Management and Effects of Coalbed Methane Produced Water in the Western United States (2010) / Chapter Skim
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3 Regulatory Context for Coalbed Methane Produced Water Management
3 Regulatory Context for Coalbed Methane Produced Water Management
Pages 57-90
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From page 57... ...
This chapter reviews the significant statutory and regulatory provisions that address the management of CBM produced water in the six western states, with an aim to provide a foundation to understand the regulatory challenges of managing CBM produced water. Several recent changes to the regulatory framework affecting CBM operations in several states took place during the course of this study and the permitting processes for CBM production and CBM produced water management are continuing to evolve.
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From page 58... ...
In the western states a system of prior appropriation water rights is generally applied and water rights are treated in a similar way to rights to real property: rights to water are established by actual use of the water and are maintained by continued use and need. Water rights in the western states thus can be conveyed, mortgaged, transferred, and encumbered independent from the land on which the water originates or on which it is used, as dictated by state-specific water management regulations.
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From page 59... ...
.5 The relevance of instream flow for CBM produced water relates to managed discharge of some CBM produced water into perennial and ephemeral streams. See www.fws.gov/mountain-prairie/wtr/water_rights_def.htm (accessed March 9, 2010)
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From page 60... ...
S . TABLE 3.1 Approaches to Administering Water Rights and Managing CBM Produced Water in Six Western States North Dakota Montana Wyoming Water rights Prior appropriation Prior appropriation Prior appropriation doctrine; doctrine doctrine; all water is doctrine; all water is all natural waters within property of public, with property of the state of the state are property of water rights allocated for Montana, to be used for the state, with water rights beneficial uses the benefit of the people allocated for beneficial uses Designated Includes domestic, Defined as a use of Recognized beneficial uses beneficial municipal or public, water for the benefit include irrigation, municipal, uses livestock, irrigation, of the appropriator, industrial, power generation, industrial (including mining other persons, or the recreational stock, domestic, and manufacturing)
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From page 61... ...
have included aesthetics and preservation of natural environments, augmentation, commercial, domestic, fire protection, fishery, geothermal, groundwater recharge, industrial irrigation, livestock, minimum flow, municipal, power, recreation, silvicultural, snowmaking, wildlife watering, wildlife habitat, instream flow State divided into "groundwater Must obtain permit from State The State Engineer establishes and areas;" policies are similar Engineer to drill a well; if regulates water use in declared to surface water, but permit "tributary" to a surface stream, "underground water basins" approval criteria may differ by use of the groundwater falls to protect prior appropriation, area under the prior appropriation ensure water is put to beneficial system, and water rights must use, and maintain orderly obtained; in nontributary development of the state's water aquifers the water is allocated resources based on the percentage of land owned on the surface above the aquifer continued
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From page 62... ...
matters Agency North Dakota Department Montana Department Wyoming Department of responsible of Health, Environmental of Environmental Environmental Quality for produced Health Section: oversees Quality oversees surface Water Quality Division water water quality rules and discharges through NPDES oversees produced water management regulations, reviews and discharges; has primacy for and issues NPDES permits regulating UIC permits for permitting for surface discharges, Class I, III, and V wells and and administers the UIC groundwater monitoring program beneath impoundments; State Engineer's Office oversees construction permits for on-channel impoundments; Wyoming Oil and Gas Conservation Commission oversees construction permits for off-channel impoundments Agency North Dakota Industrial Montana Board of Oil and Wyoming Oil and Gas responsible Commission, through its Gas Conservation oversees Conservation Commission for CBM Oil and Gas Division oil and gas operations, responsible for permitting operation including those for CBM, oil and gas wells and UIC and and has been delegated permits for Class II reinjection permitting jurisdiction by EPA over wells on state and the UIC program for Class private land II wells See seo.state.wy.us/about.aspx (accessed July 8, 2010)
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From page 63... ...
administers and distributes the state's waters (water.state.co.us/) ; seven water courts oversee each major river basin Utah Department of One of three agencies: Oil Conservation Division of Environmental Quality Colorado Oil and Gas the New Mexico Department of Division of Water Quality Conservation Commission Energy, Minerals, and Natural (groundwater monitoring and (under Department of Natural Resources as delegated by compliance, groundwater Resources; State Engineer; the New Mexico Environment discharge permitting, surface Department of Public Health Department and its associated water quality and monitoring)
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From page 64... ...
