Vol. 7 No. 8

Members, 

In this version of The Standard, we provide several updates including information on proposed amendments to Waste Management by the RRC of Texas, PBPA Committee Initiatives, and more. Our team has been hard at work advocating for the oil and gas industry in the Permian Basin and your input and participation are highly appreciated.

Below, you will also find information on our upcoming Annual Meeting, joint Luncheon with TTARA, as well as other important information on additional PBPA events and other relevant community activities:

Important Updates

• 2024 Annual Meeting
• NMOCC WELC Petition Update
• NM SLO Update to the O&G Manual

• RRC Proposed Amendments to Waste Management

• Public Utility Commission Workshop

• TxDOT Unified Transportation Program Update

• BLM Policy Changes and Educational Webinars

• Congress Comes to the Permian Basin
• PFAS Mitigation Initiative

• HSE Committee Annual Survey Complete

• Electrical Coalition Activities
• Remembering Mr. Autry C. Stephens
• PBPA + TTARA Luncheon
• Committee Meetings

Community Events

• Midland College PPDC Courses
• SPE-GCS: Fall 2024 Energy Professionals Hiring Event
• Nella Domenici Luncheon
• Additional events can be found on the online event calendar!

Regards, 

Ben Shepperd

PBPA President

Join us for the 62nd Annual Meeting featuring an evening reception on the 11th followed by a full day of informational speakers, panels, and networking on the 12th.

Sign up to sponsor at the All-Events level or higher before 9/2 for the opportunity to set up an exhibit booth for the 12th at the Petroleum Club of Midland. Exhibit space is limtied, so don't wait! (Note: Event programs are already in production and copmanies who sponsor after 8/25 will not be listed. All other sponsorship benefits remain available.)

Event Schedule:

• September 11th: 6 - 8 PM: Welcome Reception @ the Permian Basin Petroleum Museum
• September 12th: 7:30 AM - 2 PM: Kick-off breakfast, Keynote Luncheon, and more! @ the Petroleum Club of Midland

NMOCC WELC Petition Update

Earlier this summer in June, the Western Environmental Law Center (WELC), along with several other NGOs, filed a petition with the New Mexico Oil Conservation Commission (NMOCC) seeking to amend the New Mexico Oil Conservation Division’s (NMOCD) rules concerning operatorship, financial assurance, well transfers, and temporary abandonment. The NMOCC set the matter for a hearing that was held on August 15, 2024 to determine whether the petition should be docketed and receive a case number. 

WELC is seeking the following changes to NMOCD’s rules:

Bonding Amounts:  Bonding amount of $150,000 for single well bonds, $200,000 for 1-5 well bonds, and $250,000 for six or more well bonds for active wells.  A $150,000 bond for stripper wells bonds for each stripper well.  And bonding for each well for operators with less than 1,000 bbl./BOE per day average during a calendar year.  A $150,000 per well bond for each inactive well, temporarily abandoned well and well in expired temporary abandonment status.

Denials in Transfer of Operatorship:  WELC proposes that NMOCD should deny well transfers when a large number of stripper wells properties are proposed to be transferred in a change of operatorship approval.

New Certification in the Change of Operatorship Form:  WELC would like companies to certify that they are in compliance with all state and federal rules when submitting a change of operator form.  Additionally, this certification would include looking at any beneficial owners in a company/business entity to ensure that they aren’t in business with other entities who are out of compliance with state or federal laws.

Numerous changes to Temporary Abandonment Approvals & Timelines:  WELC would like operators to prove that a well will be beneficially used in the future to justify longer temporary abandonment timelines.  Additionally, WELC seeks to set firm deadlines to permanently plug temporarily abandoned wells.

At the August 15 hearing, NMOCC unanimously approved initiating a rulemaking hearing and ordered the parties to come back for the September NMOCC meeting with a proposed Notice of Hearing for the actual rulemaking hearing.

PBPA continues to support our industry partners who have directly engaged in this rulemaking and will keep everyone updated as this rulemaking process moves forward.

