WEBVTT 00:00:05.360 --> 00:00:06.460 Good morning everyone. 00:00:06.460 --> 00:00:08.210 Thank you for your patience while we work 00:00:08.210 --> 00:00:10.500 through these technical difficulties. 00:00:10.500 --> 00:00:13.030 Thank you for attending this webinar this morning. 00:00:13.030 --> 00:00:15.840 You can submit questions throughout the presentation 00:00:15.840 --> 00:00:17.530 by clicking the Q&A button 00:00:17.530 --> 00:00:20.010 in the center of the bottom of your window. 00:00:20.010 --> 00:00:22.510 You will see both the questions and responses 00:00:22.510 --> 00:00:24.120 after they have been answered. 00:00:24.120 --> 00:00:26.230 Some questions may be held for answer 00:00:26.230 --> 00:00:28.350 until the end of the presentation. 00:00:28.350 --> 00:00:31.260 Presentations and webinar recordings are all available 00:00:31.260 --> 00:00:34.330 by navigating to the RRC regulatory webinars 00:00:34.330 --> 00:00:36.800 from the Oil and Gas Workshops and Seminars page 00:00:36.800 --> 00:00:39.680 on the Railroad Commission of Texas website. 00:00:39.680 --> 00:00:41.870 Okay, let's go ahead and get started. 00:00:41.870 --> 00:00:43.800 Our presenter this morning is Sean Avitt, 00:00:43.800 --> 00:00:46.470 the manager of the Injection Storage Permits Department 00:00:46.470 --> 00:00:48.040 in the technical permitting section 00:00:48.040 --> 00:00:49.890 of the oil and gas division. 00:00:49.890 --> 00:00:51.440 Sean, we're ready when you are. 00:00:53.290 --> 00:00:54.520 Hello. 00:00:54.520 --> 00:00:55.570 As Molly said, 00:00:55.570 --> 00:00:57.830 I'm the Injection Storage Departments Unit Manager, 00:00:57.830 --> 00:00:58.663 Sean Avitt, 00:00:58.663 --> 00:01:01.470 and I have been I'm working for the Railroad Commission 00:01:01.470 --> 00:01:03.350 about eight years. 00:01:03.350 --> 00:01:06.150 I've been in this particular role for two years, 00:01:06.150 --> 00:01:07.913 and I'm a geoscientist. 00:01:09.370 --> 00:01:13.070 And we're going to talk about 00:01:13.070 --> 00:01:15.070 oil storage in the state of Texas today. 00:01:20.920 --> 00:01:23.420 Here's a broad outline for the talk today. 00:01:23.420 --> 00:01:24.540 I'm going to discuss 00:01:24.540 --> 00:01:27.660 the state of hydrocarbon storage generally. 00:01:27.660 --> 00:01:29.700 Then we'll discuss how to apply for a permit 00:01:29.700 --> 00:01:32.210 to store oil in salt, 00:01:32.210 --> 00:01:34.890 and how to apply for a permit to store oil 00:01:34.890 --> 00:01:37.370 in a non-salt formation pursuant to the Commission's 00:01:37.370 --> 00:01:39.520 May 5th, 2020 Order. 00:01:39.520 --> 00:01:41.020 One last thing before we get started. 00:01:41.020 --> 00:01:44.350 This presentation is about underground storage of oil, 00:01:44.350 --> 00:01:46.140 but it is also generally applicable 00:01:46.140 --> 00:01:48.210 to storage of any liquid hydrocarbon 00:01:48.210 --> 00:01:50.010 under the Commission's jurisdiction. 00:01:55.910 --> 00:01:56.930 Over the next couple slides, 00:01:56.930 --> 00:01:59.580 we'll discuss why we're talking about storage. 00:01:59.580 --> 00:02:02.330 This is the first storage only presentation 00:02:02.330 --> 00:02:05.940 that we've given in recent history and possibly ever. 00:02:05.940 --> 00:02:08.730 I'll talk briefly about the history of oil storage 00:02:08.730 --> 00:02:10.070 and its regulation, 00:02:10.070 --> 00:02:12.180 then I'll show you the distribution of storage facilities 00:02:12.180 --> 00:02:13.230 in Texas. 00:02:13.230 --> 00:02:15.950 And lastly, by now I would normally have told you 00:02:15.950 --> 00:02:18.510 where you can find all this information on our website, 00:02:18.510 --> 00:02:22.160 but currently there is no storage manual on the web sadly. 00:02:22.160 --> 00:02:24.750 I plan to rectify that situation however, 00:02:24.750 --> 00:02:27.290 and update our online UIC manual 00:02:27.290 --> 00:02:30.030 and add more detailed storage information to it 00:02:30.030 --> 00:02:31.610 in the coming year. 00:02:31.610 --> 00:02:35.040 If you attended the presentation prior to this one 00:02:35.040 --> 00:02:36.570 with Rob Castillo, 00:02:36.570 --> 00:02:39.940 he probably showed you all of our UIC manual information 00:02:39.940 --> 00:02:41.313 on our website. 00:02:48.950 --> 00:02:50.780 So, why are we here? 00:02:50.780 --> 00:02:53.860 Well, it starts with the Texas miracle. 00:02:53.860 --> 00:02:57.630 Up at the top, you can see Texas oil production has gone 00:02:57.630 --> 00:03:00.296 from a million barrels a day in 2010, 00:03:00.296 --> 00:03:03.920 1.1 million barrels around January 2010, 00:03:03.920 --> 00:03:08.030 to over three and a half million barrels a day in 2015 00:03:08.030 --> 00:03:12.480 to nearly five and a half million barrels each day today. 00:03:12.480 --> 00:03:15.380 There's much more capacity to produce oil in Texas 00:03:15.380 --> 00:03:18.040 than there has ever been before. 00:03:18.040 --> 00:03:19.520 And as you have undoubtedly heard, 00:03:19.520 --> 00:03:22.680 oil prices have slumped since the beginning of this year, 00:03:22.680 --> 00:03:25.770 from nearly $150 oil in 2008, 00:03:25.770 --> 00:03:29.470 to $50 oil over the last couple years, 00:03:29.470 --> 00:03:33.480 to nearly having gone to a negative price 00:03:33.480 --> 00:03:36.480 which is dramatically shown in the graph on the bottom left. 00:03:37.820 --> 00:03:40.090 Now, that last financial phenomenon 00:03:40.090 --> 00:03:43.360 is just sort of sensational, but the overall trend is real. 00:03:43.360 --> 00:03:47.140 And it correlates with an increase in oil supply and storage 00:03:47.140 --> 00:03:49.483 that you can see in the bottom right hand graph. 00:03:51.450 --> 00:03:52.960 I don't claim to fully understand 00:03:52.960 --> 00:03:55.290 these complex economic systems. 00:03:55.290 --> 00:03:57.530 And that's not necessarily what we're here to talk about, 00:03:57.530 --> 00:04:00.350 but that's why the Commission has taken action, 00:04:00.350 --> 00:04:02.450 and why we need to talk about oil storage. 00:04:08.190 --> 00:04:10.120 So this is not the first time that Texas in the country 00:04:10.120 --> 00:04:12.470 has seen an economic or energy crisis. 00:04:12.470 --> 00:04:15.750 In 1973, the Oil Embargo decreased U.S. oil supply 00:04:15.750 --> 00:04:17.700 and hiked oil and fuel prices. 