WEBVTT 00:00:05.457 --> 00:00:06.910 - We come to order to consider matters 00:00:06.910 --> 00:00:09.790 which have been duly posted with the Secretary of State, 00:00:09.790 --> 00:00:13.910 for January 23, 2019. Happy New Year. 00:00:13.910 --> 00:00:16.330 The commission will consider the items on the agenda, 00:00:16.330 --> 00:00:18.180 as posted on the agenda. 00:00:18.180 --> 00:00:20.900 Under our public participation policy, 00:00:20.900 --> 00:00:23.150 anyone desiring to offer public testimony 00:00:23.150 --> 00:00:26.610 on any items that are not noticed on today's agenda 00:00:26.610 --> 00:00:28.530 will need to fill out a testimony form, 00:00:28.530 --> 00:00:29.660 found in the back of the room, 00:00:29.660 --> 00:00:32.240 and submit it to Commission Secretary Kathy Way. 00:00:32.240 --> 00:00:36.280 A reminder for me, particularly, turn off your cell phones. 00:00:36.280 --> 00:00:37.563 And, item number one. 00:00:42.660 --> 00:00:44.211 Morning, Sarah, how are you? 00:00:44.211 --> 00:00:46.110 - Good morning, Commissioners. 00:00:46.110 --> 00:00:48.400 For the record, my name is Sarah Montoya-Foglesong. 00:00:48.400 --> 00:00:50.310 I'm representing the Market Oversight section 00:00:50.310 --> 00:00:52.610 of the Oversight and Safety Division. 00:00:52.610 --> 00:00:56.480 Before you today is Gas Utilities Docket Number 10781, 00:00:56.480 --> 00:00:58.270 the application of Texas Gas Service 00:00:58.270 --> 00:01:01.228 for the Test Year 2017 annual interim rate adjustment 00:01:01.228 --> 00:01:03.150 for the unincorporated portion 00:01:03.150 --> 00:01:05.430 of the Gulf Coast service area. 00:01:05.430 --> 00:01:07.390 This docket is the second interim rate adjustment 00:01:07.390 --> 00:01:08.930 the company has filed for the environs 00:01:08.930 --> 00:01:09.867 of the Gulf Coast service area since 00:01:09.867 --> 00:01:11.470 the final order was issued 00:01:11.470 --> 00:01:14.960 in Gas Utilities Docket Number 10488. 00:01:14.960 --> 00:01:17.260 This adjustment represents an incremental increase 00:01:17.260 --> 00:01:20.760 of $191,597, 00:01:20.760 --> 00:01:25.470 of which $4,638 is allocated to environs customers. 00:01:25.470 --> 00:01:26.470 I recommended approval of 00:01:26.470 --> 00:01:28.230 the interim rate adjustment as proposed, 00:01:28.230 --> 00:01:30.440 and I'm available to answer any questions you may have. 00:01:30.440 --> 00:01:32.730 - Thank you, are there any questions? 00:01:32.730 --> 00:01:34.785 I move we approve the examiners' recommendation. 00:01:34.785 --> 00:01:35.618 Is there a second? 00:01:35.618 --> 00:01:36.451 - [Ryan] Second. 00:01:36.451 --> 00:01:37.440 - Second, by Commissioner Sitton. 00:01:37.440 --> 00:01:38.900 All those in favor, say aye. 00:01:38.900 --> 00:01:39.733 - [Commissioners] Aye. 00:01:39.733 --> 00:01:40.566 - Motion's approved. 00:01:40.566 --> 00:01:41.693 - [Sarah] Thank you. 00:01:41.693 --> 00:01:42.526 - Thank you. 00:01:42.526 --> 00:01:44.000 Item number two. 00:01:44.000 --> 00:01:44.969 Morning, John. 00:01:44.969 --> 00:01:46.519 - Good morning. 00:01:46.519 --> 00:01:47.352 Good morning, Commissioners. 00:01:47.352 --> 00:01:50.290 I'm Administrative Law Judge John Dawson, Hearings Division. 00:01:50.290 --> 00:01:53.770 Agenda item two, GUD 10455, 00:01:53.770 --> 00:01:55.820 is joint motion filed by the parties of duress 00:01:55.820 --> 00:01:57.210 directly to the commissioners. 00:01:57.210 --> 00:01:58.590 The parties have reached a settlement 00:01:58.590 --> 00:01:59.700 and request that the commissioners 00:01:59.700 --> 00:02:02.439 sign their proposed file and order attached to their motion. 00:02:02.439 --> 00:02:04.070 If the commissioners have any questions for me, 00:02:04.070 --> 00:02:04.953 I'm available. 00:02:04.953 --> 00:02:06.710 - Thank you, are there any questions? 00:02:06.710 --> 00:02:07.577 - Nope. 00:02:07.577 --> 00:02:08.740 - I want to say, John, 00:02:08.740 --> 00:02:10.140 you and Rose have done a great job. 00:02:10.140 --> 00:02:11.630 This has been a long case. 00:02:11.630 --> 00:02:13.520 I'm glad they got a settlement done. 00:02:13.520 --> 00:02:14.501 Thank you for your work. 00:02:14.501 --> 00:02:15.334 - [John] It's my pleasure. 00:02:15.334 --> 00:02:17.660 - I move that we enter the proposed order. 00:02:17.660 --> 00:02:18.493 Is there a second? 00:02:18.493 --> 00:02:19.326 - [Wayne] Second. 00:02:19.326 --> 00:02:21.070 - Second by Commissioner Christian. 00:02:21.070 --> 00:02:22.084 All those in favor, say aye. 00:02:22.084 --> 00:02:23.100 - [Commissioners] Aye. 00:02:23.100 --> 00:02:24.690 - Motion passed, this item's approved. 00:02:24.690 --> 00:02:25.523 Thank you. 00:02:28.752 --> 00:02:30.621 Good morning, how are you, Steve? 00:02:30.621 --> 00:02:32.052 Item number three. 00:02:32.052 --> 00:02:32.970 - Good morning Commissioners. 00:02:32.970 --> 00:02:35.993 Item three is the application by the Luminant Mining, LLC, 00:02:37.310 --> 00:02:38.830 for a new renovation of its service body 00:02:38.830 --> 00:02:41.037 and reclamation permit number 58 00:02:41.037 --> 00:02:43.260 for the Martin Lake Liberty Mine. 00:02:43.260 --> 00:02:47.177 The property area contains approximately 3,866 acres 00:02:47.177 --> 00:02:50.201 and is located approximately six miles southwest of Tatum, 00:02:50.201 --> 00:02:52.380 in Rusk County, Texas. 00:02:52.380 --> 00:02:55.750 Luminant proposes to mine approximately 817 acres 00:02:55.750 --> 00:02:59.220 and produce approximately ten million tons of lignite 00:02:59.220 --> 00:03:01.692 during the five-year proposed product renewal term 00:03:01.692 --> 00:03:03.900 and requests approval of revised operations 00:03:03.900 --> 00:03:05.528 and reclamation plans. 00:03:05.528 --> 00:03:09.020 Public and other notices required by law were provided. 00:03:09.020 --> 00:03:10.630 No hearing was requested. 00:03:10.630 --> 00:03:11.640 Comments were filed by 00:03:11.640 --> 00:03:13.430 the Texas Parks and Wildlife Department 00:03:13.430 --> 00:03:15.670 and are addressed in the proposed order. 00:03:15.670 --> 00:03:17.270 No other comments were received. 00:03:17.270 --> 00:03:19.250 No exceptions were filed. 00:03:19.250 --> 00:03:21.630 It is recommended that the five existing 00:03:21.630 --> 00:03:24.658 permit provisions for permit 58 be withdrawn because 00:03:24.658 --> 00:03:26.990 they have been incorporated into the operations, 00:03:26.990 --> 00:03:28.077 or reclamation plan, 00:03:28.077 --> 00:03:30.310 or are no longer applicable. 00:03:30.310 --> 00:03:32.100 Five new park provisions relating to 00:03:32.100 --> 00:03:33.373 surface and groundwater 00:03:33.373 --> 00:03:36.270 were proposed by staff and are recommended for adoption 00:03:36.270 --> 00:03:39.020 to ensure the protection of the hydrologic balance 00:03:39.020 --> 00:03:41.250 in compliance with the regulations. 00:03:41.250 --> 00:03:43.307 Luminant maintains a blanket collateral bond of 00:03:43.307 --> 00:03:47.743 $975 million to cover its statewide mining operations. 00:03:47.743 --> 00:03:50.594 Soft reclamation cost estimate for Permit 58 is 00:03:50.594 --> 00:03:55.594 $55,588,075.95. 00:03:56.510 --> 00:03:59.430 The total of approved reclamation cost estimates for 00:03:59.430 --> 00:04:01.877 Luminant's statewide mining operations is 00:04:01.877 --> 00:04:06.877 $755,862,074. 00:04:07.000 --> 00:04:09.760 Accordingly, Luminant remains adequately bonded. 00:04:09.760 --> 00:04:11.600 No changes to the current bond instrument 00:04:11.600 --> 00:04:13.440 are requested in this docket. 00:04:13.440 --> 00:04:14.510 The order I'm presenting today 00:04:14.510 --> 00:04:16.600 contains a few typographical corrections 00:04:16.600 --> 00:04:18.380 from the one in the notebooks. 00:04:18.380 --> 00:04:20.317 I recommend approval of the proposed order, 00:04:20.317 --> 00:04:22.490 and I'm available to answer questions. 00:04:22.490 --> 00:04:23.323 - [Christi] Thank you. 00:04:23.323 --> 00:04:24.240 Are there any questions? 00:04:24.240 --> 00:04:25.233 - [Ryan] Nope. 00:04:25.233 --> 00:04:26.890 - I move we approve the examiners' recommendation. 00:04:26.890 --> 00:04:27.723 Is there a second? 00:04:27.723 --> 00:04:28.556 - [Ryan] Second. 00:04:28.556 --> 00:04:29.660 - Second by Commissioner Sitton. 00:04:29.660 --> 00:04:30.610 All those in favor, say aye. 00:04:30.610 --> 00:04:31.838 - [Commissioners] Aye. 00:04:31.838 --> 00:04:32.894 - Motion passed, this item's approved. 00:04:32.894 --> 00:04:33.727 Thank you. 00:04:34.567 --> 00:04:36.490 - Item four is the application by the 00:04:36.490 --> 00:04:39.550 San Miguel Electric Cooperative, Inc., for the lease 00:04:39.550 --> 00:04:43.890 of phase one reclamation obligations for 308.9 acres 00:04:43.890 --> 00:04:46.140 within the San Miguel sea area mine. 00:04:46.140 --> 00:04:49.660 Permit 52A, located in Atascosa County. 00:04:49.660 --> 00:04:51.150 The approved post-mined land use 00:04:51.150 --> 00:04:53.700 for the requested area is pastureland. 00:04:53.700 --> 00:04:55.060 The evidence in the record shows that 00:04:55.060 --> 00:04:57.660 San Miguel has met the phase one requirements 00:04:57.660 --> 00:05:00.752 for back-filling, regrading, and drainage control. 00:05:00.752 --> 00:05:03.980 Public and other required notices were provided. 00:05:03.980 --> 00:05:05.280 No hearing was requested, 00:05:05.280 --> 00:05:07.840 and no exceptions were filed to the proposed order. 00:05:07.840 --> 00:05:10.894 San Miguel's staff are the only parties to the proceeding. 00:05:10.894 --> 00:05:14.400 No changes are requested of the current bond instrument. 00:05:14.400 --> 00:05:18.290 No reduction of the required bond is recommended because 00:05:18.290 --> 00:05:20.680 the current reclamation cost estimate is based on 00:05:20.680 --> 00:05:23.310 the worst-case PET calculation method, 00:05:23.310 --> 00:05:24.460 which assumes that mining 00:05:24.460 --> 00:05:27.320 or reclamation operations are contemporaneous. 00:05:27.320 --> 00:05:28.503 I recommend approval of the application, 00:05:28.503 --> 00:05:30.570 and I'm available to answer questions. 00:05:30.570 --> 00:05:32.700 - Thank you, are there any questions? 00:05:32.700 --> 00:05:34.547 I move that we approve the examiners' recommendation. 00:05:34.547 --> 00:05:35.380 Is there a second? 00:05:35.380 --> 00:05:36.213 - Second. 00:05:36.213 --> 00:05:37.760 - Second by Commissioner Christian. 00:05:37.760 --> 00:05:39.078 All those in favor, say aye. 00:05:39.078 --> 00:05:39.911 - [Commissioners] Aye. 00:05:39.911 --> 00:05:41.210 - Motion passed, this item's approved. 00:05:41.210 --> 00:05:42.043 Thank you. 00:05:43.700 --> 00:05:45.633 Item number four. 00:05:45.633 --> 00:05:46.466 Morning, Carl. 00:05:46.466 --> 00:05:48.213 - Morning Chairman and Commissioners. 00:05:49.942 --> 00:05:53.230 Item number five is the application 00:05:53.230 --> 00:05:54.935 of Ruger Properties, LLC, 00:05:54.935 --> 00:05:58.360 for a commercial permit to dispose of oil and gas waste 00:05:58.360 --> 00:06:01.160 by injection into a porous formation, 00:06:01.160 --> 00:06:03.060 not productive of oil or gas, 00:06:03.060 --> 00:06:04.767 pursuant to Statewide Rule Nine, 00:06:04.767 --> 00:06:08.490 for the Chandler SW deed lease, well number one. 00:06:08.490 --> 00:06:11.460 The applicant proposes to inject a maximum volume 00:06:11.460 --> 00:06:14.300 of 25,000 barrels of saltwater per day 00:06:14.300 --> 00:06:17.110 into the San Andres and Glorieta formations 00:06:17.110 --> 00:06:21.330 in a depth interval from 4300 to 6200 feet. 00:06:21.330 --> 00:06:22.870 The application is protested 00:06:22.870 --> 00:06:25.132 by adjoining surface tract owners. 