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Oil, Gas & Geothermal- Frequently Asked Questions

General Questions

1. How are wells drilled in California?

2. How are wells plugged and abandoned?

3. How is groundwater protected when an oil and gas well is being drilled?

4. When buying/selling a well what paperwork must be filed?

5. What are Section, Township and Range?

6. How do I find oil or gas production information on a well?

7. Where are the Oil, Gas, and Geothermal laws and regulations found?

8. Why are some wells confidential and how and when can I get copies of the well data?

9. How do I find well construction (history of work) information?

10. How do I report an oil or saltwater spill?

Operator Questions

11. How do I find the owner or operator of a well?

12. Is there any way I can find out if an operator is legitimate?

13. How do I get an address and telephone number for an operator?

Property Questions

14. How do I determine if a well is on my property?

15. Can you tell me if a well is on my property if I give you the Assessor’s Parcel Number (APN)?

16. If a well is on my property and the operator no longer exists (orphaned well), how can I get the well removed? Who pays for it?

17. How close can someone drill to my house?

18. What rights do I have if I don’t own the mineral rights and an operator wants to drill on my property?

Permitting Questions

19. What permits are needed to drill a well in California?

20. What other agencies issue permits for drilling wells in California?

21. How long does it take to get a drilling permit?

22. How long are permits good for?

23. What kind of well work requires a permit?

24. What type of bond is acceptable?

25. What kind of well work requires a bond?

26. What are the requirements for well plugging?

Questions on Property Development in an Oil Field

27. How do I develop property near and active or abandoned well?

28. Can I build a structure over an old abandoned well?

29. How do I find a well that has been drilled and plugged on my property?

 

 

 

ANSWERS

General Questions

1. How are wells drilled in California?

A well is made by drilling a hole called a wellbore, into the earth (watch a movie). Oil and gas wells can range in depth from a few hundred feet to over 20,000 feet. Metal pipe, called casing, is placed in the well-bore and cement is pumped down the casing. The cement pushes out around the bottom of the casing (watch a movie), and flows up the space between the wellbore and casing, back to the surface. When the cement hardens, it forms a bond between the walls of the wellbore and the outside of the casing. This bond protects groundwater, and oil and gas reservoirs, from contamination. Holes are then made in the casing opposite the reservoir, allowing oil and/or gas to move into the casing, and up to the surface where they are processed and transported to market.

2. How are wells plugged and abandoned?

When a well is no longer needed, either because the oil or gas reservoir becomes depleted, or because no oil or gas was found (called a dry-hole), the well is plugged and abandoned. A well is plugged by placing cement in the well-bore or casing at certain intervals as specified in California laws or regulations. The purpose of the cement is to seal the wellbore or casing and prevent fluid from migrating between underground rock layers. Cement plugs are required to be placed across the oil or gas reservoir (zone plug), across the base-of-fresh-water (BFW plug), and at the surface (surface plug) (watch a movie). Other cement plugs may be required at the bottom of a string of open casing (shoe plug), on top of tools that may become stuck down hole (junk plug), on top of cut casing (stub plug), or anywhere else where  a cement plug may be needed. Also, the hole is filled with drilling mud to help prevent the migration of fluids.

3. How is groundwater protected when an oil, gas, or injection well is being drilled?

When a well is being drilled, drilling fluid, a specially designed liquid, is pumped through the drill pipe, and circulated out through the wellbore, and back to the surface. One function of the drilling fluid is to lift rock cuttings out of the wellbore and to the surface. Drilling fluid also serves to cool the drill bit, and to counteract downhole formation pressure keeping reservoir fluids and groundwater from entering the well bore and preventing them from mixing. When a well is completed, casing is cemented in the wellbore (watch a movie), keeping reservoir fluids and groundwater from mixing.

4. When buying/selling a well what paperwork must be filed?

When buying or selling a well, a properly filled out Report of Property/Well Transfer or Acquisition form (OG30A) (with both buyer and seller signatures) must be submitted. In addition, the buyer must supply any bonds that may be required. Click here to view additional information on bonds. If the buyer is a new operator, additional forms including a Designation of Agent form (OG134A or OG134B) and Contact Questionnaire form (OGD7) are needed. The well(s) will remain in the name of the seller until all paperwork is properly filled out and the buyer obtains bond coverage (if needed).