00:04:17.700 --> 00:04:20.160 As a result, there were long lines of gas stations, 00:04:20.160 --> 00:04:22.560 gas rationing, oil price control, 00:04:22.560 --> 00:04:24.600 and the search for energy independence. 00:04:24.600 --> 00:04:25.840 Shortly thereafter, 00:04:25.840 --> 00:04:28.720 the Energy Policy and Conservation Act was passed 00:04:28.720 --> 00:04:30.880 which authorized among other things, 00:04:30.880 --> 00:04:34.541 the creation of the Strategic Petroleum Reserve or SPR. 00:04:34.541 --> 00:04:38.150 The SPR is the largest reserves of crude oil in the world. 00:04:38.150 --> 00:04:40.300 It's a system of pipelines and underground storage 00:04:40.300 --> 00:04:43.660 for crude oil, including Bryan Mound and Big Hill domes 00:04:43.660 --> 00:04:46.653 in Texas, and two other salt domes in Louisiana. 00:04:47.780 --> 00:04:52.730 The SPR currently has a 797 million barrel capacity 00:04:52.730 --> 00:04:57.652 with a current inventory of 635 million as of April 17th, 00:04:57.652 --> 00:05:01.203 at an average price paid of about $28 per barrel. 00:05:02.110 --> 00:05:04.640 During my career, short as it is, 00:05:04.640 --> 00:05:08.030 I'd normally say $28 a barrel is a pretty good deal 00:05:08.030 --> 00:05:09.833 unless of course it's April 2020. 00:05:17.670 --> 00:05:19.313 Now under federal regulations. 00:05:20.300 --> 00:05:22.280 In our earlier presentation 00:05:22.280 --> 00:05:24.280 on Injection Disposal Well Permitting, 00:05:24.280 --> 00:05:26.610 you would have heard about the Safe Drinking Water Act, 00:05:26.610 --> 00:05:28.950 and specifically about Underground Injection Control 00:05:28.950 --> 00:05:30.170 part of that act. 00:05:30.170 --> 00:05:34.250 Well, UIC covers underground and storage of liquids, 00:05:34.250 --> 00:05:37.080 but does not cover the underground storage of gas. 00:05:37.080 --> 00:05:38.890 And the Commission does not have 00:05:38.890 --> 00:05:40.390 Federal Delegation of Authority 00:05:40.390 --> 00:05:42.200 for underground storage of gas 00:05:42.200 --> 00:05:44.320 from the federal agency that handles that, 00:05:44.320 --> 00:05:47.710 the Pipeline and Hazardous Materials Safety Administration 00:05:47.710 --> 00:05:48.543 or PHMSA. 00:05:49.820 --> 00:05:53.000 However, we still have state authority for gas storage. 00:05:53.000 --> 00:05:55.280 So we still permit storage of gas, 00:05:55.280 --> 00:05:57.470 but you may have to talk to PHMSA as well. 00:05:57.470 --> 00:05:59.620 We're considering applying for federal delegation 00:05:59.620 --> 00:06:02.053 to simple regulation of gas storage in Texas. 00:06:07.870 --> 00:06:11.050 Here, we have a map of all the injection wells 00:06:11.050 --> 00:06:12.870 in the state of Texas. 00:06:12.870 --> 00:06:16.300 The black and gray dots are injection disposal wells, 00:06:16.300 --> 00:06:18.680 the red or light red are storage wells, 00:06:18.680 --> 00:06:21.930 and the blue are brine mining wells. 00:06:21.930 --> 00:06:23.670 I put this together so that you can get 00:06:23.670 --> 00:06:26.820 a sense of the distribution of injection wells in the state, 00:06:26.820 --> 00:06:29.690 the oil and gas basins and the proportion of those wells 00:06:29.690 --> 00:06:31.130 that are for storage. 00:06:31.130 --> 00:06:32.400 You can tell there aren't very many 00:06:32.400 --> 00:06:34.620 storage wells proportionally. 00:06:34.620 --> 00:06:37.180 On the next slide, we'll show you just the storage wells 00:06:37.180 --> 00:06:38.630 so you can actually see them. 00:06:56.060 --> 00:06:59.060 So again, we can see there aren't a whole lot 00:06:59.060 --> 00:07:00.370 of storage facilities in the state 00:07:00.370 --> 00:07:03.160 compared to the total number of injection wells. 00:07:03.160 --> 00:07:05.230 The storage in the Permian and Panhandle 00:07:05.230 --> 00:07:08.470 is in bedded salt formations like the Castillo, 00:07:08.470 --> 00:07:10.950 Clearfork and Salado formations. 00:07:10.950 --> 00:07:12.640 The Gulf Coast and East Texas storage 00:07:12.640 --> 00:07:14.400 is mostly in salt domes. 00:07:14.400 --> 00:07:16.560 Then we can see in Central Texas 00:07:16.560 --> 00:07:18.770 where there are not substantial salt formations, 00:07:18.770 --> 00:07:20.320 the wells are bright red, 00:07:20.320 --> 00:07:22.220 which represents depleted gas storage. 00:07:23.910 --> 00:07:26.620 It's important for me to note two things about this map. 00:07:26.620 --> 00:07:28.350 One, that at this scale, 00:07:28.350 --> 00:07:30.370 you're not really seeing individual wells 00:07:30.370 --> 00:07:32.050 so much as very small blobs 00:07:32.050 --> 00:07:34.000 typically representing many wells, 00:07:34.000 --> 00:07:36.880 and two, that these wells may not be active. 00:07:36.880 --> 00:07:38.510 They might just be storage permits, 00:07:38.510 --> 00:07:40.130 not drilled or completed, 00:07:40.130 --> 00:07:42.710 or they could have been plugged already. 00:07:42.710 --> 00:07:45.743 We'll get to specific numbers after the next slide. 00:07:47.160 --> 00:07:48.710 Give everybody a moment just to 00:07:50.320 --> 00:07:51.473 take in the image. 00:08:04.630 --> 00:08:06.450 And now to zoom in a little closer, 00:08:06.450 --> 00:08:09.230 here we can see the counties in the Houston area, 00:08:09.230 --> 00:08:11.880 and we can start to see individual storage wells. 00:08:11.880 --> 00:08:14.450 You may notice too that there can be many caverns 00:08:14.450 --> 00:08:17.050 and storage wells associated with one salt dome 00:08:17.050 --> 00:08:18.480 or storage facility. 00:08:18.480 --> 00:08:21.580 The cluster of bright red wells in the center, 00:08:21.580 --> 00:08:23.823 just north of the Harris County label, 00:08:25.330 --> 00:08:26.940 here, 00:08:26.940 --> 00:08:30.510 is not actually a salt dome but the Bammel gas reservoir. 00:08:30.510 --> 00:08:33.470 Then, I'll point out the dark red blob to the right 00:08:33.470 --> 00:08:37.193 or east of the map under the Chambers County label, here, 00:08:39.480 --> 00:08:42.400 which are the storage wells in the Barbers Hill salt dome 00:08:42.400 --> 00:08:44.170 underneath the City of Bellevue. 00:08:44.170 --> 00:08:47.600 This is one of the most active storage salt domes in Texas, 00:08:47.600 --> 00:08:49.710 and has the most or highest density of storage vaults 00:08:49.710 --> 00:08:50.543 in the state. 