00:06:25.132 --> 00:06:28.100 The protestants' concerns include 00:06:28.100 --> 00:06:29.750 potential pollution of groundwater 00:06:29.750 --> 00:06:31.910 and contamination of water wells, 00:06:31.910 --> 00:06:35.850 and that the disposal well is not in a public interest 00:06:35.850 --> 00:06:38.499 as there isn't a need for additional disposal capacity 00:06:38.499 --> 00:06:40.010 in this area, 00:06:40.010 --> 00:06:44.130 and the well may pose a threat to the fauna in the area. 00:06:44.130 --> 00:06:45.648 Based on the evidence in the record, 00:06:45.648 --> 00:06:49.130 the examiners recommend approval of the application 00:06:49.130 --> 00:06:51.980 with the addition of two special permit commissions 00:06:51.980 --> 00:06:55.720 to be met prior to commencing disposal operations. 00:06:55.720 --> 00:06:58.320 The examiners recommend a permit condition 00:06:58.320 --> 00:07:00.270 that the entire wellbore be cased, 00:07:00.270 --> 00:07:02.490 and the casing cemented in accordance with 00:07:02.490 --> 00:07:04.960 Statewide Rules Nine and 13. 00:07:04.960 --> 00:07:08.000 The examiners also recommend a permit condition 00:07:08.000 --> 00:07:10.050 that the applicant log the well, 00:07:10.050 --> 00:07:12.561 and provide a copy of the log to USC, 00:07:12.561 --> 00:07:16.070 prior to commencing disposal operations to show 00:07:16.070 --> 00:07:18.903 that the Glorieta and San Andres disposal formations 00:07:18.903 --> 00:07:21.230 are separated from freshwater formations 00:07:21.230 --> 00:07:22.850 by impervious intervals 00:07:22.850 --> 00:07:26.313 which will provide protection to the freshwater formations. 00:07:26.313 --> 00:07:28.650 The protestants filed exceptions 00:07:28.650 --> 00:07:30.420 to the proposal for decision, 00:07:30.420 --> 00:07:32.130 and the applicant filed a reply 00:07:32.130 --> 00:07:34.200 to the protestants' exceptions. 00:07:34.200 --> 00:07:35.977 I'm available to answer questions. 00:07:35.977 --> 00:07:37.827 - Thank you, are there any questions? 00:07:38.668 --> 00:07:41.490 I move we approve the examiners' recommendation. 00:07:41.490 --> 00:07:42.745 Is there a second? 00:07:42.745 --> 00:07:43.578 - [Ryan] Second. 00:07:43.578 --> 00:07:44.730 - Second by Commissioner Sitton. 00:07:44.730 --> 00:07:46.107 All those in favor, say aye. 00:07:46.107 --> 00:07:47.230 - [Commissioners] Aye. 00:07:47.230 --> 00:07:48.610 - Motion passed, this item's approved. 00:07:48.610 --> 00:07:49.827 Thank you, Carl. 00:07:50.830 --> 00:07:51.873 Item number six. 00:07:54.822 --> 00:07:56.072 For the record. 00:07:57.160 --> 00:07:59.770 - Good morning, Chairman and Commissioners. 00:07:59.770 --> 00:08:01.560 For the record, my name is Robert Musick, 00:08:01.560 --> 00:08:03.971 Technical Examiner for the Hearings Division. 00:08:03.971 --> 00:08:06.270 Item number six is the application 00:08:06.270 --> 00:08:10.130 for Wildhorse Resource Management Company, LLC. 00:08:10.130 --> 00:08:12.780 The application is for a permit to dispose of 00:08:12.780 --> 00:08:17.670 oil and gas waste by injection into a porous formation, 00:08:17.670 --> 00:08:19.920 not productive of oil and gas, 00:08:19.920 --> 00:08:22.793 as authorized by Statewide Rule Number Nine. 00:08:23.700 --> 00:08:26.580 Wildhorse is requesting to use the number one well 00:08:26.580 --> 00:08:30.230 in the Edwards Formation, Burleson County, Texas, 00:08:30.230 --> 00:08:33.223 as a non-commercial saltwater disposal well. 00:08:34.210 --> 00:08:37.200 Wildhorse is proposing to inject the maximum volume of 00:08:37.200 --> 00:08:39.529 50,000 barrels per day of saltwater 00:08:39.529 --> 00:08:41.720 into the Edwards Formation, 00:08:41.720 --> 00:08:46.487 located at a depth of 7508 feet to 7594 feet. 00:08:48.530 --> 00:08:52.223 The application is protested by adjacent land owners 00:08:52.223 --> 00:08:56.460 and Post Oak Savannah Groundwater Conservation District. 00:08:56.460 --> 00:08:58.300 The protestants' concerns include 00:08:58.300 --> 00:09:02.190 potential groundwater and surface water contamination, 00:09:02.190 --> 00:09:05.070 increased seismic events in region, 00:09:05.070 --> 00:09:06.323 and traffic safety. 00:09:07.680 --> 00:09:09.530 Wildhorse proposed in the hearing to limit 00:09:09.530 --> 00:09:13.120 the volume of waste traveling to the facility by vehicle. 00:09:13.120 --> 00:09:16.000 As a special condition of the disposal permit, 00:09:16.000 --> 00:09:19.860 the volume of waste entering the disposal site by vehicle 00:09:19.860 --> 00:09:22.943 is limited to 30,000 barrels per day. 00:09:23.931 --> 00:09:28.370 The proposed disposal well is cased, cemented, and completed 00:09:28.370 --> 00:09:32.160 in a manner consistent with commission rule requirements. 00:09:32.160 --> 00:09:34.040 The evidence in the record demonstrates 00:09:34.040 --> 00:09:37.320 Wildhorse has met its burden of proof. 00:09:37.320 --> 00:09:38.850 The examiners recommend approval 00:09:38.850 --> 00:09:40.330 of the Wildhorse application 00:09:40.330 --> 00:09:42.742 with the proposed special condition. 00:09:42.742 --> 00:09:45.619 Exceptions were filed. 00:09:45.619 --> 00:09:47.767 I'm available for questions. 00:09:47.767 --> 00:09:48.970 - [Christi] Thank you. 00:09:48.970 --> 00:09:50.430 Do y'all have any questions? 00:09:50.430 --> 00:09:51.263 - [Ryan] Nope. 00:09:51.263 --> 00:09:52.640 - Alright, we have here today, 00:09:52.640 --> 00:09:55.790 I'm told Mike Sutherland, you're the the County Judge? 00:09:55.790 --> 00:09:57.008 Is that correct, Mr. Sutherland? 00:09:57.008 --> 00:09:58.094 - [Mike] Right here. 00:09:58.094 --> 00:10:00.465 - Y'all weren't a party to this but we'll be glad 00:10:00.465 --> 00:10:04.290 to let you give about two, three minutes of testimony, 00:10:04.290 --> 00:10:06.330 if you want to out of courtesy. 00:10:06.330 --> 00:10:07.163 Yes sir? 00:10:08.084 --> 00:10:10.840 - Thank you, Madam Chair and Commissioners 00:10:10.840 --> 00:10:12.390 for allowing me to speak today. 00:10:13.482 --> 00:10:16.230 The application that I'm here to talk about 00:10:16.230 --> 00:10:17.660 is the one that y'all just heard about. 00:10:17.660 --> 00:10:18.911 - [Christi] Could you state your name for the record? 00:10:18.911 --> 00:10:20.256 - I'm sorry. - [Christi] That's okay. 00:10:20.256 --> 00:10:21.934 - I'm sorry. Mike Sutherland, Burleson County Judge. 00:10:21.934 --> 00:10:22.796 - [Christi] Thank you. 00:10:22.796 --> 00:10:27.450 - And the operator has requested a permit for up to 00:10:27.450 --> 00:10:29.356 50,000 barrels a day 00:10:29.356 --> 00:10:32.490 and 30,000 barrels of that to be trucked. 00:10:32.490 --> 00:10:35.030 That's over 300 trucks a day. 00:10:35.030 --> 00:10:37.257 There's only one way into this site, 00:10:37.257 --> 00:10:39.640 and that's on County Road 316 00:10:39.640 --> 00:10:42.430 which was built for residential standards, 00:10:42.430 --> 00:10:45.800 which means it has a very narrow footprint. 00:10:45.800 --> 00:10:48.870 These roads will hold up to limited commercial use 00:10:48.870 --> 00:10:50.880 for ranching and farming. 00:10:50.880 --> 00:10:52.610 But they're not designed or built for 00:10:52.610 --> 00:10:54.423 high-volume commercial traffic. 00:10:55.400 --> 00:10:57.770 Two commercial vehicles, including school buses, 00:10:57.770 --> 00:11:00.320 cannot pass each other on opposite sides of the road 00:11:00.320 --> 00:11:02.190 without one of them pulling off of the road, 00:11:02.190 --> 00:11:05.240 getting off of the pavement completely. 00:11:05.240 --> 00:11:07.294 There's also an at grade railroad crossing 00:11:07.294 --> 00:11:09.610 right before you get to the site. 00:11:09.610 --> 00:11:13.224 And that figures into the traffic mix as well. 00:11:13.224 --> 00:11:16.720 It's true that the commission does not regulate 00:11:16.720 --> 00:11:19.210 road safety or truck traffic. 00:11:19.210 --> 00:11:22.860 It does regulate disposal capacity in the disposal wells 00:11:22.860 --> 00:11:25.010 and it can restrict the volume of saltwater 00:11:25.010 --> 00:11:26.570 going in to any facility, 00:11:26.570 --> 00:11:28.300 especially if it's trucked. 00:11:28.300 --> 00:11:30.810 Requiring that extremely large volumes of water 00:11:30.810 --> 00:11:33.340 of the type proposed by the operator be piped, 00:11:33.340 --> 00:11:34.620 rather than trucked, 00:11:34.620 --> 00:11:37.036 clearly falls within the commission's authority 00:11:37.036 --> 00:11:40.240 to place conditions in any disposal permit 00:11:40.240 --> 00:11:42.865 that would fall within the public interest. 00:11:42.865 --> 00:11:45.740 Burleson County is also blessed with abundant 00:11:45.740 --> 00:11:48.020 high-quality groundwater. 00:11:48.020 --> 00:11:51.220 In fact, so much so that we are now the source of the 00:11:51.220 --> 00:11:54.030 largest inner-basin transfer of water 00:11:54.030 --> 00:11:56.233 in the history of the state of Texas. 00:11:57.130 --> 00:12:00.006 The San Antonio Water Supply Corporation is permitted 00:12:00.006 --> 00:12:04.030 to transfer up to 60,000 acre feet a year 00:12:04.030 --> 00:12:07.993 of groundwater to supply the I-35 Corridor. 00:12:08.900 --> 00:12:11.915 The pipeline from Burleson County to San Antonio 00:12:11.915 --> 00:12:14.560 is under construction and said to be completed 00:12:14.560 --> 00:12:15.720 within the next two years. 00:12:15.720 --> 00:12:17.040 The wells are already drilled, 00:12:17.040 --> 00:12:19.340 all have been tested. 00:12:19.340 --> 00:12:22.060 The most critical aspect of any saltwater disposal 00:12:22.060 --> 00:12:24.640 application is the protection of freshwater. 00:12:24.640 --> 00:12:27.530 The use of a cement log to establish a firm bond 00:12:27.530 --> 00:12:30.060 between the well's casing and cement surrounding it 00:12:30.060 --> 00:12:34.570 is the most reliable way of establishing this bond. 00:12:34.570 --> 00:12:37.810 Without this test there is a chance 00:12:37.810 --> 00:12:40.390 that some of the injected fluids might migrate 00:12:40.390 --> 00:12:42.790 into the various freshwater zones. 00:12:42.790 --> 00:12:44.740 So I'm asking for two modifications, 00:12:44.740 --> 00:12:47.387 or two requirements to be added to the permit. 00:12:47.387 --> 00:12:50.220 Number one, require that the maximum fluids 00:12:50.220 --> 00:12:52.570 transported by truck be limited to 30, 00:12:52.570 --> 00:12:55.800 I mean, excuse me, they suggested 30,000, 00:12:55.800 --> 00:12:58.453 we're suggesting 5,000 barrels per day. 00:12:59.520 --> 00:13:02.570 And the excess to be transported by pipe. 00:13:02.570 --> 00:13:07.320 A pipeline can easily be built from a much larger facility 00:13:07.320 --> 00:13:09.260 that Wildhorse already owns and operates 00:13:09.260 --> 00:13:12.530 on a state road that is four miles away from the site 00:13:12.530 --> 00:13:14.720 where this disposal well is. 00:13:14.720 --> 00:13:17.797 And then also require that a new cement bond log be run 00:13:17.797 --> 00:13:21.680 with a commission district office representative present. 00:13:21.680 --> 00:13:23.500 These requests are not unreasonable. 00:13:23.500 --> 00:13:25.450 Both will serve not only the public interests 00:13:25.450 --> 00:13:27.290 of the people of Burleson County, 00:13:27.290 --> 00:13:30.160 but also the people of Texas that will soon be enjoying 00:13:30.160 --> 00:13:32.382 that freshwater from Burleson County. 00:13:32.382 --> 00:13:34.560 I'll be glad to answer any questions. 00:13:34.560 --> 00:13:35.393 - Thank you, Judge. 00:13:35.393 --> 00:13:37.270 Anybody have any questions for the judge? 00:13:37.270 --> 00:13:40.190 - Judge, I just want to thank you for coming. 00:13:40.190 --> 00:13:41.810 I appreciate you doing this. 00:13:41.810 --> 00:13:44.290 Let me share with you, I lived in rural East Texas, 00:13:44.290 --> 00:13:47.010 where we had the disposal problem on the county roads, 00:13:47.010 --> 00:13:48.687 and I understand your problem. 00:13:49.567 --> 00:13:51.530 The thing I would encourage you 00:13:51.530 --> 00:13:53.803 is to work with TxDOT on this problem 00:13:53.803 --> 00:13:56.107 because we are certainly being heard before now, 00:13:56.107 --> 00:13:58.050 and some other issues of this kind. 00:13:58.050 --> 00:13:58.883 - [Mike] Right. 