in Tim Scheck the most important things we have a variety of technical specialties. Dick Schremmer learned is that we can accomplish The diversity of thought contributes Lesli Baker more than we realized was possible. powerfully to the advancement of Joe Schremmer So, we advance in the name of the KIOGA’s goals. Over the past several Will Darrah industry pausing to acknowledge Adam Beren years, KIOGA has achieved nearly all and recognize the accomplishments of our legislative priorities and the Dana Wreath of the industry leaders named above 2019 Kansas legislative session was Andrea Krauss and to those we may have missed or no exception. We achieve our goals Dave Murfin because we have the corporate val- Doug Louis who we are not aware. To you our ues and human capital essential to Dave Dayvault gratitude and we say Thank You! the success of any major enterprise. Steve Dillard We have skilled and dedicated oil Emma Richmond and gas industry professionals and Richard Koll talented leadership who volunteer David Bleakley their time and efforts. Leveraging Jon Callen our industry’s intellectual capital Diana Edmiston and leadership is a major driver of Mike Reilly Mark Shreve our success. The following KIOGA Hays members are some of the many who Ryan Schweizer and gave a little extra for the oil and gas James Beilman Leawood industry during the 2019 legislative Ed Nemnich Enhancing session: Lives & Don’t miss Strengthening Reilly’s Irish Pub Families Watch for the registration forms to be sent out soon.

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34 35 Voice of the Kansas Independent Petroleum Industry the Energy Education Partnership, Inc. and other industry topics oil and gas industry. Join If you are not a member of KIOGA, Your KIOGA Membership (EEPI) means the concerns of Kansas important to you. our efforts to fight the neg- we encourage you to join. Through Share your newsletter Makes a Difference Independent oil and gas producers are • KIOGA Website at www. ative public image that has KIOGA you can play a significant role or request more copies heard in Topeka as well as Washington. kioga.org for industry made voters and policy- in our efforts to win the political battles kioga.org When addressing the benefits of information and online com- makers unsympathetic to in Topeka and Washington and the pub- KIOGA membership, we can begin munication capabilities. major problems confront- lic relations battle in the court of public ing independent oil and gas with our motto “KIOGA - Voice of • KIOGA Express is an email opinion. Be a part of the solution. Join producers. the Kansas Independent Petroleum information service that us today! Your membership does make Our industry faces many challenges. Industry”. KIOGA is an everyday, keeps members abreast of a difference! Staying involved and frontline representative of the Kansas ongoing and breaking oil and Thanks to KIOGA members, voters and growing in numbers is vital if we are Founded in 1937, the Kansas independent oil and natural gas industry. natural gas industry news. policymakers in Kansas are learning to maintain our status as the “Voice of Independent Oil & Gas Association • The American Oil & Gas that the oil and gas industry is work- the Kansas Independent Petroleum ing for them, the economy, and the (KIOGA) is a nonprofit member orga- Membership in KIOGA gives you: Reporter, a fast-paced Industry”. nization representing oil and gas A United Voice in Topeka and monthly magazine that cov- environment. KIOGA advances in the producers in Kansas, as well as allied Washington ers the industry from A to Z. name of the industry pausing only to service and supply companies. The • Few independent businesses • KIOGA President Reports acknowledge the accomplishments of purpose of KIOGA, as stated in the have the budget, time, and and KIOGA Federal & State our members whose support makes our original articles of incorporation, is “… expertise to individually Legislative Reports keep efforts possible. To you, our gratitude. to improve the market for oil and gas tackle issues at the federal, members current with federal produced in Kansas and to promote the state, and local levels of gov- and state legislative, regula- welfare of the oil and gas industry….” ernment as well as regulatory tory, and policy issues. KIOGA represents the interests of issues. • Kansas Oil & Gas Industry the oil and gas industry at the local, The Power of Unity Strategic Analysis is an Membership in KIOGA state, and federal levels of government. • KIOGA achieves results annual comprehensive report gives you: KIOGA is committed to ensuring that through a strong coalition of that provides the latest infor- tomorrow’s economic climate will be independent businesses with mation on the economic • A united Voice in Topeka & one in which our members can grow a common purpose and goal impact of the Kansas oil and Washington and prosper. Our active presence optimizing our effectiveness gas industry including sta- • Access to legislative & business before the Kansas Legislature, U.S. on critical issues. tistics on Kansas oil and gas information Congress, and state and federal regula- Access to Legislative and industry