00:09:05.600 --> 00:09:08.270 To save you from counting all those dots like I promised, 00:09:08.270 --> 00:09:11.580 here are a few basic counts for oil and gas storage 00:09:11.580 --> 00:09:12.440 in Texas. 00:09:12.440 --> 00:09:14.730 We have nearly 100 storage facilities. 00:09:14.730 --> 00:09:18.800 Of those there are 751 liquid storage wells 00:09:18.800 --> 00:09:20.700 permitted in salt, 00:09:20.700 --> 00:09:23.083 331 of which are active. 00:09:24.520 --> 00:09:27.760 We have 113 gas storage wells permitted in salt 00:09:27.760 --> 00:09:29.750 with about half of those active. 00:09:29.750 --> 00:09:34.150 And lastly, we have 453 gas storage wells 00:09:34.150 --> 00:09:35.880 in a depleted reservoir, 00:09:35.880 --> 00:09:37.613 and over /4 of those are active. 00:09:45.950 --> 00:09:48.760 First, we're gonna discuss storage permitting in salt 00:09:48.760 --> 00:09:52.180 since that is the norm for Statewide Rule 95. 00:09:52.180 --> 00:09:53.840 This presentation assumes 00:09:53.840 --> 00:09:55.330 that you have a basic understanding 00:09:55.330 --> 00:09:58.200 of injection while permitting and build on that knowledge. 00:09:58.200 --> 00:10:00.689 So we're going to draw contrast 00:10:00.689 --> 00:10:04.170 to the typical injection disposal permit application process 00:10:04.170 --> 00:10:07.730 and draw contrast to what you would have heard 00:10:07.730 --> 00:10:11.150 in the presentation this morning if you attended it. 00:10:11.150 --> 00:10:13.290 We'll discuss the standard for permit issuance, 00:10:13.290 --> 00:10:15.700 some typical salt storage terms, 00:10:15.700 --> 00:10:18.590 what salt storage and storage wells look like, 00:10:18.590 --> 00:10:21.150 have notice and hearing, area of review, 00:10:21.150 --> 00:10:23.280 and freshwater protection could be different 00:10:23.280 --> 00:10:25.260 from the usual process, 00:10:25.260 --> 00:10:27.383 usual application permitting process, 00:10:28.500 --> 00:10:30.770 and we will discuss the structure and geology, 00:10:30.770 --> 00:10:33.713 cavern integrity, and Rule 95 safety section. 00:10:44.880 --> 00:10:47.400 Underground storage of oil must do four things. 00:10:47.400 --> 00:10:50.730 It must not waste oil or otherwise allowed to escape, 00:10:50.730 --> 00:10:52.510 it must not pollute freshwater, 00:10:52.510 --> 00:10:55.260 and it must not endanger lives or property. 00:10:55.260 --> 00:10:57.300 This is the standard that we will look for 00:10:57.300 --> 00:11:00.100 when we decide whether or not an application for permit 00:11:00.100 --> 00:11:01.343 should be approved. 00:11:11.570 --> 00:11:14.670 We have some common terms we use 00:11:14.670 --> 00:11:17.150 when referring to the process of removing salt 00:11:17.150 --> 00:11:19.330 by dissolution from a salt structure. 00:11:19.330 --> 00:11:21.600 Some terms are generally understood, 00:11:21.600 --> 00:11:24.090 and don't need to be defined by a statute or rule. 00:11:24.090 --> 00:11:26.330 The term "solution mining" and "leaching a cavern" 00:11:26.330 --> 00:11:27.530 are like this. 00:11:27.530 --> 00:11:32.530 When we tend to say leaching for storage and mining 00:11:32.970 --> 00:11:35.340 for brine mining to try to distinguish 00:11:35.340 --> 00:11:37.820 between the two different purposes and rules, 00:11:37.820 --> 00:11:39.890 but they're both solution mining. 00:11:39.890 --> 00:11:42.560 The term brine mining injection well 00:11:42.560 --> 00:11:44.810 does have a specific rule definition however, 00:11:44.810 --> 00:11:46.080 and it's important to understand 00:11:46.080 --> 00:11:47.803 how that impacts our regulation. 00:11:55.170 --> 00:11:58.140 This Venn diagram illustrates the relationship 00:11:58.140 --> 00:12:00.500 between different purposes of solution mining 00:12:00.500 --> 00:12:01.800 and how they're regulated. 00:12:03.930 --> 00:12:07.360 To grow a storage cavern, you have to solution mine 00:12:07.360 --> 00:12:08.720 to make the void space. 00:12:08.720 --> 00:12:11.800 This is the physical operation and solution mining of salt 00:12:11.800 --> 00:12:13.933 is just one kind of solution mining. 00:12:14.900 --> 00:12:18.330 We have a couple Commission rules for solution mining. 00:12:18.330 --> 00:12:20.390 So which rule do we fill under? 00:12:20.390 --> 00:12:23.620 Is it brine mining under Statewide Rule 81? 00:12:23.620 --> 00:12:26.193 Or is it leaching for storage under Rule 95. 00:12:27.040 --> 00:12:29.160 We're solution mining under both rules 00:12:29.160 --> 00:12:31.540 doing basically the same physical operation. 00:12:31.540 --> 00:12:35.060 So then it's about the purpose for the solution mining. 00:12:35.060 --> 00:12:37.390 If the applicant states that the solution mining 00:12:37.390 --> 00:12:39.970 is for the purpose of making a void space 00:12:39.970 --> 00:12:41.820 for storage or disposal, 00:12:41.820 --> 00:12:44.580 then it is not brine mining by definition. 00:12:44.580 --> 00:12:47.650 Otherwise, we say that the operation is brine mining. 00:12:47.650 --> 00:12:49.380 The applicant is responsible of course 00:12:49.380 --> 00:12:51.260 for applying for the correct permit 00:12:51.260 --> 00:12:53.350 for their solution mining purpose. 00:12:53.350 --> 00:12:56.780 If the business purpose of the solution mining changes, 00:12:56.780 --> 00:13:01.090 for example, you begin for the purposes of brine mining 00:13:01.090 --> 00:13:04.200 but didn't want to use the cavern for storage or disposal, 00:13:04.200 --> 00:13:06.100 then the applicable rule changes 00:13:06.100 --> 00:13:08.030 and you have to apply for a new permit 00:13:08.030 --> 00:13:09.470 under the applicable rule. 00:13:20.460 --> 00:13:23.920 This illustration shows the salt dome in light blue, 00:13:23.920 --> 00:13:26.970 which is a salt structure that has pushed its way up 00:13:26.970 --> 00:13:29.180 through more dense geologic strata, 00:13:29.180 --> 00:13:31.730 and stopped at some depth when it reached buoyancy. 00:13:33.070 --> 00:13:35.420 Salt domes often have a shape like a lava lamp, 00:13:37.260 --> 00:13:40.750 lava lamp makes, where they have a bulbous head at the top 00:13:40.750 --> 00:13:43.100 and a slightly narrower stalk. 00:13:43.100 --> 00:13:46.170 There's cap rock immediately above that is often altered 00:13:46.170 --> 00:13:47.720 and very porous. 