00:13:58.883 --> 00:14:02.530 - What I found, and this has nothing to do, just sharing, 00:14:02.530 --> 00:14:05.270 in our town we found that the total intake of taxes 00:14:05.270 --> 00:14:09.130 from the oil and gas revenue somewhat supplemented 00:14:09.130 --> 00:14:12.190 what was needed for the county road maintenance. 00:14:12.190 --> 00:14:14.210 While there was always, 00:14:14.210 --> 00:14:17.150 the big problem we had this kind of site was bridges. 00:14:17.150 --> 00:14:18.760 'Cause bridges are phenomenally expensive 00:14:18.760 --> 00:14:19.788 on those county roads. 00:14:19.788 --> 00:14:23.432 Some of those county roads have 80 of these little bridges. 00:14:23.432 --> 00:14:25.190 So I understand your problem. 00:14:25.190 --> 00:14:27.120 We did pass some legislation that helps with that. 00:14:27.120 --> 00:14:28.687 I think you'll find the legislature. 00:14:28.687 --> 00:14:29.720 [Mike] Right. 00:14:29.720 --> 00:14:31.490 - May I assure you in closing, 00:14:31.490 --> 00:14:34.493 that we are very concerned of groundwater. 00:14:34.493 --> 00:14:36.810 You might go back and look at a report 00:14:36.810 --> 00:14:40.310 that our good staff did just a while back, 00:14:40.310 --> 00:14:42.860 and researching all of the drilling 00:14:42.860 --> 00:14:44.880 across the state of Texas, the disposal, 00:14:44.880 --> 00:14:48.280 there was not one ounce of drinking water 00:14:48.280 --> 00:14:51.550 that could be identified as being exposed or contaminated. 00:14:51.550 --> 00:14:53.100 And so I think there's some good results there, 00:14:53.100 --> 00:14:55.000 and that study was in fact 00:14:55.000 --> 00:14:58.990 endorsed and backed and complimented by the National EPA. 00:14:58.990 --> 00:15:00.680 So that might be some assurance for you folks 00:15:00.680 --> 00:15:04.650 on some of these issues that we hope to be monitoring 00:15:04.650 --> 00:15:08.030 and have successfully the last decades, this good staff has. 00:15:08.030 --> 00:15:09.850 And you'll find they'll work with you in any way. 00:15:09.850 --> 00:15:10.740 Thank you for coming. 00:15:10.740 --> 00:15:12.010 - Yeah, absolutely. 00:15:12.010 --> 00:15:14.447 I just wanna again point out that there's 00:15:14.447 --> 00:15:17.820 an over a hundred acre site that Wildhorse owns 00:15:17.820 --> 00:15:20.280 that's a sand and cement site 00:15:20.280 --> 00:15:23.250 that's four miles away from where the well site is. 00:15:23.250 --> 00:15:26.090 If they're already saying that they would agree 00:15:26.090 --> 00:15:29.840 to limit themselves to 30,000 barrels a day being trucked, 00:15:29.840 --> 00:15:32.256 which is still 300 trucks a day, 00:15:32.256 --> 00:15:35.230 then that means they're gonna be piping 00:15:35.230 --> 00:15:36.890 some of it in already. 00:15:36.890 --> 00:15:40.130 We would just ask that the Commission consider 00:15:40.130 --> 00:15:43.300 having that number lowered down 00:15:43.300 --> 00:15:46.470 to 5,000 barrels of oil per day. 00:15:46.470 --> 00:15:51.470 And they already have a 24-hour facility four miles away 00:15:52.090 --> 00:15:56.537 that they could easily use to pipe it over. 00:15:58.757 --> 00:16:01.178 So on that part, take care of that. 00:16:01.178 --> 00:16:04.710 The Post Oak Savannah Groundwater Conservation District, 00:16:04.710 --> 00:16:06.973 of which we appoint the commissioners to it, 00:16:08.006 --> 00:16:13.006 they also were one of the protestants that 00:16:13.155 --> 00:16:15.663 have concerns about this. 00:16:16.740 --> 00:16:19.036 We would just ask that that one extra log be run 00:16:19.036 --> 00:16:23.197 so that way it would assure everyone, 00:16:23.197 --> 00:16:25.460 and it would be easier for me to assure everyone 00:16:25.460 --> 00:16:28.150 in Burleson County that we've done everything possible 00:16:28.150 --> 00:16:29.640 to ensure that the water, 00:16:29.640 --> 00:16:32.506 not only for us but eventually a supply 00:16:32.506 --> 00:16:36.910 a lot of us and a lot of y'all over here, 00:16:36.910 --> 00:16:40.134 would be good water. 00:16:40.134 --> 00:16:41.460 So thank you. 00:16:41.460 --> 00:16:42.293 - [Christi] Thank you, Judge. 00:16:42.293 --> 00:16:43.585 Did you have any questions? 00:16:43.585 --> 00:16:44.850 - Yeah, more of a statement. 00:16:44.850 --> 00:16:47.090 Once again, I wanna echo what Commissioner Christian said, 00:16:47.090 --> 00:16:48.020 I appreciate you being here 00:16:48.020 --> 00:16:50.960 and taking the time to come up and engage with us. 00:16:50.960 --> 00:16:52.650 You asked about the integrity, 00:16:52.650 --> 00:16:53.640 or ensuring the integrity, 00:16:53.640 --> 00:16:56.513 of the cement job and running a cement bond log. 00:16:57.460 --> 00:16:59.930 They ran a series of tests on the well. 00:16:59.930 --> 00:17:01.180 They ran a fit assessment, 00:17:01.180 --> 00:17:03.580 a pressure test on the surface and production casing, 00:17:03.580 --> 00:17:06.978 acoustic cement bond assessment on the cement. 00:17:06.978 --> 00:17:08.520 That was all recent, 00:17:08.520 --> 00:17:10.510 plus whatever they did when the well was originally drilled, 00:17:10.510 --> 00:17:12.020 which I don't have quick reference to here. 00:17:12.020 --> 00:17:13.018 - [Mike] Right. 00:17:13.018 --> 00:17:16.170 - These series of tests give us, 00:17:16.170 --> 00:17:17.860 in general, from an industry perspective, 00:17:17.860 --> 00:17:19.220 a lot of confidence. 00:17:19.220 --> 00:17:20.980 So, I want to make sure, 00:17:20.980 --> 00:17:24.540 you didn't state that, that they've done a lot of things 00:17:24.540 --> 00:17:27.120 to make sure that this well has sufficient integrity. 00:17:27.120 --> 00:17:27.953 Those are the things our staff 00:17:27.953 --> 00:17:30.599 and our hearings examiners will look for. 00:17:30.599 --> 00:17:32.740 The cement bond log is not the only way 00:17:32.740 --> 00:17:34.890 to make sure that the wellbore has integrity, 00:17:34.890 --> 00:17:36.990 and I believe in this case they've done that. 00:17:36.990 --> 00:17:39.990 In all these cases, we never know. 00:17:39.990 --> 00:17:41.849 Nothing is 100%, right? 00:17:41.849 --> 00:17:45.380 When our staff goes in to look, and the rules that we have 00:17:45.380 --> 00:17:48.350 around how these things are done offers some variations, 00:17:48.350 --> 00:17:51.455 and I believe that they've used a series of variations 00:17:51.455 --> 00:17:53.350 that give us a lot of confidence, 00:17:53.350 --> 00:17:55.199 once again, as an industry, that this well is okay. 00:17:55.199 --> 00:17:56.105 - [Mike] Thank you. 00:17:56.105 --> 00:17:57.340 - Thank you, Mike. 00:17:57.340 --> 00:17:58.280 - [Christi] Thank you for being here. 00:17:58.280 --> 00:17:59.385 We appreciate it. 00:17:59.385 --> 00:18:00.802 - [Mike] You bet. 00:18:01.810 --> 00:18:04.860 - I also have on behalf of Wildhorse, Mr. Neale, 00:18:04.860 --> 00:18:07.080 and since we've had one negative, 00:18:07.080 --> 00:18:09.683 do you want to get up and add anything, Mr. Neale? 00:18:10.650 --> 00:18:12.795 - [George] Well, we did everything he asked us to do. 00:18:12.795 --> 00:18:14.064 - [Wayne] You have to come talk into the mic. 00:18:14.064 --> 00:18:14.940 - Come up here, unfortunately. 00:18:14.940 --> 00:18:16.595 - [George] I'm not planning on being there very long. 00:18:16.595 --> 00:18:18.140 - No, no, I appreciate it, but I always like to give 00:18:18.140 --> 00:18:20.153 both opposing sides an opportunity. 00:18:21.943 --> 00:18:23.773 - George Neale, for the applicant. 00:18:25.160 --> 00:18:27.990 We ran that cement bond log that he asked about. 00:18:27.990 --> 00:18:29.370 We had engineers, 00:18:29.370 --> 00:18:32.430 Ph.D's from UT testified about the construction 00:18:32.430 --> 00:18:34.621 and the integrity of the well. 00:18:34.621 --> 00:18:37.340 All the things he asked for 00:18:37.340 --> 00:18:39.730 they've done it about four times over. 00:18:39.730 --> 00:18:41.510 These guys have spent an incredible amount of money 00:18:41.510 --> 00:18:44.050 making sure the cement was competent. 00:18:44.050 --> 00:18:46.480 They ran four cement squeezes. 00:18:46.480 --> 00:18:48.100 They took the well over from Clayton Williams. 00:18:48.100 --> 00:18:49.400 They ran cement squeezes. 00:18:49.400 --> 00:18:50.900 They ran cement bond logs. 00:18:50.900 --> 00:18:52.510 They pressure tested the well. 00:18:52.510 --> 00:18:55.160 Actually, when they found the well for this conversion, 00:18:55.160 --> 00:18:57.580 they had pressure on it, for years. 00:18:57.580 --> 00:18:59.580 There's no way that this well will be a problem 00:18:59.580 --> 00:19:02.420 if it maintained that pressure in place for years 00:19:02.420 --> 00:19:04.040 before they started working on it. 00:19:04.040 --> 00:19:07.750 This is a well that should not ever be a problem. 00:19:07.750 --> 00:19:09.940 All that talk about a hundred acre facility, 00:19:09.940 --> 00:19:11.573 that was not in the record. 00:19:12.580 --> 00:19:14.780 Personally, I attended the hearing, 00:19:14.780 --> 00:19:15.830 I represented the applicant, 00:19:15.830 --> 00:19:18.681 and I don't know anything about what he's talking about. 00:19:18.681 --> 00:19:19.670 Thank you. 00:19:19.670 --> 00:19:22.320 - Thank you, George. 00:19:22.320 --> 00:19:24.960 Do y'all have any questions before he sits down? 00:19:24.960 --> 00:19:27.010 Robert, do you have anything else to add? 00:19:27.010 --> 00:19:28.810 Do we have any questions for Robert? 00:19:29.692 --> 00:19:31.093 Okay, thank you. 00:19:34.502 --> 00:19:35.490 Alright. 00:19:35.490 --> 00:19:37.640 I move we approve the examiners' recommendation. 00:19:37.640 --> 00:19:38.473 Is there a second? 00:19:38.473 --> 00:19:39.306 - [Wayne] Second. 00:19:39.306 --> 00:19:40.760 - Second by Commissioner Christian. 00:19:40.760 --> 00:19:42.425 All those in favor, say aye. 00:19:42.425 --> 00:19:43.258 - [Commissioners] Aye. 00:19:43.258 --> 00:19:44.600 - Motion passed, this item's approved. 00:19:44.600 --> 00:19:46.550 Thank you, thank you all for your time. 00:19:51.370 --> 00:19:52.710 Item number seven. 00:19:52.710 --> 00:19:53.543 Good morning, Richard. 00:19:53.543 --> 00:19:54.376 - Good morning. 00:19:54.376 --> 00:19:55.490 Good morning, Commissioners. 00:19:55.490 --> 00:19:56.970 For the record my name is Richard Eyster, 00:19:56.970 --> 00:19:59.700 Technical Examiner, Hearings Division. 00:19:59.700 --> 00:20:01.700 Item number seven is the docket to consider 00:20:01.700 --> 00:20:04.050 Commission's staff's administrative denials of 00:20:04.050 --> 00:20:06.710 the application of Four Half Circle, LP, 00:20:06.710 --> 00:20:11.710 pursuant to Statewide Rules 4.2, 3.8, and Statewide Rule 78, 00:20:12.410 --> 00:20:15.240 for a permit to construct and operate a stationary, 00:20:15.240 --> 00:20:18.280 commercial oil and gas solid waste recycling facility 00:20:18.280 --> 00:20:19.323 in McMullen County. 00:20:20.770 --> 00:20:22.920 The proposed site is located on eight acres 00:20:22.920 --> 00:20:27.013 of a 568-acre tract, approximately 20 miles south of Tilden. 00:20:28.010 --> 00:20:30.310 The application is opposed by commission staff 00:20:30.310 --> 00:20:33.860 and protested by the McMullen County Conservation Group. 00:20:33.860 --> 00:20:36.930 The protestants contend that the proposed application 00:20:36.930 --> 00:20:39.700 does not meet the minimum requirements of the applicable 00:20:39.700 --> 00:20:42.270 statewide rules and are concerned that the facility 00:20:42.270 --> 00:20:43.829 will pollute surface and groundwater, 00:20:43.829 --> 00:20:45.450 and may cause the waste of 00:20:45.450 --> 00:20:48.123 oil, gas, or hydrothermal resources. 