Stoel Rives attorneys Michael Mills and Eric Martin recently discussed Senate Bill 1139 in California Energy Markets. The bill addresses the regulation of enhanced oil recovery and carbon sequestration. Although some believe the bill is not comprehensive, it would close a few regulatory gaps and make it easier for companies to make project investment decisions.
The Department of Conservation's Division of Oil, Gas and Geothermal Resources (DOGGR) is tasked with overseeing CO2 injection for enhanced oil recovery. Under new leadership DOGGR is tackling a long to-do list that includes revising regulations including those pertaining to hydraulic fracturing, stepping up its Underground Injection Control (UIC) program and developing regulations for carbon injection in enhanced oil recovery applications. Mills noted that there is a lot for the agency to adapt to in such a short period of time.
Martin discussed the language of the bill with specific regard to pore-space ownership. He noted that although it is unclear whether the language is sufficient, the intent is to clarify ownership of pore space between the surface land owner and the mineral rights owner.
SB 1139 is scheduled to be taken up by the California Assembly Appropriations Committee in August.
Read the California Energy Markets articles (PDF)
"State Agency Faces Challenges in Regulating Carbon Sequestration," California Energy Markets, July 20, 2012
"CCS Bill Makes Headway," California Energy Markets, July 20, 2012