Please reach out to Stephen Robertson (stephen@pbpa.info) for more information.

NM SLO Update to the O&G Manual

The Oil, Gas & Minerals Division of the New Mexico State Land Office (NM SLO) has released an updated version of its Oil & Gas Manual.  According to the NM SLO, this version makes important changes to the coms and units portion of the Manual.  Other updates will follow next year to include a section detailing many of the online tools available at the NM SLO.  In the meantime, we recommend replacing any existing manuals with this new, updated, manual which may be found here: https://www.nmstatelands.org/divisions/oil-gas-and-minerals/oil-and-gas/notices/

RRC Proposed Amendments to Waste Management

On August 15, 2024, the Railroad Commission of Texas formally adopted the proposal for changes and amendments to Statewide Rule 8 and Chapter 4.  As part of the same action, the Commission voted to publish the proposal for public comment.  The public comment period officially opened on August 16 and will run until September 30.  During this time period, the Commission will also host two public comment hearings.

The first public comment hearing will be hosted at 10:00 a.m. on September 5, 2024, in-person in Austin.  The second hearing will be hosted at 12:00 p.m. on September 6, 2024, and will be virtual.  Registration to give comment at the virtual hearing must be received by 5:00 p.m. on September 5, 2024.  The first part of each hearing will consist of a brief overview by Commission staff regarding the proposed rule amendments. The second part of each hearing will consist of the Commission taking public comments.

Both hearings can be viewed via live webcast on the AdminMonitor website at https://adminmonitor.com/tx/rrc/.

To view the proposed rule amendments, visit the RRC website at https://www.rrc.texas.gov/general-counsel/rules/proposed-rules/ under Chapters 3 and 4.

Officially this proposal of a new Subchapter A, Chapter 4, creates 11 new divisions as well as amendments and new rules to Subchapter B, Chapter 4. The same will appear in the Texas Register on August 30, 2024.

A PBPA working group had already been established previously to focus on this issue and that group now takes up the task of reviewing the new proposal.  If you are not involved with these efforts, but are interested in participating, please let us know.

Public Utility Commission Workshop

On August 22, 2024, the Public Utility Commission of Texas (PUC) held a public workshop in Austin on the Reliability Plan for the Permian Basin.  Attending this meeting on behalf of PBPA were staff members Ben Shepperd, Stephen Robertson and Michael Lozano, consultants Meghan Griffiths and Ken Donohoo, and representatives from PBPA members ConocoPhillips, Coterra, Diamondback Energy, Endeavor Energy Resources, and Targa Resources.  Others there to speak on behalf of the oil and gas industry included representatives from TXOGA and the Texas Alliance.

During the workshop, which was opened with comments from PUC Commissioner Lori Cobos, PUC staff asked a series of questions and opened the floor for anyone in attendance to provide comment.  These questions focused on the reliability plan in general, affordability and cost of the plan, the Certificate of Convenience and Necessity (CCN) process as related to the plan, and a few open questions categorized as “Other Topics.”  While a variety of opinions were provided on these questions, far and away, the majority of comments aligned with PBPA’s previously stated position that the PUC should move forward with a single plan, not a phased approach, that utilizes 345 kV lines and import paths to serve the growing load demand in West Texas.  However, there were others who offered different suggestions, such as AEP’s support of Electric High Voltage (EHV) 765 kV lines, and others who argued that more information should be considered before moving forward with any plan.

PUC staff had heard previously from PBPA through our submitted official written comments, and heard again on August 22 from PBPA in person.  Our positions were vocalized by Meghan Griffiths an attorney with Jackson Walker hired as a consultant by PBPA for these exact issues, as well as representatives from ConocoPhillips, Coterra, Diamondback, and Endeavor.  These positions were further supported by representatives from Oncor, Wind Energy Transmission of Texas (WETT), Texas and New Mexico Power (TNMP), Texas Industrial Energy Consumers (TIEC), Texas Oil and Gas Association (TXOGA), Texas Alliance of Energy Producers, and the Lower Colorado River Authority (LCRA).