00:20:48.970 --> 00:20:51.870 The examiner and the administrative law judge conclude 00:20:51.870 --> 00:20:53.830 the proposed application does not meet 00:20:53.830 --> 00:20:55.860 the minimum requirements of the Commission's rules, 00:20:55.860 --> 00:20:58.200 and recommend that the application be denied. 00:20:58.200 --> 00:20:59.620 No exceptions were received, 00:20:59.620 --> 00:21:01.530 and I'm available to answer any questions. 00:21:01.530 --> 00:21:02.840 - [Christi] Thank you, are there any questions? 00:21:02.840 --> 00:21:04.240 - [Commissioners] No. 00:21:04.240 --> 00:21:06.390 - I move we approve the examiners' recommendation. 00:21:06.390 --> 00:21:07.380 Is there a second? 00:21:07.380 --> 00:21:08.213 - [Ryan] Second. 00:21:08.213 --> 00:21:09.410 - Second by Commissioner Sitton. 00:21:09.410 --> 00:21:10.659 All those in favor, say aye. 00:21:10.659 --> 00:21:11.510 - [Commissioners] Aye. 00:21:11.510 --> 00:21:12.998 - Motion's approved, item passes. 00:21:12.998 --> 00:21:14.053 Thank you, Richard. 00:21:16.650 --> 00:21:18.770 - Morning, Lynn, you're gonna do eight and nine together? 00:21:18.770 --> 00:21:19.603 - [Lynn] Yes, please. 00:21:19.603 --> 00:21:20.436 - Great. 00:21:20.436 --> 00:21:23.120 - Items number eight and nine have common issues 00:21:23.120 --> 00:21:25.890 of fact and law and were heard as a consolidated hearing. 00:21:25.890 --> 00:21:27.369 With your permission, 00:21:27.369 --> 00:21:30.660 I will present them as one item for one vote, one order. 00:21:30.660 --> 00:21:32.730 Items eight and nine are complaints filed 00:21:32.730 --> 00:21:35.168 by Marilyn Jones claiming Chisholm Operating does not have 00:21:35.168 --> 00:21:37.880 a good faith claim to operate two leases 00:21:37.880 --> 00:21:40.000 in Callahan County, Texas. 00:21:40.000 --> 00:21:41.370 Complainant is a mineral owner 00:21:41.370 --> 00:21:43.380 of the subject wells on the leases. 00:21:43.380 --> 00:21:44.830 Complainant requests that the Commission 00:21:44.830 --> 00:21:46.914 find the operator does not have a good faith claim 00:21:46.914 --> 00:21:50.690 to operate the leases and order the wells plugged. 00:21:50.690 --> 00:21:52.440 Complainant asserts that the contractual lease 00:21:52.440 --> 00:21:53.860 on which the operator relies 00:21:53.860 --> 00:21:55.920 has failed for lack of production. 00:21:55.920 --> 00:21:58.248 The contractual lease is past its primary term 00:21:58.248 --> 00:22:01.810 and requires production thereafter to prevent termination. 00:22:01.810 --> 00:22:05.450 There's been no record of production since 2016. 00:22:05.450 --> 00:22:07.640 Respondent contends that the contractual lease 00:22:07.640 --> 00:22:10.820 has not terminated and is being held by the production of 00:22:10.820 --> 00:22:12.640 small amounts of gas. 00:22:12.640 --> 00:22:13.980 The wells are not operational. 00:22:13.980 --> 00:22:16.400 Electricity has been disconnected. 00:22:16.400 --> 00:22:17.780 It is recommended that the commission 00:22:17.780 --> 00:22:19.220 grant the complainant's request 00:22:19.220 --> 00:22:21.270 and find respondent does not have a good faith claim 00:22:21.270 --> 00:22:23.980 to operate the leases and order the wells plugged. 00:22:23.980 --> 00:22:25.250 No exceptions were filed. 00:22:25.250 --> 00:22:26.870 I'm available for any questions. 00:22:26.870 --> 00:22:28.948 - Thank you, are there any questions? 00:22:28.948 --> 00:22:29.781 - [Commissioners] No. 00:22:29.781 --> 00:22:31.550 - I move we approve the examiners' recommendation 00:22:31.550 --> 00:22:33.120 on items eight and nine. 00:22:33.120 --> 00:22:33.953 Is there a second? 00:22:33.953 --> 00:22:34.786 - [Wayne] Second. 00:22:34.786 --> 00:22:36.120 - Second by Commissioner Christian. 00:22:36.120 --> 00:22:37.278 All those in favor, say aye. 00:22:37.278 --> 00:22:38.210 - [Commissioners] Aye. 00:22:38.210 --> 00:22:39.950 - Motions are passed, items are approved. 00:22:39.950 --> 00:22:40.783 Thank you. 00:22:43.654 --> 00:22:45.460 Item number 10. 00:22:45.460 --> 00:22:47.780 - [Woman] Chairman, the Hearings Division requests that 00:22:47.780 --> 00:22:49.430 item number 10 is passed. 00:22:49.430 --> 00:22:50.263 - Okay. 00:22:50.263 --> 00:22:51.440 Item number 10 we're passing. 00:22:52.730 --> 00:22:53.563 - Before we pass that 00:22:53.563 --> 00:22:55.228 I'd like to make a comment about number 10, 00:22:55.228 --> 00:22:58.469 if that's okay. 00:22:58.469 --> 00:23:00.297 I had prepared these comments 00:23:00.297 --> 00:23:02.886 and I'd like to put them out there anyway. 00:23:02.886 --> 00:23:05.963 There's something about this particular case that struck me. 00:23:07.620 --> 00:23:10.910 One was, we got an operator here who clearly 00:23:10.910 --> 00:23:12.530 is operating outside of a permit. 00:23:12.530 --> 00:23:14.360 And that's a serious issue, 00:23:14.360 --> 00:23:19.350 and I'm all in favor of being very direct 00:23:19.350 --> 00:23:22.380 and being swift with action when operators do that. 00:23:22.380 --> 00:23:26.440 In this case, levying a hefty fine is appropriate. 00:23:26.440 --> 00:23:29.240 However, it seems like there were a number of issues 00:23:29.240 --> 00:23:30.850 in how our case was presented, 00:23:30.850 --> 00:23:35.850 and so, if we're gonna do the things we should do 00:23:37.381 --> 00:23:39.970 to hold people accountable for their actions, 00:23:39.970 --> 00:23:42.150 if we're gonna do that, we need to be specific. 00:23:42.150 --> 00:23:43.080 There's nowhere in this record 00:23:43.080 --> 00:23:46.430 that explained how the $329,000 was totaled, 00:23:46.430 --> 00:23:48.130 and where we got that number from. 00:23:49.530 --> 00:23:52.480 In the record it says that the operator violated 00:23:52.480 --> 00:23:53.950 their capacity limits. 00:23:53.950 --> 00:23:56.548 But then in their exceptions they come back and say, 00:23:56.548 --> 00:23:59.080 part of that was oil, it wasn't a waste product, 00:23:59.080 --> 00:24:01.710 and we in our responses don't address that issue. 00:24:01.710 --> 00:24:06.340 That's a pretty significant area of disagreement. 00:24:06.340 --> 00:24:10.480 We alleged that there were issues of contamination 00:24:10.480 --> 00:24:11.418 because there was, 00:24:11.418 --> 00:24:12.690 due to over spray. 00:24:12.690 --> 00:24:15.037 But then our own inspector somewhere said, 00:24:15.037 --> 00:24:17.663 all of that has been cleaned up and remediated. 00:24:18.860 --> 00:24:20.836 Finally, in one of the offers, 00:24:20.836 --> 00:24:25.427 apparently our enforcement staff offered a deal in which 00:24:25.427 --> 00:24:27.740 they would have to give up their right to 00:24:27.740 --> 00:24:28.640 notice of the hearings, 00:24:28.640 --> 00:24:32.350 allowing enforcement to single-handedly shut this down, 00:24:32.350 --> 00:24:34.810 which I think, my concern is violation of due process. 00:24:34.810 --> 00:24:36.285 So my point is, 00:24:36.285 --> 00:24:39.870 I believe it's doing the state's business 00:24:39.870 --> 00:24:41.880 to hold people accountable for violating permits, 00:24:41.880 --> 00:24:43.050 and hefty fines are appropriate. 00:24:43.050 --> 00:24:46.080 And I'm glad to see that we are taking swift action 00:24:47.588 --> 00:24:49.120 and recognizing a fault here. 00:24:49.120 --> 00:24:50.070 But if we're gonna do that, 00:24:50.070 --> 00:24:52.150 we need to be very deliberate in our reporting 00:24:52.150 --> 00:24:53.870 of how we got to those conclusions, 00:24:53.870 --> 00:24:55.670 how we landed there. 00:24:55.670 --> 00:24:59.240 This record, frankly, was weak to support that. 00:24:59.240 --> 00:25:01.180 Although I think that it may be entirely appropriate, 00:25:01.180 --> 00:25:03.330 but there wasn't enough data there for me to assess. 00:25:03.330 --> 00:25:05.720 So I'm glad y'all are passing it. 00:25:05.720 --> 00:25:06.860 I think that probably makes sense, 00:25:06.860 --> 00:25:08.720 but I still wanted to make my comments about this one 00:25:08.720 --> 00:25:09.917 'cause it was concerning to me. 00:25:09.917 --> 00:25:11.057 Thank you. 00:25:11.057 --> 00:25:11.900 - [Christi and Ryan] Thank you. 00:25:11.900 --> 00:25:13.179 - [Ryan] Madam Chairman. 00:25:13.179 --> 00:25:14.012 - Yeah. 00:25:14.012 --> 00:25:14.863 - If I might mention, 00:25:15.850 --> 00:25:17.020 I think you're doing the appropriate thing 00:25:17.020 --> 00:25:19.107 by passing for reconsideration on this. 00:25:19.107 --> 00:25:21.003 May I express that my concern is 00:25:21.003 --> 00:25:22.870 yes, number one, we need to protect the public, 00:25:22.870 --> 00:25:24.980 make sure that the rules are followed. 00:25:24.980 --> 00:25:27.498 I compliment the staff for doing that. 00:25:27.498 --> 00:25:30.750 I do have a concern of the amount of the fine 00:25:30.750 --> 00:25:32.150 that was put there. 00:25:32.150 --> 00:25:33.410 We wanna do hefty fines, 00:25:33.410 --> 00:25:35.350 but just like we want to protect the public 00:25:35.350 --> 00:25:39.158 from any dangers or any problems, 00:25:39.158 --> 00:25:41.490 we also don't want to put people out of work. 00:25:41.490 --> 00:25:43.100 And when fines are that size, 00:25:43.100 --> 00:25:45.610 it makes me concerned that we're harming citizens, 00:25:45.610 --> 00:25:47.010 in that point, 00:25:47.010 --> 00:25:49.030 by threatening the life of a company. 00:25:49.030 --> 00:25:51.049 That should be a consideration also. 00:25:51.049 --> 00:25:52.510 Safety, number one, 00:25:52.510 --> 00:25:55.050 but also the livelihoods of our citizens of Texas 00:25:55.050 --> 00:25:58.038 is a concern I have on the amount of that fine. 00:25:58.038 --> 00:26:00.610 - I think we probably all have some of the same challenges, 00:26:00.610 --> 00:26:04.700 so thank y'all for passing and going back and re-looking at, 00:26:04.700 --> 00:26:07.810 specifically in giving us some more vibrant PFD 00:26:07.810 --> 00:26:09.570 so we understand the process. 00:26:09.570 --> 00:26:10.870 Thank y'all for your time. 00:26:12.605 --> 00:26:13.693 Item number 12. 00:26:15.242 --> 00:26:16.075 - [Woman] Hold on, 11. 00:26:16.075 --> 00:26:16.908 - I'm sorry, 11. 00:26:16.908 --> 00:26:17.973 Sorry, I skipped one. 00:26:19.100 --> 00:26:20.670 - Kristi Reeve, Administrative Law Judge 00:26:20.670 --> 00:26:22.090 with the Hearings Division. 00:26:22.090 --> 00:26:23.480 Item number 11 is a motion for 00:26:23.480 --> 00:26:25.441 rehearing an enforcement matter. 00:26:25.441 --> 00:26:28.710 On October 30, 2018, the Commission issued an order 00:26:28.710 --> 00:26:31.820 finding Jet Black Oil in violation of Commission rules 00:26:31.820 --> 00:26:34.550 and finding its officers subject to the restrictions 00:26:34.550 --> 00:26:38.040 of Texas Natural Resources Code 91.114. 00:26:38.040 --> 00:26:40.650 On November 27, 2018, the Commission received 00:26:40.650 --> 00:26:43.020 Jet Black's time and motion for rehearing. 00:26:43.020 --> 00:26:45.000 Enforcement filed a response and opposition 00:26:45.000 --> 00:26:46.800 to the motion for rehearing. 00:26:46.800 --> 00:26:49.250 None of the issues raised in the motion are new. 00:26:49.250 --> 00:26:50.680 All issues raised in the motion 00:26:50.680 --> 00:26:52.490 were already raised by respondent 00:26:52.490 --> 00:26:53.851 and considered by the Commission 00:26:53.851 --> 00:26:56.690 prior to the Commission issuing its order. 00:26:56.690 --> 00:26:58.740 It is recommended the motion be denied. 00:26:58.740 --> 00:27:00.610 The motion will be overruled by operation of law 00:27:00.610 --> 00:27:02.720 on February 7, 2019. 00:27:02.720 --> 00:27:04.220 I'm available for questions. 00:27:04.220 --> 00:27:05.140 - [Christi] Are there any questions? 00:27:05.140 --> 00:27:05.973 - [Commissioners] No. 00:27:05.973 --> 00:27:07.424 - I move that we approve the examiners' recommendation. 00:27:07.424 --> 00:27:08.580 Is there a second? 00:27:08.580 --> 00:27:09.710 - [Ryan] Second. 00:27:09.710 --> 00:27:11.204 - Second by Commissioner Sitton. 