activity, taxes, pro- • A Way to build public understanding • A stronger industry voice tory agencies means that the concerns Business Information duction, issues, challenges, • Access to industry publications of independents like you are foremost • Whether you need to know and opportunities. in the minds of legislators and gov- how to comply with the latest • KIOGA App for use in ernment officials. Our cooperative laws and regulations or need iPhone, iPad, and Android Become a member today partnerships and networking with legislative updates on pend- devices. Pass the newsletter other state associations, the Domestic ing issues, KIOGA provides • INAlert instant communi- to non-members Energy Producers Alliance (DEPA), you with timely information cation technology that is Help us grow our network in the oil and gas industry Independent Petroleum Association of that can affect your com- accessible by mobile devices. America (IPAA), U.S. Global Leadership pany’s profit and growth A Way to Build Public Coalition (USGLC), National Stripper opportunities. Understanding Well Association (NSWA), Interstate Oil • KIOGA Newsletter published • Today, public perception Member & Gas Compact Commission (IOGCC), 6 times a year that covers continues to be a major chal- Council for a Secure America (CSA), and government relations issues lenge facing the domestic

36 37 KIOGA 2019 Midyear Meeting 2019 Midyear Pictures Educates & Informs Kansas Star Casino seminars were well-attended and convention including Kansas 1st provided business development District Congressman Dr. Roger Provides Excellent Venue information and thought-provoking Marshall; Kansas 2nd District ideas. Dawn Monroe of Monroe Congressman Steve Watkins; Services, LLC shared tips to cus- Kansas 4th District Congressman The 2019 KIOGA Midyear tomize your Microsoft Excel Ron Estes; Kansas Lieutenant Convention, held April 17th-19th environment in a seminar titled Governor Lynn Rogers; Kansas at the in Kansas Star Casino Advancing Your Data Analysis State Treasurer Jake LaTurner; , surpassed our Mulvane, Kansas with Microsoft Excel. Ken White Kansas State Senate President highest of White Exploration, Inc., Will , Kansas State expecta- Darrah of Darrah Oil, and Dick Senators Rick Billinger, and tions. The Schremmer of Bear Petroleum, LLC Randall Hardy; Kansas House meeting shared insights on strategies used to Minority leader Tom Sawyer; attracted survive low-price environments and Kansas House Majority Caucus top industry provided outlooks going forward in a Chair ; Kansas executives, industry professionals, panel discussion titled 2019 Kansas House Energy Committee Chair legislators, and government officials Oil & Gas Outlook. Meeting par- ; Kansas House Rural from across Kansas. The Midyear ticipants were updated on the latest & Revitalization Committee Chair Meeting Committee led by Dick federal and state legislative and ; Kansas State Schremmer organized an outstand- regulatory issues affecting the inde- Representatives , Jack ing meeting and the hard work and pendent oil and gas industry during Thimesch, Cheryl Helmer, and tireless effort of and Kelly Rains the KIOGA Board Meeting and Ron Howard; and KCC Chairman made the event Amanda Carrillo General Membership Meeting. Commissioner Dwight Keen. The proceed without a hitch. Kansas 1st District Congressman Midyear Meeting was rounded out The meeting attracted over 300 Dr. Roger Marshall was the key- with a golf tournament and sport- participants. In addition, 37 exhib- note speaker for this year’s KIOGA ing clays. itors participated in the trade show Midyear Meeting. Dr. Marshall KIOGA sincerely thanks our demonstrating some of the new shared insights on the happenings in members, sponsors, exhibitors, products and services available to the 116th Congress and some of the and attendees for making the 2019 the oil and gas industry. Participants challenges going forward. KIOGA Midyear Convention a began the convention with food, Several legislators and govern- resounding success! drinks, and entertainment at The ment officials participated in the Dickster Bash. Value-added

38 39 Part 60, Subpart OOOOa) methane examples to emissions rules. support our com- We supported this study by providing: ments, EPA will • well site data on marginal well(s) not revise the pro- Kansas Oil & Gas Industry Engage in in Michigan and Kansas; posal. That is why • in-kind cost share by way of the work that we site access to marginal well(s) in do (the methane Oil & Gas Methane Emission Study Michigan and Kansas; and emission survey, Last October, the EPA published in the copy of KIOGA’s white paper demon- on marginal wells demonstrating and Researchers Invite Kansas Oil • in-kind cost share in the form of KIOGA comments, Federal Register its proposed changes strating and exposing the mendacity of exposing the mendacity of the flawed & Gas Industry to Participate in supplemental funding ($50,000) methane coalition to its rules on methane emissions from the flawed EDF study. KIOGA maintains EDF study. KIOGA comments and the Survey to support field investigations comments, and the DOE study) is crit- oil and gas infrastructure. The pro- that wells with less production also have