Regulatory Requirements Associated with Drilling

Pending

State Requirements

Drilling on non-federal lands is primarily regulated by the Arkansas Oil and Gas Commission (AOGC) through a series of AOGC rules.

Rule B-1 – Application to Drill
Rule B-2 – Proof of Financial Responsibility Required to Be Furnished
Rule B-3 – Spacing of Wells
Rule B-5 – Submissions of Well Records and Issuance of Certificate of Compliance
Rule B-15 – Casing Requirements
Rule B-16 – Blow-Out Prevention
Rule B-30 – Deviation Tests

The application for drilling a well must be made on Form 2 – Notice of Intention to Drill for Oil or Gas

Reserve Pits

Jurisdiction over the reserve pit is shared between the AOGC and the Arkansas Department of Environmental Quality (ADEQ). In addition, the Arkansas Department of Health and Human Services (ADHHS) has the opportunity to review and comment on reserve pit applications. The requirements imposed by each agency are described below.

AOGC Requirements: The AOGC published the "Requirements for Pumping Reserve Pits into Wells." This is an unnumbered section appended to the end of the AOGC General Rules and Regulations. Operators must file Form 20 – Request for Disposal of Reserve Pit Fluids.

ADEQ Requirements: The relevant ADEQ regulatory requirements are found in Section 4 - Fluid Disposal and Section 5 – Pit Closure of the Oilfield Waste and Reserve Pit Requirements.

ADEQ prepared a general NPDES permit 00000-WG-P – Authorization to Construct, Operate, and Close the Pits Associated with Oil and Gas Well Exploration. To be covered under the general permit, companies would need to file a Notice of Intent form.

During updating of this page in June 2010, the ADEQ was contacted. An ongoing appeal of this permit was scheduled to be settled in the near future. Readers should check with the ADEQ to learn if any of the permit requirements have changed as a result of the appeal.

ADEQ also issues a permit for Land Application of Reserve Pit Drilling Fluids,Flow-Back Water and Produced Water.

ADHHS Requirements: The ADHHS reviews the reserve pit application forms filed with the AOGC. The ADHHS makes a determination whether the proposed location is in the watershed of a current drinking water supply. The ADHHS then issues an authorization to construct and operate a reserve pit. The authorization may include requirements relating to liner construction.

Federal Requirements

When the site preparation occurs on federal lands, companies must follow the relevant requirements from the Bureau of Land Management (BLM) Gold Book and Onshore Order No. 1.

Onshore Oil and Gas Order No. 1 describes the procedure for filing either an Application for Permit to Drill or Reenter (APD), Form 3160-3, or a Notice of Staking (NOS) followed by an APD.

With each copy of Form 3160–3, the operator must submit to the BLM either a Drilling Plan or reference a previously submitted field-wide drilling plan (a drilling plan that can be used for all wells in a field, with any differences for specific wells described in the APD specific to that well). The Drilling Plans must be sufficiently detailed to permit a complete appraisal of the technical adequacy of, and environmental effects associated with, the proposed project. The Drilling Plan must adhere to the provisions and standards of Onshore Oil and Gas Order Number 2 and, if applicable, Onshore Oil and Gas Order Number 6, and must include the following information:

a. Names and estimated tops of all geologic groups, formations, members, or zones.

b. Estimated depth and thickness of formations, members, or zones potentially containing usable water, oil, gas, or prospectively valuable deposits of other minerals that the operator expects to encounter, and the operator’s plans for protecting such resources.

c. The operator’s minimum specifications for blowout prevention equipment and diverter systems to be used. d. The operator’s proposed casing program.

e. The estimated amount and type(s) of cement expected to be used in the setting of each casing string.

f. Type and characteristics of the proposed circulating medium or media proposed for the drilling of each well-bore section, the quantities and types of mud and weighting material to be maintained, and the monitoring equipment to be used on the circulating system.

g. The testing, logging, and coring procedures proposed, including drill stem testing procedures, equipment, and safety measures.

h. The expected bottom-hole pressure and any anticipated abnormal pressures, temperatures, or potential hazards that the operator expects to encounter, such as lost circulation and hydrogen sulfide.

i. Any other facets of the proposed operation that the operator would like the BLM to consider in reviewing the application. Examples include, but are not limited to:

For directional wells, proposed directional design, plan view, and vertical section in true vertical and measured depths;
Horizontal drilling; and
Coil tubing operations.

A Well Completion or Recompletion Report and Log, Form 3160-4, must be filed within 30 days after completion of a well. The report must reflect the mechanical and physical condition of the well. Geologic information and, when applicable, information on the completed interval and production is required.

As part of its Surface Use Plan of Operations, the operator must prepare a reclamation plan. Part of the plan will deal with reclamation of reserve pits. All pits must be reclaimed to a safe and stable condition and restored to a condition that blends with the rest of the reclaimed pad area. If it was necessary to line the pit with a synthetic liner, the pit must not be breached or filled while still containing fluids. Pits must be free of oil and other liquid and solid wastes prior to filling. Pits may be allowed to air dry or may be solidified in place. The pit liner must be removed to the solids level or treated to prevent its reemergence to the surface or its interference with long-term successful revegetation. If necessary, the pit area should usually be mounded slightly to allow for settling and positive surface drainage.

Split Estate Minerals Administered by the BLM

Where the minerals are federally owned and the surface is privately or state owned, the operator must make a good faith effort to notify the private surface owner before entering the private land to stake a well location and access road or to conduct cultural or biological surveys.

Prior to approval of the APD, the operator must certify as part of the complete application that a good faith effort was made to reach a surface use agreement with the private surface owner and that an agreement was reached or that it failed. If the surface owner and operator fail to reach an agreement, the operator must file a bond with the BLM ($1,000 minimum) for the benefit of the surface owner to cover compensation, such as for reasonable and foreseeable loss of crops and damages to tangible improvements.

DISCLAIMER
This regulatory information is provided as guidance to viewers. It should not be used as the sole source of information concerning the relevant and applicable regulatory requirements. Agency organization, laws and regulations, and Web linkages are subject to change. Therefore viewers are encouraged to check with the appropriate regulatory agencies for authorized up-to-date information.