00:27:11.204 --> 00:27:12.160 All those in favor, say aye. 00:27:12.160 --> 00:27:13.334 - [Commissioners] Aye. 00:27:13.334 --> 00:27:14.420 Motion's approved. 00:27:14.420 --> 00:27:15.500 Item number 12. 00:27:15.500 --> 00:27:16.753 - [Kristi] Thank you very much. 00:27:17.590 --> 00:27:19.170 - Oh, you're already standing up here, okay. 00:27:19.170 --> 00:27:20.213 Sorry. 00:27:20.213 --> 00:27:21.046 Morning. 00:27:21.046 --> 00:27:21.879 - Good morning, Chairman. 00:27:21.879 --> 00:27:23.010 Good morning, Commissioners. 00:27:23.010 --> 00:27:24.674 I'm Jennifer Cook with the Hearings Division. 00:27:24.674 --> 00:27:28.000 Item 12 concerns a timely motion for rehearing 00:27:28.000 --> 00:27:30.680 of a Commission default enforcement order 00:27:30.680 --> 00:27:32.350 approving the administrative penalty 00:27:32.350 --> 00:27:37.000 of $9200 for violation of Statewide Rule 14D12 00:27:38.390 --> 00:27:41.973 against respondent Hitex Resources, LP. 00:27:43.130 --> 00:27:46.010 Respondent claims it did not receive the original complaint 00:27:46.010 --> 00:27:48.000 and is now aware of this case. 00:27:48.000 --> 00:27:51.650 Respondent asserts it is working on compliance. 00:27:51.650 --> 00:27:54.040 Staff found a response in opposition to the motion. 00:27:54.040 --> 00:27:56.100 The original complaint was sent 00:27:56.100 --> 00:27:58.140 to the respondent's address of record 00:27:58.140 --> 00:27:59.060 here at the Commission, 00:27:59.060 --> 00:28:02.370 which is also the same address identified 00:28:02.370 --> 00:28:03.770 on the motion for rehearing. 00:28:04.700 --> 00:28:06.970 The certified mail was delivered 00:28:06.970 --> 00:28:09.530 and the first-class mail was not returned. 00:28:09.530 --> 00:28:11.610 The examiners recommend denying the motion. 00:28:11.610 --> 00:28:14.600 The motion is overruled by operation of law, 00:28:14.600 --> 00:28:17.990 or will be on February 21, 2019, 00:28:17.990 --> 00:28:19.627 and I'm available for questions. 00:28:19.627 --> 00:28:22.160 - Thank you, are there any questions? 00:28:22.160 --> 00:28:24.340 I move we approve the examiners' recommendation. 00:28:24.340 --> 00:28:25.173 Is there a second? 00:28:25.173 --> 00:28:26.160 - [Wayne] Second. 00:28:26.160 --> 00:28:27.770 - Second by Commissioner Christian. 00:28:27.770 --> 00:28:29.070 All those in favor, say aye. 00:28:29.070 --> 00:28:30.010 - [Commissioners] Aye. 00:28:30.010 --> 00:28:30.950 - Motion is approved. 00:28:30.950 --> 00:28:31.970 Thank you. 00:28:31.970 --> 00:28:33.940 - I'm also doing item 13. 00:28:33.940 --> 00:28:37.270 Item 13 concerns a Commission default order 00:28:37.270 --> 00:28:39.790 approving lease change of operator from 00:28:39.790 --> 00:28:42.530 Lavaca River Operating Company, LLC, 00:28:42.530 --> 00:28:46.650 to Mid-Texas Natural Gas for the West Sandy Creek, Unit One. 00:28:46.650 --> 00:28:49.270 The order was issued after Lavaca did not respond 00:28:49.270 --> 00:28:53.100 to a letter containing a notice of opportunity for hearing. 00:28:53.100 --> 00:28:56.440 A timely motion for rehearing was received from Lavaca. 00:28:56.440 --> 00:28:58.530 Lavaca claimed it did not receive the notice. 00:28:58.530 --> 00:29:01.130 The notice was sent to Lavaca's address of record, 00:29:01.130 --> 00:29:03.270 which is also the same address identified 00:29:03.270 --> 00:29:05.330 on the motion for rehearing. 00:29:05.330 --> 00:29:06.320 The first-class mailing 00:29:06.320 --> 00:29:10.080 of the opportunity for hearing was not returned. 00:29:10.080 --> 00:29:12.020 The examiners recommend denying the motion. 00:29:12.020 --> 00:29:15.160 The motion will be overruled by operation of law 00:29:15.160 --> 00:29:17.007 on February 21, 2019, 00:29:17.007 --> 00:29:18.780 and I'm available for questions. 00:29:18.780 --> 00:29:20.298 - [Christi] Thank you, are there any questions? 00:29:20.298 --> 00:29:21.131 - [Wayne] No. 00:29:21.131 --> 00:29:22.640 - I move we approve the examiners' recommendation. 00:29:22.640 --> 00:29:23.620 Is there a second? 00:29:23.620 --> 00:29:24.453 - [Ryan] Second. 00:29:24.453 --> 00:29:25.400 - Second by Commissioner Sitton. 00:29:25.400 --> 00:29:26.668 All those in favor, say aye. 00:29:26.668 --> 00:29:27.630 - [Commissioners] Aye. 00:29:27.630 --> 00:29:29.450 - Motion's approved. 00:29:29.450 --> 00:29:31.330 Thank you, Jennifer. 00:29:32.220 --> 00:29:33.053 Item 14. 00:29:36.400 --> 00:29:37.580 Morning, Clayton. 00:29:37.580 --> 00:29:39.060 - Morning. 00:29:39.060 --> 00:29:40.460 Chairman and Commissioners, Clayton Hoover, 00:29:40.460 --> 00:29:42.340 Administrative Law Judge. 00:29:42.340 --> 00:29:45.410 Item 14 is a motion for rehearing in an enforcement case 00:29:45.410 --> 00:29:47.141 against Lavaca River Operating Company 00:29:47.141 --> 00:29:49.420 out of Fort Bend County. 00:29:49.420 --> 00:29:52.113 It involves violations of Rule Three. 00:29:52.113 --> 00:29:53.990 The operator failed to respond 00:29:53.990 --> 00:29:56.180 after notice was properly sent. 00:29:56.180 --> 00:29:58.390 Docket proceeded as a default. 00:29:58.390 --> 00:30:00.610 On October 16, the Commission entered an order 00:30:00.610 --> 00:30:03.600 requiring compliance and assessing a penalty. 00:30:03.600 --> 00:30:05.180 Operator has filed the motion, 00:30:05.180 --> 00:30:06.500 alleging the failure to respond 00:30:06.500 --> 00:30:08.860 was due to a reasonable mistake 00:30:08.860 --> 00:30:11.520 and are requesting more time for compliance. 00:30:11.520 --> 00:30:14.550 But it has not presented facts which would refute 00:30:14.550 --> 00:30:17.530 the Rule Three violations proved by staff. 00:30:17.530 --> 00:30:20.540 It therefore fails the second prong of the Craddock Test. 00:30:20.540 --> 00:30:23.850 The recommendation is to deny the motion. 00:30:23.850 --> 00:30:25.950 The motion will be overruled by operation of law 00:30:25.950 --> 00:30:29.334 on January 24, 2019. 00:30:29.334 --> 00:30:31.445 - [Christi] Thank you, are there any questions? 00:30:31.445 --> 00:30:32.427 - No. 00:30:32.427 --> 00:30:34.800 - I move we approve the examiners' recommendation. 00:30:34.800 --> 00:30:35.633 Is there a second? 00:30:35.633 --> 00:30:36.466 - [Wayne] Second. 00:30:36.466 --> 00:30:37.620 - Second by Commissioner Christian. 00:30:37.620 --> 00:30:38.785 All those in favor, say aye. 00:30:38.785 --> 00:30:39.770 - [Commissioners] Aye. 00:30:39.770 --> 00:30:41.382 Motion passed, this item's approved. 00:30:41.382 --> 00:30:42.215 Thank you. 00:30:42.215 --> 00:30:43.470 - Thank you, and item number 15 00:30:43.470 --> 00:30:45.820 is a motion for rehearing in an enforcement case 00:30:45.820 --> 00:30:48.045 against Kimber Oil Corporation. 00:30:48.045 --> 00:30:49.790 This is out of Wheeler County. 00:30:49.790 --> 00:30:52.850 It also involves violations of Rule Three. 00:30:52.850 --> 00:30:54.890 Once again, the operator failed to respond 00:30:54.890 --> 00:30:56.890 after a notice was properly sent. 00:30:56.890 --> 00:30:59.020 The docket proceeded as a default, 00:30:59.020 --> 00:31:02.130 and on October 16th, the Commission entered an order 00:31:02.130 --> 00:31:05.080 requiring compliance and assessing a penalty. 00:31:05.080 --> 00:31:07.120 The motion once again alleges 00:31:07.120 --> 00:31:08.590 that there was a reasonable mistake, 00:31:08.590 --> 00:31:11.880 but it does not present facts which would refute 00:31:11.880 --> 00:31:14.364 the Rule Three violations proved by staff, 00:31:14.364 --> 00:31:16.400 and therefore it doesn't satisfy 00:31:16.400 --> 00:31:18.140 the second prong of the Craddock Test. 00:31:18.140 --> 00:31:20.370 And the recommendation once again 00:31:20.370 --> 00:31:22.740 is to deny the motion for rehearing. 00:31:22.740 --> 00:31:25.010 And once again, it'll be overruled by operation of law 00:31:25.010 --> 00:31:26.906 on January 24, 2019. 00:31:26.906 --> 00:31:29.110 - [Christi] Are there any questions? 00:31:29.110 --> 00:31:29.943 - [Wayne] No. 00:31:29.943 --> 00:31:31.870 - I move we approve the examiners' recommendation. 00:31:31.870 --> 00:31:32.703 Is there a second? 00:31:32.703 --> 00:31:33.536 - [Ryan] Second. 00:31:33.536 --> 00:31:34.820 - Second by Commissioner Sitton. 00:31:34.820 --> 00:31:36.255 All those in favor, say aye. 00:31:36.255 --> 00:31:37.105 - [Commissioners] Aye. 00:31:37.105 --> 00:31:38.440 - Motion's approved. 00:31:38.440 --> 00:31:40.130 Item 16. 00:31:40.130 --> 00:31:42.610 - Item 16 is also a motion for rehearing 00:31:42.610 --> 00:31:46.030 in an enforcement case involving Rule Three violations. 00:31:46.030 --> 00:31:49.160 This is against Knox Oil and Gas, LLC. 00:31:49.160 --> 00:31:50.970 It's out of Harris County. 00:31:50.970 --> 00:31:53.150 One again, the operator failed to respond 00:31:53.150 --> 00:31:55.200 and proceeded as a default. 00:31:55.200 --> 00:31:58.090 On October 16th, the Commission entered the order 00:31:58.090 --> 00:32:00.787 requiring compliance and assessing a penalty. 00:32:00.787 --> 00:32:04.116 The operator filed the motion for rehearing, 00:32:04.116 --> 00:32:07.030 alleging that there was a reasonable mistake, 00:32:07.030 --> 00:32:08.970 mentioning that there had been recent flooding, 00:32:08.970 --> 00:32:10.790 which had been a burden on the operator, 00:32:10.790 --> 00:32:15.410 but it did not say that it was impairing their ability 00:32:15.410 --> 00:32:18.330 to achieve compliance, specifically, 00:32:18.330 --> 00:32:20.950 and requesting more time for compliance. 00:32:20.950 --> 00:32:23.614 But once again, it did not present facts 00:32:23.614 --> 00:32:26.990 to show that the violations did not occur. 00:32:26.990 --> 00:32:28.870 And compliance has not been achieved, 00:32:28.870 --> 00:32:31.890 so it fails the second prong of the Craddock Test. 00:32:31.890 --> 00:32:34.492 And once again the recommendation is to deny the motion. 00:32:34.492 --> 00:32:36.450 And once again, it's overruled 00:32:36.450 --> 00:32:39.293 by operation of law January 24, 2019. 00:32:39.293 --> 00:32:41.072 - [Christi] Are there any questions? 00:32:41.072 --> 00:32:41.984 - [Wayne] No. 00:32:41.984 --> 00:32:43.950 - I move we approve the examiners' recommendation. 00:32:43.950 --> 00:32:44.783 Is there a second? 00:32:44.783 --> 00:32:45.616 - [Wayne] Second. 00:32:45.616 --> 00:32:48.552 - Second by Commissioner Christian. 00:32:48.552 --> 00:32:50.854 All those in favor, say aye. 00:32:50.854 --> 00:32:51.687 - [Commissioners] Aye. 00:32:51.687 --> 00:32:54.203 - Motion passed, this item's approved. 00:32:54.203 --> 00:32:56.101 Thank you, Clayton. 00:32:56.101 --> 00:32:58.011 Lynn, good morning, you're back. 00:32:58.011 --> 00:32:58.844 - Thank you. 00:32:58.844 --> 00:33:00.830 Again, Lynn Latombe with the Hearings Division. 00:33:00.830 --> 00:33:03.320 Item 17 is a motion for rehearing filed by 00:33:03.320 --> 00:33:05.320 Safari Production Company. 00:33:05.320 --> 00:33:07.144 On October 30, 2018, the Commission entered a final order 00:33:07.144 --> 00:33:11.253 against Safari on a default enforcement action. 00:33:11.253 --> 00:33:14.580 The motion for rehearing states that Safari communicated 00:33:14.580 --> 00:33:16.352 with staff after receiving the notice 00:33:16.352 --> 00:33:18.622 and agreed to plug the well. 00:33:18.622 --> 00:33:21.120 The operator believed that its voluntary compliance 00:33:21.120 --> 00:33:22.150 answered the notice. 00:33:22.150 --> 00:33:24.320 No further action was required. 00:33:24.320 --> 00:33:26.070 Safari asserts the defense that the well 00:33:26.070 --> 00:33:27.530 was productive in the past, 00:33:27.530 --> 00:33:30.130 as shown by witnesses and business records. 00:33:30.130 --> 00:33:32.870 Staff responds that Safari does not meet the criteria 00:33:32.870 --> 00:33:34.700 to merit a new hearing. 00:33:34.700 --> 00:33:36.420 The motion for rehearing will be overruled 00:33:36.420 --> 00:33:39.572 by operation of law on February 7, 2019. 