An energy company seeking to significantly expand the existing oil drilling operation in Price Canyon has submitted an altered project proposal that has garnered the backing of state regulatory agencies. However, the project has yet to overcome regulatory hurdles placed from the federal Environmental Protection Agency, and members of the public who have been granted extended time to submit public comments. [New Times]
In 2015, Freeport-McMoRan Oil and Gas applied to expand its oil fields in Price Canyon north of Pismo Beach. The application sought to expand the oil drilling operation from 400 wells on 249 acres to 850 wells on 807 acres. The proposed wells would use water-injection methods to extract oil, and then pump the remaining oil wastewater into the underlying aquifer.
Sentinel Peak Resources has since acquired the oil fields from Freeport and is now the project applicant. The energy company is awaiting a final regulatory decision on use of the aquifer before starting the next two phases of its planned drilling expansion project in Price Canyon.
Despite outcry from neighbors and environmental groups, the California Division of Oil, Gas and Geothermal Resources (DOGGR) and the State Water Resources Control Board have approved an exemption for the aquifer from the Safe Drinking Water Act. Sentinel Peak Resources’ new application shrinks the area of the proposed exemption due to the existence of two drinking water wells along the northeastern border of the aquifer.
As required, the state agencies have submitted the exemption request to the EPA for final approval. The project has been held up at the EPA for about two years.
The EPA is still requesting answers from DOGGR and the water board as to why the aquifer is considered unusable for drinking water and why the field is considered “hydraulically isolated,” meaning water does not flow between the oil field and the neighboring aquifers that are used for drinking purposes.
DOGGR and the water board say the aquifer is isolated by a fault on one side and a tar seal around the rest of the boundary. The agencies maintain that the tar seal is an effective boundary, through critics question the impermeability of the seal.
Currently, DOGGR and the water board are accepting public comments on the aquifer exemption application. The extended public comment period ends on Dec. 22.