The State Engineer's office in North Dakota, Wyoming, Utah, Colorado, and New Mexico and the Montana Department of Natural Resources and Conservation's Water Rights Bureau are charged with the development and appropriation of surface water and groundwater resources for the state. At the federal level the Bureau of Land Management (BLM)
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From page 65... ...
The BLM regulatory framework governing oil and gas operations for federal and tribal lands is contained in 43 CFR Part 3160 (Onshore Oil and Gas Operations) .8 BLM is required to take into account the provisions of the National Environmental Policy Act of 1969 (NEPA)
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From page 66... ...
Although the committee could not find a published map of the entire Powder River Basin that displayed all current CBM well operations relative to their distribution on private, state, or federal land, the maps in this figure demonstrate the shared responsibility for CBM leasing and produced water management among the various authorities. SOURCE: Adapted from Taber and Kinney (1999)
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From page 67... ...
published on November 2, 1993) , which applies to disposal of produced water from completed wells on federal and tribal oil and gas leases, whether from conventional oil and gas production or from CBM production.
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From page 68... ...
. • An application must be submitted for CBM water produced on federal lands that is to be disposed of "off-lease" on state and privately owned lands; a copy of the UIC permit for injection wells or pit permit may also be required (BLM, 1993)
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From page 69... ...
. EPA The EPA's involvement in water management and environmental regulation in the area of CBM produced water involves the CWA, which deals primarily with permitting of discharges to surface waters, and the SDWA, which deals with underground injection permitting and controls.
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From page 70... ...
and Ute Mountain Ute Tribe (near the western edge of the San Juan Basin) have received approval from EPA to administer water quality standards and certification programs, although these are not specific to CBM produced water issues (see also Appendix F)
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From page 71... ...
because no significant CBM production existed in 1979. Accordingly, these ELGs do not apply to CBM produced water discharges.
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From page 72... ...
The Montana Department of Environmental Quality, for example, under the guidance and directive of the EPA Region 8, has now established technology-based effluent limitations (TBEL) for any new CBM produced water NPDES permits (managed for the EPA by Montana and called Montana PDES, or MPDES)
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From page 73... ...
In accordance with the act, EPA is required to set standards for drinking water quality and to oversee all states, localities, and water suppliers that implement these standards. The SDWA also regulates the construction, operation, permitting, and closure of injection wells that place fluids underground for storage or disposal under its UIC program.
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From page 74... ...
Motivated by the growth of the CBM extraction industry and the potential impacts to surface waters from discharge of CBM produced water, the EPA began considering the potential to designate CBM extrac tion as a specific subcategory with its own guidelines under the Oil and Gas Effluent category of the CWA. A "detailed study" of the CBM extraction industry was therefore recently begun by EPA to consider the possibility of recommending such a designation for the CBM industry.
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From page 75... ...
NOTE: Class II wells are the most common of five classes of UIC wells used in the United States and include wells used for deep-well injection of CBM produced water, as well as for injection of brines remaining after water treatment (see also Chapter 6)
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From page 76... ...
State-specific approaches for regulating CBM produced water for the five states that presently have active CBM development are described below with respect to water rights issuance, CBM production permitting, and CBM water management. Produced water management for conventional oil and gas operations is described for North Dakota, where no CBM production presently occurs.
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From page 77... ...