00:33:39.572 --> 00:33:41.540 Upon consideration of the arguments 00:33:41.540 --> 00:33:42.660 in the motion for rehearing, 00:33:42.660 --> 00:33:45.570 particularly the operator's mistake in good faith belief 00:33:45.570 --> 00:33:48.610 that he had voluntarily agreed with staff to plug the well, 00:33:48.610 --> 00:33:51.010 and his potential meritorious defense, 00:33:51.010 --> 00:33:54.220 it is recommended that the motion for rehearing be granted. 00:33:54.220 --> 00:33:55.783 I'm available for any questions. 00:33:55.783 --> 00:33:58.080 - [Christi] Are there any questions? 00:33:58.080 --> 00:33:58.913 - [Wayne] No. 00:33:58.913 --> 00:34:01.110 - I move we approve the examiners' recommendation. 00:34:01.110 --> 00:34:01.943 Is there a second? 00:34:01.943 --> 00:34:02.776 - [Ryan] Second. 00:34:02.776 --> 00:34:03.820 - Second by Commissioner Sitton. 00:34:03.820 --> 00:34:05.090 All those in favor, say aye. 00:34:05.090 --> 00:34:05.980 - [Commissioners] Aye. 00:34:05.980 --> 00:34:08.053 - Motion passed, this item's approved. 00:34:09.920 --> 00:34:11.940 - I'm also here for 18 and 19, 00:34:11.940 --> 00:34:14.840 both of which are P5 motions for rehearing. 00:34:14.840 --> 00:34:17.160 Item number 18 is a motion for rehearing 00:34:17.160 --> 00:34:19.520 filed by Flying Seven Oil Company. 00:34:19.520 --> 00:34:22.148 On October 16, 2018, 00:34:22.148 --> 00:34:24.370 a final order was entered by the Commission 00:34:24.370 --> 00:34:26.150 denying the renewal of the operator's 00:34:26.150 --> 00:34:27.713 P5 organization report, 00:34:27.713 --> 00:34:30.160 because the operator has wells not compliant 00:34:30.160 --> 00:34:31.970 with Statewide Rule 15. 00:34:31.970 --> 00:34:34.210 In its motion, the operator states they are working 00:34:34.210 --> 00:34:35.900 to schedule required testing, 00:34:35.900 --> 00:34:38.130 and need more time to come into compliance. 00:34:38.130 --> 00:34:40.810 Staff responds that one well is not compliant. 00:34:40.810 --> 00:34:42.760 It is recommended that the motion be denied. 00:34:42.760 --> 00:34:44.560 The motion is overruled by operation of law 00:34:44.560 --> 00:34:46.840 on January 24, 2019. 00:34:46.840 --> 00:34:48.410 I'm available for any questions. 00:34:48.410 --> 00:34:49.810 - [Christi] Thank you, are there any questions? 00:34:49.810 --> 00:34:50.643 - [Wayne] No. 00:34:50.643 --> 00:34:52.570 - I move we approve the examiners' recommendation. 00:34:52.570 --> 00:34:53.403 Is there a second? 00:34:53.403 --> 00:34:54.236 - [Wayne] Second. 00:34:54.236 --> 00:34:55.380 - Second by Commissioner Christian. 00:34:55.380 --> 00:34:56.613 All those in favor, say aye. 00:34:56.613 --> 00:34:57.450 [Commissioners] Aye. 00:34:57.450 --> 00:34:59.390 - Motion passed, this item's approved. 00:34:59.390 --> 00:35:00.223 19. 00:35:00.223 --> 00:35:02.130 - And, lastly, we have a good news item. 00:35:02.130 --> 00:35:03.980 A motion for rehearing was filed by 00:35:03.980 --> 00:35:06.423 Watson Solid Waste Disposal Systems, Ltd. 00:35:06.423 --> 00:35:08.810 Subsequent to filing the motion for rehearing, 00:35:08.810 --> 00:35:10.770 they have come into compliance. 00:35:10.770 --> 00:35:12.810 We recommend granting the motion for rehearing 00:35:12.810 --> 00:35:15.325 and dismissing the underlying docket as moot. 00:35:15.325 --> 00:35:17.015 - I always like good news, thank you. 00:35:17.015 --> 00:35:19.640 I move that we approve the examiners' recommendation. 00:35:19.640 --> 00:35:20.473 Is there a second? 00:35:20.473 --> 00:35:21.306 - [Ryan] Second. 00:35:21.306 --> 00:35:22.530 - Second by Commissioner Sitton. 00:35:22.530 --> 00:35:23.824 All those in favor, say aye. 00:35:23.824 --> 00:35:24.657 - [Commissioners] Aye. 00:35:24.657 --> 00:35:26.270 - Motion passes, that item's approved. 00:35:26.270 --> 00:35:27.233 Thank you, Lynn. 00:35:30.474 --> 00:35:32.570 We're gonna move to the oil and gas consent agenda. 00:35:32.570 --> 00:35:35.440 There are items 20 through 155, 00:35:35.440 --> 00:35:38.340 there are 136 items on the consent agenda. 00:35:38.340 --> 00:35:41.610 Do we have anything to needs to be taken up individually? 00:35:41.610 --> 00:35:42.940 Any changes, okay? 00:35:42.940 --> 00:35:46.880 I move we approve items 20 through 155. 00:35:46.880 --> 00:35:47.713 Is there a second? 00:35:47.713 --> 00:35:48.546 - [Wayne] Second. 00:35:48.546 --> 00:35:49.980 - Second by Commissioner Christian. 00:35:49.980 --> 00:35:51.020 All those in favor, say aye. 00:35:51.020 --> 00:35:52.290 - [Commissioners] Aye. 00:35:52.290 --> 00:35:54.393 - Motion passes, those items are approved. 00:35:55.320 --> 00:35:57.680 Rule 15, inactive well items, 00:35:57.680 --> 00:36:00.403 I'm told we have number 162 is in compliance, 00:36:00.403 --> 00:36:01.712 is that correct? 00:36:01.712 --> 00:36:02.545 - [Woman] That's correct. 00:36:02.545 --> 00:36:06.210 - So we have items 156 through 174, 00:36:06.210 --> 00:36:08.108 there are 19 of these. 00:36:08.108 --> 00:36:12.360 I move that we approve items 156 through 174, 00:36:12.360 --> 00:36:14.830 with the exception of item 162. 00:36:14.830 --> 00:36:15.663 Is there a second? 00:36:15.663 --> 00:36:16.496 - [Ryan] Second. 00:36:16.496 --> 00:36:17.830 - Second by Commissioner Sitton. 00:36:17.830 --> 00:36:19.103 All those in favor, say aye. 00:36:19.103 --> 00:36:20.080 - [Commissioners] Aye. 00:36:20.080 --> 00:36:22.230 - Motion passes, those items are approved. 00:36:22.230 --> 00:36:26.567 Master default items, items 175 through 234. 00:36:27.580 --> 00:36:29.500 There are 60 of these. 00:36:29.500 --> 00:36:32.840 I move we approve items 175 through 234. 00:36:32.840 --> 00:36:33.673 Is there a second? 00:36:33.673 --> 00:36:34.610 - [Wayne] Second. 00:36:34.610 --> 00:36:36.130 - Second by Commissioner Christian. 00:36:36.130 --> 00:36:37.414 All those in favor, say aye. 00:36:37.414 --> 00:36:38.363 - [Commissioners] Aye. 00:36:38.363 --> 00:36:41.220 - Motion passes, those items are approved. 00:36:41.220 --> 00:36:42.610 And agreed enforcement orders, 00:36:42.610 --> 00:36:44.400 I'm sorry, did I go too fast? 00:36:44.400 --> 00:36:46.180 - [Woman] Chairman, I believe on Rule 15, 00:36:46.180 --> 00:36:47.250 inactive well items, 00:36:47.250 --> 00:36:50.607 I believe you said items 156 to 174, 00:36:50.607 --> 00:36:52.470 and it should be 155. 00:36:52.470 --> 00:36:54.050 - Oh, I apologize. - [Woman] To 174. 00:36:54.050 --> 00:36:55.900 - Do I need to back up and redo that? 00:36:56.908 --> 00:36:58.210 I apologize. 00:36:58.210 --> 00:36:59.660 Can we back up and withdraw, 00:36:59.660 --> 00:37:00.579 who was my second? 00:37:00.579 --> 00:37:01.490 You were. 00:37:01.490 --> 00:37:02.323 - [Wayne] I was. 00:37:02.323 --> 00:37:04.470 Will you withdraw your second and let me readjust my motion, 00:37:04.470 --> 00:37:05.303 I apologize. 00:37:05.303 --> 00:37:10.160 - [Wayne] I will, and our, our book doesn't agree with that. 00:37:11.589 --> 00:37:13.523 - I did 155 in the one before. 00:37:15.580 --> 00:37:17.937 In items 20 through 155, I did that and then-- 00:37:17.937 --> 00:37:21.143 - [Wayne] We've got 155 as oil and gas consent agenda. 00:37:23.620 --> 00:37:25.560 - I know I passed it one way or the other. 00:37:25.560 --> 00:37:26.393 (Christi and Wayne chuckle) 00:37:26.393 --> 00:37:28.397 - [Woman] That is true, 155 is on both. 00:37:28.397 --> 00:37:30.020 - Okay. 00:37:30.020 --> 00:37:34.487 Well, I did 155 in the group that I did 20 through 155. 00:37:34.487 --> 00:37:36.420 Do you want me to adjust the motion? 00:37:36.420 --> 00:37:37.253 - [Man] You don't need to, 00:37:37.253 --> 00:37:39.130 you can continue just to proceed on as is, 00:37:39.130 --> 00:37:41.230 'cause irrespective, 155 has been covered 00:37:41.230 --> 00:37:42.637 at least once and it has been approved. 00:37:42.637 --> 00:37:43.470 (Wayne laughs) 00:37:43.470 --> 00:37:44.303 - Okay, that's fine, 00:37:44.303 --> 00:37:45.966 we can change our motions if we need to. 00:37:45.966 --> 00:37:48.790 I know I didn't skip it in the order, so. 00:37:48.790 --> 00:37:51.130 Okay, that's fine, alright. 00:37:51.130 --> 00:37:53.470 So we're back to agreed enforcement orders, 00:37:53.470 --> 00:37:57.102 items 235 through 464. 00:37:57.102 --> 00:38:00.323 There are 230 items on this, 00:38:01.200 --> 00:38:04.113 and I move that we approve items 235 through 464. 00:38:04.113 --> 00:38:05.635 Is there a second? 00:38:05.635 --> 00:38:06.580 - [Ryan] Second. 00:38:06.580 --> 00:38:07.413 - Second by Commissioner Sitton. 00:38:07.413 --> 00:38:08.810 All those in favor, say aye. 00:38:08.810 --> 00:38:09.930 - [Commissioners] Aye. 00:38:09.930 --> 00:38:12.200 - Motion passes, those items are approved. 00:38:12.200 --> 00:38:13.590 That includes the hearing section. 00:38:13.590 --> 00:38:14.853 Thank you very much. 00:38:17.090 --> 00:38:18.740 We'll now take up administrative. 00:38:21.549 --> 00:38:22.890 Good morning, Wei. 00:38:22.890 --> 00:38:24.540 - [Wei] Good morning, Chairman, Commissioners. 00:38:24.540 --> 00:38:27.200 For the record, I'm Wei Wang, Executive Director. 00:38:27.200 --> 00:38:30.100 I'm glad to report we're making progress 00:38:30.100 --> 00:38:31.070 on the hiring front. 00:38:31.070 --> 00:38:36.070 As of last Friday, the 18th, we had 764 employees. 00:38:36.250 --> 00:38:37.900 - Oh, that's more than last time. 00:38:37.900 --> 00:38:39.270 - Yes! 00:38:39.270 --> 00:38:44.270 And we're also projecting we'll reach 770 in February, 00:38:45.070 --> 00:38:49.480 with the hiring lined up for the next two weeks. 00:38:49.480 --> 00:38:52.190 And also, we're retaining our inspectors. 00:38:52.190 --> 00:38:54.350 We still have 63 pipeline inspectors 00:38:54.350 --> 00:38:56.660 and around 150 floor inspectors. 00:38:56.660 --> 00:38:58.563 But we also have the challenge of hiring, 00:38:58.563 --> 00:39:01.010 filling vacancies in certain areas, 00:39:01.010 --> 00:39:04.170 so we're working hard on getting those positions filled 00:39:04.170 --> 00:39:06.300 and retaining the employees. 00:39:06.300 --> 00:39:08.290 And I know that Clay will give you a report 00:39:08.290 --> 00:39:11.273 on the first quarter performance for well plugging. 00:39:11.273 --> 00:39:16.030 As of last Friday, we physically plugged 570 wells, 00:39:16.030 --> 00:39:18.470 so we're on track of meeting our target 00:39:18.470 --> 00:39:20.210 for this year as well. 00:39:20.210 --> 00:39:23.080 And for permanent turnaround time, 00:39:23.080 --> 00:39:25.974 I'm glad to report that we're holding the line 00:39:25.974 --> 00:39:27.200 on drilling permit, 00:39:27.200 --> 00:39:30.220 we're still below two days for the turnaround time. 00:39:30.220 --> 00:39:32.090 And for groundwater advisory lighter, 00:39:32.090 --> 00:39:36.050 we're below three days, sorry, below four days 00:39:36.050 --> 00:39:39.870 for expedited and also for regular permits, 00:39:39.870 --> 00:39:43.010 or I should say regular lighter for that. 00:39:43.010 --> 00:39:43.843 - [Christi] Great. 00:39:43.843 --> 00:39:47.200 - And also I have with me Edgar Chavez, 00:39:47.200 --> 00:39:49.570 he's our Director of IT Operation. 00:39:49.570 --> 00:39:53.000 And I'm glad to report that we are launching 00:39:53.000 --> 00:39:57.580 RRC Online Inspection Lookup today, or RRC OIL. 00:39:57.580 --> 00:40:01.380 It is a public searchable database on our website. 00:40:01.380 --> 00:40:06.110 Now, this is part of the inspection and enforcement 00:40:06.110 --> 00:40:09.860 tracking and reporting capital budget authority we got 00:40:09.860 --> 00:40:12.560 last session for 2018 and '19. 00:40:12.560 --> 00:40:14.770 This is one of the three components. 00:40:14.770 --> 00:40:19.710 Now, with this new software, or database, 00:40:19.710 --> 00:40:23.300 anybody anywhere at any time can go on our website 00:40:23.300 --> 00:40:25.700 and use multiple search criteria 00:40:25.700 --> 00:40:29.960 and look up inspection enforcement and violation data. 00:40:29.960 --> 00:40:32.730 And this data is updated every night. 