00:13:47.720 --> 00:13:50.350 Salt is essentially impermeable, 00:13:50.350 --> 00:13:52.983 but can be easily dissolved with unsaturated water. 00:13:55.600 --> 00:14:00.000 We can hollow out a void in salt with injected water. 00:14:00.000 --> 00:14:03.370 Then we can use that void to store other fluids, 00:14:03.370 --> 00:14:05.680 and we use storage wells to transmit fluids 00:14:05.680 --> 00:14:06.930 in and out of the cavern. 00:14:08.420 --> 00:14:10.750 Finally, I think it's always important 00:14:10.750 --> 00:14:13.330 to get a sense of scale when we talk about storage 00:14:13.330 --> 00:14:16.440 because storage caverns and salt domes 00:14:16.440 --> 00:14:18.730 are just unbelievably big. 00:14:18.730 --> 00:14:21.870 So here we can see that this particular salt cavern 00:14:21.870 --> 00:14:24.100 is about 1000 feet tall, 00:14:24.100 --> 00:14:26.570 which is big enough to fit the Eiffel Tower. 00:14:26.570 --> 00:14:29.240 Of course, the salt dome is even bigger than that. 00:14:29.240 --> 00:14:32.230 So we may have many Eiffel Tower sized caverns 00:14:32.230 --> 00:14:33.437 inside one dome, 00:14:33.437 --> 00:14:36.020 and 1000 feet tall wouldn't even be the tallest 00:14:36.020 --> 00:14:37.170 of our storage caverns. 00:14:37.170 --> 00:14:38.520 They're really, really big. 00:14:58.650 --> 00:15:00.640 Storage wells are typically more complicated 00:15:00.640 --> 00:15:02.470 than your standard injection disposal well, 00:15:02.470 --> 00:15:04.380 or oil or gas well. 00:15:04.380 --> 00:15:06.230 There are two basic reasons for this. 00:15:07.180 --> 00:15:08.240 They're bigger, 00:15:08.240 --> 00:15:11.670 and they're designed to get fluids in and out. 00:15:11.670 --> 00:15:13.660 The wells have to be bigger to address demand 00:15:13.660 --> 00:15:14.823 and operate safely. 00:15:15.870 --> 00:15:18.210 Therefore, the diameter of a storage well 00:15:18.210 --> 00:15:20.340 maybe 36 inches wide 00:15:20.340 --> 00:15:22.460 compared to a typical injection disposal well 00:15:22.460 --> 00:15:24.000 or an oil gas well, 00:15:24.000 --> 00:15:26.540 which are more often around nine or 13 inches wide 00:15:27.440 --> 00:15:29.633 at its largest casing. 00:15:31.330 --> 00:15:33.730 Storage wells typically have a casing string 00:15:33.730 --> 00:15:35.130 and a hanging string, 00:15:35.130 --> 00:15:38.170 so that they can inject brine through the hanging string 00:15:38.170 --> 00:15:40.610 and produce oil from the casing string. 00:15:40.610 --> 00:15:43.390 This diagram to the right is even a little more complicated 00:15:43.390 --> 00:15:44.240 than that. 00:15:44.240 --> 00:15:47.073 It has a casing string that is open to the oil pad, 00:15:48.080 --> 00:15:49.750 you can see that in black, 00:15:49.750 --> 00:15:51.803 and then it has to hanging strings. 00:15:52.680 --> 00:15:55.430 Unfortunately, you can't see the bottom of the casing string 00:15:55.430 --> 00:15:58.740 on this diagram since the oil pad is also colored black, 00:15:58.740 --> 00:16:02.513 but it's about even with the oil pad label on the diagram. 00:16:04.390 --> 00:16:06.700 The strings for injection and production 00:16:06.700 --> 00:16:08.380 are reversed in this case. 00:16:08.380 --> 00:16:10.900 The injection is occurring above the production 00:16:10.900 --> 00:16:12.950 because the well is leaching the cavern, 00:16:12.950 --> 00:16:14.750 not storing hydrocarbons. 00:16:14.750 --> 00:16:16.370 You can see the second hanging string 00:16:16.370 --> 00:16:21.181 extends down into the brine and the brine shown in green 00:16:21.181 --> 00:16:25.020 to produce the brine, while freshwater shown in blue 00:16:26.020 --> 00:16:28.710 is injected above the second hanging string 00:16:28.710 --> 00:16:32.073 through the first hanging string to solution mine the salt. 00:16:34.370 --> 00:16:39.170 Some caverns may not have a single well performing injection 00:16:39.170 --> 00:16:42.380 and production, but instead use two wells to perform 00:16:43.300 --> 00:16:45.380 both operations. 00:16:45.380 --> 00:16:47.780 It's important to be able to inject and produce 00:16:47.780 --> 00:16:52.010 at the same time so that the operator can displace fluids 00:16:52.010 --> 00:16:53.500 in the storage cavern. 00:16:53.500 --> 00:16:58.160 This way, the operator won't under pressure as the cavern 00:16:58.160 --> 00:16:59.680 is keeping a balance 00:17:17.143 --> 00:17:19.220 Notice and hearing requirements for storage 00:17:19.220 --> 00:17:20.420 are a bit more rigorous 00:17:20.420 --> 00:17:23.260 than for a typical injection disposal well. 00:17:23.260 --> 00:17:26.320 You must notify a surface and adjacent tract owners 00:17:26.320 --> 00:17:28.450 like you would with a commercial disposal well, 00:17:28.450 --> 00:17:32.820 but also all oil, gas, and salt leaseholders on the surface 00:17:32.820 --> 00:17:34.320 and adjacent tracks. 00:17:34.320 --> 00:17:36.840 Then, instead of one publication, 00:17:36.840 --> 00:17:38.820 you have to run the published notice once a week 00:17:38.820 --> 00:17:41.110 for three consecutive weeks. 00:17:41.110 --> 00:17:43.460 Finally, all new storage facilities 00:17:43.460 --> 00:17:45.430 are required to have a hearing by rule. 00:17:45.430 --> 00:17:48.230 However, the May 5th, 2020 Order 00:17:48.230 --> 00:17:50.890 suspended that hearing requirement for one year 00:18:01.560 --> 00:18:04.280 How is the area of review or AOR different 00:18:04.280 --> 00:18:08.122 from a typical injection disposal well application? 00:18:08.122 --> 00:18:11.220 Well, it's based on the extent of the storage 00:18:11.220 --> 00:18:14.200 instead of treating the well like a point location. 00:18:14.200 --> 00:18:17.040 And in addition to the typical well list, 00:18:17.040 --> 00:18:19.540 you have to identify all storage facilities 00:18:20.718 --> 00:18:22.413 within a quarter mile also. 00:18:23.890 --> 00:18:25.910 Buffering a quarter mile from the storage limits 00:18:25.910 --> 00:18:27.830 can be a little bit of a complicated task, 00:18:27.830 --> 00:18:31.790 so often the AOR we get is like this image here. 00:18:31.790 --> 00:18:36.130 Facility is outlined in a dusty highlighter, yellow, 00:18:36.130 --> 00:18:39.310 and they've shown every storage facility 00:18:39.310 --> 00:18:41.010 and well in the vicinity, 00:18:41.010 --> 00:18:43.740 and the boundaries of all the storage on the salt dome 00:18:43.740 --> 00:18:44.663 for good measure. 