Committees advance oil, gas measures

Several bills seeking to address issues related to the ongoing development of Oklahoma's shale fields advanced Tuesday in House and Senate committee meetings at the Capitol.

Two of the measures relate to ongoing complaints some vertical well owners have expressed about negative impacts they say hydraulic fracturing activities have had on their wells.

House Bill 1379 by Rep. Zack Taylor, R-Seminole, was considered by the House Judiciary Committee. It proposes requiring horizontal well operators to avoid creating pollution, production problems or equipment damage to previously drilled and producing vertical wells.

The measure, which Taylor named the “Art and Yvonne Platt Act,” would require any operator creating a negative impact on a vertical well to take immediate actions to minimize damage. It also would require the operator to conduct timely negotiations with vertical well owners to resolve any claims the latter might have.

Failing that, it would allow a vertical well owner claiming such damage to file an emergency injunction with an appropriate district court judge that, if granted, would prevent the horizontal well operator from continuing completion operations.

The proposed language also would allow a judge to determine amounts of apparent damage, including amounts of reserves likely lost, and to require the horizontal well operator to deposit funds equaling that amount into an escrow fund where it would be held until litigation was settled.

The measure is backed by the Oklahoma Energy

Producers Alliance, which stated Tuesday that hundreds of vertical wells in Oklahoma's oil patch have been damaged by hydraulic fracturing completion operations of horizontally drilled wells. Art and Yvonne Platt, both the association and Taylor said, are lifelong Oklahomans who have said hydraulic fracturing operations ruined vertical wells producing on Kingfisher County land they had depended upon as part of their retirement incomes.

“This an effort to bring everyone to the table to negotiate over issues that have been growing along with hydraulic fracturing in Oklahoma,” Taylor said. “We are trying to create accountability and outline the party causing damage is responsible for the damage.”

The bill, advanced by the committee's 12-to-4 vote, was sent to the House floor without title,

which must be restored before it can become law.

Meanwhile, House Bill 2111, by Rep. Terry O'Donnell, R-Catoosa, was considered by the House Energy and Natural Resources Committee. If enacted, it would create the “Oklahoma Oil and Natural Gas Regulatory Modernization Commission” to evaluate the effect of new drilling activities on existing wells, both vertical and horizontal.

The commission, it states, would consist of the chairman of the House's Energy and Natural Resources Committee, the chairman of the Senate's Energy Committee, a member of the Oklahoma Corporation Commission and designated representatives from the Attorney General's office, the offices of the Governor and Lt. Governor, the Oklahoma Energy Resources Board and Oklahoma's Secretary of Energy and Environment. It received a unanimous due-pass recommendation from the committee and was sent to the House

floor.

A third measure, Senate Bill 517, was heard by the Senate's Transportation Committee. It would require oil and gas operators and service companies to obtain written permissions and provide compensation to landowners impacted by the use of state rightsof-way along public roads and highways for temporary lines used to transport produced, treated water from recycling or storage facilities to well completion locations.

The measure, which also would need its title restored before it could be made law, was sent to the Senate by 7-to-0 vote.

Chad Warmington, president of the Oklahoma Independent Petroleum Association — Oklahoma Oil and Gas Association, said Tuesday his organization is aware of all three measures.

Warmington said the organization opposes HB1379, noting it includes language like what vertical well operators sought from the Oklahoma

Corporation Commission when they asked for rules on the issue to be developed years ago.

He said exploration and production companies drilling and completing horizontal wells today have the same rights as existing well owners to recover minerals from shared resources, and noted most potential issues are addressed before wells are drilled and completed through negotiations involving the parties involved.

As for HB2111, Warmington said OIPA — OKOGA supports that measure, noting that horizontal drilling and completions are the oil and gas industry of the future.

“The Corporation Commission has been looking at this issue for three years,” Warmington said. “It still is a largely undefined problem. If people really and truly want to get to the bottom of this, then let's get to the bottom of it and do some research into what modern completion practices and regulation ought to look like.”