At the end of the hearing, PUC staff informed those in attendance that it was PUC’s intent to finalize the plan over two open meetings, both currently planned for September 2024.  PBPA will continue to engage with PUC Commissioners and staff on the details of the Permian Basin Reliability plan to make sure it is a plan that does its best to serve the needs of energy consumers in West Texas and to comply with the requirements of Texas House Bill 5066, which initiated this process originally.

While PBPA is here to be the voice of the Permian Basin, when regulators and elected officials hear directly from operators, it has a tremendous impact.  Thank you to those members who made the trip to Austin on August 22 to attend the PUC Workshop and a special thank you to those members who offered public comment at the workshop.  If you would like to get more involved in these efforts, please reach out to us and let us know. 

TxDOT Unified Transportation Program Update

PBPA engages with the Permian Basin Metropolitan Planning Organization (PBMPO), MOTRAN, and the Permian Road Safety Coalition to improve road and driving conditions throughout the Permian Basin.  Each of these partners helps to further the focus on road needs in our region and offers a variety of tools to advocate for improved road and driving conditions. 

As a result of these organizations’ efforts, on Thursday August 22, 2024 the Texas Transportation Commission voted to approve its Unified Transportation Program (UTP) which included a record setting $104.17 B investment package for the statewide transportation system for the period 2025-2034.  New additions to the authorized projects in the Midland/Odessa Metropolitan area now include the following:

• a new interchange at E. Loop 338 and 87th Street in Odessa -  $35M;
• widening of SH 158 from Wadley to Briarwood (5-lanes) in Midland - $6.5M;
• partial funding for a new interchange on SH 191 at CR 1250 between Midland and Odessa - $16M; and,
• operational improvements on Loop 250 between Midland Drive and Midkiff in Midland - $5M.

Leading up to the UTP approval, TxDOT received nearly 900 comments regarding Permian Basin Regional Projects under consideration for this year’s UTP.  MOTRAN was a driving force in this commenting effort, which saw comments on projects in our region far outpace the amount of projects for the second highest topic, being 128 comments on Public Transit/Rail. 

Continuing the momentum, the PBMPO is preparing its 25-year long range plan which includes listed projects in the state’s 10-year UTP and beyond. Stakeholders and interested citizens are encouraged to respond to the survey that the PBMPO has made available on its website at www.permianbasinmpo.com. The plan will be completed by November 2024 and will cover the planning period 2025-2050. 

BLM Policy Changes and Educational Webinars

The U.S. Bureau of Land Management (BLM) has been busy.  In August, BLM released nine new policy documents for agency employees to use during the Land Planning and NEPA process. Most of these documents provide detailed information regarding implementation of the Conservation & Landscape Health Rule.  Many of these new policies create new substantive requirements and are binding on agency employees.  BLM, however, did not put these policies out for notice and comment.   

The released documents cover the following topics:

• Restoration & Mitigation Leasing;
• Revision of BLM’s ACEC Manual;
• Socioeconomics in Land Use Planning & NEPA;
• Information Bulletin on the Conservation and Landscape Health Rule;
• Restoration Prioritization & Planning;
• Drought and Water Availability;
• Watershed Condition Assessments;
• Land Health Standards IM; and
• BLM Inventory & Monitoring Ecological Resources Manual. 

PBPA has put together a summary of these documents.  For a copy of this summary, please email us. 

To discuss some of the new rules associated with the released policies, BLM is hosting an Oil and Gas Rules Overview webinar, on September 4, 2024, 2:00 p.m. CDT, 1:00 p.m. MDT.  The webinar is being advertised as an essential session for professionals in the oil and gas industry operating on Federal onshore minerals.  Intended to be covered during the webinar will be:  

1. Waste Prevention, Production Subject to Royalties, and Resource Conservation Rule: This rule introduces significant changes aimed at reducing waste and ensuring that production activities contribute fairly to public revenue.