00:18:58.490 --> 00:19:00.320 Just like injection disposal wells 00:19:00.320 --> 00:19:03.550 and all oil and gas operations generally, 00:19:03.550 --> 00:19:05.470 you must protect fresh water. 00:19:05.470 --> 00:19:07.560 Statewide Rule 13, which sets standards 00:19:07.560 --> 00:19:09.870 for well construction applies to storage wells 00:19:09.870 --> 00:19:13.410 just like all other wells under our jurisdiction. 00:19:13.410 --> 00:19:17.040 Additionally, Rule 95 requires all outer casing strings 00:19:17.040 --> 00:19:18.660 to be submitted to surface. 00:19:18.660 --> 00:19:21.450 This adds an additional layer of protection for freshwater 00:19:21.450 --> 00:19:23.620 for many fluids that could potentially come up 00:19:23.620 --> 00:19:24.833 or around the wellbore. 00:19:25.760 --> 00:19:28.270 Finally, geologic isolation 00:19:28.270 --> 00:19:30.830 is not a common permit application deficiency 00:19:30.830 --> 00:19:32.890 since the storage is occurring in salt, 00:19:32.890 --> 00:19:34.690 and salt as essentially impermeable. 00:19:35.720 --> 00:19:38.710 Plus adequate storage you can find fluids in all directions, 00:19:38.710 --> 00:19:41.250 so there is substantial financial incentive 00:19:41.250 --> 00:19:43.500 to ensure no loss of product. 00:19:43.500 --> 00:19:46.500 However, there are substantial geologic concerns 00:19:46.500 --> 00:19:48.163 for cavern storage in salt. 00:19:56.030 --> 00:20:00.010 A cavern is of course at its most basic definition, 00:20:00.010 --> 00:20:01.370 just a hole. 00:20:01.370 --> 00:20:03.090 It can serve as storage 00:20:03.090 --> 00:20:05.340 if its boundaries aren't compromised, 00:20:05.340 --> 00:20:08.370 or unfortunately, it can serve as a conveyance 00:20:08.370 --> 00:20:10.340 if it loses integrity. 00:20:10.340 --> 00:20:13.160 Therefore, you must submit information 00:20:13.160 --> 00:20:15.680 to demonstrate the thickness, continuity, 00:20:15.680 --> 00:20:17.890 and structure of the salt to ensure that 00:20:17.890 --> 00:20:21.283 the cavern can be safely created without operated, 00:20:24.310 --> 00:20:26.290 can be safely created and operated 00:20:26.290 --> 00:20:28.910 without intersecting the edge of the salt, 00:20:28.910 --> 00:20:31.860 and to demonstrate that there are no faults, fractures, 00:20:31.860 --> 00:20:34.410 or other features that could compromise the cavern. 00:20:48.620 --> 00:20:50.890 This leads us to the concept of cavern integrity 00:20:50.890 --> 00:20:51.730 or stability. 00:20:51.730 --> 00:20:54.480 Caverns can be compromised several ways. 00:20:54.480 --> 00:20:57.280 The cavern can close up through precipitation of the brine 00:20:57.280 --> 00:20:58.683 back into solid salt. 00:20:59.860 --> 00:21:02.240 The cavern can be compromised 00:21:02.240 --> 00:21:04.993 so that it can no longer hold fluids and pressure. 00:21:06.470 --> 00:21:08.980 Two caverns that are too close together can coalesce 00:21:08.980 --> 00:21:10.463 to become one large cavern. 00:21:11.560 --> 00:21:13.550 The roof can become structurally unstable 00:21:13.550 --> 00:21:15.260 and cause collapse, 00:21:15.260 --> 00:21:17.873 the casing shoe bond could become compromised. 00:21:19.010 --> 00:21:21.380 And lastly, we can use surface collapse 00:21:21.380 --> 00:21:22.833 and the example on the right. 00:21:24.390 --> 00:21:27.210 And lastly, we can cause surface collapse. 00:21:27.210 --> 00:21:28.540 Excuse me. 00:21:28.540 --> 00:21:31.640 In the example on the right, we see a storage well 00:21:31.640 --> 00:21:33.770 that might have seemed to be a safe distance 00:21:33.770 --> 00:21:35.870 from the edge of the salt dome at the top. 00:21:37.200 --> 00:21:40.860 But at depth, the salt dome is narrower, 00:21:40.860 --> 00:21:44.630 and the cavern intersected the salt dome's edge 00:21:44.630 --> 00:21:46.470 while it was leaching. 00:21:46.470 --> 00:21:49.170 This obviously compromised the cavern, 00:21:49.170 --> 00:21:51.850 but it also allowed sediments to enter the void space 00:21:51.850 --> 00:21:55.363 causing a geologic collapse and sinkhole at the surface. 00:21:58.370 --> 00:22:00.830 This is why rigorous review and testing of cavern walls 00:22:00.830 --> 00:22:01.910 is needed. 00:22:01.910 --> 00:22:03.690 Mechanical integrity testing 00:22:03.690 --> 00:22:06.103 that is performed every five years on storage wells 00:22:06.103 --> 00:22:08.870 is a nitrogen-brine interface test. 00:22:08.870 --> 00:22:10.760 Although the test is very different 00:22:10.760 --> 00:22:12.230 from a standard well pressure test, 00:22:12.230 --> 00:22:14.170 the concept is very similar. 00:22:14.170 --> 00:22:16.820 Instead of pressuring up the tubing casing annulus 00:22:16.820 --> 00:22:18.660 to ensure the well has integrity, 00:22:18.660 --> 00:22:21.160 you have to pressure up the entire storage cavern. 00:22:25.010 --> 00:22:28.270 Casing shoe bond test is required as part of the MIT 00:22:28.270 --> 00:22:31.210 and sonar surveys are performed to ensure that 00:22:31.210 --> 00:22:33.610 the shape of the cavern is understood over time. 00:22:52.170 --> 00:22:53.580 This is a picture of the sinkhole 00:22:53.580 --> 00:22:55.410 that resulted from that diagram. 00:22:55.410 --> 00:22:57.890 From this far away, it kind of looks like a mud pit 00:22:57.890 --> 00:23:01.450 or land farm, or maybe just barren land, 00:23:01.450 --> 00:23:04.530 but actually all the trees and anything else that were there 00:23:04.530 --> 00:23:06.600 were essentially swallowed up by this sinkhole. 00:23:06.600 --> 00:23:09.890 The sinkhole at this stage covered about an acre. 00:23:09.890 --> 00:23:12.550 So it was about 100 feet across, 00:23:12.550 --> 00:23:15.913 but it grew to encompass 37 acres. 00:23:35.250 --> 00:23:36.910 I'm not gonna discuss each and every one 00:23:36.910 --> 00:23:37.950 of these bullet points. 00:23:37.950 --> 00:23:40.450 Each one is a subtitle and subsection 00:23:40.450 --> 00:23:44.970 under Statewide Rule 95H, which is all about safety. 00:23:44.970 --> 00:23:46.940 These facilities can be dangerous 00:23:47.920 --> 00:23:51.210 if not regulated, and properly operated. 