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Oil and Gas Commission Upholds Restart Order in AWMS Appeal

By Jay Carr

On May 21, 2021, the Division of Oil and Gas Resources Management issued Chief’s Order 2021-97 (the “Restart Order”), authorizing AWMS Water Solutions, LLC, to resume injection operations at one of its Class II injection wells. Those operations had been suspended by a prior Division order issued in 2014 due to detected seismic activity. The Restart Order contained two operating conditions that would (i) require the immediate suspension of operations if a M 2.1 seismic event were to occur within three miles of AWMS’ facilities; and (ii) prevent AWMS from resuming operations thereafter unless and until the Division agrees, but which contained no deadline for the Division to act. AWMS appealed those conditions to the Ohio Oil and Gas Commission, arguing that they were unlawful and unreasonable.

The Commission disagreed. It found “that the M 2.1 standard establishes a reasonable margin of safety in order to prevent or minimize ‘felt’ earthquakes and to provide an acceptable degree of security that the injection-induced earthquakes can be addressed before the level of escalation becomes unacceptable for the restart of this particular well.” In doing so, however, the Commission also recognized that the “Division should give operators the opportunity to demonstrate whether a ‘felt event’ is the result of seismic activity caused by the injection well or from some other activity. Care and prudence must be exercised by the industry; however, the avoidance of any kind of unintended disturbance is an untenable standard to maintain.”

Moreover, the Commission observed that the “Division’s review of AWMS’s analysis is [] dependent on the situation and on the quality of the analysis conducted by AWMS; these factors are not entirely in the Division’s control. It is the Division’s duty to assure that AWMS will complete the analysis required by the Restart Order and to perform such a review in a reasonable and timely manner.” But, “[a]bsent a specific timeframe, the Commission expects the Division to conduct any such review in a reasonable amount of time.”

For a copy of the full order, see here.

Tags: Division of Oil and Gas Resource Management, Class II Injection Wells, Ohio Oil and Gas Commission

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