5. What are Section, Township and Range?

Section/Township/Range (STR) is a surveyed rectangular land grid system that covers most of the United States. A township is the measure of units north or south of a baseline, the horizontal line where the survey began. A Range is the measure of units east or west of a meridian, the vertical line where the survey began. Each Township/Range is thirty-six square miles, measuring 6 miles by 6 miles, and contains 36 one-mile square sections. In California, there are three base and meridians, Humboldt, Mount Diablo, and San Bernardino.

6. How do I find oil or gas production information on a well?

Production (or injection) information on oil and gas wells can be found by clicking here. This is the Division’s online production/injection (OPI) program that allows monthly production/injection information by well from 1977 to present to be viewed. Totals by field, operator, and lease can also be obtained, with the capability of saving that information into an Excel spreadsheet.

7. Where are the Oil, Gas, and Geothermal laws and regulations found?

Click here to find the laws and regulations regarding oil, gas, and geothermal well drilling and operation.

8. Why are some wells confidential and how and when can I get copies of the well data?

Most well records in California are open to public inspection. However, wells that meet certain criteria may be kept in confidential status. The records (including monthly production/injection reports) for confidential wells are not open for public inspection. To be considered for confidential status, a well must be classified as an exploratory well, or there must be extenuating circumstances (defined in regulation as conditions beyond the control of the operator, preventing the operator from utilizing the competitive advantage from the information obtained from a well). Extenuating circumstances include, but are not limited to active competitive leasing or mineral rights sales in the immediate vicinity of the well; governmental or judicial action delaying oil, gas, or geothermal development; natural disasters; or scarcity of materials and equipment. Onshore wells are granted confidentiality for a two-year period, and offshore wells are granted confidentiality for a five-year period (with the possibility of extensions).

 9. How do I find well construction (history of work) information?

Information on well construction can be found in the well record. Every oil, gas, or geothermal well drilled in California has information about that well such as the history of work done, permits issued, inspections made, and well logs run. That information, called a well record, is maintained in the district office where that well is located. Well records are open to public inspection and can be viewed by contacting the local district office.

IIn addition, the well records for District 6 have been scanned and are available on the Internet via the Online Well Record Search web application.

10. How do I report an oil or saltwater spill?

For all areas of the state other than the San Joaquin Valley, oil spills that are more than 42 gallons (1 barrel), or any oil spills that threaten or enter a waterway must be reported to the Office of Emergency Services Warning Center at (800) 852-7550 or (916) 845-8911. For oil spills that occur in the San Joaquin Valley, if a spill is within a contained area, the minimum reporting requirement is 420 gallons (10 barrels) and for spills outside a contained area, the reporting threshold is 210 gallons (5 barrels). Any spills that threaten or enter a waterway must be reported to the Office of Emergency Services.

Operator Questions

11. How do I find the owner or operator of a well?

The quickest way to find the name of the owner or operator of a well is to look on the well-site sign. Division regulations require that each well location have a sign posted in a conspicuous place containing the name of the owner or operator, the lease name, and the well number. If there is no sign at a well site, contact our local office (click here for a listing of district office phone numbers). Division staff at the local district office will be able to assist you in identifying the name of the operator or owner.

12. Is there any way I can find out if an operator is legitimate?

The Division does not maintain financial records or financial reports on well owners or operators, and therefore, cannot determine the owner’s or operator’s standing. Other governmental agencies that do maintain financial information on operators include the California Secretary of State (http://kepler.ss.ca.gov/list.html), the U.S. Securities and Exchange Commission (http://www.sec.gov/), the California Department of Financial Institutions (http://www.dfi.ca.gov/), and the California Department of Corporations (http://www.corp.ca.gov/).

13. How do I get an address and telephone number for an operator?

If you know the name of the owner or operator, and you want to obtain an address or phone number for that owner or operator, click here for an alphabetical listing of all the operators in California.

Property Questions

14. How do I determine if a well is on my property?

One way to determine if a well is on your property is to look at the oilfield map for your area. Many of the oilfield maps have been posted on the Internet. Click here to start investigating if a digital map has been prepared for your area. If so, the digital maps can be viewed and downloaded from this web site. If not, hard-copy maps are available that show the locations for all the known wells that have been drilled. Click here to view the map index and information for ordering hard-copy oilfield maps.