The Montana Department of Natural Resources and Conservation (DNRC) oversees issues of water rights, the Montana DEQ oversees surface discharges through MPDES, and the Montana Board of Oil and Gas Conservation oversees oil and gas operations, including those for CBM, and has been delegated jurisdiction by EPA over the UIC program for Class II wells (see Table 3.1)
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From page 78... ...
Thus, under EPA regulations, point source discharge permits issued or authorized by Wyoming to waters in Wyoming and upstream from Montana must meet Montana water quality standards for the Tongue and Powder rivers, which flow northward into Montana from Wyoming. This assurance of water quality standards includes the tributaries to the Tongue and Powder rivers and is considered particularly important for purposes of irrigation by farmers and ranchers in southeastern Montana.22 In 2006 the Montana BER appended "nondegradation" provisions (also referred to as antidegradation provisions)
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From page 79... ...
The primary CBM produced water management options in the state include direct surface discharge, with or without treatment depending on water quality; reinjection (deep Montana Code Annotated § 85-2-205; see data.opi.state.mt.us/bills/mca/85/2/85-2-505.htm (accessed March 4, 24 2010)
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From page 80... ...
Monitoring requirements under the GPC program depend on depth to groundwater and water quality beneath the impoundment and the degree of hydrologic connection to surface water. 33 In April 2010, Wyoming DEQ released a new set of specific guidelines for compliance monitoring and siting requirements for unlined impoundments (on- and off-channel)
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From page 81... ...
A key foundation to the policy is management of the "assimilative capacity"34 of the Powder River. Of the chemical constituents in CBM produced water, TDS and sodium were the only ones identified with sufficient potential to exceed Montana water quality standards at the state line, and the Wyoming DEQ has therefore instituted a greater level of permitting oversight for these two constituents.
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From page 82... ...
However, in some circumstances the State Engineer's Office may authorize temporary water rights to allow produced waters from mining operations (including CBM produced water) to be put to beneficial use once it has been diverted from its underground location (Bryner, 2002)
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From page 83... ...
Beneficial use of produced water from a CBM well by the operator or another person requires compliance with the water rights acts of the state and requires a water well permit, issued by the State Engineer. A well permit for water from a CBM well presumes that the water is tributary, although the person may submit data to document that the water is nontributary (Wolfe and Graham, 2002)
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From page 84... ...
The plaintiffs were ranchers and landowners who own surface water rights in the basin, which they claimed could be impacted by water withdrawals related to CBM production. In affirming the Water Court's decision, the Colorado Supreme Court in Vance ruled that extraction of water through CBM wells constitutes beneficial use and an appropriation of water; thus, CBM wells that produce tributary water are subject to water well permitting, water court adjudication, and administration in Colorado's water rights priority system.
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From page 85... ...
oversees the main environmental protection laws for the state, including surface water quality through NPDES permits and issues related to watershed protection.43 The Water Quality Control Commission ( WQCC) , an administrative part of the NMED, has responsibility for enforcing the Water Quality Act and delegates authority for enforcing certain regulations under this act to the Oil Conservation Division (OCD)
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From page 86... ...
States and tribes may seek to establish their own water quality standards to serve the purposes of the CWA. Similarities among the six western states' approaches to produced water management, including CBM produced water where applicable, include provisions for appropriate siting, construction, and lining of impoundments.
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From page 87... ...
Recent changes, for example, in the case of Colorado court decisions regarding the "tributary" nature of produced water, and ongoing litigation related to Montana's challenge to Wyoming over priority water rights of the Powder River (and the need to honor stateinstituted water quality standards at the state boundary) , exemplify state-specific approaches about how produced water is perceived and the realization of a need for change in perspectives on water resource management.
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From page 88... ...
Bismarck: North Dakota Department of Health, Division of Water Quality. Available at www.ndhealth.gov/WQ/GW/pubs/swap.pdf (accessed March 4, 2010)
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From page 89... ...
2002. Water Rights and Beneficial Use of Coal Bed Methane Produced Water in Colorado.
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