00:23:51.210 --> 00:23:53.660 They're storing flammable liquids at pressure 00:23:53.660 --> 00:23:55.240 and are huge engineering feats 00:23:55.240 --> 00:23:57.610 with serious consequences if something goes wrong. 00:23:57.610 --> 00:24:00.630 So the rule takes safety very seriously. 00:24:00.630 --> 00:24:02.810 I encourage you to read the rule to make sure that 00:24:02.810 --> 00:24:05.510 each one of these safety subsections is addressed. 00:24:05.510 --> 00:24:07.380 It's also important to note that 00:24:07.380 --> 00:24:09.940 most of these safety features must be in place 00:24:09.940 --> 00:24:12.383 before storage operations can begin. 00:24:26.260 --> 00:24:29.100 We don't have published amendment guidance 00:24:29.100 --> 00:24:31.620 to reduce application requirements like we do 00:24:31.620 --> 00:24:34.163 for injection disposal permit applications. 00:24:36.600 --> 00:24:38.870 For injection disposal permit applications, 00:24:38.870 --> 00:24:40.617 we have a web page that says, 00:24:40.617 --> 00:24:42.387 "Under this sort of amendment, 00:24:42.387 --> 00:24:44.017 "you only need to submit these things 00:24:44.017 --> 00:24:45.967 "or these things are really important." 00:24:47.224 --> 00:24:49.770 We will be working on broad storage guidance 00:24:49.770 --> 00:24:52.260 in the next year and publishing that to the web. 00:24:52.260 --> 00:24:54.810 Typically, we get permit amendment applications 00:24:54.810 --> 00:24:57.693 that are essentially a full new application for storage. 00:24:59.000 --> 00:25:01.900 The two main reasons people Want to amend their permits 00:25:01.900 --> 00:25:05.960 is to add a new cavern, increase carrying capacity, 00:25:05.960 --> 00:25:08.710 or change the injection pressure rate. 00:25:08.710 --> 00:25:11.400 Additionally, you can expect that 00:25:11.400 --> 00:25:12.740 we will do a compliance check 00:25:12.740 --> 00:25:15.283 just like we do for injection disposal permits. 00:25:16.480 --> 00:25:19.550 Unlike injection disposal permits, you are not as restricted 00:25:19.550 --> 00:25:21.880 to what you can inject by the permit. 00:25:21.880 --> 00:25:23.960 You can inject any liquid hydrocarbon 00:25:23.960 --> 00:25:27.140 under the Commission's jurisdiction. 00:25:27.140 --> 00:25:29.570 So, if you have a storage well 00:25:29.570 --> 00:25:31.690 storing other liquid hydrocarbons, 00:25:31.690 --> 00:25:34.046 you can enter your cavern and start storing oil 00:25:34.046 --> 00:25:35.290 as soon as you're ready. 00:25:35.290 --> 00:25:38.820 That being said, you should of course make sure that 00:25:38.820 --> 00:25:41.040 you don't have any outstanding regulatory requirements 00:25:41.040 --> 00:25:43.000 like reports, testing or safety equipment 00:25:43.000 --> 00:25:45.450 before commencing or changing storage operations. 00:26:00.280 --> 00:26:02.367 Now we're going to begin discussing oil storage 00:26:02.367 --> 00:26:04.763 and geologic formations other than salt. 00:26:05.890 --> 00:26:08.740 First things, the May 5th, 2020 Order 00:26:08.740 --> 00:26:12.810 allowed applications to be submitted for this purpose 00:26:12.810 --> 00:26:16.440 for one year, and that permitted facility can store oil 00:26:16.440 --> 00:26:17.840 for up to five years. 00:26:17.840 --> 00:26:20.450 The order also suspended the requirement for hearing 00:26:20.450 --> 00:26:21.833 on new storage permits. 00:26:23.360 --> 00:26:26.430 Storage of liquids, including crude oil 00:26:26.430 --> 00:26:30.070 into formations other than salt is not common. 00:26:30.070 --> 00:26:33.440 We do not have rules in Texas that explicitly allow for it. 00:26:33.440 --> 00:26:35.780 That's why the May 5th order was issued. 00:26:35.780 --> 00:26:39.290 The good news is, our existing rules especially Rule 95 00:26:39.290 --> 00:26:40.900 gives us a good start on how to think 00:26:40.900 --> 00:26:43.120 about permitting this kind of storage. 00:26:43.120 --> 00:26:45.790 We created a web page with application guidelines 00:26:45.790 --> 00:26:49.760 for oil storage not into salt to fill in the gaps. 00:26:49.760 --> 00:26:52.990 So the rest of the slides today will be clarifications 00:26:52.990 --> 00:26:56.000 to our standard salt storage permitting process 00:26:56.000 --> 00:26:57.740 for oil storage not in salt 00:27:10.010 --> 00:27:12.410 Here's a screenshot of the top of the web page 00:27:12.410 --> 00:27:15.740 that we created where you can find this guidance. 00:27:15.740 --> 00:27:19.960 At the top of the PowerPoint slide, there is the URL 00:27:19.960 --> 00:27:22.870 in case this presentation gets distributed in a format 00:27:22.870 --> 00:27:25.370 where you're not able to click the link. 00:27:25.370 --> 00:27:28.060 On the Application Guidelines page in the first sentence, 00:27:28.060 --> 00:27:29.700 there's also a link to the May 5th Order 00:27:29.700 --> 00:27:31.653 if you want to read that text yourself. 00:27:43.670 --> 00:27:45.420 This is the basic outline 00:27:45.420 --> 00:27:48.500 of the Application Guidelines webpage. 00:27:48.500 --> 00:27:50.500 You can see the items that we're gonna discuss 00:27:50.500 --> 00:27:52.690 over the next slides in bold. 00:27:52.690 --> 00:27:54.980 We're discussing these specifically 00:27:54.980 --> 00:27:56.830 because they may be substantially different 00:27:56.830 --> 00:28:00.660 from the typical injection permit or storage permit process. 00:28:00.660 --> 00:28:03.490 The first thing we're going to do is address inconsistencies 00:28:03.490 --> 00:28:05.130 in the form H-4, 00:28:05.130 --> 00:28:08.633 which assumes that the storage medium is salt. 00:28:14.170 --> 00:28:17.110 First you need to submit a form H-4 to store oil 00:28:17.110 --> 00:28:21.070 regardless of what geologic formations it's in salt or not. 00:28:21.070 --> 00:28:25.403 However, the terms on the H-4 assume a salt cavern. 00:28:26.260 --> 00:28:28.390 We can successfully use the form H-4 00:28:28.390 --> 00:28:30.970 for storage and formations other than salt 00:28:30.970 --> 00:28:33.110 with a few tweaks in our understanding 00:28:33.110 --> 00:28:36.093 of what the terms mean for storage, not in salt. 00:28:37.430 --> 00:28:39.780 You don't need to fill out Item 12 on the form. 00:28:40.840 --> 00:28:43.563 For Items 13 through 16, 00:28:44.540 --> 00:28:46.582 you need to identify the storage reservoir 00:28:46.582 --> 00:28:48.400 or geologic formation, 00:28:48.400 --> 00:28:51.040 and provide the top and bottom of the storage reservoir 00:28:51.040 --> 00:28:52.293 or geologic formation. 