15. Can you tell me if a well is on my property if I give you the Assessor’s Parcel Number (APN)?

No, the County Assessor’s Parcel Number is not used by the Division to locate wells or leases, and therefore, cannot be used to tell if there is a well on your property. The only way to tell if there is a well on your property is to compare your property’s location on the appropriate Division map, or contact a local district office for assistance.

 16. If a well is on my property and the operator no longer exists (orphaned well), how can I get the well removed? Who pays for it?

For wells that no longer have a viable owner or operator (called orphan wells), the Division has a program to plug and abandon these wells. The Division spends about $1 million annually plugging orphan wells. A list of orphan wells is maintained, and wells are prioritized for plugging based on their condition. Hazardous wells are given priority, followed by bonded wells, then unbonded wells. The $1 million plugging fund is paid for by an assessment on the oil and gas industry.

17. How close can someone drill to my house?

Land-use issues such as how close can someone drill to your house, business, or school are handled by the local agency such as the city or county where you live. Each local agency will have different set-back rules that depend on your type of structure. Check with your city or county planning department to find out how close a well can be drilled to your house.

The Division has well-spacing regulations that can be found in Section 3600 of the Public Resources Code. Also, the Division defines a critical well as a well that is located:

  • Within 300 feet of a residence or airport runway or

  • Within 100 feet of a dedicated public street, highway, or operating railway; any navigable body of water; any public recreational facility such as a golf course, amusement park, picnic ground, campground, or any other area of periodic high-density population; or any officially recognized wildlife preserve.

Critical wells are required to have safety devices installed on them that automatically close the well down in case of an emergency.

18. What rights do I have if I don’t own the mineral rights and an operator wants to drill on my property?

Generally, the mineral interest owner may use the surface to drill for and produce oil and gas. However, you should obtain private legal advice. There may be restrictions on the mineral interest owner's right to use the surface of your property. These may be specified in your deed or other document affecting your title. Additionally, there are common law and statutory limitations. For example, Chapter 3 of Title 5 of Division 2 (beginning with Section 883.110) of the California Civil Code addresses the termination of dormant mineral rights.

Permitting Questions

19. What permits are needed to drill a well in California?

Usually, two permits are needed to drill a well in California. You need a use permit from the local agency such as the city or county, and you need a drilling permit from the Division. In many counties, most wells drilled in existing oil or gas fields do not need a local-agency permit, so only a Division permit is required. In other counties, use permits are required and can be obtained from the planning department.

20. What other agencies issue permits for drilling wells in California?

Depending on where a well is drilled, besides permits from the local agency (city or county) and/or the Division, permits may be needed from the Bureau of Land Management (for wells located on federal land), the State Lands Commission (for wells located on state-owned land), or other agencies such as the Reclamation Board.

21. How long does it take to get a drilling permit?

The Division issues most drilling permits within a week. By law, the Division must respond within 10 working days or the permit is automatically approved. Use permits from local agencies can take longer, depending on the local agency, and the level of environmental review required. For Kern County, the Division acts as CEQA lead agency, and wells drilled outside administrative field boundaries may require 30-60 days to permit.

22. How long are permits good for?

Permits are good for one year from the date of issuance. Additionally, a one-year extension can be granted, for a total of two years. Permits are cancelled by the Division after two years.

23. What kind of well work requires a permit?

Following is a list of the Notices of Intention required by the Division and the kind of well work to which each applies.

A. Notice of Intention to Drill New Well (Form OG105)

1. Drill a new well.

B. Notice of Intention to Rework Well (Form OG107)

1. Redrill or deepen an existing well.

2. Convert from one well type to another (i.e., oil and gas to steamflood).

3. Any change in the mechanical condition of the well such as:

a. Mill out or remove casing or liner.

b. Run and land liner or inner liner.

c. Run and cement liner or inner liner.

d. Cement off existing perforations.

e. Reperforate existing perforations.

f. Perforate casing in a previously unperforated interval.

g. Install sand control devices such as screens.

h. Run and cement casing or tubing.

i. Set any type of permanent plug.

j. Set any type of bridge plug.

k. Drill out any type of permanent plug or bridge plug.

l. Repair damaged casing by means of cementing, placing casing patch, swaging, etc.

m. Relocating the packer of an injection well.

