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Reg-Fix Rule Authorization Questions

Reg-Fix was billed by US EPA as a clarification of the existing underground injection control (UIC) regulations, but it turned out to be much more.  The Reg-Fix changes became effective on January 3, 1994 (except for certain Class V interim final provisions).  This effort is limited to the effects of Reg-Fix on the rule authorization status of certain Class II injection wells.

Under the pre-Reg-Fix UIC regulations, rule authorization was available to only those Class IIR (enhanced recovery) injection wells in existence prior to June 25, 1984 (existing wells).  Injecting into a Class IIR  injection well during the first year of the UIC program was also necessary for rule authorization (rule authorization was only to be available to existing wells in operation since it was felt these wells were a safer bet for rule authorization than those not in a condition to be used; the inoperable wells would require permitting similar to new injection wells under the regulatory scheme).  Finally, an inventory submission was required at the end of the first year of the UIC program in order to maintain rule authorization.  Class IIR wells that were in existence prior to June 25, 1984, and that were injected into during the first year of the program, automatically lost rule authorization upon failure to submit inventory information in a timely fashion (these wells remained under the jurisdiction of the UIC program and had to be either permitted or plugged).  On the other hand, existing Class IIR wells never injected into during the first year of the program and never inventoried are completely "invisible" to the UIC program and remain so to this day.

EPA has been understandably annoyed that thousands of old injection wells have fallen through the cracks of the UIC program, wells neither used during the first year of the UIC program nor inventoried.  But EPA was even more annoyed when a small number of operators claimed they had inventoried certain injection wells in error.  These operators inventoried existing wells that they never injected into during the first year of the UIC program, either through innocent mistake or because EPA personnel instructed them to do so.  So a portion of Reg-Fix was designed to address this problem.  The solution is very strange, given the history of the UIC regulations.

The new version of 40 CFR 144.22 bestows rule authorization on a Class IIR well that was injected into during the first year of the UIC program or was inventoried.  To make matters worse the new regulatory language includes the phrase "for the first time" and debate has arisen as to its meaning.  The meaning of this "clarification" is clear as mud.  On January 20, 1994, a list of five questions was posed to US EPA Region IV in an effort to learn how EPA believed the new rule was supposed to work.  After no response, the questions were refined and resubmitted to Region IV on December 12, 1994.  Region IV finally responded on February 24, 1997.  What follows are the questions, the Region IV responses, and my totally ignored commentary submitted to Region IV on February 27, 1997.


Question 1.  A well was never used for injection before or after June 25, 1984, but was included in a timely inventory submission--is such a well rule authorized?

Region IV Response:  "The answer is yes.  40 C.F.R. 144.22 states, in part, that an existing Class II well is authorized by rule for the life of the well or project " [sic]...if the owner or operator injects into the existing well within one year...or inventories the well pursuant to 144.26." (emphasis added)  Therefore, if the well is rule authorized via a timely inventory submittal, the "existing" criteria is not a prerequisite for rule authorization."

Commentary:  "Region IV has concluded that the answer is yes to Question 1; the most stupefying and bizarre position taken by the Region IV UIC program to date!  Someone has apparently (based on the "emphasis added" parenthetical) seized on the fact that the word existing was omitted in the phrase "...or inventories the well pursuant to 144.26" in 40 CFR 144.22.  But all of 144.22 applies to, and only to, existing Class II wells as one might gather from the title of the subsection, "Existing Class II enhanced recovery and hydrocarbon storage wells."  The position you suggest would allow any such inventoried new injection wells to escape the permitting process, and hence the corrective action requirements of 40 CFR 144.55 (there is no corrective action mechanism for rule authorized wells under the current rule).

"To be eligible for rule authorization, a Class II enhanced recovery well must have been used for injection purposes at some point prior to the "magic date" of June 25, 1984, and this holds true both before and after "reg-fix".  The inclusion of a new injection well on an inventory submission has always been illegal under the UIC regulations, and it remains so.

"Notwithstanding the illegality issue, I personally think that allowing rule authorization for new injection wells is a grand idea.  If this novel Region IV argument prevails, I would certainly like to get in on the deal!  Region IV ought to realize a mistake has been made after applying the Levine litmus test (that is the test where Region IV automatically rejects anything I think is a good idea)."


Question 2.  A well was used for injection prior to June 25, 1984, but not after said date, and was not included in a timely inventory submission; is such a well rule authorized or does it remain invisible to the UIC program as in the past?