00:40:32.730 --> 00:40:37.730 So it's the same data that our inspectors are looking at. 00:40:38.840 --> 00:40:42.930 So I think this is a great step towards transparency 00:40:42.930 --> 00:40:44.610 for the general public, 00:40:44.610 --> 00:40:48.960 and also because of the hard work from our IT department 00:40:48.960 --> 00:40:50.410 and other divisions, 00:40:50.410 --> 00:40:54.180 we're able to accomplish components more than seven months 00:40:54.180 --> 00:40:57.090 ahead of the August 31st deadline. 00:40:57.090 --> 00:40:59.030 So with that, I'll turn over to Edgar 00:40:59.030 --> 00:41:00.930 to give you a presentation. 00:41:00.930 --> 00:41:02.027 Thank you. 00:41:02.027 --> 00:41:03.238 - [Christi] Good morning. 00:41:03.238 --> 00:41:04.540 - Good morning, Commissioners, Chairman. 00:41:04.540 --> 00:41:05.661 - [Christi] And I'm not gonna be rude, 00:41:05.661 --> 00:41:08.018 but I'm gonna get up so I can see. 00:41:08.018 --> 00:41:08.851 (Edgar laughs) 00:41:08.851 --> 00:41:10.737 - For the record, my name is Edgar Chavez. 00:41:20.373 --> 00:41:21.289 My name is Edgar Chavez, 00:41:21.289 --> 00:41:22.940 I'm the IT Service Delivery Director 00:41:22.940 --> 00:41:24.750 in the ITS division, 00:41:24.750 --> 00:41:28.320 and I'm gonna provide a very high-level overview 00:41:28.320 --> 00:41:33.320 of the RRC OIL, online inspection lookup system. 00:41:35.810 --> 00:41:37.910 During the last legislative session, like Wei mentioned, 00:41:37.910 --> 00:41:40.190 we received appropriations to implement 00:41:40.190 --> 00:41:42.980 the inspection tracking reporting system, 00:41:42.980 --> 00:41:45.160 and which objectives have 00:41:45.160 --> 00:41:48.100 improving our inspection enforcement capabilities, 00:41:48.100 --> 00:41:51.680 implementing an expandable case management platform, 00:41:51.680 --> 00:41:54.290 and improve our data transparency in reporting. 00:41:54.290 --> 00:41:56.710 And on that last objective, 00:41:56.710 --> 00:41:59.783 we implemented the RRC OIL system. 00:42:02.277 --> 00:42:04.968 Through this system, anybody anywhere 00:42:04.968 --> 00:42:07.470 will have the ability to search 00:42:07.470 --> 00:42:12.470 all our inspection and violation data as of August 1, 2015, 00:42:15.500 --> 00:42:20.490 will have the ability to search with multiple criteria, 00:42:20.490 --> 00:42:24.010 operator name, lease name, operator number, lease number, 00:42:24.010 --> 00:42:26.667 county, which statewide rule. 00:42:26.667 --> 00:42:31.667 Each of the criteria will provide a drill down information 00:42:32.817 --> 00:42:34.663 if they want to. 00:42:36.277 --> 00:42:38.530 This is an example of how they would be able to search 00:42:38.530 --> 00:42:40.803 by statewide rule. 00:42:42.100 --> 00:42:45.000 This would be the search results screen. 00:42:45.000 --> 00:42:48.598 They will be able to have different type of information, 00:42:48.598 --> 00:42:50.700 the same way that you can search for it, 00:42:50.700 --> 00:42:51.963 you will get the results. 00:42:53.840 --> 00:42:58.840 For each of the inspections that they are able to show, 00:42:59.350 --> 00:43:02.610 they will be able to drill even further down to be able 00:43:02.610 --> 00:43:05.580 to see which violations were found in that inspection, 00:43:05.580 --> 00:43:09.230 which rules were compliant during that inspection, 00:43:09.230 --> 00:43:12.243 and additional details, and the location of the inspection. 00:43:14.306 --> 00:43:18.110 They will be able to do very similar searches 00:43:18.110 --> 00:43:19.623 for violation information. 00:43:20.850 --> 00:43:23.140 And last, we'll provide the ability to download 00:43:23.140 --> 00:43:27.230 the entirety of the data set as downloadable bulk files, 00:43:27.230 --> 00:43:29.935 so if somebody wants to get all our inspection data, 00:43:29.935 --> 00:43:32.283 or all of our violation data, 00:43:32.283 --> 00:43:36.410 they will be able to get that file and do further research, 00:43:36.410 --> 00:43:37.243 if they want to. 00:43:39.090 --> 00:43:41.500 So, we have trained some of our staff 00:43:41.500 --> 00:43:44.350 throughout the agency on how to respond to inquiries 00:43:44.350 --> 00:43:47.800 about this application and about the data. 00:43:47.800 --> 00:43:51.780 And like we mentioned, this application will be a great step 00:43:51.780 --> 00:43:53.320 towards our efforts to improve 00:43:53.320 --> 00:43:56.040 data transparency and reporting. 00:43:56.040 --> 00:43:58.400 So, thank you very much, 00:43:58.400 --> 00:44:00.520 and I'm available for any questions you may have. 00:44:00.520 --> 00:44:02.800 - [Ryan] Does this cover all of our inspections currently, 00:44:02.800 --> 00:44:05.190 or are there some to be added in the future? 00:44:05.190 --> 00:44:06.940 - This includes all our inspections 00:44:06.940 --> 00:44:10.145 that have been considered complete by a technical reviewer 00:44:10.145 --> 00:44:14.725 since August 2015 until yesterday. 00:44:14.725 --> 00:44:16.284 - [Ryan] And it's updated daily? 00:44:16.284 --> 00:44:17.400 - I'm sorry? 00:44:17.400 --> 00:44:18.480 - [Ryan] We're updating daily-- 00:44:18.480 --> 00:44:20.683 - Yes, it is updated every night, 00:44:21.580 --> 00:44:25.325 and the data available for download is available, 00:44:25.325 --> 00:44:27.060 is updated once a week, 00:44:27.060 --> 00:44:29.810 but the data available for search is updated nightly. 00:44:29.810 --> 00:44:32.250 - [Christi] And so they're completed inspections, 00:44:32.250 --> 00:44:33.670 so if something's ongoing, 00:44:33.670 --> 00:44:36.250 we aren't putting that in there yet, right? 00:44:36.250 --> 00:44:37.083 - Correct. 00:44:37.083 --> 00:44:39.010 - [Christi] We want it completed so we know the outcome. 00:44:39.010 --> 00:44:39.843 - Exactly. 00:44:39.843 --> 00:44:40.690 - Okay. 00:44:40.690 --> 00:44:41.800 Well, we've come a long way. 00:44:41.800 --> 00:44:44.480 This is a good piece, since we get to go 00:44:44.480 --> 00:44:45.911 in front of Senate finance hawks, 00:44:45.911 --> 00:44:47.632 they'll be glad, this'll be great 00:44:47.632 --> 00:44:49.110 if y'all'd like to come show it to them. 00:44:49.110 --> 00:44:50.820 But thank y'all for the work. 00:44:50.820 --> 00:44:51.653 This'll be great. 00:44:51.653 --> 00:44:53.002 Questions, comments? 00:44:53.002 --> 00:44:53.835 - Thank y'all very much. 00:44:53.835 --> 00:44:54.668 And I would like to thank the Oil and Gas Division 00:44:54.668 --> 00:44:55.501 and our IT staff. 00:44:55.501 --> 00:44:58.322 They did a tremendous job on putting this together. 00:44:58.322 --> 00:44:59.155 - [Christi] They have. 00:44:59.155 --> 00:44:59.988 We've come a long way. 00:44:59.988 --> 00:45:01.347 Thank you, we appreciate it. 00:45:01.347 --> 00:45:03.892 - And just one quick note, this is the first release, 00:45:03.892 --> 00:45:05.720 and we'll continue to make improvements on this 00:45:05.720 --> 00:45:07.470 based on feedbacks we get. 00:45:07.470 --> 00:45:09.401 So there's more to come. 00:45:09.401 --> 00:45:10.234 - Good. 00:45:10.234 --> 00:45:12.562 So do we need to approve this to be released? 00:45:12.562 --> 00:45:13.400 - [Wei] No, no. 00:45:13.400 --> 00:45:14.233 - No 00:45:14.233 --> 00:45:15.066 Okay, I just wanted to make sure. 00:45:15.066 --> 00:45:16.480 - [Edgar] It is in production as of this morning 00:45:16.480 --> 00:45:18.060 and available to anybody through our website. 00:45:18.060 --> 00:45:19.880 - Okay, so it's up and live today. 00:45:19.880 --> 00:45:20.757 - [Edgar and Wei] Yes. 00:45:20.757 --> 00:45:23.405 - The way you mentioned this was the first part, 00:45:23.405 --> 00:45:26.993 briefly, what are the future additions 00:45:26.993 --> 00:45:28.510 that we're working on? 00:45:28.510 --> 00:45:31.990 - One thing we're thinking of is adding more capability 00:45:31.990 --> 00:45:35.070 for download of the search results. 00:45:35.070 --> 00:45:38.140 So currently, the download is for bulk data 00:45:38.140 --> 00:45:40.903 of all inspections and violations. 00:45:41.930 --> 00:45:44.600 And we're looking at adding the capability of, 00:45:44.600 --> 00:45:46.560 by pushing the button, you can just download 00:45:46.560 --> 00:45:51.063 the result of a query your run, and only those records. 00:45:51.063 --> 00:45:52.674 - Okay. 00:45:52.674 --> 00:45:54.270 Thank y'all, thank you for the work. 00:45:54.270 --> 00:45:55.120 We appreciate it. 00:45:57.640 --> 00:45:58.858 Wei, did you have anything else? 00:45:58.858 --> 00:45:59.691 - [Wei] No, ma'am. 00:45:59.691 --> 00:46:00.524 - Okay, great. 00:46:01.940 --> 00:46:03.230 Alex, good morning. 00:46:03.230 --> 00:46:04.870 - Good morning, Chairman, Commissioners. 00:46:04.870 --> 00:46:06.077 For the record, my name is Alex Schoch. 00:46:06.077 --> 00:46:08.730 I'm General Counsel at the Railroad Commission of Texas. 00:46:08.730 --> 00:46:11.777 We don't have anything to report on item 466, 00:46:11.777 --> 00:46:14.892 and staff has items 467 and 68. 00:46:14.892 --> 00:46:17.510 - [Christi] Okay, great. 00:46:17.510 --> 00:46:19.080 Haley, good morning. 00:46:19.080 --> 00:46:20.180 - Good morning, Chairman, Commissioners. 00:46:20.180 --> 00:46:22.630 Haley Cochran with the Office of General Counsel. 00:46:22.630 --> 00:46:25.840 Item number 467 pertains to commissioner approval 00:46:25.840 --> 00:46:27.660 of certain contracts pursuant to the Commission's 00:46:27.660 --> 00:46:29.330 delegation of authority. 00:46:29.330 --> 00:46:31.140 The Commission's internal delegation of authority 00:46:31.140 --> 00:46:33.520 requires commissioner approval of contracts 00:46:33.520 --> 00:46:37.160 and associated amendments greater than or equal to $500,000. 00:46:37.160 --> 00:46:40.210 Section 2261.254 of the government code 00:46:40.210 --> 00:46:42.580 requires approval of contracts and associated amendments 00:46:42.580 --> 00:46:44.590 greater than one million dollars. 00:46:44.590 --> 00:46:46.590 At issue today is a contract for the Commission's 00:46:46.590 --> 00:46:49.570 inspection and enforcement tracking and reporting system, 00:46:49.570 --> 00:46:51.830 for which advance approval was received at the conference 00:46:51.830 --> 00:46:53.763 on May 22, 2018. 00:46:53.763 --> 00:46:55.470 Since that approval was received, 00:46:55.470 --> 00:46:59.650 the contract term has been extended through August 31, 2021, 00:46:59.650 --> 00:47:02.750 such that the prior not-to-exceed amount is insufficient. 00:47:02.750 --> 00:47:04.950 Approval of this item will ensure agency operations 00:47:04.950 --> 00:47:06.810 will remain on schedule and will ensure compliance 00:47:06.810 --> 00:47:08.267 with the Commission's delegation of authority 00:47:08.267 --> 00:47:10.015 and the government code. 00:47:10.015 --> 00:47:12.734 - [Christi] Thank you, are there any questions? 00:47:12.734 --> 00:47:13.567 Alright. 00:47:13.567 --> 00:47:15.780 I move we approve staff's recommendation. 00:47:15.780 --> 00:47:16.613 Is there a second? 00:47:16.613 --> 00:47:17.446 - [Wayne] Second. 00:47:17.446 --> 00:47:19.210 - [Christi] Second by Commissioner Christian. 00:47:19.210 --> 00:47:20.783 All those in favor, say aye. 00:47:20.783 --> 00:47:21.680 - [Commissioners] Aye. 00:47:21.680 --> 00:47:24.183 - [Christi] Motion passed, this item's approved. 00:47:24.183 --> 00:47:26.840 - Item 468 is the quarterly report on the Commission's 00:47:26.840 --> 00:47:28.670 centralization of agency procurement 00:47:28.670 --> 00:47:30.150 and contracts management, 00:47:30.150 --> 00:47:33.400 in compliance with Senate Bill 20 of the 84th legislature. 00:47:33.400 --> 00:47:35.310 This fiscal year, our contracts management group 00:47:35.310 --> 00:47:37.176 has established business process maps 00:47:37.176 --> 00:47:40.710 to help divisions better visualize the contracting process, 00:47:40.710 --> 00:47:43.996 therefore ensuring compliance with SB 20 and CPA guidelines. 