OGCC Secretary Update – January 2022

Mick Thomas

Division Administrator – Minerals, Navigable Waters, and Oil & Gas

Secretary to the Oil & Gas Conservation Commission

This update was sent to the Commission on Saturday, January 8, 2022.

January 2022 Secretary Update

Current Items:
Special OGCC Meetings
Proposed Legislation Idaho Code 47-3
Field Status
Injection Well Update
News Article(s) of Interest
Current Prices

Special OGCC Meetings
The Department held a special meeting for the Commission on December 16, 2021, in order for the Commission to choose to authorize one person to review substantive documents for filing with the court, and to make strategic litigation decisions on behalf of all commissioners, as the Commission, regarding CAIA v. Miller in consultation with the Commission’s attorneys of record, the Idaho Attorney General’s Office. The Commission chose Chairman Betty Coppersmith to take this role. An additional Commission meeting was held on January 5, 2022. More specific detail is provided below:

Proposed Legislation Idaho Code 47-3
In the month of December, the Department worked through comments received and created a second draft text. This draft text was presented to the Commission at the January 5, 2022 special meeting for the Commission. Public comment was not accepted at the meeting but written comments will be accepted on the second draft text from January 5- January 12, 2022. Please visit the OGCC website for more information.
Idaho Code title 47, chapter 3 – Proposed Statutory Changes | Oil & Gas Conservation Commission

The January 5, 2022 meeting lasted approximately five hours with a brief lunch. While comments were not accepted at the meeting It was open for telephonic and in person attendance.
The Commission discussed the proposed changes to Title 47, Chapter 3, Idaho code. The Commission evaluated the written and oral comments received and shared ideas on potential revisions.

Some of the main points discussed:
1. Make-up of the Commission: There was general consensus that the number of Commissioners will remain the same at five. The qualifications of the Commissioners were discussed as well. The Commission did support replacing the IDL Director with a different person to be selected by the Governor, however the qualifications of that person are still being evaluated.
2. Drilling Location and Well Spacing: Significant discussion was given to rewording Section 317 and Section 318, with the goal of simplifying the wording, providing more clarity, and being more consistent with other states.
3. The role of the Commission: The ability of the Commission to be more involved as a technical resource to the Department was discussed. Especially regarding the role of the Commission as an appellate body vs. hands-on technical expert in the hearing process.

The Department and AG’s office are working together to aggregate Commission comments and will provide an updated version of the of Title 47, Chapter 3, Idaho code soon.

Field Status
The Dutch Lane 1-13 on the eastern side of Harmon Field spudded December 18, 2021 and has reached a total depth of 4875’. Snake River Oil & Gas has designated this as a Confidential Well per Idaho Code § 47-327. Drilling operations for the season have been completed for the present, but some additional workover operations are planned for the next one to two months. Snake River will perform remedial cementing operations on the Fallon #1-10 in the next week in preparations for commencing production from the well.

Injection Well Update
Snake River Oil & Gas has reached out to the EPA Region 10 office at various times over the past several months regarding the status of their application. The most recent information indicates that they will possibly be making a proposed recommendation in the early part of 2022.

News Article(s) of Interest
Interior: US has twice as many abandoned oil and gas wells as previously thought | TheHill
Secretary Note: I have been tracking this legislation. A change in leadership at the federal level provided a massive influx of federal funding for O&G well plugging. Because of this increase many O&G producing states found additional orphaned wells, doubling the volume previously reported to the IOGCC as recently as September 2021. Idaho does not have any orphaned and abandoned O&G wells and therefore did not apply for these funds.

New York State: Natural gas bans are new front in effort to curb emissions
https://denvergazette.com/ap/science-tech/natural-gas-bans-are-new-front-in-effort-to-curb-emissions/article_706d9110-9858-5a1c-a95d-52eeeb9ee605.html

Colorado: Garfield County to continue oil and gas regulations economic impact study into new year
https://www.postindependent.com/news/garfield-county-to-continue-oil-and-gas-regulations-economic-impact-study-into-new-year/

Anti-government conspiracies create another challenge to addressing drought in the West
https://www.deseret.com/2022/1/3/22841583/anti-government-conspiracies-create-another-challenge-to-drought-in-the-west-bundy-colorado-river

Current Prices

Natural Gas $3.79 mmbtu. 01/05/22 (no change since last month)
NGL $10.14 mmbtu. 01/05/22 (9.3% / $0.94 increase since last month)
Utah Sweet Crude $65.91 bbl. 01/07/22 (7.5% / $4.27 increase since last month)
WTI $78.85 bbl. 01/07/22 (8.8% / $6.91 increase since last month)

(green indicates prices increase since last update, red indicates decline)