00:28:53.800 --> 00:28:57.680 For Items 17 and 18, you can assume that "Cavity" 00:28:57.680 --> 00:28:59.703 instead means storage well. 00:29:00.550 --> 00:29:03.010 Please submit a well table as an attachment 00:29:03.010 --> 00:29:05.510 if you're applying for more than one storage well. 00:29:07.820 --> 00:29:10.801 For Item 19, assume that "Cavity" means 00:29:10.801 --> 00:29:14.000 the top and bottom of the injection interval 00:29:14.000 --> 00:29:16.373 and capacity is not applicable. 00:29:28.140 --> 00:29:28.973 Feasibility. 00:29:29.810 --> 00:29:32.993 Can you put the oil in and can you get it back? 00:29:33.910 --> 00:29:36.790 Some of these items are already clearly required 00:29:36.790 --> 00:29:40.060 by Statewide Rule 95 or the form H-4. 00:29:40.060 --> 00:29:42.030 However, at the risk of duplication, 00:29:42.030 --> 00:29:44.670 we need to highlight or clarify a few items 00:29:44.670 --> 00:29:48.380 for storage of oil and geologic formations other than salt. 00:29:48.380 --> 00:29:52.140 Then, there are some items here that must be addressed 00:29:52.140 --> 00:29:53.743 because Rule 95 or the form H-4 00:29:53.743 --> 00:29:56.333 assumes that the storage will be in salt. 00:30:01.190 --> 00:30:04.700 Generally, these items are highlighted 00:30:04.700 --> 00:30:08.330 because we anticipate that the responsive information 00:30:08.330 --> 00:30:10.310 could be substantially different 00:30:10.310 --> 00:30:13.673 than from typical storage permit applications. 00:30:14.950 --> 00:30:15.883 Fluid data. 00:30:17.070 --> 00:30:20.470 Storing and injecting fluid into a salt void 00:30:20.470 --> 00:30:23.920 versus storing these fluids in geologic pore space 00:30:23.920 --> 00:30:25.300 is very different. 00:30:25.300 --> 00:30:28.620 So we need to know how the fluids will act in the pore space 00:30:28.620 --> 00:30:30.183 you're proposing for storage. 00:30:45.570 --> 00:30:50.500 Engineering, this is not my specialty since I'm geologists. 00:30:50.500 --> 00:30:53.820 However, our storage lead an engineer Scott Rosenquist 00:30:53.820 --> 00:30:55.700 has put this list together 00:30:55.700 --> 00:30:58.390 to ensure that injection into geologic pore space 00:30:58.390 --> 00:31:01.383 and retrieval from it is feasible and safe. 00:31:02.370 --> 00:31:04.970 Also, that we understand how much oil 00:31:04.970 --> 00:31:07.080 this reservoir is capable of storing, 00:31:07.080 --> 00:31:10.080 and how much oil will ultimately be lost to the reservoir 00:31:10.080 --> 00:31:13.460 since physical forces keep some oil ultimately trapped 00:31:13.460 --> 00:31:15.593 on grains of sediment forever. 00:31:46.290 --> 00:31:48.500 Confinement, a storage reservoir 00:31:48.500 --> 00:31:50.453 must be bounded on all sides. 00:31:51.680 --> 00:31:54.320 Geology, this is really no different 00:31:54.320 --> 00:31:56.370 than the requirement for salt storage, 00:31:56.370 --> 00:31:58.570 but because the storage reservoir 00:31:58.570 --> 00:32:00.690 is not a void space being created 00:32:00.690 --> 00:32:04.600 in an essentially impermeable geologic formation, 00:32:04.600 --> 00:32:07.440 the geologic analysis to demonstrate 00:32:07.440 --> 00:32:09.590 that the reservoir is bounded on all sides 00:32:09.590 --> 00:32:10.763 will be very different. 00:32:11.770 --> 00:32:14.800 For example, reservoir gas storage has been permitted 00:32:14.800 --> 00:32:16.540 in depleted reservoirs 00:32:18.308 --> 00:32:23.308 and in an igneous intrusion creating a geologic boundary 00:32:23.530 --> 00:32:27.550 between the reservoir and adjacent sedimentary formations 00:32:27.550 --> 00:32:30.500 similar in some ways to a salt dome, 00:32:30.500 --> 00:32:33.470 and it has been permitted into depleted reservoirs 00:32:33.470 --> 00:32:34.940 bounded by faults. 00:32:34.940 --> 00:32:36.870 The reservoir traps were sufficient 00:32:36.870 --> 00:32:39.610 to collect gas over geologic time. 00:32:39.610 --> 00:32:40.600 And so the assumption is 00:32:40.600 --> 00:32:42.890 that they can also store injected gas. 00:32:42.890 --> 00:32:45.690 However, conditions for storage 00:32:45.690 --> 00:32:48.616 of hydrocarbon injecting under pressure 00:32:48.616 --> 00:32:53.510 a natural phenomenon that occur over geologic time 00:32:53.510 --> 00:32:55.620 can be very different. 00:32:55.620 --> 00:32:58.373 Therefore, confinement must be demonstrated. 00:33:11.370 --> 00:33:15.010 Operations, again the engineering of storage 00:33:15.010 --> 00:33:17.730 could compromise the storage reservoir itself. 00:33:17.730 --> 00:33:21.590 If injection of the fluid exceeds the fracture gradient, 00:33:21.590 --> 00:33:23.790 fractures will be created that could compromise 00:33:23.790 --> 00:33:25.980 the confining boundaries of the storage reservoir 00:33:25.980 --> 00:33:27.750 or the fluid itself, 00:33:27.750 --> 00:33:29.520 which may not be native to the formation 00:33:29.520 --> 00:33:31.820 could have physical interactions with the reservoir 00:33:31.820 --> 00:33:34.993 like dissolution that could compromise confinement. 00:33:36.370 --> 00:33:39.250 So, we need to know the physical parameters of the operation 00:33:39.250 --> 00:33:40.860 to ensure confinement will continue 00:33:40.860 --> 00:33:42.763 under the proposed storage operations. 00:33:43.970 --> 00:33:47.510 Testing, if there are going to be multiple wells 00:33:47.510 --> 00:33:49.460 and some will be designated for injection 00:33:49.460 --> 00:33:50.910 and some for production, 00:33:50.910 --> 00:33:52.850 then it's likely that a standard pressure test 00:33:52.850 --> 00:33:53.723 would suffice. 00:33:54.640 --> 00:33:56.800 However, we will need to understand 00:33:56.800 --> 00:33:59.690 exactly how MITs will be performed 00:33:59.690 --> 00:34:01.990 if the wells are going to be more complicated. 00:34:03.710 --> 00:34:05.640 Finally, we wanna make it clear that 00:34:05.640 --> 00:34:07.800 review of a permit application for oil storage 00:34:07.800 --> 00:34:10.160 into non salt formations is new 00:34:10.160 --> 00:34:12.280 and may require additional information 00:34:12.280 --> 00:34:14.823 and further review following initial application. 