Region IV Response:  "The well would remain invisible to the UIC program.  A possible exception is if the well is part of an injection system which is otherwise rule-authorized."

Commentary:  "I concur that the well would remain invisible to the UIC program, but I do not understand your "possible exception".  Please cite the applicable law or regulation that would impart rule authorization status to an existing injection well neither inventoried nor used after June 25, 1984, simply because it is located among other rule authorized wells.  Perhaps I do not know what you mean by "part of an injection system which is otherwise rule-authorized."  I am aware of no area rule authorization that parallels the area permit concept, but even an area permit does not bestow authorization by permit status on wells automatically."


Question 3.  If the well in Question No. 2 was timely inventoried, is it authorized?

Region IV Response:  "Yes.  If a well is inventoried, it is rule authorized.  No other documentation is required."

Commentary:  "I concur that the well is rule authorized.  I assume that your comment that no other documentation is required stems from your position set out in your response to Question 1.  In fact, some operators have been required to submit proof that a well is an existing well and eligible for rule authorization.

"Many operators inventoried existing wells they had not used since June 25, 1984, and which wells they wish they had never inventoried.  These wells were inventoried for a number of reasons ranging from innocent mistake to heavy handed threats from EPA that their inventory was mandatory.  Though I did not think of it until recently, it occurs to me that there is no reason why such inventories should be irrevocable so long as the well has not been used since June 25, 1984.  Please see the enclosed copy of my letter of January 7, 1997 to Ms. Wilde for a more thorough discussion of this unique issue."


Question 4.  A well was used for injection prior to June 25, 1984, and after said date during the first year of the UIC program, but was not included in a timely inventory submission; is such a well rule authorized?

Region IV Response:  "Yes, the well is a rule authorized well pursuant to 144.22(a).  This does not relieve the owner or operator of the additional responsibilities associated with rule authorized wells as set forth in 144.22(b)-(d).  As to the wells mentioned in your letter of January 31, 1994, please see the discussion below."

Commentary:  "I concur that the well is rule authorized, and that is precisely the reason the wells discussed in section (2) of your letter do not need permits!"  [See note below.]


Question 5.  Can a well that was not used for injection before June 25, 1984, but that was used for the first time for injection after June 25, 1984, during the first year of the program, be rule authorized?

Region IV Response:  "Unless the well were [sic] inventoried, the answer is no.  A well becoming operational during the first year of the program is considered a new injection well as defined at 40 C.F.R. 144.3."

Commentary:  "As discussed above, any attempt to obtain rule authorization status for a new injection well is illegal.  A well in Kentucky never used prior to June 25, 1984, and used for the first time after June 25, 1984, is a new injection well requiring a permit.  That Region IV would argue that a new injection well could escape the permitting process by being inventoried just blows me away, as we used to say back in the hippie days."



Note:  The reference in Question 4 to my letter of January 31, 1994, concerns a number of Class IIR injection wells in Kentucky that were injected into during the first year of the UIC program, but not timely inventoried under the previous rule.  Under the old rule, such wells forever lost rule authorization upon failure to submit a timely inventory (never mind the fact that Region IV accepted late inventory submissions in violation of the rule for years).  The only cure for this subset of wells was to obtain a UIC permit (usually an administrative order on consent (AOC) was negotiated allowing continued operation of the wells in violation).  But Reg-Fix seemed to offer a simpler solution. After Reg-Fix, rule authorization was not automatically lost and a late inventory submission could presumably be made to cure the defect.

Administratively, the solution was elegant and would have saved the affected operators, and the government untold hours of paperwork.  Region IV was less than enthusiastic (after initially embracing the concept), so the battle was taken to EPA headquarters.  After six months and hundreds of pages of correspondence, a headquarters memorandum was issued on July 6, 1994 authorizing the proposal.  Region IV dragged its feet, then on February 24, 1997, for reasons that remain murky, Region IV reversed its position (again), costing the taxpayers and affected individuals thousands and thousands of wasted dollars.  Strangely, when the head of the old Region IV UIC Section (it has since been reorganized) was recently deposed, he said he had instructed his personnel to follow the memorandum.  This episode was a bitter disappointment and unnecessarily punished the affected individuals (and the taxpayers).  For a more detailed look at this issue, see A Futile Plea For Reason - Reg-Fix Permitting.


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