C. Notice of Intention to Abandon Well (Form OG108)

1. Plug and abandon a well.

D. Supplementary Notice (Form OG123)

1. Significant changes occur to operations proposed in the original notice.

2. Reabandon any well.

3. Request an extension of time for performing the above operations.

24. What type of bond is acceptable?

Cash bonds (Certificates of Deposit, cashier’s checks, or pass book accounts) or surety bonds (from Department of Insurance-approved sureties) are acceptable. There are two types of bonds used in California, depending on the number of wells to be covered: individual bonds and blanket bonds. Individual bonds cover single wells, while blanket bonds cover multiple wells. Blanket bonds come in three amounts: $250,000 for more than 50 wells, or $100,000 for 50 or less total wells, or a $1 million “super” blanket bond that also meets the idle-well requirements in Section 3206 of the PRC. Click here for more information on bonds.

25. What kind of well work requires a bond?

Well operations that require bonding include:

  • Drill, redrill, or deepen any well.

  • Mill out or remove casing or liner.

  • Run and cement casing or tubing.

  • Run and cement liner or inner liner.

  • Perforate casing in a previously unperforated interval for the purpose of production, injection, testing, observation, or cementing.

  • Drill out any type of permanent plug.

  • Reentry of an abandoned well not having an existing bond.

  • Drill and operate a commercial geothermal well, including the plugging and abandonment of such well. Drill a geothermal temperature-gradient well.

  • Operate a Class II commercial waste-water disposal well. The bond amount is $50,000 for each well.

  • The acquisition of a well that has been idle for five or more years.

  • Maintaining a well that has been idle five or more years. The bond amount is $5,000 for each well.

  • Drill a water-source well for an EOR or subsidence-control project if the proposed depth is below the base of fresh water, or if the well may penetrate oil or gas formations.

26. What are the requirements for well plugging?

The requirements for well plugging can be found in the California Code of Regulations, Section 1723. Basically, to plug and abandon a well, the following are needed:

  • A Notice of Intention to Abandon must be filed with the appropriate district office, and a permit to conduct operations must be received from the Division prior to commencing operations.

  • The hole will be filled with drilling mud.

  • Cement plugs will be placed across all oil or gas zones, the fresh water/salt water interface, the casing shoe (if open hole is below the shoe), casing stub (if casing was removed from the hole), and at the surface. The length required for each plug will vary.

  • If there is junk in the hole, a cement plug is required to be placed on top of the junk.

  • If there is uncemented casing at the base of fresh water interface, cement must be squeezed through perforations in the casing. The same applies if there is uncemented casing at the surface; all annuli need to be plugged.

  • Plugging and abandonment operations require witnessing by a Division engineer. This will be identified in the plugging permit.

Questions on Property Development in an Oil Field

27. How do I develop property near and active or abandoned well?

First, contact your local building department. They will inform you about any applicable city/county regulations regarding active or abandoned wells. Second, contact the Division to obtain a "Construction Site Review Packet"  (click here for more information). The information in this packet will assist you in preparation of your plans. The plans will need to be reviewed and approved by the Division to obtain a building permit from the local building department. The building plans that are submitted must illustrate the footprint of all buildings and access obstructions and the surveyed location of all wells. All wells must be excavated and tested for leakage and some or all of the wells may require additional plugging and venting. Developers should submit their applications as early as possible since there are a limited number of engineers to review the plans. Please allow 4 to 6 weeks for processing your plans.

28. Can I build a structure over an old abandoned well?

Yes, However, during the Division's construction site plan review process, the Construction Site Engineer will require all wells to be tested for leakage and all wells under buildings or restricted access must be vented and abandoned or reabandoned to present day standards. It is advisable to design your project so that you avoid building over old wells since the cost to abandoning or reabandoning a well is very high, ranging from $25,000 - $100,000 and up.

29. How do I find a well that has been drilled and plugged on my property?

A search of the well records and maps is required to find out if a well has been drilled on your property. Many oil field maps are posted on the Division’s web page. However, unless you are very familiar with the Division’s well record system and well location information, it may be advisable to hire a consultant that is familiar with this process. A list of consultants is available from any Division office. This list is not all-inclusive; it is only a list of consultants in our area and does not constitute a recommendation of any kind.