00:34:16.040 --> 00:34:18.440 We like to pretend but we don't know everything. 00:34:29.810 --> 00:34:33.570 The area of review or AOR for non-salt formations 00:34:34.660 --> 00:34:36.300 is likely to be more complicated 00:34:36.300 --> 00:34:39.750 than four an injection disposal well 00:34:39.750 --> 00:34:41.370 or even for salt storage 00:34:42.330 --> 00:34:44.770 although the standard is really the same 00:34:44.770 --> 00:34:46.740 as it is for salt storage. 00:34:46.740 --> 00:34:48.070 Since the boundaries of the storage 00:34:48.070 --> 00:34:50.270 may be determined by sedimentary boundaries 00:34:50.270 --> 00:34:53.820 or structural elements like faulting, 00:34:53.820 --> 00:34:57.050 the area of the AOR is likely to be more complex. 00:34:57.050 --> 00:34:58.500 In this particular example, 00:34:58.500 --> 00:35:00.490 you can see that the boundary of the reservoir 00:35:00.490 --> 00:35:02.340 is defined by ISO pack, 00:35:02.340 --> 00:35:05.670 showing zero feet of thickness of reservoir at the boundary, 00:35:05.670 --> 00:35:06.913 essentially a pinch out. 00:35:08.270 --> 00:35:10.820 So this very odd and unique shape 00:35:10.820 --> 00:35:13.230 would then have to be buffered by a quarter mile. 00:35:13.230 --> 00:35:16.580 And all wells within that shape would have to be identified 00:35:16.580 --> 00:35:18.190 and analyzed to ensure that 00:35:18.190 --> 00:35:19.983 they don't compromise the storage. 00:35:21.350 --> 00:35:25.110 As a geologist, I could just stare at this map forever, 00:35:25.110 --> 00:35:27.093 but alas, we must move on. 00:35:36.640 --> 00:35:39.780 The notice and hearing requirements for non-salt storage 00:35:41.700 --> 00:35:45.500 of oil are generally the same as those for salt storage. 00:35:45.500 --> 00:35:47.520 However, we wanted to make it clear 00:35:47.520 --> 00:35:50.180 that if for some reason the extend to the storage reservoir 00:35:50.180 --> 00:35:52.150 goes beyond the surface track 00:35:52.150 --> 00:35:54.473 that you notify all applicable persons. 00:35:55.370 --> 00:35:57.920 We've included this in our online guidance. 00:35:57.920 --> 00:36:00.270 Also included in our online guidance 00:36:00.270 --> 00:36:03.110 is a section called Publication Guides. 00:36:03.110 --> 00:36:04.893 This walks you through the, 00:36:05.910 --> 00:36:08.010 it walks you through how to prepare your publication 00:36:08.010 --> 00:36:11.380 to make sure it meets our standards for review. 00:36:11.380 --> 00:36:16.380 Finally, well, the de facto hearing requirement for storage 00:36:16.460 --> 00:36:18.710 was suspended by the May 5th Order, 00:36:18.710 --> 00:36:20.920 it is important to remember that a hearing 00:36:20.920 --> 00:36:24.030 still may be required if the application is protested 00:36:24.030 --> 00:36:25.530 or is administratively denied. 00:36:40.640 --> 00:36:42.060 Thanks for participating today. 00:36:42.060 --> 00:36:44.290 I'd like to thank Scott, our storage lead 00:36:44.290 --> 00:36:47.480 and Rick Rosso, who is my permit tech manager. 00:36:47.480 --> 00:36:49.930 If you have any permitting questions after today, 00:36:51.160 --> 00:36:52.223 I know we always, 00:36:54.260 --> 00:36:55.620 maybe our minds are kind of blank 00:36:55.620 --> 00:36:58.640 as things are kind of being spoken to us 00:36:58.640 --> 00:37:01.100 but oftentimes I'm the other person 00:37:01.100 --> 00:37:03.910 you know 15 minutes after I lose the opportunity, 00:37:03.910 --> 00:37:05.500 I've got a question. 00:37:05.500 --> 00:37:06.780 You can send those to 00:37:08.800 --> 00:37:11.750 our UIC email inbox. 00:37:11.750 --> 00:37:14.603 It's uic@rrc.texas.gov. 00:37:16.970 --> 00:37:20.850 And we've actually got a new email address 00:37:20.850 --> 00:37:25.410 specific for permit information. 00:37:25.410 --> 00:37:28.160 We're accepting electronic applications 00:37:28.160 --> 00:37:33.160 in the UIC_Permits@rrc.texas.gov email address. 00:37:35.620 --> 00:37:38.190 And if you've got read letters 00:37:38.190 --> 00:37:41.310 or deficiency letters, any correspondence, 00:37:41.310 --> 00:37:42.970 you wanna protest an application, 00:37:42.970 --> 00:37:46.630 all of that can be sent to UIC_Permits@rrc.texas.gov. 00:37:51.130 --> 00:37:56.130 And I'm happy to answer any more questions in the Q&A chat. 00:37:57.460 --> 00:37:59.910 There haven't been any 00:38:01.130 --> 00:38:03.350 unanswered questions yet. 00:38:03.350 --> 00:38:05.820 I will add two things, 00:38:05.820 --> 00:38:08.873 questions that you may have on your mind. 00:38:11.890 --> 00:38:15.200 The permitting timeframe for storage wells 00:38:15.200 --> 00:38:18.663 is longer than it is for typical injection disposal wells. 00:38:19.620 --> 00:38:22.113 It's 90 days total. 00:38:25.705 --> 00:38:27.250 And so, 00:38:27.250 --> 00:38:29.880 storage operations being a little more complicated, 00:38:29.880 --> 00:38:32.630 it is expected that the review may take longer 00:38:32.630 --> 00:38:35.633 and so the rule allows us a total of 90 days. 00:38:36.630 --> 00:38:39.400 And the other thing I neglected to mention 00:38:39.400 --> 00:38:43.593 in the presentation is the cost although currently, 00:38:45.100 --> 00:38:47.390 all storage wells 00:38:49.980 --> 00:38:53.633 fees are suspended by the May 5th Order. 00:38:56.835 --> 00:38:57.668 The 00:38:58.810 --> 00:39:01.540 cost normally is $200 per well, 00:39:01.540 --> 00:39:06.540 or 500 if you include the 130% surcharge that we add on. 00:39:09.860 --> 00:39:11.680 And so basically the same 00:39:11.680 --> 00:39:15.763 as a H-1 Rule 46 well. 00:39:17.240 --> 00:39:19.830 And we have a question about whether or not 00:39:19.830 --> 00:39:24.580 we can use the UIC permits email for H-1s and W14s, 00:39:24.580 --> 00:39:25.923 and the answer is yes. 00:39:26.920 --> 00:39:31.920 So any permit information for injection disposal or storage, 00:39:32.830 --> 00:39:36.450 you can send to that email applications, 00:39:36.450 --> 00:39:38.720 correspondence, protests, like I said, 00:39:38.720 --> 00:39:39.763 all of that works. 00:39:44.920 --> 00:39:47.237 Okay, so since there are no other questions, 00:39:47.237 --> 00:39:49.190 and that concludes our webinar. 00:39:49.190 --> 00:39:50.023 Thank you, Sean, 00:39:50.023 --> 00:39:52.593 and thank you everyone so much for participating. 00:39:54.410 --> 00:39:55.360 Thank you.