00:47:43.996 --> 00:47:46.580 Contracts continues to work closely with OGC 00:47:46.580 --> 00:47:48.650 to ensure compliance with CPA guidelines, 00:47:48.650 --> 00:47:52.680 LBB and statutory requirements, and agency best practices. 00:47:52.680 --> 00:47:54.880 To that end, the Commission's contract management guide 00:47:54.880 --> 00:47:56.900 is being reviewed and revised to better align 00:47:56.900 --> 00:47:58.490 with the CPA's guide. 00:47:58.490 --> 00:48:00.900 Also, all current awarded and solicited contracts 00:48:00.900 --> 00:48:03.910 are now publicly viewable on the Commission's website. 00:48:03.910 --> 00:48:05.800 Finally, the Commission continues its efforts 00:48:05.800 --> 00:48:07.930 to increase the use of historically underutilized 00:48:07.930 --> 00:48:09.760 businesses through outreach. 00:48:09.760 --> 00:48:11.600 In its November external newsletter, 00:48:11.600 --> 00:48:15.150 the Commission described its need for HUB subcontractors 00:48:15.150 --> 00:48:18.446 in drilling, surveying, lab analysis, geophysical work, 00:48:18.446 --> 00:48:20.890 waste transportation and disposal, 00:48:20.890 --> 00:48:22.360 and provide detail on how to become 00:48:22.360 --> 00:48:24.970 a certified HUB subcontractor with the Commission. 00:48:24.970 --> 00:48:26.410 The Commission will also participate 00:48:26.410 --> 00:48:29.080 in its third HUB forum on April 18th, 00:48:29.080 --> 00:48:32.810 in association with 11 other state agencies. 00:48:32.810 --> 00:48:34.750 This concludes the report for the first quarter 00:48:34.750 --> 00:48:35.837 of fiscal year 2019. 00:48:35.837 --> 00:48:38.418 - [Christi] Thank you, are there any questions? 00:48:38.418 --> 00:48:39.646 Thank you, Haley. 00:48:39.646 --> 00:48:40.800 - [Haley] Thanks. 00:48:40.800 --> 00:48:41.700 - Thank you, Alex. 00:48:47.700 --> 00:48:49.758 - Good morning, Chairman, Commissioners. 00:48:49.758 --> 00:48:51.890 For the record, I am Clay Woodul, 00:48:51.890 --> 00:48:54.030 Assistant Director of Field Operations. 00:48:54.030 --> 00:48:58.100 I will be presenting items 469 and 470. 00:48:58.100 --> 00:49:02.130 Item 469 is the Oil Field Cleanup Program annual report 00:49:02.130 --> 00:49:04.460 for fiscal year 2018. 00:49:04.460 --> 00:49:09.130 Texas National Resources Code A1.069c requires 00:49:09.130 --> 00:49:11.894 the Commission to file an annual report to the legislature 00:49:11.894 --> 00:49:15.440 for the Oil and Gas Regulation and Cleanup Fund. 00:49:15.440 --> 00:49:20.100 This report covers the period from September 1, 2017, 00:49:20.100 --> 00:49:23.666 through August 31, 2018, and contains information 00:49:23.666 --> 00:49:27.130 on state managed plugging and cleanup programs, 00:49:27.130 --> 00:49:30.630 enforcement activities, and financial information. 00:49:30.630 --> 00:49:32.640 We recommend your approval of this report 00:49:32.640 --> 00:49:34.356 for submission to the legislature. 00:49:34.356 --> 00:49:36.345 May I answer any questions? 00:49:36.345 --> 00:49:38.225 - [Christi] Thank you, are there any questions? 00:49:38.225 --> 00:49:39.407 - [Wayne] No. 00:49:39.407 --> 00:49:40.240 - I'll just make a comment. 00:49:40.240 --> 00:49:43.260 Y'all have made a huge amount of progress. 00:49:43.260 --> 00:49:44.300 I know we're back to zero, 00:49:44.300 --> 00:49:46.170 but y'all are making a huge amount of progress, 00:49:46.170 --> 00:49:49.360 and thank you for the good work and the aggressiveness. 00:49:49.360 --> 00:49:50.346 - [Clay] Thank you. 00:49:50.346 --> 00:49:53.940 - I was looking, if we've plugged 570 year to date so far, 00:49:53.940 --> 00:49:55.185 and we were at 14-- 00:49:55.185 --> 00:49:57.590 - [Clay] 1440 last year. 00:49:57.590 --> 00:50:00.850 - We're gonna hit, you're gonna get within the margins. 00:50:00.850 --> 00:50:02.990 You're close, I think you're gonna get there. 00:50:02.990 --> 00:50:03.823 - [Clay] I think so, too. 00:50:03.823 --> 00:50:04.660 - I think it's great, thank you. 00:50:04.660 --> 00:50:06.565 Thank y'all for the work. 00:50:06.565 --> 00:50:08.900 We don't need to approve, you're just presenting this? 00:50:08.900 --> 00:50:10.819 - [Clay] Yes, ma'am, you need a, 00:50:10.819 --> 00:50:11.829 you do need to approve, yes ma'am. 00:50:11.829 --> 00:50:13.019 - Oh, so y'all can release it outside. 00:50:13.019 --> 00:50:14.120 Yes you do, I have that in my thing. 00:50:14.120 --> 00:50:16.559 Does anybody else have any questions, comments? 00:50:16.559 --> 00:50:18.690 I move we approve staff's recommendation. 00:50:18.690 --> 00:50:19.523 Is there a second? 00:50:19.523 --> 00:50:20.356 - [Ryan] Second. 00:50:20.356 --> 00:50:21.300 - Second by Commissioner Sitton. 00:50:21.300 --> 00:50:22.729 All those in favor, say aye. 00:50:22.729 --> 00:50:24.010 - [Commissioners] Aye. 00:50:24.010 --> 00:50:24.843 - Motion's approved. 00:50:24.843 --> 00:50:25.676 Thank y'all for the work. 00:50:25.676 --> 00:50:26.850 - Thank you. 00:50:26.850 --> 00:50:29.300 Item 470 is the Oil Field Cleanup Program's 00:50:29.300 --> 00:50:33.543 first quarter status report for fiscal year 2019. 00:50:33.543 --> 00:50:35.310 I'll present the well plugging report, 00:50:35.310 --> 00:50:38.770 and Peter Pope will present the site remediation section. 00:50:38.770 --> 00:50:41.630 During the first quarter, plugging operations were completed 00:50:41.630 --> 00:50:44.150 and files were closed on 250 wells 00:50:44.150 --> 00:50:49.150 at a cost of $5,053,838. 00:50:49.550 --> 00:50:51.721 This includes only those wells that were plugged, 00:50:51.721 --> 00:50:53.640 invoiced by the plugging contractor, 00:50:53.640 --> 00:50:56.630 and approved for payment by field operations. 00:50:56.630 --> 00:50:59.680 A total of 391 wells were physically plugged 00:50:59.680 --> 00:51:01.727 through the end of the first quarter, 00:51:01.727 --> 00:51:06.727 of which, as I mentioned, 250 were invoiced and paid. 00:51:07.080 --> 00:51:10.510 During the same period, 363 new wells were approved 00:51:10.510 --> 00:51:12.250 for plugging with state funds. 00:51:12.250 --> 00:51:16.170 As Wei mentioned, as of last Friday, we were at 570 wells, 00:51:16.170 --> 00:51:19.720 at an estimated cost of 10.8 million. 00:51:19.720 --> 00:51:22.050 And we are on our way to our target 00:51:22.050 --> 00:51:24.730 of 1560 wells for this year. 00:51:24.730 --> 00:51:26.150 So now, I'll turn it over to Peter 00:51:26.150 --> 00:51:28.513 for site remediations portion. 00:51:28.513 --> 00:51:29.618 - [Christi] By the way, Peter, I'm not ignoring you, 00:51:29.618 --> 00:51:30.718 you've come a long way, too. 00:51:30.718 --> 00:51:31.551 So thank you. 00:51:31.551 --> 00:51:32.399 (Peter laughs) 00:51:32.399 --> 00:51:33.900 - Thank you, thank you very much. 00:51:33.900 --> 00:51:36.040 Chairman, Commissioners, my name is Peter Pope. 00:51:36.040 --> 00:51:38.970 I'm manager of the Site Remediation section. 00:51:38.970 --> 00:51:40.769 During the first quarter of fiscal year '19, 00:51:40.769 --> 00:51:43.750 the state managed cleanup program completed and closed 00:51:43.750 --> 00:51:48.050 nine cleanup activities, using OGRC funds 00:51:48.050 --> 00:51:52.003 at a cost of $54,722.49. 00:51:53.180 --> 00:51:56.828 An additional 62 activities were authorized 00:51:56.828 --> 00:51:59.490 during the first quarter. 00:51:59.490 --> 00:52:00.930 I would like to point out a typo 00:52:00.930 --> 00:52:03.490 in the second paragraph of the memo. 00:52:03.490 --> 00:52:08.110 The number 86 in the third sentence should be 00:52:08.110 --> 00:52:11.260 62 additional cleanup activities. 00:52:11.260 --> 00:52:15.203 We will correct that in the report before we post it. 00:52:16.750 --> 00:52:18.300 At the end of the first quarter, 00:52:18.300 --> 00:52:22.010 we had 86 cleanup activities authorized 00:52:22.010 --> 00:52:23.493 but not yet completed. 00:52:25.450 --> 00:52:29.350 And then, for a current snapshot, as of January 18th, 00:52:29.350 --> 00:52:32.937 the program had completed another 16 activities, 00:52:32.937 --> 00:52:37.643 for a total of 25 completed to date at a cost of $376,937. 00:52:41.620 --> 00:52:44.080 And then, an additional 24 activities 00:52:44.080 --> 00:52:47.060 have been completed in the field 00:52:47.060 --> 00:52:49.130 and are awaiting final invoice payment 00:52:49.130 --> 00:52:52.710 for an estimated cost of $230,000. 00:52:52.710 --> 00:52:54.968 May I answer any questions? 00:52:54.968 --> 00:52:56.803 - [Christi] Anybody have any questions? 00:52:56.803 --> 00:52:58.628 Thank ya'll for the work. 00:52:58.628 --> 00:52:59.589 - Thank you. 00:52:59.589 --> 00:53:00.422 - Appreciate it. 00:53:00.422 --> 00:53:02.890 Got good staff working on good projects. 00:53:02.890 --> 00:53:05.853 So thank you for the time. - [Peter] Thank you. 00:53:12.684 --> 00:53:13.517 - Morning. 00:53:13.517 --> 00:53:14.605 - [Jason] Morning. 00:53:14.605 --> 00:53:15.438 - How are you? 00:53:15.438 --> 00:53:16.271 - [Jason] Good, how are You? 00:53:16.271 --> 00:53:17.303 - Good, good to see you. 00:53:17.303 --> 00:53:18.910 - Good morning Chairman, Commissioners. 00:53:18.910 --> 00:53:20.500 For the record, my name is Jason Clark, 00:53:20.500 --> 00:53:22.840 assistant director with Administrative Compliance. 00:53:22.840 --> 00:53:26.240 Today we're bringing one item, item 471. 00:53:26.240 --> 00:53:28.700 We're requesting the approval to pose proposed revisions 00:53:28.700 --> 00:53:33.590 to the forms P17 and P17a, related to an application 00:53:33.590 --> 00:53:38.390 for exception to Statewide Rules 26 and 27, 00:53:38.390 --> 00:53:40.160 along with the associated instructions 00:53:40.160 --> 00:53:43.360 on the Commission website for a 30-day review period. 00:53:43.360 --> 00:53:44.867 This request is being generated as part of 00:53:44.867 --> 00:53:47.480 the Texas Oil Field Relief Initiative. 00:53:47.480 --> 00:53:49.490 The revisions to the form P17, 00:53:49.490 --> 00:53:51.980 and creation of the new form P17a, 00:53:51.980 --> 00:53:53.780 correspond to rule amendments proposed 00:53:53.780 --> 00:53:57.290 at the November 13, 2018, conference. 00:53:57.290 --> 00:53:59.030 The same information is being requested, 00:53:59.030 --> 00:54:01.900 but in a different format on the new form. 00:54:01.900 --> 00:54:04.110 The changes to the associated form instructions 00:54:04.110 --> 00:54:06.410 will provide clarity on how and when 00:54:06.410 --> 00:54:10.060 to file the form P17a or P17, 00:54:10.060 --> 00:54:12.420 in conjunction with the proposed rule adoptions 00:54:12.420 --> 00:54:16.129 regarding Statewide Rules 25, 26, and 27. 00:54:16.129 --> 00:54:18.178 I'm available for questions. 00:54:18.178 --> 00:54:20.918 - [Christi] Thank you for your work on this. 00:54:20.918 --> 00:54:22.059 Does anybody have any questions? 00:54:22.059 --> 00:54:22.892 - [Ryan] No. 00:54:22.892 --> 00:54:23.725 - [Christi] No. 00:54:23.725 --> 00:54:24.730 I move we approve staff's recommendation. 00:54:24.730 --> 00:54:25.563 Is there a second? 00:54:25.563 --> 00:54:26.396 - [Ryan] Second. 00:54:26.396 --> 00:54:27.600 - Second by Commissioner Sitton. 00:54:27.600 --> 00:54:28.679 All those in favor, say aye. 00:54:28.679 --> 00:54:29.590 - [Commissioners] Aye. 00:54:29.590 --> 00:54:31.230 - Motion passed, this item's approved. 00:54:31.230 --> 00:54:32.063 Thank you. 00:54:33.059 --> 00:54:37.070 Item 472 is our public participation item. 00:54:37.070 --> 00:54:39.670 I don't have any other cards indicating 00:54:39.670 --> 00:54:41.460 anybody else wants to speak. 00:54:41.460 --> 00:54:44.290 And item 473 is our executive session, 00:54:44.290 --> 00:54:46.003 which we won't be going into today. 00:54:46.003 --> 00:54:49.270 Were there any other duly posted matters? 00:54:49.270 --> 00:54:51.240 Hearing none, this meeting is adjourned. 00:54:51.240 --> 00:54:52.073 Thank you all.