2. Fluid Mineral Leases and Leasing Process Rule: This rule revises the Federal onshore oil and gas leasing process to ensure responsible development of our nation’s oil and gas resources.

The webinar will include detailed presentations from experts who will walk through the key aspects of these rules, followed by a question-and-answer session to address any questions you may have. 

BLM is requesting that pre-registration for the webinar be completed through the following link by September 3, 2024: https://blm.zoomgov.com/webinar/register/WN_2sID8JdhQkCmbaJMXTaniQ

Congress Comes to the Permian Basin

While much of the national focus has been on the Democratic National Convention and the Presidential Election as of late, in August, the Permian Basin hosted visits from some key partners from Washington, D.C.

Congressman Bob Latta, who serves the people of Ohio’s Fifth Congressional District in the U.S. House of Representatives and is a senior member of the House Energy and Commerce Committee, came out to Midland to meet with several PBPA members and others in the community to discuss the current state of affairs in his areas of interest.  We always appreciate the opportunity to learn from members of Congress, especially those serving on committees that impact our industry.  Of course, it means even more when they come out to our neck of the woods.

Also in August, members of Senator Ted Cruz’s office from Washington, D.C. and from his west Texas district office, traveled to the Permian Basin to learn more about our industry and this region.  We helped organize field tours and individual meetings for these staff members.

Thank you to all those PBPA members who met with Congressman Latta and Senator Cruz’s staff.  Relationships with these folks are tremendously important in our efforts in Washington, D.C. advocating on your behalf.  Face to face interactions and hands on education in the field are invaluable experiences that make lasting impressions!

PFAS Mitigation Initiative

PBPA is always on the lookout for opportunities to improve operations in the Permian Basin, especially when those opportunities benefit our members and the communities in which we live.  Recently, through our Health, Safety and Environment (HSE) Committee, PBPA has been discussing the potential presence of PFAS in the Permian Basin. The term PFAS may be relatively new to many of us, but it has become a critical issue in the environmental community, and its rising priority could impact operations in the oil and gas industry.

Perfluoroalkyl and polyfluoroalkyl substances (PFAS) are a large, complex group of synthetic chemicals that have been used in consumer products around the world since about the 1950s. They are ingredients in various everyday products. For example, PFAS are used to keep food from sticking to packaging or cookware, make clothes and carpets resistant to stains, and, of particular interest to the oil and gas community, can be found in firefighting foam. PFAS chemicals do not degrade easily in the environment.

Even though field operations may not be purposefully using materials that contain PFAS, if fires in the field are extinguished using foam that contains PFAS by local firefighters, PFAS can be introduced into the environment.  However, the concern is something we can be proactive about and discussions on this issue in our HSE Committee led to an idea that we believe could significantly benefit our industry and the communities of the Permian Basin.

Initial outreach to a few firefighting departments in the Midland Basin has identified a number of departments that utilize foam which contains PFAS.  There are other foams, however, that do not use PFAS and are also utilized by many units in the Permian Basin. 

PBPA is now proposing a larger effort that would include:

1. Identifying all fire departments with PFAS-containing foam, such as Chem Chard AR-AFFF in the Permian Basin, both in Texas and New Mexico.
2. Reaching agreement with those departments to replace their PFAS-containing foam.
3. Contracting with a company to properly collect and dispose of the PFAS-containing foam.
4. Collecting and disposing of the foam (with no possession or liability for oil and gas operators).
5. Restocking fire departments with PFAS-free foam, such as Novacool UEF, SFFF – Natural, Chem Guard CM, etc.

As mentioned above, identifying this PFAS source is just the first step. To proceed with collection, disposal, and replacement, would require financial support.  While we are currently soliciting estimates on cost for this project, we are also looking to the PBPA membership to see who might be willing to help financially support it.  Your support could make a significant difference in mitigating PFAS risks in our region.