Industry Methane Coalition comments from Kansas, Michigan, Illinois, ical going forward. KIOGA submitted posal involves targeted improvements fewer emissions. But, those who accept (which include the methane emission Researchers invited participation and Indiana. a comprehensive white paper on the to the 2016 New Source Performance EDF’s study maintain that is unimport- survey) were submitted to the EPA in from Kansas oil and gas producers in a GSI Environmental, Inc. is the EPA/ impact of methane regulations on mar- Standards (NSPS) for the oil and gas ant because small wells have the same December 2018. confidential survey assessing emissions DOE approved contractor employed to ginal oil and gas producers in Kansas industry that streamline implementa- number of components as large ones. In October from marginal oil and natural gas wells. conduct the that includes compliance cost estimates, tion, reduce duplicative EPA and state That is not likely true. 2018, the U.S. Specifically, data was sought on methane study. GSI project economics, documentation bur- requirements, and significantly decrease Department of emissions from America’s marginal wells agreed to den, and more. The KIOGA white paper unnecessary burdens on domestic KIOGA Engages with EPA Energy (DOE) in order to address critical knowledge include a survey of methane emissions included defensible data and supporting energy producers. to Address Methane Emission announced the gaps and supply valuable information from marginal wells of the type found in information to help build a solid posi- KIOGA continues to be engaged Concerns approval of a used to develop industry regulations. Michigan, Kansas, Illinois, and Indiana tion for reinstituting a low-production addressing methane emission concerns project to quan- This project is being funded by the U.S. in the study. well exemption. KIOGA also join the and the dynamics of EPA’s efforts to The current EPA presented industry tify methane Department of Energy’s (DOE) Office While the EPA is currently reconsider- industry methane litigation coalition revise its Subpart OOOOa New Source a chance to help ourselves and reduce emissions from of Fossil Energy and in-kind contribu- ing segments of the NSPS for the oil and comments to EPA. Performance Standard for methane. the regulatory burden. The Obama-EPA marginal oil and tions. The project is being conducted natural gas sector, including provisions KIOGA President Edward Cross The big problem with the methane rule associated leaks with the number of gas wells. The by DOE/EPA approved contractor, GSI relating to low production well sites, participated in industry meetings with is that it opens an existing source path- components at a well site. The Obama- primary purpose Environmental Inc. more comprehensive data on marginal DEPA, IPAA, and the Liaison Committee way that is really problematic if there EPA grossly overestimated the number of the DOE proj- A marginal oil well produces less than oil and gas production sites across the of Cooperating Oil & Gas Associations is no framework for low-production of components at low production sites. ect is to develop 15 barrels per day, while marginal gas U.S. is needed to improve the under- in February, March, and April regarding wells. KIOGA President Edward Cross The current EPA asked for defensible data from well wells produce less than 90 thousand standing of emissions from marginal EPA methane regulations. KIOGA is met with the Senior Advisor to the EPA data and supporting information to show sites in basins cubic feet per day. Though marginal wells and could help shape rules promul- working with these groups to coordinate Administrator in late 2018 and urged the that the number of components at low across the U.S. to wells individually supplement a small gated by the government in the future. a response on methane emission tech- EPA to reinstitute a low-production well production wells sites is much smaller help address critical knowledge gaps volume of oil and natural gas, collec- The study required in-kind cost share nical issues to address with EPA on oil provision and also reinstate an off-ramp than originally stated. KIOGA joined 18 and support best management prac- tively these wells supply a sizeable by way of site access to marginal wells and gas production regulations. Several as wells decline. KIOGA encouraged other state, regional, and national oil and tices that are appropriate for marginal percentage of the nation’s crude oil and and supplemental funding to support issues were discussed in the meetings, EPA to look into using the stripper well gas groups last year to challenge the EPA wells. KIOGA President Edward Cross natural gas. field investigations. Producers and and KIOGA engaged on the issues most definition in the tax code to determine methane rules. KIOGA has coordinated met with Energy Secretary Rick Perry The Kansas oil and gas industry associations in U.S. shale basins have important for Kansas operators. Those what constitutes a low-production well with our methane litigation coalition to in early 2018 to encourage DOE sup- joined the Michigan oil and gas industry, come forward and the study will include issues