STATE OF ALASKA

ALASKA OIL AND GAS CONSERVATION COMM~SSION

3001 Porcupine Drive

Anchorage, Alaska 99501-3912
Re:  THE REQUEST OF UNION OIL )    Disposal Injection Order No. 6     
     COMPANY OF CALIFORNIA to )
     dispose of non-hazardous )    Lewis River Well D-l
     oil field waste fluids   )    Lewis River Gas Field
     by underground injection )
     in Lewis River Well D-l  )
                                   May 11, 1989
IT APPEARING THAT:

1. By letter dated December 7, 1988, Union Oil Company of California (Unocal) submitted an application requesting the Alaska Oil and Gas Conservation Commission (the Commission) to issue an order authorizing the disposal of non-hazardous oil waste fluids by injection into Lewis River Well D-l.

2. Notice of an opportunity for a public hearing on January 13, 1989 was published by the Commission in the Anchorage Daily News on December 14, 1988.

3. By letter dated December 28, 1988 Trustees for Alaska and the Alaska Center for the Environment protested issuance of subject disposal order and requested a hearing for Unocal's application.

4. On January 13, 1989, at 11:00 AM AST in the conference room of the Alaska Oil and Gas Conservation Commission, 3001Porcupine Drive, Anchorage, Alaska, a hearing was held on Unocal's application to dispose of non-hazardous oil field waste fluids by underground injection in Lewis River Well D-1.

5. The hearing record remained open for ten working days following notification, to all parties attending the hearing, of the U. S. Environmental Protection Agency's (EPA's) action under 40 CFR 144.7(b)(3)(ii) with respect to Unocal's aquifer exemption application. EPA approved the aquifer exemption by letter dated March 28, 1989. Trustees for Alaska and the Alaska Center for the Environment both testified against the application. Trustees for Alaska submitted a written opposition dated January 13, 1989. The hearing record closed at 4:30 PM, April 11, 1989, without any further opposition to the application being filed.

6. The Commission issued Aquifer Exemption Order No. 3 on March 30, 1989, exempting aquifers lying below a depth of 2300 feet in Unocal's Lewis River Well D-l and within a circle of one-quarter (1/4) mile radius around the well. The exemption is for the purpose of Class II underground injection activities only.

FINDINGS:

1. Trustees for Alaska and the Alaska Center for the Environment have raised questions regarding: 1) requirement for a waste water disposal permit from Alaska Department of Environmental Conservation (ADEC); 2) consistency of activity with the Alaska Coastal Management Program (ACMP) and notification of those agencies with ACMP responsibility; 3) Commission authority to approve activity outside an existing oil and gas unit; 4) D-l well's integrity and subsequent ability to confine injected fluids to proposed disposal zones; 5) characterization of fluids proposed for disposal; 6) compatibility of injected fluids with formation and formation waters; 7) extent of radial invasion of injected fluids; 8) processing of fluids proposed for disposal; 9) solid waste disposal; 10) filing of EPA Form 4 (EPA Form 7520-6); 11) applicable procedures for processing UIC permits; and 12) public notice requirements.

2. No ADEC permit is required because AS 46.03.100(d) exempts from ADEC permitting requirements injection projects permitted by the Commission under AS 31.05.030(h).

3. Unocal received a conclusive ACMP consistency determination for its surface operations from the Division of Governmental Coordination March 22, 1989. The Commission's regulations provide for control of the proposed subsurface operations, which should ensure that surface impacts will not occur, other than those resulting from the above ground activities which have been permitted by other agencies and which already have been found to be consistent with the ACMP.

4. AS 31.05.030 grants the Commission jurisdiction and authority over all persons and property subject to the state's police powers, regardless of whether the property is "unitized".

5. Unocal's Lewis River Well D-l, an abandoned well, will be entered and completed as an underground injection well. 20 AAC 25.005(b) requires submission of an application for Permit to Drill. Enforcement of 20 AAC 25.412 requires that Lewis River Well D-l be constructed, and the mechanical integrity demonstrated in a manner that will insure that injected fluids are confined to projected disposal strata. The well must be tested and monitored thereafter for disclosure of possible abnormalities in operating conditions that may lead to the endangerment of underground sources of drinking water.

6. The Commission finds the fluids proposed for injection under Unocal's December 7, 1988 application are acceptable for disposal into Class II injection wells.

7. Commission regulations do not require that oil field waste fluids injected for disposal be compatible with the formation or formation waters.

8. The Commission finds the proposed volume of injected fluids over the life of the disposal project will not extend beyond a one-quarter (1/4) mile radius from the well.

9. Enforcement by the Commission of the regulations will insure the requirements of 20 AAC 25.432, requiring regular reporting of injection activities, are met.

10. Disposal of waste solids has no bearing on issuance of an order providing for disposal of oil field waste fluids.

11. The Commission does not require the filing of EPA Form 4 (EPA Form 7526-6) as part of an application for issuance of an order providing for disposal of non-hazardous oil field waste fluids.

12. The Commission's authority to act in this matter is embodied in 40 CFR 147 Subpart C, the Alaska Oil and Gas Conservation Act (AS 31.05), and the Alaska Administrative Code (20 AAC 25.005 through 20 AAC 25.570).

13. The Commission's procedures in matters involving handling of the subject application and posting of public notice fully conforms to the Alaska Oil and Gas Conservation Act AS 31.05; the Commission's regulations, 20 AAC 25; and 40 CFR 147 Subpart C (which is in consort with those sections of 40 CFR Part 124 that apply to state UIC programs awarded in conformance with Section 1425 of the Safe Drinking Water Act of 1974 as amended).

14. Permeable strata that will accept injected fluids are present below 2300 feet in Lewis River Well D-l.

15. A series of confining strata are present above 2300 feet in Lewis River Well D-l that will prevent upward movement of injected fluids through the strata into underground sources of drinking water.

16. The strata into which fluids are to be injected should accept fluids at injection pressures which are less than the fracture pressure of the confining strata.

CONCLUSION:

The stratigraphic sequence present at the well site and maintenance of the mechanical integrity of Lewis River Well D-l will prevent movement of injected fluids into underground sources of drinking water.

NOW, THEREFORE, IT IS ORDERED THAT:

Rule 1

Non-hazardous oil-field waste fluids may be injected in conformance with AAC Title 20, Chapter 25 for the purpose of disposal into the Beluga Formation below the measured depth of 2300 feet in Lewis River Well D-l.

Rule 2

Tubing/casing annulus pressure variations between consecutive observations need not be reported to the Commission.

Rule 3

Upon request, the Commission may amend any rule stated above so long as the operator demonstrates to the Commission's satisfaction that sound engineering practices are maintained, and the amendment(s) will not result in an increased risk of fluid movement into an underground source of drinking water.

DONE at Anchorage, Alaska, and dated May 11, 1989.

C V Chatterton, Chairman
Alaska Oil and Gas Conservation Commission

Lonnie C Smith, Commissioner
Alaska Oil and Gas Conservation Commission

David W Johnston Commissioner
Alaska Oil and Gas Conservation Commission

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