Please let us know your thoughts, questions, or willingness to support this initiative.

HSE Committee Annual Survey Complete

Representatives of the PBPA Health, Safety, and Environment (HSE) Committee conduct an annual survey of PBPA member companies in order to benchmark HSE Key Performance Indicators (KPI) for operations in the Permian Basin. While in the first few years of this effort, data was focused on safety and spill metrics, starting in 2019 the survey was expanded to also include key Environmental and Social Governance (ESG) metrics.

In our survey, data focuses on:

• worker injuries and labor hours of member company operations in the Permian Basin,
• motor vehicle accident data with corresponding annual mileage, and
• environmental and ESG related KPI data consisting of reporting annual volumes of: oil/condensate; produced water; other liquids released; GHG and methane emissions; freshwater usage; and, annual hydrocarbon production volumes.

Now that we have collected a number of years of data, we can start to see and compare trends over time.  This data, and the trend comparisons, are annually used to conduct the sharing of recommended practices amongst members of the PBPA HSE Committee, which help improve operations across the board.

This survey could not have been conducted without the volunteered time of several PBPA members.  Thank you to all those who helped with this year’s survey.  And a special thank you to Susan Cabaniss with Ovintiv and Scott Russell with Pioneer Natural Resources who helped compile the submitted data, along with our HSE Committee Co-Chairs, Greg Schrab with SM Energy and Jeff Atwood with Diamondback Energy who annually help to steer this project from start to finish.

If you are interested in getting more engaged with the Annual Benchmarking Survey or in getting more involved with the PBPA HSE Committee, please let us know.

PBPA Electrical Coalition Activities

PBPA’s Electrical Coalition is a working committee of PBPA members that has been focused on improving electrical transmission and distribution throughout the Permian Basin for over a decade.  While the efforts of this coalition impact the advocacy of PBPA at the legislative and regulatory level, such as is discussed elsewhere in this newsletter regarding the Permian Basin Reliability Plan, the coalition’s actions don’t stop there. 

In pursuit of better electricity delivery in the Permian Basin, the coalition also hosts meetings between Transmission and Distribution Service Providers (TDSPs) who provide electricity delivery services to PBPA members in west Texas and southeastern New Mexico.  We have two of these meetings coming up in the next few months, one with Oncor to discuss issues with their customers in the Texas portion of the Permian Basin and one with Xcel to have a similar discussion regarding electricity delivery in New Mexico.

The meetings are limited to members of the Electrical Coalition, but if you are interested in these types of opportunities and would like to get involved with our Electrical Coalition, please let us know!

Autry C. Stephens

1938 - 2024

Please join us at PBPA + TTARA's Midland Luncheon for networking and an engaging fireside chat with Lieutenant Governor Dan Patrick and G. Brint Ryan, Chairman and CEO of Ryan, LLC.

Committee Meetings

• Regulatory Practices Committee: 9/17/2024

For more information on these or any of our other committees, please contact Stephen Robertson at stephen@pbpa.info or (432) 684-6345.

MC PPDC provides quality training programs designed to keep oil and gas industry professionals current in their areas of expertise by offering the latest industry updates, as well as providing timely and pertinent educational opportunities. Click the link below for upcoming classes being offered by the MC PPDC in the coming months.

Customized Training Available! For more information contact Midland College PPDC at (432) 683-2832 or cepetroleumtraining@midland.edu

October 10, 2024

Houston, TX

You are cordially invited to attend the “ENERGY PROFESSIONALS HIRING EVENT” hosted by the Society of Petroleum Engineers – Gulf Coast Section. We strive to provide a platform for experienced upstream and energy professionals and industry companies create value for both sides.

While PBPA does not engage in political activity, we always want to make sure our members are aware of opportunities to get to know candidates or elected officials who could make decisions that impact operations in the Permian Basin. This is not a PBPA event or an endorsement of any candidate or party.

Permian Basin Petroleum Association | 601 North Marienfeld St., Suite 200, Midland, TX 79701