included: because that is a known standard. gather data and information on the num- port for the project. DOE also met with Illinois oil and gas industry, and Indiana wells in the Permian Basin in Texas, • Proposed language to exclude The Obama-EPA removed the exclu- ber of components at low-production several other groups too who encour- oil and gas industry to participate in the the Marcellus shale in the Appalachian low producing wells from meth- sion of low-producing wells from its well sites. KIOGA sent a low produc- aged support. The project is needed U.S. Department of Energy (DOE) study region, and other areas of the country. ane regulations; fugitive emissions program based on tion well component survey to our to demonstrate that the contribution [Quantification of Methane Emissions KIOGA worked with producers and • If necessary, subcategorize regu- a specious Environmental Defense members last November seeking infor- of methane emissions from marginal from Marginal (Small Producing) Oil and associations in Michigan, Illinois, and lations to develop low producing Fund (EDF) study mation on the number of components oil and gas wells are much lower than Gas Wells (DE-FE0031702)] to quantify Indiana to provide in-kind cost share well regulations and determine if that character- at low-production well sites. Thanks what the EPA determined and used in and compare methane emissions at arrangements to have the study also regulations are needed; ized small wells as to the outstanding response from our its methane rule. Having the informa- marginal and non-marginal wells. We include measurement of methane emis- • EPA fugitive emissions require- ‘super emitters.’ members, we gathered information from tion necessary to counter the specious believe that unbiased, representative sions from marginal wells of the type ments should be annual, less KIOGA provided 272 Kansas wells. In addition, KIOGA EDF study can provide a basis for future and appropriate results are necessary to found in Kansas, Michigan, Illinois, and onerous, and have the flexibility the new Acting developed comments that provide eco- decisions on whether low producing well respond to recent and future proposed Indiana. to change with experience; EPA Administrator, nomic and scientific information on the regulations are needed. amendments to EPA’s New Source The EPA made it very clear that if • EPA should revisit its definition of Andrew Wheeler, a impact of methane emission regulation Performance Standards (NSPS, 40 CFR we do not provide data and specific Continued on page 42 40 41 From Page 41

Federal Regulatory REFINING IN THE MID-CONTINENT SINCE 1906 Actions Continued Going Forward, Continued REFINING FACILITIES TO MEET YOUR NEEDS hydraulic fracturing; 1. The cross-section of informa- Michigan data are very simi- 2 • EPA needs to revise record- tion supplied covers almost lar. So, there are two sources CRUDE OIL keeping requirements, such every situation in our busi- of data collection that were TRANSPORTS as those that compel detailed ness; waterflooding, single well independently taken that pulled 130 records for storage vessels site, multiple well tank battery, repetitive data into a single MILES OF OWNED, LEASED and facilities that fall below the stripper crude oil production, study for review. & JV PIPELINES threshold for an affected facility; stripper natural gas production, Thank you again for taking the time 570 and light and heavy oil, and 24/7 and effort to complete the question- • EPA should expand the well- production; and naire. This will all help in the effort EMPLOYEES head exemption. 2. Cross-referencing the data to turn back major issues concerning 1,500+ SERVING YOU Our groups continue to work on shows that Kansas and methane regulations. these issues and will have a white BPCD OF RATED CAPACITY paper ready for a meeting with the IN WYNNEWOOD EPA later this year. 70,000 Environmental activist groups have BPCD OF RATED CAPACITY a number of go-to talking points on IN COFFEYVILLE methane emissions, one of which 115,000 is suggesting that companies are recklessly venting and flaring meth- BPD OF COMBINED ane at increasing levels. The Sierra 204,748 CRUDE THROUGHOUT IN 2017 Club claims energy companies are “currently allowed to flare or leak BARRELS OF OWNED & LEASED unlimited amount of methane pol- CRUDE OIL STORAGE CAPACITY lution into our air,” and only federal 6,400,000 regulation will be effective at reducing $ IN NET SALES emissions. In reality, those emissions FOR 2017 are already declining, even as U.S. oil 5,664,200,000 production continues to increase. Thank You For Your Help! Thanks to everyone who completed and submitted the methane production MOVING AMERICA FORWARD site questionnaire. The information WITH QUALITY MOTOR FUELS. submitted from Kansas was combined with information from Michigan. After review of the Kansas/Michigan data, The real value comes from our people, processes and facilities that have the it looks excellent for two reasons. capacity to transport and optimize your crude oil reliably, with minimal downtime. To learn more, contact a CVR Refining representative today. www.CVRRefining.com

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