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Legislative Issues That Would Impact Califronia's
Energy Producers
Proposed Legislation That Would Hurt Energy Producers:
Reducing Permit Review Bottleneck:
Only 24 new well permits were issued in 2023, a significant drop from previous years, and only 12 Underground Injection Control Projects have been approved, each taking about 25 months to process. CIPA aims to expedite the approval process, which currently has over 1,300 applications pending. We are working with state leaders on solutions to reduce this backlog or pursue other avenues, including taking legal action. CIPA meets twice monthly with the Oil and Gas Supervisor to review CalGEM practices and explore resolving the permit bottleneck.
Reducing Permit Review Bottleneck:
Only 24 new well permits were issued in 2023, a significant drop from previous years, and only 12 Underground Injection Control Projects have been approved, each taking about 25 months to process. CIPA aims to expedite the approval process, which currently has over 1,300 applications pending. We are working with state leaders on solutions to reduce this backlog or pursue other avenues, including taking legal action. CIPA meets twice monthly with the Oil and Gas Supervisor to review CalGEM practices and explore resolving the permit bottleneck.
Only 24 new well permits were issued in 2023, a significant drop from previous years, and only 12 Underground Injection Control Projects have been approved, each taking about 25 months to process. CIPA aims to expedite the approval process, which currently has over 1,300 applications pending. We are working with state leaders on solutions to reduce this backlog or pursue other avenues, including taking legal action. CIPA meets twice monthly with the Oil and Gas Supervisor to review CalGEM practices and explore resolving the permit bottleneck.
Bonding Requirements:
The State Oil and Gas Supervisor is authorized to require additional bonding on operators up to $30 million. However, increased bonding is not commercially available to most California operators. Furthermore, premiums paid to bonding companies don’t plug any wells. CIPA is working with CalGEM to establish practical alternatives so operators can use the money to plug idle wells rather than enrich Wall Street insurance companies.
Repeal of SB 1137 - Setbacks:
Senate Bill 1137 imposes a 3,200-foot setback between wells and sensitive land uses, disallowing drilling of new wells and workovers of existing wells, potentially impacting 15,000 existing California wells. CIPA led the charge to place a referendum on the ballot for the 2024 election, successfully putting the law on hold until voters can weigh in. In the meantime, CIPA is encouraging legislators to enact a legislative fix to avoid an expensive ballot battle.
