In response to federal audit, oil regulators vow new rules


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California oil regulators are vowing to draft new rules and pursue legislation next year to strengthen oversight of ‘underground injection,’ a risky method of oil extraction common in the state.

The pledge comes more than a year after the federal Environmental Protection Agency issued an audit that found regulators were not adequately protecting potential drinking water and urged them to tighten extraction standards.


The state’s response, released Monday, said the California Division of Oil, Gas and Geothermal Resources had taken steps to correct deficiencies in its oversight program, including adding staff, increasing training and stepping up annual reviews of underground injection projects. Officials also said they developed new policies to ensure the integrity of oil wells.

Still, regulators said they needed to update existing rules to comply with federal standards, including testing requirements for a controversial form of drilling that has been linked to spills, eruptions and a Kern County worker’s death. ‘Cyclic steam’ injection, in which a rush of steam heats the ground and loosens oil deposits, yields much of California’s crude.

‘With changes in oil field practices and advancements in technology, the Division has been slow to change its regulatory framework,’ said Tim Kustic, the state’s oil and gas supervisor, in his response to the federal EPA. ‘Although the Division has a strong regulatory program, the Division is pursuing greater and more consistent enforcement.’

Regulators acknowledged that some energy firms have failed to comply with existing regulations and resisted enforcement efforts.

The federal audit sparked a firestorm last year when top California regulators tightened some permit requirements to comply with EPA standards. Oil companies complained that the stringent rules were killing jobs, and Gov. Jerry Brown fired those regulators, saying they had needlessly stepped up environmental scrutiny and slowed the permitting process.



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-- Michael J. Mishak in Sacramento